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Even more unsolicited advice

Tuesday, Mar 31, 2009

* Dear major media,

Why do you listen to this guy?

“What Quinn hasn’t revealed is that the state is getting more than $11 billion in stimulus money, so that covers the alleged deficit. If he would raise the income tax $4 billion a year, that would give him $20 billion a year in new revenue,” added [president of the National Taxpayers United of Illinois, Jim Tobin].

Tobin says the money will likely just go to pad the pension pockets of retired state workers.

That’s so ludicrous on so many levels that I won’t even touch it. And not one person was quoted to shoot down these claims? Suddenly, I feel like banging my head against a wall.

* Dear Gov. Quinn,

Leaking stories to Michael Sneed means you’re putting your message in her hands, and you may not love the outcome

To wit: Although Quinn will not dress up as an Easter Bunny, Sneed hears he will read stories to disabled kids searching for 1,000 plastic Easter eggs on the grounds of the governor’s mansion on April 11.

Sweet idea. Not-so-wonderful visual of Quinn as the Easter Bunny, however. You’d think after the “Will the new state police director attend the police academy?” piece, Quinn would’ve learned something.

- Posted by Rich Miller   28 Comments      


Tuesday, Mar 31, 2009

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Daley on Quinncome tax: Change it; Cig tax advances

Tuesday, Mar 31, 2009

* 12:21 pm - Looks like a revamp may be coming

Chicago Mayor Richard Daley said if income taxes go up under Governor Pat Quinn’s proposal, property taxes should go down. Quinn wants to raise the tax to four-and-a-half percent, but the mayor says if it’s going to happen, property owners need some tax relief.

For years, the mayor has advocated what some call a tax swap, wherein the income tax would be raised only if property taxes were lowered a corresponding amount. The mayor said his position on increasing the state income tax has been a long-standing one. […]

“Taxpayers are, first of all, losing their homes,” said Daley. “They are losing their homes. They are losing their jobs. Or someone in the home has lost their job. They are not getting overtime. Some have lost their pensions. There has to be property tax relief. You cannot increase (income) taxes without property tax relief, simple as that. People can’t pay these property taxes.”

Daley wants local governments to get their traditional slice of any income tax increase (Quinn uses that 10 percent share for his capital bill), so this property tax thing could be a negotiating ploy. But it also strengthens Sen. James Meeks’ hand while he negotiates for a tax swap. You can bet the house (and the Senate) that Chicago legislators and the governor and everyone else in politics in this state are taking note of Daley’s remarks.

The governor’s spokesman was surprised that Daley held a news conference to comment on the Quinn budget plan.

I’ll bet he was.

* 12:27 pm - From Lee Newspapers

A day before the federal tax on cigarettes jumps $.62, a Senate committee voted to phase in another $1 increase for Illinois over two years.

* 12:49 pm - More Daley react

“We get no benefit,” the mayor said at a news conference at a school on the South Side. “Then why should anybody be for it?”

The mayor called on the state to expand property tax relief if it is going to raise the income tax.

“You cannot increase the income tax without property tax relief,” he said, noting the high rate of foreclosures.

Daley also complained that the city would only get $54 million in new education funding from the state under Quinn’s budget, saying the schools need an increase of $200 million.

- Posted by Rich Miller   30 Comments      

This just in…

Tuesday, Mar 31, 2009

* 11:59 am - The chairman of the governor’s independent reform commission talked to the Daily Herald editorial board before unveiling his plans to the Statehouse media later this afternoon. Here’s a bit of what former federal prosecutor Patrick Collins had to say…

The reform commission wants to put Illinois campaign law more in line with federal law, limiting donations from individuals to $2,400 per election cycle and contributions from unions, businesses and interest groups to $5,000.

That would mirror federal guidelines, which haven’t really cleaned up DC all that much.

Under the proposal, contributions from registered lobbyists and trusts would be banned and outside groups would have to make donors public.

I cannot see how contributions from lobbyists - a group of people protected under the constitution - can be banned.

On the contracting end, the commission is proposing rules to isolate procurement officials from political bosses and institute a watchdog agency to oversee state spending

We’ll have more details here later today.

