Burned by a City Hall contracting scandal, Mayor Richard Daley swore off political contributions from city vendors.
It didn’t hurt him a bit.
Daley, who has proven he can adapt to any fundraising challenge, has built a formidable campaign fund nonetheless–and he continues to add to his war chest with money from those who profit from city business.
Investment firms, lawyers and one of the city’s most prominent insurance executives are still able to give generously to re-elect Daley on Feb. 27 without violating any campaign-financing limits.
Executives of Ariel Capital Management, for example, have given $157,000 to Daley’s campaign. Ariel was paid $3.8 million last year to manage money for city pension funds, which are not covered by Daley’s ban.
Since starting to campaign for high-profile office in 1979, Daley has created a political money machine that smothers opponents and scares away his most viable challengers.
A Tribune analysis of nearly 47,000 contributions to Daley’s campaign fund for the last 27 years shows he has tapped firms that do business with the city or need city approval for their plans.
The analysis, the first historical look at how Daley raises campaign cash, shows how adaptable he can be. He has adjusted to limits on corporate contributions–imposed either by city ordinance or by Daley himself–by soliciting hefty donations from wealthy executives and collecting checks from dozens of lawyers at top law firms.
It also shows for the first time exactly how much of the more than $40 million he has raised over the years has flowed in from real estate developers, unions and wealthy individuals.
He has used much of the money for television advertising, political polling and consultants. Daley political adviser David Axelrod, who advises the mayor even when he’s not running, was paid nearly $9 million since 1988–of which all but about $800,000 went to pay for TV ads, Axelrod said.
Overwhelmingly popular
Daley, who became mayor in 1989 after eight years as Cook County state’s attorney, also uses his campaign fund to give gifts. He spent more than $61,000 on Christmas cards and $21,000 on wedding and baby gifts. He has given $75,000 to his church, Old St. Patrick’s in the West Loop.
Daley’s supporters say his fundraising prowess is due to his overwhelming popularity.
“The mayor and the job he’s done speaks for itself. It does not require a lot of selling,” said the mayor’s nephew and campaign finance manager, Peter Thompson. “I have the best product in the world.”
Despite the self-imposed restrictions and corruption scandals throughout his administration, Daley’s fundraising hasn’t slowed. In just three months starting in November, the fund brought in $4.8 million. With cash left over from past campaigns, he had about $5.6 million in the bank at the end of January. And the money continues to flow in.
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He has received $1.5 million from 13 separate donors who gave $100,000 or more–the first contributions of that size since 1989.
The mayor’s two opponents, Cook County Circuit Court Clerk Dorothy Brown and William “Dock” Walls, an aide to the late Mayor Harold Washington, had about $119,000 and $4,000, respectively, on hand at the end of last year.
A better-known potential rival, U.S. Rep. Jesse Jackson Jr. (D-Ill.), said he decided not to challenge Daley partly because of the mayor’s “lockdown” on local campaign contributions. Of 28 donors who financed Jackson’s potential mayoral bid, 17 lived outside Illinois, records show.
“It’s virtually impossible for you to raise money [in Chicago] if you’re challenging the mayor,” Jackson said. “People spurn you. Nobody wants to show up at a fundraiser in the city of Chicago that would be on the other side [of Daley].”
Scrupulous compliance
The mayor has not been hampered by current limits on giving. Under Chicago’s campaign-financing ordinance, contractors for the city and related agencies cannot give more than $1,500 in each election to candidates for city office. In 2005, Daley signed an executive order that banned contractors and their owners and spouses from giving any money to his campaign fund.
Daley has been scrupulous about complying with the limits.
His campaign has refunded about $200,000 from donors with city contracts and has refused to accept $1.5 million, according to Thompson.
But Daley’s order did not include the city’s pension funds, which are considered independent agencies even though the mayor plays a role in the appointment of some of their trustees.
Ariel manages money for six pension funds covering city workers and employees at the Chicago Public Schools, Chicago Park District and Chicago Transit Authority.
John Rogers Jr., Ariel’s chairman, gave $100,000 to Daley; the firm’s president, Mellody Hobson, gave $50,000; and other Ariel employees chipped in $7,000. Another $1,000 was given in the firm’s name.
Rogers, a longtime Daley supporter and civic leader, said Ariel officials gave so generously partly because of their ties to Thompson, who had worked at Ariel for 12 years before leaving in late 2006. The contributions are not connected to the firm’s city pension work, which represents a small share of Ariel’s total business, company officials said.
“We have this business because of our investment record, not because of anything else,” Hobson said.
Executives at six other firms with pension business also donated about $94,000 in the last three months.
Hedge fund officials were major contributors, but none of those donors has worked for city pension funds. Public pension funds are increasingly moving into hedge funds, lightly regulated investment funds that charge high fees but can pay big returns.
