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No there there

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* On Monday, I told you about a Crain’s story about alleged ties between Bruce Rauner and the notorious Stu Levine. From that Crain’s piece

In testimony during the 2008 trial of Blagojevich pal Tony Rezko, Mr. Levine and others said Mr. Levine had had a $25,000-a-month contract “consulting” for CompBenefits Corp., an Atlanta-based dental and vision benefits company once known as CompDent. According to its website, CompBenefits at the time of Mr. Levine’s contract principally was owned by four private-equity firms, including GTCR LLC. Mr. Rauner, a founder of GTCR, is the “R” in the acronym.

Mr. Levine said his job was to get work for CompBenefits through whatever means were needed, including payoffs. A 2005 Sun-Times article says the firm then held contracts covering tens of thousands of workers at Chicago Public Schools and with the state.

Mr. Levine testified that he’d paid a bribe to obtain the CPS work, worked with insiders Bill Cellini and Ed Vrdolyak on other deals (both men later were convicted in unrelated federal cases) and plotted with Mr. Rezko to get work with Cook County via Orlando Jones, a key insider who later committed suicide.

Messrs. Levine and Rezko eventually went to prison on other matters, and prosecutors never took any action on CompBenefits. Perhaps that’s because they could not corroborate Mr. Levine’s testimony, or perhaps it’s because some major figures were going to prison anyway. I don’t know. Neither do I know whether Mr. Rauner or GTCR knew the details of what the firm was up to prior to the federal probe.

But I do know that Mr. Rauner, GTCR and Stu Levine had another interaction. That came in 2003, when the board of the Illinois Teachers’ Retirement System—on which Mr. Levine served—first tabled and then approved GTCR’s bid to get a $50 million investment from the giant pension fund.

According to a Sun-Times account, the bid stalled at the board’s February 2003 meeting after Mr. Levine objected but then was zipped through in May, when Mr. Rauner attended the board session. Now-retired TRS Executive Director Jon Bauman corroborates the gist of the newspaper report. He adds that he believes the February flop mostly was because of a bad presentation by GTCR but also says he does not know the particulars of Mr. Levine’s motives

My response on Monday

The timing is an issue here. If Levine got that CompBenefits gig after the first unsuccessful TRS vote and before the second vote, then there’s a very serious problem. If not, then it’s not as bad. Neither article has that info, and I wasn’t able to find it online.

* Rauner’s spokesman Chip Englander responded via e-mail late yesterday…

Here’s the answer: Levine’s contract with CompBenefits started in the late 1990’s, years before the 2003 TRS vote.

Here’s the backstory. CompBenefits in the late 90s bought an Illinois company that was co-owned by Stuart Levine. As part of that purchase agreement Levine got a consulting contract. Fast forward, years later when CompBenefits discovered Levine was accused of wrongdoing they terminated the contract and assisted with the investigation against Levine.

I hope this helps.

So, if that’s all there is and Rauner’s flak is telling the truth, then there’s no there there.

* Crain’s, however, is maintaining its focus with another Rauner piece, which is based on this 2011 story by the Philadelphia Inquirer

As friends and foes assess Ed Rendell’s tenure as governor, few events better illustrate his record in one contentious arena - campaign fund-raising - than his 2001 trip to see a Chicago businessman.

Rendell was in the early stages of the governor’s race. Aides had dispatched him to the Windy City with what they thought was a reasonable goal - a $50,000 check, according to one who spoke on condition of anonymity.

Rendell left the meeting buoyant, but confessed to aides he never asked the would-be donor for a set amount. Rendell “just had a feeling,” he told them.

A week or so later, the Chicagoan, Bruce Rauner, sent a check for $200,000. Another check, for $100,000, came just before the election.

At the time, Rauner’s private-equity firm had business with the state of Pennsylvania. GTCR L.L.C. was managing $110 million in pension funds for the State Employee Retirement System, records show.

After Rendell became governor, the state doubled its stake in GTCR funds, to $226 million. That meant at least $4 million more in management fees to the firm.

* Crain’s

As was the case with my column this week, there is no proof in the Philadelphia story that giving led to getting. “There’s nothing improper about the (pension) contract, nor anything to suggest Rendell influenced it or even knew about it,” the paper said.

Indeed, though Mr. Rendell did push an income tax hike when he was governor, he also did a lot of other pro-business things as governor, and earlier as Philadelphia mayor, that might appeal to Mr. Rauner.