* 12:38 pm - The Trib has a list

*Hold primary elections in June, closer to the November general election, to cut down on costs and length of campaigns.

That’ll never happen. As I’ve pointed out before, legislators would have to take a lot of tough votes at the end of session in May, then immediately face the voters in a June primary. Not gonna happen. And it’s probably not such a great idea, either. If you think legislators are averse to tough votes now, just require a June primary and see what happens.


*Increased disclosure requirements, including requiring contributions of $500 or more to be reported more quickly year-round instead of only before an election.

*Requiring political action committees to disclose “bundling” of contributions from several people of $16,000 or more in a six-month period.

*Amend ethics act to require enhanced training.

*Reduce number of state jobs exempted from a ban on patronage hiring.

*Prohibit campaign contributions by state employees to constitutional officers.

- Posted by Rich Miller   25 Comments      

Question of the day

Tuesday, Mar 31, 2009

* This bill has already passed the House, but today’s Sun-Times editorial reminded me to ask the question. The setup is from a recent Tribune story

Student-athletes across the state would be subject to random drug testing throughout the season if a bill that was unanimously passed by the House on Thursday is approved by the Senate and signed by Gov. Pat Quinn.

Illinois last fall joined Texas, New Jersey and Florida in testing its high school athletes in a plan implemented and funded by the Illinois High School Association. Florida dropped its state-funded program in mid-February, citing a lack of money.

Sponsoring Rep. Jack Franks (D-Marengo) said the bill proposes testing an additional 1,000 student-athletes each year from at least 25 percent of Illinois high schools. […]

Of the 264 tests that were administered last fall, 258 came back negative; the six others were granted medical exceptions.

“I think it’s a good thing because it will even the playing field,” said Nazareth running back LaSteven McKinney, a junior. “With the old system, they had time to clear their system before a random test. I think most kids still think they won’t get caught.”

The Illinois chapter of the American Civil Liberties Union opposes the legislation because “there ought to be some basis on which to do that search,” said spokesman Ed Yohnka.

* The Question: Should Illinois’ high school athletes be randomly tested for performance enhancing drugs? Explain fully. Thanks.

- Posted by Rich Miller   22 Comments      

The horses are approaching the starting gates

Tuesday, Mar 31, 2009

* Congressman Mark Kirk says he will make a decision about running for statewide office “by the end of next month.” He told NBC5 that he wants to read the Blagojevich indictment before making a final decision.

Asked if he’d made any downstate trips to learn more about the state, Kirk said he’s so far been to McHenry, DuPage and Champaign counties. [Hat tip: Team America]

* I asked a source close to Sheriff Tom Dart yesterday about whether Dart might be interested in running for statewide office. I’ll save the response for subscribers, but CBS2 talked to Dart himself

Sheriff Tom Dart seems to be everywhere these days. He’s arresting sex offenders, tackling the dark side of the Internet and rescuing puppies. He’s gone after cemetery vandals, helped to run a sting aimed at burglars, and Monday, in another moment made for TV, specifically Dr. Phil, Dart took on prostitutes using the Craigslist Web site. He’s a media regular.

So, is he running or what?

“People have talked to me about other opportunities out there,” Dart told CBS 2.

If Lisa Madigan runs for governor, as expected, some Democrats want Dart to run to replace her as state attorney general. If that doesn’t happen, Dart may against Todd Stroger for Cook County Board president. […]

“I can’t think of a scenario where I would not be running for re-election,” Dart said earlier this month. “I couldn’t be more honest with you, if I wanted to.”

CBS2 asked Republican strategist and Cicero town/township/park district/TIF district spokesperson Dan Proft his opinion about Dart. Maybe they should’ve also asked Proft about the quite weird but oddly persistent and credible reports that Proft wants to run for governor. I just tried calling him, but there was no answer, so I left a message.

* The Illinois Republican Party responds to yesterday’s announcement by Alexi Giannoulias that he won’t take corporate PAC money or federal lobbyist cash in his US Senate bid…

In an attempt to hide his record of questionable loans to crime figures and willingness to look the other way on Rod Blagojevich’s flagrant corruption, Illinois Treasurer Alexi Giannoulias announced today that his Senate campaign will refuse donations from corporate PACs and federal lobbyists.

