Giving Away the Farm
Once again, the Park District is planning to let a private company operate on publicly owned lakefront property. And if the city doesn’t negotiate a better deal than it did on Soldier Field and Millennium Park, the taxpayers will get screwed one more time.
The Park District has released only the bare bones of its plan to rent a chunk of Northerly Island to Clear Channel, the multibillion-dollar, Texas-based media conglomerate that plans to charge the public to attend a series of summer concerts there. The deal, approved by the Park District board on February 9, is the latest twist in Mayor Daley’s attempt to transform Meigs Field and Northerly Island into a public park open to all free of charge. The park wasn’t a bad idea–the public should be able to enjoy as much of the lakefront as possible. But Daley has never had the money to back up his vision, and the ham-fisted way he shut down the airport only put that vision farther out of reach.
Daley underestimated public support for Meigs Field when he announced his plan to rip it up in 1996. “There’s a long tradition of an airfield on Northerly Island,” says Steven Whitney, a suburban businessman and pilot who founded Friends of Meigs Field shortly after Daley made his announcement. “Mayor Daley liked to write us off as a bunch of fat cats. But in fact, most of our support came from working people who don’t even fly.”
Whitney and his allies argued that Meigs had pumped hundreds of millions of dollars into Chicago’s economy while relieving congestion at O’Hare and Midway, and they got support from the Sun-Times, the Tribune, Governor Jim Edgar, and state legislators from both parties. Worried that the fight over Meigs might jeopardize his plans to expand O’Hare, Daley grudgingly backed off. In December 2001 he and Governor George Ryan agreed Meigs would stay open until 2026.
But soon Daley and some of his key aides–including Timothy Mitchell, who’s now superintendent of the Park District–were privately plotting to close Meigs. On the night of March 30, 2003, about a month after his reelection, Daley sent crews to bulldoze the runway. He then declared that he’d done it to prevent terrorists from using it to fly airplanes into Loop buildings.
Probably a stretch. But according to the Tribune, bulldozing the runway and relocating the fire department’s air-rescue base cost the city at least $4 million, $2.9 million of which came from Federal Aviation Administration airport-development funds. Using development funds to destroy Meigs pissed off the FAA, which wants to impose fines of more than $8 million. City lawyers are still fighting with FAA lawyers over that.
The mayor and his strategists probably assumed the public would forget about what the demolition had cost the city once they began enjoying the new park. But the city’s probably further now from getting that park than it was when Daley proposed it in 1995. Back then the economy was booming, and the city could afford major capital expenditures. Now the economy’s in the dumps, and there’s no money to build another big lakefront park.
So it wasn’t surprising when Mitchell announced on February 7 that the Park District planned to build an 8,000-10,000-seat concert venue on Northerly Island to raise money to build the park. He said it was a wonderful deal for the taxpayers because it would generate about $800,000 a year in rent. It would be open only 25 to 30 times a year, so it wouldn’t inconvenience most park users. And it was temporary–Clear Channel was getting just a five-year lease, though Mitchell left open the possibility that the lease could be extended.
Those claims echo the claims Daley and his aides made about Soldier Field and Millennium Park when they tried to sell them to the public: they underestimated the construction costs and overestimated the return. According to the Park District’s own budget records, Soldier Field will bring in about $19.8 million in rental revenue this year. But the Park District has to pay $11 million to the private firm SMG to operate Soldier Field, $4.2 million on loans it borrowed to build the new stadium, and $3 million to rent new offices because its old offices, which were free, were demolished to make way for the new stadium. And that’s not counting the money that’s been budgeted to cover security, utilities, and garbage collection. “You could argue that no money is coming in for the taxpayers out of Soldier Field,” says Erma Tranter, president of Friends of the Parks, an advocacy group that opposed the stadium deal.
Millennium Park, built on the promise that it would raise enough money to pay not only for itself but for underfunded neighborhood parks in poor communities, isn’t helping taxpayers out either. As I wrote on February 18, the public paid at least $270 million of the construction costs, and the loans were supposed to be repaid with revenues from leases and parking fees. One of the big moneymakers was supposed to be the Park Grill, the restaurant at Randolph and Michigan. But according to the Park District, as of February 1 the restaurant had paid only $162,656 in rent since it opened in November 2003. And given that the Park District agreed to pay for the Park Grill’s gas and garbage collection, it’s probably losing money on the deal.
City residents lose in another way when control of public property is handed over to a private company. Soldier Field is virtually off-limits to members of the public unless they’re paying an admission charge. SMG even charges $15 for a tour. Local high school football and soccer teams can’t practice there–though money that might have gone to the public schools was used to build it–because they might damage the grass. And the Park Grill is allowed to close off parts of the park for concerts and special events the public has to pay to attend.