As Rauner spokesman Chip Englander emailed me when I asked him for comment on the Philadelphia story, “The vast majority of (Mr. Rauner’s) donations have been to Republicans and conservative and government reform causes, but Bruce is an independent guy, and he has supported some Democrats who he knows personally, or who have pursued education reform or pro-business policies.”

Mr. Englander adds, “Pennsylvania invested in GTCR funds starting in 1997, four years before Bruce ever contributed (to Mr. Rendell). Pennsylvania invested in them, under Republican and Democratic governors alike, because of GTCR’s strong returns and great reputation.”

As with the Levine stuff, that could make for a good TV ad blasting the supposed “outsider” as a possibly corrupt insider. But they ain’t got him yet.

posted by Rich Miller
Wednesday, Mar 13, 13 @ 9:17 am


  1. The only sensible thing for him to do would be blaming Aaron Schock for his troubles and dispatching an aide to rip Schock on Facebook.

    Oh wait.

    He’s actually dealing with his issues head on and trying to answer the questions.

    Whether the guy wins or not, he certainly has a better temperament and natural reaction to criticism than some of his competitors.

    Comment by Keep Calm and Carry On Wednesday, Mar 13, 13 @ 9:24 am

  2. If he was running for Mayor he’d be a strong independent and Chicago voters would probably be able to look past his bi-partisan ways. I am really doubtful that IL GOP primary voters will support him given all his Democratic contributions. GOP primaries have essentially become purity tests, which is unfortunate for all of us.

    I never thought Rutherford was very strong and don’t really like him, but have to admit that his City Club speech this week was excellent. I think he might end up being the guy for the Republicans.

    Comment by siriusly Wednesday, Mar 13, 13 @ 9:27 am

  3. you’re missing the point of the post bush republican party which is that there doesn’t have to be a there there, there just has to be the scent of something that makes a nose turn to end a candidate.

    Far less has been used to do far more damage to candidates in gop primaries and again until this guy can demonstrate he doesn’t have a mckenna/plummer inability to handle tv debates I don’t see him doing anything.

    Comment by Shore Wednesday, Mar 13, 13 @ 9:43 am

  4. The PA story: totally pay to play, at least from the perspective of the payor.

    Comment by Conservative Republican Wednesday, Mar 13, 13 @ 9:54 am

  5. He’s a big-time political player so he won’t be able to maintain the “outsider” image if anyone has any money to run TV spots in the primary.

    Comment by wordslinger Wednesday, Mar 13, 13 @ 9:57 am

  6. If there’s one thing Mitt Romney taught us it’s that voters are hungry for an ultra rich white guy with a lot of ultra rich white friends. Oh wait.

    Comment by just sayin' Wednesday, Mar 13, 13 @ 10:13 am

  7. Until the discussion of Rauner gets beyond the “inside baseball” the others running against Rauner are going to be begging for coverage and searching for a “smoking gun”.

    Attention, all GOP gubernatorial hopefuls & their staffs;

    You are going to get one shot at dropping serious connections of Rauner to Levine, to Blago, to whomever.

    Yoiu better have it Correct, and you better have it Down Cold….

    And you better have some serious cash to get that message out besides free media.

    Other than that, …Good Luck, All.

    Comment by Oswego Willy Wednesday, Mar 13, 13 @ 10:15 am

  8. So let me get this straight:

    In the late 1990’s a company owned by Rauner’s fund started paying Levine $25,000/month for consulting that Levine later testified was allegedly “to get work for CompBenefits through whatever means were needed, including payoffs.”

    In 2003 Rauner appeared before TRS to convince Levine (who he’s paying $25,000/month) and other board members to give him more money to invest. Rauner knows he has one of the board members deciding where/how to invest public pension fund money on his payroll to the tune of $300,000/year and he doesn’t think this is either completely illegal or at the very least very unethical?

    As if this wasn’t enough there’s another story of him getting twice as much Pennsylvania public pension fund money to invest after donating $300,000 to the Governor there.

    Maybe there’s no fire here but the door is certainly hot to the touch and there’s a papal conclave-level amount of smoke here.

