Illinois Gov. J.B. Pritzker, his wife and brother-in-law are under federal investigation for a more than $330,000 property tax break Pritzker received on one of his Gold Coast mansions — in part by removing toilets, WBEZ-FM (91.5) reported on Wednesday.
The sticky timing comes a day after the Democratic political newcomer celebrated his 100th day in office — and with just weeks left in his expansive push for a graduated income tax and the legalization of recreational marijuana in the state.
A law enforcement source confirmed to WBEZ that the federal investigation began in October.
At an unrelated news conference Wednesday morning, Pritzker said, “what I know is what you all know from the reporting that was done this week.”
The governor reiterated that any review “will show that the rules were followed.” Asked if the probe will affect his push for a graduated income tax, Pritzker replied: “all of these things will pass.”
Pritzker says he has “no concerns at all” about criminal charges. Pritzker attorney Marc Elias, a partner with the Perkins Coie law firm, in a statement issued earlier Wednesday had said “neither the governor nor the first lady have been contacted by law enforcement regarding the property tax appeal.”
Pritzker’s latest quarterly filing with the Illinois State Board of Elections shows he has paid Perkins Coie more than $465,000 this year, but a campaign spokesman said the payments to the law firm were not related to the investigation. The spokesman said the firm was paid for a variety of reasons, including shutting down campaign offices and setting up Pritzker’s “blind trust.”
The Chicago Sun-Times reported last year that Pritzker bought the historic mansion next door to his home, let it fall into disrepair — and then argued it was “uninhabitable” to win nearly $230,000 in property tax breaks.
The toilets had been disconnected, and the home had “no functioning bathrooms or kitchen,” according to documents Pritzker’s lawyers filed with Cook County Assessor Joseph Berrios.
Illinois’ Republican Congressional delegation in October wrote a letter to the U.S. attorney’s office requesting Pritzker be investigated following a inspector general’s report which called the tax savings a “scheme to defraud.”
In that letter, the congressmen wrote that the facts in the case constituted fraud and perjury.
“Illinois, perhaps more than any other state, has suffered greatly due to public corruption. Four of Illinois’ last nine governors have gone to prison,” the letter said. “It is important to send a strong signal to the people of Illinois that no one is above the law, not even billionaires running for governor. For that reason, we urge you to fully investigate this matter with all due speed.”
A Sept. 28 inspector general’s report found that Pritzker saved $331,432.03. Cook County Inspector General Patrick Blanchard wrote in the report — obtained by the Sun-Times — that the assessor’s office was “the victim of sworn affidavits containing false representations.”
Labeled “Evidence of a plan to Defraud Cook County,” the report includes a work-order email dated Oct. 5, 2015, from a project manager to a plumbing company vice president that says M.K. Pritzker, J.B. Pritzker’s wife, wanted the toilets pulled.
“She is going to have the house re-assessed as an uninhabitable structure,” the email says. “To do this, she would like to have us pull all toilets and cap all toilet lines in the house. Then after the assessment, she would like us to put the 1st Floor toilet back in and have this as the one functioning bathroom in the place (she will then be finishing out the front room for JB’s [Jay Robert ‘J.B.’ Pritzker’s] hangout/meeting area].”
The project manager that the Pritzkers hired told inspectors that M.K. Pritzker did specifically mention “reassessed” during a meeting, according to the report.
“When asked if it was clear that M.K. wanted to have all the toilets removed because it was related somehow to the home being ‘reassessed,’ the B&A Project Manager replied. ‘She did note those two areas together,’” the report says.
The toilets were removed on Oct 6, 2015, with no directive to reinstall them. A ticket from the plumbing company notes five toilets were pulled, with the five toilet supply lines also capped, along with additional gas lines disconnected and additional work.
There were two affidavits signed that said “the property has been vacant and uninhabitable from January 1, 2012 to present. There are no functioning bathrooms or kitchen.” That was signed on Oct. 15, 2015.
One was signed by Tom Muenster, J.B. Pritzker’s brother-in-law. Another was signed by Christine Lovely, who is identified in the report’s footnotes as M.K. Pritzker’s personal assistant.
The toilet scandal became endless campaign fodder last year as former Republican Gov. Bruce Rauner tried to unsuccessfully hold onto his seat. And following the release of the inspector general’s report, which occurred just weeks before the November election, Pritzker paid back the savings to the county.
Now the reported federal investigation gives fuel to another fight over the graduated income tax. Pritzker is helping to fund one side of a dark money group which is putting big bucks into fighting for the tax. Ideas Illinois, an opposing dark money group, is working hard to oppose it.
The group on Wednesday released a statement which accuses Pritzker, a billionaire heir and philanthropist, of knowing “nothing about fairness or equity.”
“Governor Pritzker should immediately abandon his push for this massive Jobs Tax on middle class families because he can’t expect people to pay more when he is reportedly under criminal investigation for gaming the system to pay less,” Ideas Illinois Chairman Greg Baise said in a statement.
The investigation may also renew calls for Pritzker to release his full tax returns. While both Rauner and Pritzker released some of their tax information, neither disclosed his full return, which would also include schedules filed to claim exemptions and donations other than those to their own charitable organizations. Releasing tax returns isn’t required for candidates or elected officials.
Pritzker has a net worth estimated by Forbes magazine at $3.2 billion. He has released four years of tax summaries, which only uncover a portion of his disposable income, much of which is held in trusts.
Pritzker in January placed his investments into a “blind trust” just before taking office, as he had vowed to do during the election. The steps mean Pritzker will still make money off those investments during his term. But he’ll be removed from decision making and from managing his personal assets.