I understand that the city’s broke and that this is one way it can generate revenue. But the public’s paying for these projects, and private companies are profiting from them. If we’re going to give up some access to the city’s most treasured assets, let’s at least make some money on the deal.
The Park District and Clear Channel have just started negotiating their contract. In 1996 the Park District estimated it would cost about $26 million to build a park on Northerly Island, a figure it hasn’t updated but which has undoubtedly gone up. The $4 million the concert venue will bring in over five years won’t even cover the cost of destroying Meigs Field, much less building the park.
If the Park District plays it as it did with the Park Grill, Clear Channel will also get exclusive rights to concessions and kiosks. And maybe taxpayers will get to foot the bill for private security guards to shoo away Mexican ice cream vendors the way guards have been shooing photographers out of Millennium Park.
“The irony is that this really is a deal that only benefits fat cats,” says one member of the Friends of Meigs Field who didn’t want to be named for fear it would alienate Daley further. “If there was any kind of public scrutiny in this city–if the Park District board was anything more than a rubber stamp–they’d have to kill this deal.”
Here’s an Idea: How About an Airport?
Steven Whitney is hoping public anger over the Clear Channel proposal will help him bring back Meigs Field. In 2003 he and other members of the Friends of Meigs Field designed a 25-acre park on Northerly Island with a nature walk, prairie grasses, lagoons, gardens, and a museum showcasing the history of aviation in Chicago. And of course a rebuilt Meigs Field.
Whitney and his allies presented their plan at a Park District budget meeting that December. The board members asked no questions and made no comments. And they’ve expressed no interest since. But the group says the deal’s still on the table.
Whitney and other group members think the city could take advantage of the FAA’s Airport Improvement Program, which covers 95 percent of the cost of projects that alleviate air-traffic congestion. As Whitney explains it, the FAA would pay the city to buy Northerly Island from the Park District. “Our estimate for that land’s value is about $141 million,” he says. He figures it would cost about $25 million to build the park and lagoon, and $10 million to repave the runway, and the rest of the money would be the Park District’s to spend as it chose.
It’s a little hard to understand why the FAA would want to pay $141 million to transfer Northerly Island from one entity controlled by the mayor to another entity controlled by the mayor, especially since it’s the same mayor who wrecked the runway. But Whitney thinks the FAA would be interested, and he has a letter from the agency saying it wouldn’t automatically oppose the idea. “From the FAA’s standpoint it makes sense, because reopening Meigs alleviates congestion at O’Hare and Midway,” he says. “At its peak, Meigs handled about 80,000 operations–takeoffs and landings–a year.”
The plan’s backers know they’re not likely to get the city’s support anytime soon, certainly not while Daley’s in office. “I don’t know if Mayor Daley could ever admit he was wrong about Meigs,” says one member of the group. But they figure that as long as the city’s looking to make money from Northerly Island, it ought to consider a plan that might actually generate some.
Who Was on That Committee Anyway?
Timothy Mitchell seemed pleased when he announced that the Park District had chosen Clear Channel to operate the music venue on Northerly Island. He said a five-person selection team of Park District employees had chosen the Texan media conglomerate over its local rival, Jam Productions, after studying their bids and interviewing both companies. He said the committee had determined that a contract with Clear Channel was in the taxpayers’ best interest.
Yet the selection of Clear Channel is controversial. According to Mitchell, it will pay the Park District $800,000 a year for the right to run the venue. But Jam cofounder Jerry Mickelson told the Sun-Times that his company offered to pay $1 million or more. Mickelson, whose lawyers have told him to stop talking to reporters, also told the Sun-Times it’s “not healthy” to have “one company control two major outdoor venues” in one market. (Clear Channel also books the Tweeter Center in Tinley Park.)
After Mitchell made his announcement I heard from two good sources that Laura Foxgrover, director of the Park District’s Department of New Business, was on the selection committee. She’s been a central figure in the soap opera involving the Park Grill restaurant in Millennium Park: she’s the mother of Matthew O’Malley’s child, and O’Malley co-owns the Park Grill, which managed to get a remarkably generous lease from the Park District during the time he and Foxgrover were involved.
Last summer the Park Grill sponsored a series of jazz concerts in the park, for which it charged admission, and the cosponsor was WNUA, a radio station that’s owned by Clear Channel. So I wanted to know if Foxgrover really was on the committee that was considering a city contract with a company that does business with the father of her child.
When I called the Park District about Foxgrover, spokesperson Michelle Jones told me, “I think you’re going to have to file a Freedom of Information request to get that.” Later she called back to say I shouldn’t bother with a FOIA request. “We do not release the names of the evaluation committee prior to the completion of the negotiations,” she said. “All I can tell you is that it was a committee of five members and that never is a project of this magnitude determined by one member.”
Art accompanying story in printed newspaper (not available in this archive): photo/Bruce Powell.