“No amount of phony reform and renewal pledges from Alexi Giannoulias can hide his shameful history of bankrolling mobsters and convicted felons like Tony Rezko,” said ILGOP Spokesman Lance Trover.

The Giannoulias family bank, Broadway bank, made millions of dollars in loans to Tony Rezko as well as Michael Giorango and Boris Stratievsky, convicted felons and reputed mob figures. These loans were made while Alexi Giannoulias was the chief loan officer.

“If Mr. Giannoulias wants to kick off his campaign by talking about reform then he should begin by fully explaining why, throughout the last six years, he loaned millions of dollars to mob figures and endorsed Rod Blagojevich for re-election in 2006,” added Trover.

In addition, Mr. Giannoulias apparently has no problem with unions attempting to “buy a seat at the table”, as he neglected to ban the labor contributions that bankrolled his Illinois Treasurer campaign to the tune of tens of thousands of dollars.

* Sen. Rutherford is gearing up for treasurer

Former presidential candidate Mitt Romney is headlining a fundraiser for state Sen. Dan Rutherford, who’s interested in running for Illinois treasurer.

A downstate Republican, Rutherford says he plans to announce when the General Assembly is on Easter break that he will form an exploratory committee.

* Chicago Public Radio talks to state Rep. Julie Hamos about her future

An Illinois state representative says she’s interested in running for two high-profile offices in next year’s election. But Evanston Democrat Julie Hamos says everything is in a “holding pattern” for now.

As we’ve discussed before, Hamos is thinking about running for attorney general or Congress, if Jan Schakowsky defies expectations and runs for US Senate.

HAMOS: Some musical chairs have to take place. People are judging where the state’s going, how well we can solve the problems facing us, and nobody’s quite jumping in to anything quite yet.

With a primary election in Illinois just ten months away, Hamos needs to organize and start lining up contributors - efforts, she says, that are already underway.

Petitions go out just over four months from now. Time’s a-wastin’.

Hamos is avoiding any firm position on possibly the most politically explosive issue right now in Illinois: Governor Pat Quinn’s proposed income tax hike. She says she wants more answers about the state’s finances.

That does put her in a bind.

…Adding… Ald. Preckwinkle appears to be using her vote against the Chicago parking meter contract to her advantage in the county board presidency bid.

* Related…

* Giannoulias to decline special interest cash

* Treasurer says he won’t accept lobbyist cash

* Editorial: Quigley for 5th District seat : A brief word about Pulido. She is the founder of the Illinois Minuteman Project, a far right group that battles illegal immigration. The national Republican Party is offering Pulido no help, which speaks volumes about her candidacy. She is well outside the mainstream.

- Posted by Rich Miller   46 Comments      

Fumigation and reform

Tuesday, Mar 31, 2009

* More fumigation

Four of the state’s largest public-employee pension systems would face a major shakeup at the top under a plan by key statehouse Democrats to purge holdovers from ex-Gov. Blagojevich’s scandal-tainted tenure, several sources briefed on the ethics proposal said Monday.

The plan, which will be unveiled today, would end the terms of the current gubernatorial appointees on the boards of the Teachers Retirement System, the State Universities Retirement System, the State Employees Retirement System and the Illinois State Board of Investment.

* My weekly syndicated newspaper column takes up the ethics issue and how it may play out in Springfield…

Both Gov. Pat Quinn and House Speaker Michael Madigan have said they’d like to see Illinois politics and government cleaned up before any deficit-closing tax increases are debated.

It’s doubtful, of course, that the two men are talking about the same sort of cleanup - with Madigan coming from the old school and Quinn being the decades-long reformer.

Madigan mentioned two targets for reform the other day when talking to public television: The pension systems and the state’s purchasing act. He didn’t elaborate much. A spokesman said ideas are being developed, but Madigan does want some of the state’s purchasing reforms from a few years ago applied to the state pension systems.

Quinn, meanwhile, has pushed binding public referenda, campaign contribution limits and a whole host of other ideas that are never very popular in Springfield. Good government groups and some newspapers have made contribution caps their top priority, partly because disgraced former Gov. Rod Blagojevich’s campaign funding apparatus was so obscene.

So, where does it go from here?

