Mayor Eugene Sawyer released copies of his tax returns covering the years 1985 through 1987 late Friday to end a day on which former U.S. Atty. Dan Webb was also named as a special prosecutor to investigate irregularities in petitions gathered by supporters of Cook County State`s Atty. Richard M. Daley.
The appointment of Webb by Circuit Court Judge Richard Fitzgerald, the presiding judge of the criminal division, came after Daley`s mayoral rivals demanded an outside prosecutor after claims that Daley`s office had failed to adequately investigate the petitions that were circulated during a 1985-86 drive for a nonpartisan mayoral election.
Webb`s appointment was lauded by Daley, but drew mixed reactions from others in the mayoral field as the Feb. 28 Democratic primary showdown between Daley and Sawyer grew more heated.
Sawyer suggested that Daley might have been the source of disclosures that the mayor had filed late tax returns and accused Daley of ”extortion”
for sending a letter to Chicago law firms asking each to make a $25,000 campaign contribution.
A day after Sawyer told reporters that he had filed his 1986 and 1987 returns late, campaign aides said they discovered that the 1987 return had actually been filed on time.
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And then Friday evening, Sawyer campaign aide Larry Horist announced that the mayor`s tax returns would be released. Shortly after 7 p.m., a lone security guard passed out copies in the 6th floor City Hall press office.
”As promised, I am releasing copies of my IRS tax returns from 1984 to the present,” according to an attached four-paragraph typewritten statement. There was no explanation for the failure to include the return for the year 1984.
”It has always been my intention to make my tax records available; the question was when,” the statement said. ”I decided to make them available now because this tax issue has been overshadowing the real issues in this campaign.”
The disclosure of the returns did little, however, to clear up the confusion. Efforts to reach Sawyer or campaign aides were unsuccessful.
The copies-unsigned and undated-only included the first two pages of Sawyer`s returns and did not include any schedules. The 1985 and 1986 returns showed gross salaries of $25,254 for each year, even though aldermanic salaries were $27,000. His return for 1987 showed a gross salary of $57,696.
Sawyer received a refund in each of the three years, according to the documents. He deducted just over $11,000 in business expenses in both 1985 and 1986.
In 1987, the documents showed business expenses of over $23,000 and itemized deductions of just over $10,000. Sawyer`s statement provided no hint of what expenses were claimed to generate the deductions.
Aside from the release of the mayor`s taxes, the major development in the race for mayor was the appointment of Webb, who recently turned down Republican overtures to run for mayor.
Fitzgerald said the appointment was needed ”to maintain the integrity of the (state`s attorney`s) office and the public confidence” in the judicial system.
Friday`s action by Fitzgerald reversed his August, 1986, ruling in which he balked at naming a special prosecutor after news accounts reported widespread irregularities in the collection of signatures during the petition drive.
At the time, Daley was considering a possible challenge to the re-election of the late Mayor Harold Washington, and the petition drive, had it been successful, would have aided Daley`s aspirations. The petitions sought the creation of a nonpartisan primary and a run-off election if no candidate won a majority of votes in the primary.
Because of his support for the petition drive, Daley had removed himself from the investigation in August, 1986.
Last month, The Tribune disclosed that at least nine employees of Daley`s office or their family members had circulated petitions that obtained signatures of individuals who had told The Tribune they had not signed the documents. A former assistant state`s attorney said last week that the office had decided by December, 1987, that there was enough evidence to indict as many as eight individuals, including five Daley employees. No one has been charged with any wrongdoing.
Fitzgerald alluded to the new disclosures in citing the need to reverse his previous position and appoint a special prosecutor, but he also praised Daley`s first assistant, Michael Shabat, who has been in charge of the investigation. ”I think he possesses integrity of character and I am certain he has pursued the investigation,” Fitzgerald said.
Fitzgerald also directed Webb to look into allegations of irregularities involving the petitions of the current mayoral field.
Daley`s political foes predicted that the appointment will help the state`s attorney put a lid on the controversy for a while.
”The judge has made his decision, and I`m not going to question his decision,” Sawyer said. ”But, he (Webb) is with a law firm that does extensive business with the county of Cook and the state`s attorney`s office on malpractice work and Daley is part of the county. I hope he is objective and fair in his deliberations.”
Ald. Larry Bloom (5th) said the appointment of a special prosecutor was a political victory for Daley.
”The appointment will essentially eliminate this as an issue in the campaign, so it is a smart move by Daley,” said Bloom. ”For Daley, he gets this right off the table. But, I don`t think the voters will forget it.”
Daley said he welcomed the appointment of Webb. ”Everybody respects Dan Webb,” Daley said.
”If anyone knows Dan Webb, they know he`s always been an outstanding trial lawyer.”
Webb, a partner in the Chicago law firm of Winston & Strawn, said Fitzgerald had called him prior to Friday`s hearing to ask if he would accept the appointment.
”I made a pretty strong commitment to prosecute vote fraud and secure honest elections in the U.S. attorney`s office when I was there,” Webb said. ”I considered it a challenge and so I accepted.”
As Daley and Sawyer focus on their showdown in the Feb. 28 Democratic primary, the tone of their campaign has begun to turn increasingly heated.
When reporters questioned Sawyer at a press conference about his late filing of tax returns for 1986 and 1987, Sawyer aides handed out copies of a Dec. 16 letter from a Daley ally seeking the $25,000 contributions to the Daley campaign.
”Why don`t you deal with this $25,000 solicitation letter, this extortion letter?” Sawyer said. ”Why don`t you talk about extortion, extorting all kinds of money?”
Sawyer and his campaign aides also linked Daley to the leak of information about his tax records and suggested that the release could constitute a felony.
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Sawyer said that Daley has ”connections” and ”can get information from the IRS.” Sawyer`s campaign manager, Reynard Rochon, later called the tax controversy ”nothing but a smokescreen put up by the Daley campaign to avoid discussing the issues in the campaign.”
Daley denied that his campaign had any role in releasing tax information. ”That is the silliest statement I ever heard in my life coming from the mayor of Chicago,” Daley said.
Sawyer aides, meanwhile, said a search of records revealed that the 1987 return had been filed on time, despite the mayor`s assertion that it was late. An audit by the Internal Revenue Service for several previous years, which was prompted by the late filing of the 1986 return, resulted in a $200 payment by Sawyer, aides said.
Sawyer announced an endorsement by U.S. Rep. Charles Hayes (R., Ill.), the influential labor leader who succeeded Harold Washington him when Washington left his congressional seat for the mayor`s office.
Hayes has appeared at several events for Ald. Timothy Evans (4th) since Washington`s death. But he predicted that Evans, who has opted for a third-party campaign, would drop out of the mayoral field if Sawyer wins the Democratic primary.
”He (Sawyer) has proven as acting mayor the past 13 months that he can continue the legacy set forth by Harold to help the city move forward,” Hayes said. ”When it comes to the general election, I`m sure that you won`t find a situation where Tim opposes Gene Sawyer.”
Daley also picked up the expected endorsement of Ald. Luis Gutierrez
(26th), a onetime Washington loyalist who joined the City Council in 1986 with substantial help from Washington.
”I have to swallow and say, I don`t like his past actions, but I have changed and he has changed,” Gutierrez said.