Michael Sacks, chief executive of hedge fund manager Grosvenor Capital Management, and 10 other executives at the firm gave a total of $153,500. Daley’s son-in-law Sean Conroy works for the hedge fund manager. “Michael is an unabashed fan of Mayor Daley,” said company spokesman Steven Lipin.
Generous lawyers
Daley’s order also does not cover firms that work for city agencies, such as schools.
Patrick Ryan, whose Aon Corp. does business with the public schools and City Colleges of Chicago, recently donated $100,000.
Daley’s order covers only individuals who own a major stake in city contractors. That allows lawyers whose firms do business with the city to give.
Daley received a total of about $86,000 from two fundraisers attended by dozens of lawyers at Mayer Brown Rowe & Maw and Winston & Strawn.
Both law firms do legal work for the city, but their lawyers are not covered by contribution limits.
Former Illinois Gov. James Thompson, who until last year was chairman at Winston & Strawn, said he and his wife hosted a fundraiser for the Democratic mayor at their home in January. The firm was paid $1.8 million by the city last year, largely for work on a lawsuit brought by a contractor at Daley’s celebrated Millennium Park.
Thompson said most of the firm’s lawyers are Republicans who also have donated to candidates who cannot bring business to the firm. “Lawyers are just politically active. They care about the city,” he said.
Lawyers at Katten Muchin Rosenman, including the mayor’s friend Terry Newman, gave more than $8,000. The firm, which does municipal bond work for the city, also paid $1,500 in November for invitations and postage for a Daley fundraiser.
After the Tribune questioned the firm’s donation, Peter Thompson said Friday that the campaign refunded the contribution.
The Tribune analysis also shows that some of the recent big donors have been major supporters of the mayor over the years.
Ryan, who is leading Daley’s efforts to attract the 2016 Olympics to Chicago, has given a total of $166,300 since the early 1980s, placing him fifth among Daley’s all-time donors.
His former company, Ryan Holding, is among the mayor’s top institutional donors. In an e-mail in response to questions about his giving, Ryan wrote: “I have been a supporter of Richard M. Daley for over 30 years.”
Billionaire real estate investor Sam Zell, who has given $200,500 and ranks fourth among Daley’s donors, said the mayor’s contributions to Chicago might have exceeded those of his father, legendary Chicago Mayor Richard J. Daley. Zell cited the city’s political turbulence two decades ago, when Chicago was known as “Beirut on the Lake.”
“Do I have to remind you what the 1980s were like?” Zell said.
Supportive unions
Despite Daley’s recent scuffle with labor unions over the “big-box” minimum wage ordinance, the analysis shows that over the years labor–especially the construction trade–has been among Daley’s biggest supporters. Union donations are not limited.
The Chicago Regional Council of Carpenters ranks eighth among Daley’s top institutional donors, with contributions totaling $126,951. Other carpenters groups have pitched in $138,899.
Daley’s close ties to carpenters proved embarrassing in 2004, when the city hired an unqualified 19-year-old building inspector. Federal prosecutors investigating City Hall hiring fraud later showed that the teen got the job at the request of his father, a top official at one of the city’s carpenters locals.
The city’s futures exchanges, the Chicago Mercantile Exchange and the Chicago Board of Trade, have long been big supporters of the mayor and each gave more than $100,000 for this year’s race. John Sandner, a Merc director, contributed another $25,000.
Daley has been an advocate for the exchanges, opposing repeated attempts by the White House to tax futures trades as a way to fund industry regulation, said David Prosperi, a Merc spokesman. The exchanges claim a tax would make trading more costly and drive business overseas.
Proud donors
Futures trader Richard Dennis has been the mayor’s single biggest contributor over the years, giving Daley a total of $375,250. “I’m proud of that, actually,” Dennis said.
Dennis said Daley understands that the city’s exchanges would fade away like Chicago’s storied stockyards if they could not compete globally.
He has not contributed to the mayor this year–but only because he has not been asked.
“I am as supportive of him as I have ever been,” Dennis said. “I’d be in there giving money if there was any chance in hell it looked like he wouldn’t win.”
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Daley Inc.
Since first beginning to campaign for Cook County state’s attorney in 1979, Mayor Richard Daley has created a formidable fundraising machine.
He has become untouchable–attracting an impressive $37.9 million in itemized contributions from individuals and institutions from Chicago, its suburbs and across the nation. And this election year, when City Hall scandals could have weakened the 18-year incumbent’s seemingly impenetrable armor, loyal supporters have reached deeper into their pockets to sustain the country’s most powerful mayor.
Size of contributions
The bulk of the mayor’s fundraising comes from those who write checks of $1,500 or more.
Donations from individuals and institutions (Nov. 30, 1979-Dec. 31, 2006):
Less than $500
$4.8 million (13% of total)
=24,757 contributions (52.8% of total)
$500-$999
$4.3 million (11% of total)
=8,212 contributions (17.5% of total)
$1,000-$1,499
$8.0 million (21% of total)
=7,483 contributions (15.9% of total)
$1,500 and above
$20.8 million (55% of total)
=6,465 contributions (13.8% of total)
The mayor’s suburban friends
About two-thirds of contributions to Daley come from Chicago, but ZIP codes in Lake and DuPage Counties have been important sources for his political war chest.