Senate President John Cullerton may have pointed the way last week when he told a downstate newspaper’s editorial board that he believes campaign contribution limits will become the law in this state. Illinois is one of just a handful of states that places no limits on contributions. Cullerton didn’t elaborate about how high he’d place the cap, but Madigan has said he worries that wealthy candidates or interest groups could overwhelm opponents with a huge barrage of uncapped spending.

If caps are put in place, they will likely wind up being higher than the federal government’s $2,400 per election for individuals and $5,000 per year for political action committees. A starting point may be Senate Republican Leader Christine Radogno’s proposal to limit contributions to $10,000 per year from all sources.

Despite what you may think, gigantic contributions of $100,000 or more are the exception, not the rule in Illinois. But $25,000 checks are more common. The despicable Blagojevich apparently set $25,000 as his ticket price for appointments to some state boards and commissions.

Cullerton and Madigan co-chair a special bicameral committee created to come up with ethics reforms. But that legislative committee has a competitor out there, a special citizens commission formed by Gov. Quinn and run by respected former federal prosecutor Patrick Collins.

As I write this, Collins is preparing to unveil his commission’s proposals. It’s widely expected the Collins commission will propose far more radical ideas than the Madigan/Cullerton committee, and members will be way more wedded to their recommendations. One member of the Collins-headed commission told a Rockford audience at a recent town hall meeting that he would feel “very disenfranchised” if the commission’s recommendations were swept under the rug.

Quinn is proud of his reformer reputation, so implementing real change is one of his top priorities. But he also wants to pass a multibillion-dollar, job-creating capital construction plan, and he absolutely must have a balanced budget by the end of this spring’s legislative session. He needs cooperation from the General Assembly and their leaders to succeed, so he has to be somewhat careful how he proceeds on his reform agenda.

Collins and his commission have been operating independently from Quinn. The governor’s office has been given no real idea how far and wide the commission will go. And if they go too far and push too forcefully, Quinn will be put smack dab in the middle of any potential clash between the commission and the Madigan/Cullerton committee. The governor’s own commission could put him in a major political bind.

A saving grace might be the fact that Collins didn’t put any members of the state’s “good government” groups on his commission. While they’re often ignored at the Statehouse, if the groups decide to act as a sort of referee between the “too tame” and the “not gonna happen,” they could help shape the final product’s outcome.

And Quinn may have given himself a somewhat graceful way out if he has to pull the plug on the reform push. The governor said last week that he would initiate a statewide petition drive to make contribution caps the law of the land if the legislature fails to act. He probably can’t do that under the state’s constitution, but it’ll be a fun summer project for the guy.

* Related…

* Reform group includes Harper in complaints on Illinois lobbying: A new report by the Illinois Campaign for Political Reform set to be released today shows Harper officials increased their spending on clout-heavy lobbyists last year by 50 percent, from $84,000 in 2007 to $126,000 in 2008. The report analyzes lobbying efforts from dozens of governmental agencies to highlight how much taxpayer money is being spent to lobby other taxpayer-funded entities, and cites Harper’s lobbying expense as a troubling example of the practical costs of passing legislation in Illinois.

* Panel discusses ways to change legislative redistricting in Illinois

* IL Senate President Says Some Privacy Needed in Government: “You always have to have certain privacy with regard to legislative strategy but debating public policy should always be open to the public.” A spokesperson for House Speaker Michael Madigan says a state committee on political reform could look at the issue as well. But he says that might not be necessary because all final legislative decisions are made out in public.

* Reform Politics in Illinois

- Posted by Rich Miller   11 Comments      

Former first lady imperiled; More on Trib/RRB talks

Tuesday, Mar 31, 2009

* Unsurprising

A federal grand jury probing corruption under former Gov. Rod Blagojevich in the last two weeks has called witnesses to testify specifically about his wife, defense sources told the Chicago Sun-Times.

The recent questioning has centered in part on Patti Blagojevich’s real estate dealings and comes as the feds close in on an indictment involving the ex-governor and others.

You’d think she’d want to save herself, since her husband seems intent on going down in a brilliant, white-hot ball of flames.

The indictment has an April 7 deadline but could come Thursday — the day that grand jury meets.

