Troubled UNO brings in three ex-Rahm hands

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The clout-heavy United Neighborhood Organization — facing federal scrutiny and a power struggle that threatens its funding — has brought in Mayor Rahm Emanuel’s former communications director and two lawyers who helped keep Emanuel on the ballot in 2011.

Chris Mather headed the mayor’s communications operation when Emanuel took office in 2011. She stayed at City Hall for less than a year before opening the Chicago office of Purple Strategies, a public relations firm based in Alexandria, Virginia.

Kevin Forde and Michael Forde were on the legal team that repelled an effort four years ago to throw Emanuel off the ballot that claimed he hadn’t been a Chicago resident long enough to run for mayor. MichaelForde later accepted an appointment from Emanuel to chair the Illinois International Port District, a government agency that operates the Port of Chicago.

Forde serves on the port board with Lynette Santiago, whose husband Freddy Santiago is UNO’s board chairman.

Asked why UNO sought outside help from people linked to the mayor, Freddy Santiago says, “That’s implying that this is politically motivated, and it’s not.”

And how did UNO choose the Fordes’ firm?

“We just shopped around and made phone calls and found they are very reputable,” Santiago says.

Neither Mather nor the Fordes would comment.

UNO’s troubles began when reports in the Chicago Sun-Times last year revealed the group had handed out millions of dollars in taxpayer-funded deals to family members of one of its top executives. The resulting scandal cost the not-for-profit group $15 million that remained from a state school-construction grant. And it prompted the ouster of longtime UNO leader Juan Rangel, who’d been co-chairman of Emanuel’s 2011 mayoral campaign.

Now, the group faces even more worries:

  • The board of the charter-school network that UNO started — but no longer controls — plans to end the deal under which the community group runs the charter network’s 16 schools. Most of UNO’s budget comes from the charter network, which, in turn, is underwritten almost entirely by the tens of millions of dollars a year it gets from the Chicago Public Schools.
  • Two UNO board members, Joseph Galvan and James Isaacs, resigned Sept. 12, less than a year after being recruited to help reform the organization.
  • Already facing investigations by the Securities and Exchange Commission and the Internal Revenue Service, UNO also has come under scrutiny by the FBI, according to another former board member, Dan Sichelski.

Sichelski says two agents came to his home about four months ago. He says they asked whether UNO’s board had approved the contracts given to companies owned by two brothers of Miguel d’Escoto, who was UNO’s No. 2 executive when deals were given to his brothers’ companies for work on state-funded UNO schools. Sichelski says he told the FBI he couldn’t remember the board ever approving the multimillion-dollar deals with d’Escoto Inc. and Reflection Window Co.

“We didn’t micro-manage,” says Sichelski, a former Catholic school teacher who was on UNO’s board for 24 years, until 2011. “We didn’t know where the windows were coming from or who was putting in the plumbing.”

After Sun-Times reports exposed the contracts with d’Escoto Inc. and Reflection Window, Gov. Pat Quinn’s administration cut off the last $15 million in state funding that had been promised to UNO under a $98 million school-construction grant championed by Illinois House Speaker Michael Madigan, D-Chicago, in 2011.

The SEC said the reports also prompted a civil case that UNO and the charter network settled three months ago, agreeing to allow a court-appointed monitor to oversee all contracts for a year. At the time of the settlement, an SEC official said the agency’s investigation was continuing.

Santiago says he wasn’t aware of the FBI interest in UNO.

An FBI spokeswoman in Chicago would not comment.

Founded 30 years ago, UNO first entered the charter-school business in 1998. Its UNO Charter School Network Inc. has experienced rapid growth, fueled by the state grant and CPS’ support under Emanuel and former Mayor Richard M. Daley.

UNO and UCSN were overseen by virtually identical boards until last year. New members for each were brought in under reforms that helped UNO keep its state funding long enough to finish a new high school on the Southwest Side.

Last month, the UCSN board announced it would end the 16-year relationship with UNO at the end of the current school year and manage the schools itself.

Beside management fees, the charter network also pays the community group rent for UNO-owned buildings that house its schools — including the three schools built with state funding. The charter schools also pay UNO more than $3.2 million a year for janitorial services.

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