With additional monies for engineering and legal work; JAWA has potential.<quoted text>
Pay very close attention to the direction the JAWA goes in. The JAWA has the unique potential of bankrupting several municipalities simultaneously.
A plan by seven SOUTHLAND communities by getting Lake Michigan water through Whiting, Ind., has fallen apart.
Midlothian, Harvey, Robbins, Markham, Blue Island, Calumet Park and Alsip formed the South Suburban Joint Action Water Agency, which issued $5.6 million in bonds to begin the project.
No bid contracts for the feasibility studies, engineering and legal work were distributed.
Each of the seven charter members of the water agency must pay a certain percentage toward the costs.
Harvey’s share is 38 percent, followed by Alsip (30 percent), Blue Island (11 percent), Robbins (7 percent), Midlothian (6 percent), Markham (5 percent) and Calumet Park (4 percent).
Thus far the JAWA has determined water can not come from Whiting, In.; due to contamination of Lake Michigan water from regular BP refinery discharges. Most of the money has been spent, the feasibility study has not been completed, intergovernmental agreements, and a water source have not been secured.
#510 Jun 13, 2014
#511 Jun 13, 2014
Nothing for Something!
#512 Jun 14, 2014
At Last; The Criminal Federal Investigation IS Underway!
#513 Jun 15, 2014
Look at "All of the The Stunning Interconnections!"
#514 Jun 15, 2014
Extended Jail time for ALL participant!
#515 Jun 16, 2014
How NOT to Plan a New Suburban Water System
Distrustful of Detroit’s intentions toward its wholesale customers in the suburbs concerning future water services, Oakland and Macomb counties are considering building their own freshwater intake, treatment and distribution system.
Steps have been taken to study the feasibility of creating a new regional authority that would draw water from Lake St. Clair, treat it and pipe it westward across the two counties.
A similar plan in Chicago’s southern suburbs is a cautionary tale.
In 2011, seven small Chicago suburbs (Alsip, Blue Island, Calumet Park, Harvey, Markham, Midlothian and Robbins), dissatisfied with the rapidly increasing cost of Chicago water, formed an agency to study and plan their own water system.
The South Suburban Joint Action Water Agency borrowed $5.6 million in 2012 to determine feasibility and plan for construction, which was expected to cost $300 million and take three years.
To date, the agency is thought to have spent all but $1 million, and they haven’t even determined the intake site yet.
Major portions of the spending thus far have gone in no-bid contracts to cronies and/or political campaign contributors of the municipal officials running the agency.
Most of the small towns involved are deeply in debt to Chicago for past water consumption. The $5.6 million meant to finance planning is expected to double by the time the bonds mature. These are not terribly prosperous communities, but their taxpayers and ratepayers will have to take the hit as the result of the careless, reckless or corrupt spending of community leaders.
Obviously, the circumstances in Detroit’s northern suburbs are significantly different. The caliber of governance is higher. The communities are more numerous and many of them enjoy fiscal health. Nevertheless, transparency in contracting and spending should be a high priority as studies about a new water system progress.
#516 Jun 16, 2014
A high standard is REQUIRED.
#517 Jun 16, 2014
How many times have WE HEARD the JUDGE Say;
AS AN ATTORNEY; "YOU KNOW BETTER"?
#518 Jun 16, 2014
Apparently, not enough?
#519 Jun 18, 2014
Feds show interest in suburban bookkeeper
Sun, 06/15/2014 - 11:43am
Joseph Letke briefly ran for the state Senate seat once held by the Rev. James Meeks.
But across the suburbs Letke is better known as a bookkeeper for local governmental agencies, over the years doing work for Monee, Franklin Park and many other towns.
We’ve learned that in recent months federal prosecutors have issued grand jury subpoenas to municipal governments in Dolton, Riverdale and Robbins seeking contracts, invoices, cancelled checks and other documents relating to Letke and two of his south suburban companies.
Letke had been the comptroller in Riverdale and Robbins and performed financial audits in Dolton, but he no longer works with those towns.
These days, he’s the comptroller in Harvey and Markham, meaning he oversees the accounting of taxpayer funds, and one of his firms handles the finances for a south suburban water agency that’s also funded by taxpayers.