What’s your over/under on the maximum number of prison years in the indictment? I figure since Chris Kelly is looking at something like 800 years, then RRB ought to at least be facing 10,000 years.

Do they even let you out of prison to be buried if you get that many years?

Defense lawyers said witnesses were questioned about Patti Blagojevich, her former firm, River Realty, and commissions she was paid on real estate deals involving political supporters, donors or state contractors. The former first lady took part in more than half a dozen real estate dealings with convicted businessman Tony Rezko, sources said.

Go read the whole thing.

* Meanwhile, Blagojevich had a “code name” for the Tribune/Wrigley Field deal: Project Elwood

Early on a Sunday evening in December, e-mails went out among state officials who had just learned that financially strapped Tribune Co. was about to file for bankruptcy protection.

“This could measurably complicate Project Elwood,” wrote William Brandt, chairman of the Illinois Finance Authority. […]

Two days later, the plan grew far more complicated when Blagojevich was arrested on federal corruption charges. Among the charges were allegations that he was trying to extort Tribune Co.—the owner of Wrigley, the Cubs and the Chicago Tribune—over the state purchase.

The “plan grew far more complicated when Blagojevich was arrested” line is quite the understatement. But, hey, it’s the Trib reporting on Tribune Co.

So, was the governor calling in plays during games or something? Check this out…

Blagojevich’s telephone log shows several calls to members of the team, including manager Lou Piniella, coach Larry Rothschild and John McDonough, the team’s former president who is now with the Chicago Blackhawks

…Adding… Substitute “Mexico” or a country with no extradition treaty for “Chicago” and adjust the mileage accordingly, and perhaps this will be RRB and a friend come Thursday? The “real” Project Elwood perhaps? Just sayin…

* Related…

* Rod Blagojevich indictment could bring more defendants - Former governor’s brother, wife and campaign committee, as well as lobbyist Lon Monk, are possible targets

* Blagojevich takes unreality show to radio airwaves

- Posted by Rich Miller   36 Comments      

Your assignment for today - Build a budget *** UPDATED w/Roundup ***

Tuesday, Mar 31, 2009

* The folks at have done it again. Their latest Web app allows you to build your own state budget.

You don’t get to go down to the line item level on every state agency, but you get to make changes to quite a few items in budgets for the State Board of Education, Corrections, Human Services, Aging, and others.

We’re talking about bringing the Wonkish folks over here to the front page so that we can have better access to their projects. Stay tuned on that.

Anyway, have a go at the app and tell us how you did.

Forgot to add the budget roundup…

* Several Ways to Tackle Illinois’ Budget Deficit: CULLERTON: There’s a whole bunch of different alternatives to this that we’re certainly open to, it could be temporary, we could borrow the three billion dollars and pay it off in a couple of years if that’s what people want to do, so we’re very open to people with suggestions.

* Quinn eyes community college building projects in budget

* Clinton, Eureka would lose Human Services offices under Quinn plan: A full list of the proposed closures released Monday shows no lost jobs among workers, but their commutes could lengthen

* Five Southern Illinois human services offices to close

* Thomson prison supporters to rally in Illinois
: Even though money for Thomson Correctional Center wasn’t included in the governor’s proposed budget, supporters will hold an informational rally Saturday in hopes of changing the situation.

* Editorial: Sales tax holiday: Regardless, though, a back-to-school holiday could result in more students being more ready to learn. And it would be a real break for working families, coping with everything from the day care years to college costs.

- Posted by Rich Miller   20 Comments      

Morning Shorts

Tuesday, Mar 31, 2009

* 77 Names Added to Slain Journalists Memorial in Washington D.C.

The youngest journalist’s name added to the wall was Ryan Rendleman, 22, who was on assignment for the Daily Egyptian student newspaper at Southern Illinois University in April 2008 when a tractor-tractor slammed into his stopped car at a construction zone.

* Batavia native added to journalists memorial

* Batavian’s name added to journalists memorial in D.C.

* New law reduces charges for uninsured

[Attorney General Lisa Madigan’s] office says hospitals have sometimes charged the uninsured at rates that are more than 200 percent over the cost of services.