Donations from individuals and institutions, by ZIP code:
$150-$50,000
$50,000-$250,000
More than $250,000
%%
TOP CONTRIBUTORS OUTSIDE CHICAGO
60093 (Winnetka, Northfield) $977,905
60521 (Hinsdale, Oak Brook) $710,735
60035 (Highland Park) $367,589
60062 (Northbrook) $335,302
60045 (Lake Forest, Mettawa) $318,247
60022 (Glencoe) $298,134
60025 (Glenview) $282,445
60015 (Deerfield, Bannockburn, Riverwoods) $268,285
TOP CHICAGO CONTRIBUTORS
60611 $2.9 million
60606 $2.7 million
60610 $2.1 million
60602 $1.8 million
60601 $1.7 million
60614 $1.3 million
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60603 $1.1 million
60604 $1.1 million
60609 $701,234
60616 $646,335
60605 $588,908
60607 $577,748
60622 $428,993
60646 $391,991
60608 $366,939
60657 $357,167
60643 $263,240
60613 $258,520
%%
National appeal
The mayor has raised money from 43 states and Washington, D.C., several Canadian provinces, and even received one check from England ($500 in 1995). His top 10 states account for 97 percent of his contributions from individuals and institutions, with Illinois accounting for nearly 92 percent of the total.
1,500-$10,000
$10,001-$50,000
$50,001-$100,000
More than $100,000
%%
TOP CONTRIBUTORS AFTER ILLINOIS
1. Illinois: $34.9 million
2. New York $477,757
3. Washington, D.C. $360,400
4. California $303,700
5. Florida $210,170
6. Indiana $202,985
7. New Jersey $146,594
8. Massachusetts $138,550
9. Wisconsin $122,370
10. Ohio $116,100
%% Note: No contributions from Alaska or Hawaii.
Daley’s campaign does most of its fundraising just before election time. After becoming mayor in 1989, Daley has won re-election by comfortable margins.
Donations by election *
1989 $7.3 million
1991 $3.3 million
1995 $4.7 million
1999 $4.2 million
2003 $3.7 million
2007 $3.1 million
* The donation totals for the 1989 through 2003 elections cover the 12-month period from July prior to the election to June after the election (this sentence has been added to this text).
The donation total for the current election period is only through Dec. 31.
Daley’s percentage of the vote in the mayoral election
1989 55.4%
1991 70.7%
1995 60.1%
1999 71.9%
2003 78.5%
The 2007 mayoral election will be held Feb. 27.
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Top individual givers
Nov. 30, 1979, to Feb. 15, 2007:
1. Richard Dennis
Futures trader
$375,250
2. Judd Malkin
Co-founder of JMB Realty Corp.
$222,450
3. Bruce Vincent Rauner
Leads the private equity firm GTCR Golder Rauner LLC
$208,000
4. Sam Zell
Billionaire real estate investor
$200,500
5. Patrick Ryan
Founder and executive chairman of Aon Corp.
$166,300
6. Kenneth C. Griffin
Hedge fund manager, chief executive officer of Citadel Investment Group
$162,000
7. Fred Krehbiel
Co-chairman of Lisle-based Molex Inc., manufacturer of electronic components
$139,350
8. Sidney Port
Founder of Lawson Products Inc., seller and distributor of industrial products
$114,650
9. William Farley
Former chairman of Fruit of the Loom Inc.
$110,000
10. Craig J. Duchossois
Chief executive officer of Elmhurst-based Duchossois Industries Inc.; son of Arlington Park chairman
$109,500
Top institutional givers
Nov. 30, 1979, to Feb. 15, 2007:
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1. Chicago Mercantile Exchange
$323,250
2. Hotel Employees and Restaurant Employees International Union
$280,516
3. Plumbers Local Union 130
$256,455
4. Chicago Board of Trade
$224,600
5. Illinois State Medical Society
$167,439
6. International Union of Operating Engineers Local 150
$156,550
7. International Union of Operating Engineers Local 399
$133,020
8. Chicago Regional Council of Carpenters
$126,951
9. Ryan Holding Corp.
$100,000
10. Simpson Community Trust
$100,000
Sources: Tribune analysis, Chicago Board of Election Commissioners, Illinois State Board of Elections
baiduhai / John McCormick, Sue-Lyn Erbeck and Steve Layton
– See microfilm for complete graphic.
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Compiling the data
Prior to the Tribune’s efforts, records of donations made before 1999 to Mayor Richard Daley’s campaigns existed only on paper and could not be analyzed electronically. The Tribune hired a firm to keypunch information from about 7,500 pages of Daley’s campaign finance reports. That data was combined with Daley’s electronic records on file with the Illinois State Board of Elections to form a single database of the money Daley raised and spent from November 1979 through December 2006.
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