The Dolton, Riverdale and Robbins grand jury subpoenas asked for, among other things, copies of engagement letters, internal notes and financial transfers from 2009 to present, according to interviews, and documents obtained under the Illinois Freedom of Information Act.
It’s unclear whether Letke and his firms are targets, or tangential to a broader probe. However, two local government officials told us federal investigators have also questioned people about Letke’s operations. A U.S. attorney’s office spokesman declined to comment. Letke did not respond to numerous calls.
Letke was sued by Country Club Hills in 2012 for allegedly failing to complete a financial audit, despite being paid. Letke and one of his businesses also filed for bankruptcy in 2012, records show.
He and his companies have been politically active — donating nearly $100,000 over the years to campaign funds of many local politicians, according to the Illinois State Board of Elections.
In September, we reported that two Letke-led ventures had been paid more than $315,000 for financial consulting and accounting work under separate no-bid deals with the South Suburban Joint Action Water Agency.
Fed up with Chicago’s rising water rates, a group of south suburbs formed the agency and borrowed nearly $5.6 million in 2012 to study if and how they could build their own water supply system. That study is still incomplete, despite millions of taxpayer dollars having been spent.
#520 Jun 19, 2014
This is a Classic Example of a Feeding Frenzy and a well documented system that FED ITSELF!
#521 Jun 20, 2014
Depositions and Indictments; Follow the Money and the Case to see who is going to JAIL and the Person(s) of Interest behind the CURTAIN!
#523 Jun 22, 2014
Marc Atkins, a UIC researcher, took control of the study midstream.
In an interview with the Chicago Sun-Times, he acknowledged problems.
“We were getting data late and sometimes in a format that wasn’t useful,” Atkins said.“There was some missing data, particularly in the first year.”
Still, Atkins defended his work.
“We inherited the evaluation plan,” Atkins, director of the Institute for Juvenile Research at UIC, told the Sun-Times.“We carried it out the best we could under some challenging circumstances and tried to provide as informative reports as we could.”
Atkins added that the study did serve a purpose.
It tracked whether people “were getting the services that could have a positive effect down the road,” he said.
Other documents from the auditor general’s office reveal that Shaw selected the University of Illinois at Chicago for the contract even though the governor’s office preferred the University of Chicago.
Former Quinn deputy chief of staff Toni Irving — now head of a new city alliance with business titans to reduce gun violence — made that contention in a Sept. 11, 2012, interview with Audit Manager Mike Maziarz and another auditor, Brenda Barker.
“The governor’s office wanted the crime lab to do an analysis of the NRI program, but Shaw wanted this contract at UIC,” the auditors quoted Irving as saying. It’s unclear why Shaw wanted the study done at UIC.
John Theis, a lawyer representing Shaw, declined to comment Friday.
Legislators say they may subpoena Shaw to testify about the program, which is the subject of investigations by Cook County State’s Attorney Anita Alvarez and federal prosecutors in Springfield.
#524 Jun 25, 2014
Mr. Letke and his group should forfeit ill-gotten gains and pay unspecified civil penalties; to all seven of the communities.
#525 Jun 25, 2014
I knew nothing of this
#526 Jun 25, 2014
Harvey is Home Rule
SEC says Harvey, advisor committed fraud in hotel deal
By Joe Mahr and Matt Walberg
CDT, June 25, 2014
Federal authorities have accused a troubled south suburb and a controversial municipal advisor of defrauding investors to prop up the ailing town’s finances while lining the pocket of the advisor and saddling taxpayers with millions in debt.
In a civil lawsuit made public Wednesday, the Securities and Exchange Commission alleged that the City of Harvey and longtime advisor Joseph Letke committed fraud in connection with a failed hotel development deal, first reported by the Tribune last summer. The newspaper exposed how Letke worked for both sides in the project involving a developer with a history of lawsuits and liens.
The SEC allegations were contained in a request by the federal commission — established as a watchdog for investors — for an emergency order from a federal judge to stop another round of borrowing by Harvey because its “egregious misuse of bond proceeds” means “it cannot be trusted” to borrow money.
The judge agreed to temporarily halt the suburb’s efforts to issue bonds to borrow money, with Harvey spokesman Sean Howard saying the town “will cooperate fully.” Harvey officials will be able to argue why they can be trusted again at a hearing July 8.