* Ford to call back 300 full-time workers to build new Explorer

* Union: Ford calling back workers

Amid weak demand for cars, Ford dropped a second shift at the Chicago assembly plant in November, eliminating 600 part-time positions and about 200 full-time jobs. The plant began a temporary shutdown this week.

Kolanowski said building the Explorer will lead to the callback of 300 laid-off full-time workers at the plant and at a Chicago Heights stamping plant.

* State on a high in tech

Despite Motorola’s thousands of layoffs, Illinois’ high-tech industry managed to add 2,400 jobs in 2007, pushing the state to No. 7 from No. 8 in cyber sophistication among the 50 states, according to a study being released today. […]

Illinois’ tech industry employed 211,800 with a total payroll of $16.6 billion in 2007, the latest data available, while Indiana’s tech industry employed 71,300 with a total payroll of $4.2 billion, the report said.

* Chu believes FutureGen project has merit

* B-N to receive more than $1 million in energy efficiency grants

* Collapsing mines have been long-standing problem in Metro East

Schools, it seems, have been common victims.

* Students reassigned from school damaged by subsidence

* Caught in the 2-earner trap

But with so many women joining the work force, other expenses have skyrocketed for middle-class families, who have bid up prices for things like a home in a safe neighborhood with good schools. Other expenses in a dual-earner family — including child care, an extra car for mom to go to work and rising college costs — have gobbled up nearly all of the gains in salary, some argue.

* Daley deal to privatize Midway might not fly

Mayor Daley’s $2.5 billion plan to privatize Midway Airport has run into turbulence — and it just might be grounded entirely — because of the nation’s credit crunch and Wall Street slide, City Hall sources said Monday.

An April 6 closing date that would have made Midway the “first privatization of a major American airport” has been cancelled — and it’s likely to be put off for six months to give Midway Investment and Development Company LLC an opportunity to salvage the deal by lining up more equity investors or bank financing.

Asked to assess the chances the blockbuster deal will ever go through, the source said, “I wouldn’t put odds on it. No matter what happens, the city gets $126 million. That’s more for the city budget than the city gets” if the deal goes through, because of strings attached to the larger pot of money.

* O’Hare: Computer kiosks replace laid-off greeters

* HP, Chicago create high-tech lounges for visitors at O’Hare

* No stimulus money for $15 billion O’Hare expansion

* Federal Stimulus Money Flowing To O’Hare

* O’Hare Receives Millions in Stimulus Money

* City plans $15.5B in downtown projects

A draft of Chicago’s plans for the city’s central area through 2020 calls for $15.5 billion in public works, mostly for transportation improvements, and asserts the projects are attainable with or without the 2016 Olympics.

The projects include a West Loop transit hub beneath Clinton Street with an estimated price tag of almost $6 billion. The hub would connect Metra and CTA rail and bus lines with a proposed Carroll Street rail line, itself a $260 million item, near the north bank of the Chicago River.

The city’s share of the total $15.5 billion cost should be in the range of $6 billion to $8 billion, the report said. Most of the money would come from tax-increment financing, a property tax source that diverts money from regular government expenses. The rest would have to be drawn from state and federal aid or corporate deals, it said.

* Deloitte to sponsor U.S. Olympic team

* NLRB threatens complaint against Chicago company

* Window co. violated labor laws: NLRB Chicago

* City Hall hiring: Federal judge rejects compliance chief’s memo to department heads

In a “transition plan” memo issued Thursday to all city department heads, Anthony Boswell, executive director of compliance, said his office would manage “the day-to-day monitoring of all hiring.”

But an order issued Monday by U.S. District Judge Wayne Andersen states that the court-appointed hiring monitor shall continue each of her duties until Boswell’s office “advises her, and she concurs, that it is capable of assuming that function.”

The court monitor, Noelle Brennan, declined to comment Monday. In a report that led to the order, she cited continuing City Hall hiring abuses and “notably decreased” efforts to comply with federal court rules.

* Cop probed in senior’s missing $400K

Authorities are investigating whether a Chicago Police officer assigned to help senior residents bilked an 87-year-old Northwest Side woman of several hundred thousand dollars, according to court filings.

Officer Anthony Robles does not deny that his name is on Maria Hoyos’ bank accounts, nor that she lived with him for a time, nor that he traveled to Puerto Rico with her to help her.

