How Illinois pols have pocketed more than $5 million in what Barack Obama once dubbed ‘legalized bribery’

In January, with her 24 years on the Chicago City Council drawing to the end, Ald. Marge Laurino (39th) gave herself a reward: a $27,789.78 payout from her campaign fund.

Two months later, newly retired Sen. James Clayborne Jr., a Belleville Democrat, similarly marked the occasion by paying himself $42,204.65 out of his campaign fund.

For both, the amounts matched to the penny the balance each officeholder had in their political accounts on June 30, 1998.

That’s a magic date for elected officials in Illinois. That’s because it yields a magic number: the amount of money they legally can keep for themselves, no questions asked.

Before 1998, there were no limitations at all on what officials could do with their campaign money. That year, state legislators approved an ethics reform law that outlawed the practice of public officials paying themselves or their family members from their campaign funds.

But they carved out two loopholes:

• The ban would not apply to payments for “services actually rendered.”
• Whatever money they had in their campaign accounts as of June 30, 1998, would be theirs to do with as they wished.

And what at least 55 of them have wished is to keep some or all of the cash for themselves — though nearly all waited to do that until they left office and were beyond the reach of voters.

Records show those former elected officials have pocketed a total of more than $5 million since the law took effect.

VIDEO: CLICK TO HEAR MARK BROWN TALK ABOUT CASH GRAB

Last year, former 36th Ward Ald. William J.P. Banks wrote himself a $291,708 check when he shut down his campaign committee, and former Senate Republican Leader Christine Radogno of Lemont took $36,157 from her still-active campaign fund.

Some other big beneficiaries of campaign cashouts: former state Sen. James DeLeo, D-Chicago, who took $271,681, and ex-state Rep. Angelo “Skip” Saviano, R-Elmwood Park, keeping $219,093. Each took the money in 2013.

Then there’s former state Rep. Ralph Capparelli, D-Chicago, who walked away with $583,357 between 2006 and 2010 — more than anyone else has pocketed in this legalized money-grab.

“What else was I going to do? Keep running?” Capparelli said when asked why he took the money.

Maybe, I suggested, he could have donated it to charity. Capparelli laughed.

“I’m the charity,” said the retired lawmaker, who called on his way home from the health club and who, at 95, credits his longevity to weightlifting and his daily afternoon martini.

“I paid taxes. I followed the law,” Capparelli said.

And he said, “I didn’t get as much as the other ones got.”

When I told him that, yes, in fact, he did, that no one else has reported taking nearly as much as he has, Capparelli seemed surprised. “That’s pretty good,” he said. “I didn’t know.”

He’s right that he followed the law. The practice is legal as long as the public official pays taxes on the income — legislators wrote the law to make it so.

But just because it’s legal doesn’t mean they should be taking part in a practice former President Barack Obama, a former Illinois legislator himself, once called “legalized bribery.”

Campaign funds, after all, primarily come from money given by special interests who contribute based on a desire to influence those in power. When campaign money is treated as personal funds, then every contribution is a prospective bribe.

Those interviewed for this story pointed out that, in their campaign-finance reports, they duly reported taking the money. That’s true. It’s also true that nobody pays much attention to those reports after a politician retires.

The list of former elected officials who have paid themselves from their campaign funds includes Democrats and Republicans and politicians from Chicago, the suburbs and downstate. I didn’t bother with anyone who took less than $5,000.

Some of those on the list are dead. In one case, the money was paid out to his widow.

Many fall under the category of the “usual suspects” you might expect to find on such a list — including some who took the money after being sentenced to prison.

Others might come as more of a surprise. Like Radogno, someone I always regarded as a cut above Springfield’s rank-and-file.

“It wasn’t a huge amount of money,” Radogno said of the $36,157 she paid herself from her campaign fund last November.

That was exactly how much she was entitled to under the 1998 exemption to the reform law. Which, of course, she knew. Radogno said she and others who have been in office long enough keep close tabs of how much they’re allowed to keep based on that June 30, 1998, magic number.

“Everybody is aware of exactly what that amount is,” she said.

Radogno said she decided to keep the campaign cash because she had some expenses she wasn’t comfortable charging to her political fund. Also, she said, she “got screwed tax-wise” in 2017, when legislators received a lump-sum check covering back pay to make up for the salary withheld during the state’s budget standoff.

Radogno has $83,654 left in her campaign fund, which she continues to use to pay political expenses.

The law even would allow her to pay herself a salary out of her campaign account.

That’s what two of her former colleagues in Springfield did: retired Senate Presidents James “Pate” Philip, R-Wood Dale, and Emil Jones, D-Chicago. In retirement, Philip has paid himself $274,964 from his still-open campaign account for unspecified “services,” and Jones has paid himself $210,613, campaign-finance records show.

Rich Hein / Sun-Times

DeLeo took the balance of his campaign fund for himself in 2013, closing out an investment account that his campaign committee had at the Belmont Bank & Trust, where he’s on the board of directors.

“I followed the law,” said DeLeo, echoing Capparelli.