    You have to give it to these private sector guys, most of the career politicians don’t get subpoenaed until after they get elected but guys like Rauner really know how to cut through the process with maximum efficiency, he’s got a decent chance of getting subpoenaed before getting elected to anything. Pollsters and lawyers are going to make a pretty penny off of this guy.

    Comment by The Captain Wednesday, Mar 13, 13 @ 10:17 am

  9. There doesn’t need to be any actual “there” theer, only a well funded ad blitz alleging a “there” (even if the “there” is not all that plausible). Think of all baloney political ads you’ve seen over the years that were crap…but effective nonetheless

    Comment by titan Wednesday, Mar 13, 13 @ 10:33 am

  10. ===There doesn’t need to be any actual “there” theer, only a well funded ad blitz alleging a “there”===

    Just keep in mind, Rauner has the personal wealth to try to “define” himself today if he so chooses, and if Rauner gets ahead of all this and has his significant money behind it too, it might be an uphill battle… in the Primary … to get all that out.

    Every day Rauner is not being held to task, even if there is not “there” there, is a good day for that campaign.

    Money and timing will come more into play than “fact” if others are still searching for a link.

    Maybe that is why Rauner is (allegedly, ‘wink-wink’, etc.,) going after Schock first, and taking out each one so Rauner can avoid a costly “defining” of Rauner and a longer examination of Rauner than April 2013 to November 2013.

    Just a thought, and why I gave “advice” to the others.

    Comment by Oswego Willy Wednesday, Mar 13, 13 @ 10:43 am

  11. -”…but Bruce is an independent guy, and he has supported some Democrats who he knows personally, or who have pursued education reform or pro-business policies.”-

    Translated- He will invest his money where he sees the best opportunities.

    Rauner will have difficulty painting himself as an outsider.

    Illinois voters are typically skeptical of rich candidates and once this tidbit hits the campaign news, he will be toast.

    Lisa, Welcome to the Governor’s Mansion.

    Comment by Endangered Moderate Species Wednesday, Mar 13, 13 @ 10:57 am

  12. I’m not sure what you mean by no “there.” Levine had an undisclosed and significant conflict of interest — about which Rauner may well have known.

    Rauner’s conduct may not have been criminal. But Levine was acting (at least) unethically. If Rauner knew that Levine was on the payroll, Rauner was operating with an, um, ethical insensitivity that is inconsistent with any claim to being an “outsider” — or with being pro-good government.

    Comment by Anonymour Wednesday, Mar 13, 13 @ 11:07 am

  13. – Jack Roeser,Republican Party leader, said: “Politicians come and go without making much of a change to the status quo. Illinois needs a major economic transformation, and that’s what we’d get with Bruce Rauner. He has the backbone to stand up to the status quo powerbrokers in Springfield. Rauner doesn’t need the job, and can’t be bribed, bought, or pushed around. That’s what our state needs now.”

    If true, appears that Mr. Rauner is more than capable of the old put it in the left pocket,then the right pocket and then into the back pocket. And this, I ask Jack, is “what are state needs now?”

    Comment by Samurai Wednesday, Mar 13, 13 @ 11:20 am

  14. sorry–”our” state.

    Comment by Samurai Wednesday, Mar 13, 13 @ 11:21 am

  15. Whatever else you say about Rauner, all of this proves that he is DEFINITELY not an outsider. He’s been gaming the system for years.

    Comment by Cincinnatus Wednesday, Mar 13, 13 @ 11:41 am

  16. I wish Rauner could say “Of course I sent Rendell hundreds of thousands of dollars in hopes that I’d be awarde millions of dollars in consulting. Everybody knows that’s how politics works. But, unlike Rendell, I’m independently wealthy, so it won’t work when I’m governor, but it will work with my opponent.”

    Comment by Robert the Bruce Wednesday, Mar 13, 13 @ 12:36 pm

  17. mr r is trying to be the new bill c the god father im a conservative guy i would like to be given 100gs it alway seems to to be like with bill c that the time line is a issue or i gave it to mr a or mr b who is friends with mr a when is alright to business with criminals and drug addicts

    Comment by county chairman Wednesday, Mar 13, 13 @ 6:45 pm

  18. mr r should realize is easier to buy a guv bill c the god father always said why should i run for office when i can own one maybe if mr c wins guv he can have lisa fetch the drinks like bill had jim thompson do on the state plane to chicago

    Comment by county chairman Wednesday, Mar 13, 13 @ 7:18 pm

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