* Let the Trout Fishing Begin!

It may still look like winter out there, but here’s a sign of Spring. Illinois’ hugely popular trout-fishing season opens this Saturday. The state’s Department of Natural Resources is stocking lakes, ponds and rivers with rainbow trout–60-thousand of them. But you need a special permit, and there’s no jumping the gun, says Chris McCloud of the Natural Resources Department..

- Posted by Mike Murray   3 Comments      

Protected: SUBSCRIBERS ONLY - Today’s edition of Capitol Fax

Tuesday, Mar 31, 2009

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This just in… Sun-Times files for bankruptcy

Tuesday, Mar 31, 2009

* 7:57 am - Sad news, but not unexpected, I suppose…

Sun-Times Media Group Inc., owner of the Chicago Sun-Times and many suburban newspapers, today voluntarily filed for Chapter 11 bankruptcy protection with the aim of reorganizing operations, settling a tax liability and making the company fit for a buyer.

The petition was filed with the U.S. Bankruptcy Court in Delaware. Chairman Jeremy Halbreich said the filing was a difficult decision but essential for the company “to re-establish itself as a self-sustaining, profitable operation. That is worth fighting for.”

His overriding goals are to sustain the company’s print and online news operations while “preserving as many jobs as possible,” he said.

The company has one significant creditor — the Internal Revenue Service. The IRS has said Sun-Times Media Group owes up to $608 million in back taxes and penalties from past business practices by its former controlling owner, Conrad Black, now imprisoned for theft from corporate coffers.

Unlike other newspaper owners that have filed for bankruptcy amid steep dropoffs in advertising, including Chicago-based Tribune Co., Sun-Times Media Group has no bank debt. But its IRS debt thwarted efforts to raise new capital.

Halbreich said Sun-Times will continue talks with the IRS while implementing a “strong and impressive” business plan. It also will pursue a deal with buyers and has hired Rothschild Inc., which was involved in the bankruptcy of United Airlines’ owner, to field offers.

Several potential buyers have approached Halbreich since he took over Feb. 10 as chairman and interim chief executive, he said. “We’re very confident that there’s going to be some interest here,” he said. “We intend to start that process immediately.”

The company claims it has “sufficient financial resources” to continue its day-to-day operations.

* Sun-Times Media Group CEO’s letter to readers

To Our Valued Readers:

Today our corporate parent, Sun-Times Media Group, Inc. and certain of its affiliates voluntarily filed for Chapter 11 bankruptcy protection. This action begins a legal and financial process that is designed to protect our Company’s brands, stabilize our business and create a brighter future for all of our stakeholders, including our news organizations, advertisers, employees, and you our valued readers.

Please be assured that this action does NOT mean the Company or our newspapers or online sites are going out of business. We will continue to publish and operate our newspapers and corresponding online sites, including the Chicago Sun-Times, the SouthtownStar, Beacon News (Aurora), Courier-News (Elgin), Herald News (Joliet), Lake County News-Sun (Waukegan), Naperville Sun, and Post-Tribune (Merrillville, Ind.); our weeklies published by Pioneer Press and Fox Valley Publications; our free shoppers and content on corresponding online sites, including and

If you are a subscriber to any of our publications, your newspaper will continue to be delivered as it is today, and you will still get the great mix of news, sports, features and opinion that you count on in each edition. Like many U.S. companies today and like many other newspaper companies across the country, Sun-Times Media Group has faced significant declines in revenue. This process will help us to better address these challenges and ultimately work toward strengthening our commitment to remaining the Chicago area’s best, most reliable and most distinguished source of news and information for our readers.

Sun-Times Media Group intends to move through the Chapter 11 process as quickly as possible, and expects that the process will be completed in 2009.

In the coming weeks, we will be keeping you informed through our Web site If you have further questions, please do not hesitate to contact us.

I would like to thank you for your business and support during these challenging times.


Jeremy L. Halbreich

Chairman of the Board
Interim Chief Executive Officer

- Posted by Rich Miller   18 Comments      

* File this under "Stuff I didn't know"
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* Face facts and stop playing the victim
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* Yesterday's blog posts

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