DeLeo pointed out that he used his campaign fund to give to charity and continues to do so now that he’s taken the money as income.

AP

Saviano, who was elected mayor of Elmwood Park after leaving the Illinois Legislature, said he kept the money because he was entitled to it and because he needed to pay his daughters’ college tuition.

Sun-Times files

Saviano also offered one of the better defenses I heard, arguing that it was better to be “upfront and take the money” — and pay the taxes on it — than to slowly drain a campaign fund tax-free with questionable expenses or hidden self-dealing.

Indeed, there’s more than one way to loot a campaign fund. Many Illinois politicians do it by charging their campaign committees for sports tickets, restaurant meals, car leases and travel expenses.

Sun-Times Media

Laurino, who declined to be interviewed, pays her husband, former 39th Ward committeeman Randy Barnette, a $3,000 monthly salary from her campaign committee that she’s continued to pay since retiring at the beginning of the year. At that pay rate, her campaign cupboard soon will be bare.

Cashing out a campaign fund is a family affair for the Laurinos. Her brother, former state Sen. William Laurino, was one of the first to take advantage of the 1998 law. He took $85,000 from his campaign fund and put it into his personal brokerage account in 2000 before closing out his campaign committee.

It’s rare that an Illinois official has taken the money even before leaving office. But former state Rep. Daniel Burke, a Southwest Side Democrat, did so in 2016 — that was two years before voters gave him the boot.

Burke — whose older brother, Ald. Edward M. Burke (14th), has been indicted on corruption charges — said he took $94,450 from his campaign fund for personal use after the state comptroller’s office withheld legislators’ paychecks during the budget impasse.

“I took it because we weren’t getting paid, and I knew I was entitled to it eventually,” Burke said.

What I failed to hear from anyone is a good explanation for why they believe they are “entitled” to pocket campaign money, beyond the fact it is legally permitted.

Rich Hein / Sun-Times file

It’s a mindset that predates even the first campaign-finance reporting laws in Illinois, when bribes and political contributions largely were indistinguishable —lumped together in the minds of many politicians as “their money.”

Mike Lawrence, who helped negotiate passage of the 1998 reform law as director of the Paul Simon Public Policy Institute at Southern Illinois University, said many lawmakers came to think of their campaign fund as a retirement nest egg.

“It could not have passed without a grandfather clause,” Lawrence said of the compromise decision to allow an exemption for any campaign funds held on June 30, 1998.

Lawmakers were willing to pass the law, which also included other important reforms, only after being assured the ban on campaign money for personal use would not apply to them, Lawrence said.

Obama had a hand in crafting that 1998 ethics reform law while a state senator. He later boasted of his role when he ran for president.

Ashlee Rezin / Sun-Times

“I called it legalized bribery,” Obama said of the practice of Illinois politicians pocketing campaign cash. “And while it didn’t make me the most popular guy in Springfield, Illinois, I put an end to it.”

Unfortunately, the end is still a ways off. In addition to those who already have taken the money since the law took effect, about 200 more active campaign committees still could do so because they were created before June 30, 1998. Altogether, the beneficiaries of those campaign funds could easily top the $5 million extracted to date.

These include some of the big kahunas of Illinois politics, including Ald. Burke, who would be allowed to pocket $2,452,463 of the $9 million stashed in his Friends of Edward M. Burke fund, and Illinois House Speaker Michael Madigan, D-Chicago, who could keep $1,448,892 of the $7 million in his main campaign fund, Friends of Michael Madigan.

Money used to pay lawyers usually is treated separately as a legitimate campaign expense.

It’s an anachronism that Illinois still allows this in 2019. Even Congress got around to cleaning up its act on this as long ago as 1992. The House of Representatives initially passed a law to end the practice of former members pocketing leftover campaign money starting in 1980 but exempted themselves with a grandfather clause similar to the one later used in Illinois. The House finally repealed the exemption in 1989 — but gave federal lawmakers until the end of 1992 to decide whether to convert the money to personal use.

It seems obvious the legitimate purpose of allowing officeholders and office seekers to raise money is to defray the cost of running for election, not to pad their personal finances.

Remember, these are some of the same people collecting those generous, sometimes ridiculous, government pensions. Capparelli, for one, gets three government pensions — from the state, Cook County and the Chicago Park District — totaling more than $200,000 a year.

Former Chicago City Clerk Jim Laski — who lost his pension after being sentenced to two years in prison for taking bribes in the Hired Truck Scandal — used his campaign fund to help support his family after his release from prison in 2007.

“If there’s enough public concern, they should change the law,” said Laski, who paid himself $130,977 from his campaign fund between 2008 and 2010.

Ideally, Illinois legislators would move immediately to repeal the 1998 grandfather clause, along with the “services actually rendered” loophole.

Or they could take a page from Congress and allow for a short grace period with a hard cutoff — say, Dec. 31 — for any future payouts.

It might even be a way to persuade some of these folks to finally retire. For anyone choosing to take the money and stay in office, voters at least would be fully informed about that.

John H. White / Sun-Times