City Hall shuffle: Budget director leaves, water commissioner fired

SHARE City Hall shuffle: Budget director leaves, water commissioner fired

Outgoing City of Chicago Budget Director Alexandra Holt | Sun-Times file photo

The revolving door at City Hall was spinning Friday. Mayor Rahm Emanuel accepted the resignation of his only budget director, fired his water management commissioner and re-appointed his inspector general and chief procurement officer.

It all happened on the final day of the work week when politicians love to bury bad news.

Budget Director Alex Holt will be replaced by Business Affairs and Consumer Protection Commissioner Samantha Fields, who has only been on the job for a few months.

Fields will be replaced by Rosa Escareno, who served as a deputy press secretary under former Mayor Richard M. Daley.

Inspector General Joe Ferguson and Chief Procurement Officer Jamie Rhee were re-appointed to four-year terms.

Barrett Murphy, head of the Chicago Department of Water Management, was fired last week. | Sun-Times file photo

Barrett Murphy, head of the Chicago Department of Water Management, has been fired. Sources said he was let go for not disciplining an employee who sent a racist email. | Sun-Times file photo

And Water Management Commissioner Barrett Murphy was fired and replaced by First Deputy Transportation Commissioner Randy Conner.

“We were made aware of an IG investigation into the culture at the water department,” the mayor’s communications director Adam Collins wrote in an email.

“The mayor acted quickly and decisively, asking for the Commissioner’s resignation and appointing a new commissioner to lead the department forward and change the department’s culture.”

Sources said Murphy was held responsible for a chain of racist emails sent by an underling whom the commissioner failed to discipline, even though Murphy was among those receiving the emails.

The mid-level manager accused of writing those racist emails also resigned Friday.

Emanuel was described as livid about the incident.

Murphy’s firing was a stunner because of his close ties to the mayor.

Daley hired Murphy in 1999 as Chicago was preparing for the potential Y2K terrorism threat that never materialized. Murphy’s wife, Lynn Lockwood, is an Emanuel friend who once chaired a political fund-raising committee for the mayor.

Lockwood had a one-year, $160,000 consulting contract with the tourism agency known as Choose Chicago. She was an aide to former First Lady Maggie Daley and worked for the city cultural affairs department. Emanuel appointed her to the Chicago Public Library board in March 2012.

Holt, who just celebrated her 50th birthday, said she will remain on the job until late June or early July. That’ll give Emanuel plenty of time to craft a school funding fix with Holt’s help.

“My primary focus has been on the city’s finances. It’s been on the structural deficit. It’s been on the pensions. It’s been on paying off our debt service, transparency in our numbers. All of those things. We’ve made an enormous amount of progress over the last six years and we’re in a really good spot,” Holt said.

“I’m not saying that there’s not more to do because there is. But it’s time for somebody with new ideas and a fresh look at things to come in.”

Earlier this week, Emanuel said he was prepared to do “some very difficult things” to keep the Chicago Public Schools afloat and said the nearly-bankrupt school system is $596 million in the hole, only because the state is Illinois’ “largest deadbeat.”

On Friday, Holt was asked whether she was concerned that a local solution to the school funding crisis would drag the city’s own shaky finances under.

“Every decision we’ve made over the last six years has been one that’s required careful balancing,” she said.

“I’m confident we’ll be taking all the factors—stability of CPS, stability of the city, the importance of continuing to invest in economic development—all of that will come into play in addressing CPS’ situation.”

During Holt’s tenure, the city’s structural deficit has been reduced by more than $600 million. Dedicated funding sources were identified for all four city employee pension funds. But Chicago taxpayers have paid a heavy price.

They’ve been hit with $838 million in property tax increases for police, fire and teacher pensions; a 29.5 percent tax on water and sewer bills to save the Municipal Employees pension fund and a 56 percent increase in the monthly tax tacked on to telephone bills – on cell phones and land lines – for the Laborers Pension fund.

Emanuel’s plan to save two of four city employee pension funds hit a roadblock when Gov. Bruce Rauner vetoed a bill that locked in employee concessions and authorized a five-year ramp to actuarially required funding.

City Inspector General Joe Ferguson | Sun-Times file photo

City Inspector General Joe Ferguson has been re-appointed to that post by Mayor Rahm Emanuel. | Sun-Times file photo

In his veto message, the governor noted that Chicago’s largest pension fund would still be left with a gaping hole – after a 29.5 percent tax on water and sewer bills is fully phased in – that will require more revenue to honor the city’s ironclad commitment to reach 90 percent funding over a 40-year period.

The governor’s veto of a bill giving CPS $215 million in state pension help already built into the school budget exacerbated the current crisis that has Emanuel promising to ride to the rescue to prevent school from closing three weeks early.

Ferguson reappointment was not a surprise.

The Chicago Sun-Times reported last month that Ferguson’s appointment of Laura Kunard as deputy inspector general for public safety was likely to result in Ferguson’s reappointment.

That’s because Kunard wanted and received assurances that the man who hired her would not be departing in a few months.

But it nevertheless ensures continuity of local leadership over police reform at a time when U.S. Attorney General Jeff Sessions’ decision to review and retreat from police reform agreements nationwide leaves a giant void that must be filled locally by the new, 25-employee, $1.8 million unit housed in Ferguson’s office.

It also continues a remarkable turnaround in the mayor’s relationship with his inspector general.

Ferguson spent two years in a cold war with Emanuel, which included a legal battle over access to documents that went all the way to the state Supreme Court.

Their relationship was so frosty it appeared that Emanuel was counting the days until Ferguson’s term expired. It was only after the Ohio bribery scandal that culminated in the conviction of former City Comptroller Amer Ahmad that Emanuel seemed to realize Ferguson was more helpful than threatening.

In 2013, Emanuel reappointed Ferguson with the unwritten understanding that the IG would step down after a year. Eight months later, Ferguson decided to serve out his new four-year term after dramatically improving his once-contentious relationship with the mayor.

When a federal judge released Chicago from the Shakman decree and dismissed a federal hiring monitor, Ferguson assumed the all-important power to police city hiring in the post-Shakman era. He also won limited oversight over the City Council after the legislative IG’s office was disbanded.

A former federal prosecutor, Ferguson was appointed by former Mayor Richard M. Daley. Although his investigative power base has expanded greatly as his relationship with Emanuel improved, he has shown no signs of slowing down or backing off.

Last month, he dared to suggest that Chicago aldermen be stripped of their cherished control over infrastructure projects in their wards in favor of professional engineers in the Chicago Department of Transportation.

Emanuel promptly shot down the recommendation, which would amount to declaring war on a City Council that has walked the tax plank three times to solve Chicago’s $30 billion pension crisis and whose support the mayor needs going forward to save the public schools.

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