By then, the town could be broke. Records unveiled in the lawsuit show that for years Harvey has been hiding such severe financial woes that it may not be able to pay its bills starting next month. It offers a cautionary tale of what can go wrong with Illinois’ combination of broad borrowing power for towns combined with loose oversight of municipal finances. At least two council members told the Tribune they were kept in the dark about just how dire the suburb’s finances had become.
“I’m astonished. I’m angry. I’m disappointed. I’m just mad,” said Ald. Daryl Crudup, who’s been pushing for months for Harvey to work on its budget.
At the center of the SEC case is Letke, a longtime financial advisor to several suburbs, including Harvey, who has been the focus of reviews from various federal agencies. The U.S. Attorney’s Office and FBI, in what has been termed a criminal investigation, have sought records from Markham, Riverdale, Dolton and Robbins regarding payments to and dealings with Letke or his firms, records show.
The SEC subpoenaed records last fall from Harvey that would shed light on Letke’s role in the failed deal that’s left a hotel half-gutted and in foreclosure.
The Tribune revealed in July the failed deal to redevelop the aging former Ramada Inn off Halsted Street, which sits near Interstate 80 adjacent to a strip club. Developer Satish “Sunny” Gabhawala told the newspaper he was struggling to redevelop the 300-room hotel after banks turned him down for loans. He hired Letke as his corporate accountant, and then approached Harvey for the loans that, in theory, would help turn the hotel into a renovated Holiday Inn with an improved conference center.
Harvey used its power to borrow without voter approval, given to it by Illinois law, to raise about $14 million between 2008 and 2010 — telling investors who bought the bonds that the borrowed cash would be used for the hotel project.
But federal authorities said little of the money was actually used to fix up the hotel, and instead was used in part to pay off past debts for the developer, help the city make payroll and to provide Letke with six-figure fees.
The project began to collapse as debts continued to pile up, the newspaper reported. As contractors clamored for their money and filed liens against the property, Gabhawala secured a $2.3 million, six-month mortgage at 22 percent interest. But the risky move failed, and the lender filed for foreclosure on the property in August 2011. It left a vacant structure, no money and loans that could cost Harvey’s struggling tax base more than $20 million to repay.
#527 Jun 25, 2014
Gabhawala, who has recently declined comment, previously told the Tribune he hoped to resurrect the project by selling 100-year-old “Chinese gold bonds.”
Along the way, federal authorities noted this week, Letke or his firms were paid $547,000 by the suburb for acting as its financial advisor for the borrowing deals. The developer paid Letke or his firms an additional $269,000 in compensation that wasn’t disclosed in loan documents — an issue that federal authorities say amounts to misleading investors.
Beyond the six-figure payouts, Letke or his firms were paid more than $1 million from 2008 through 2010 to be Harvey’s comptroller and oversee the books.
The borrowing came at a time when Harvey continued to struggle to make ends meet, even as its longtime mayor, Eric Kellogg, insisted the town’s finances were on the mend.
Records released as part of this week’s lawsuit show that, as early as 2009, one of Letke’s employees warned him the town needed to do something to meet payroll. She suggested Harvey “dip into the bond money”— which federal officials say was a misuse of the cash. Still, a week later, to make payroll the town transferred $290,000 from a pot of cash containing the bond money, according to the complaint.
More hotel-development bond money eventually was transferred to cover day-to-day expenses, totaling at least $1.7 million over the years, records indicate. It wasn’t the only questionable budget action. The Tribune has separately reported how Harvey, as an inner-ring suburb, resold Chicago water to other towns for years without actually paying Chicago for the water. Chicago is now suing to get paid.
Earlier this year, Letke — as comptroller — told council members that drastic cuts would be needed to keep the town afloat through the end of the year. The warning was even more draconian in an April 25 memo, obtained by federal authorities and filed with their case. In that memo, Letke warned the mayor that, without drastic changes, the suburb would not be able to pay its bills starting in July and would not make its debt payments starting in August.
#528 Jun 25, 2014
#529 Jun 25, 2014
Sums it up quite well!
#530 Jun 26, 2014
The project was always about cash for cash strapped communitiies.
Letke and Postel were trolling the project for years and had documented meetings with Hammond.
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