making local government more ethical

Chicago Alderman Expense Allowances: Conflicts Between Public, Political, and Personal Interests

"I believe that an alderman's office is a political office," said Chicago alderman Suarez, one of 50 aldermen to get their expense allowances doubled last year, according to an article in the Chicago Tribune. Suarez, however, refused to use city funds to pay for his ward office, because "it's hard to draw a precise line between legislative and political activity," according to another article in the Chicago Tribune.

And when part-time local government legislators are given over $70,000 in expenses beyond an office, three aides, and a salary over $100,000 plus benefits, the precise line between legislative and personal activity also becomes an issue.

More pressure is put on the personal ethics of each alderman by an open-ended expense allowance provision (§2-8-050). 22 acceptable kinds of expenditure are followed by the open-ended subsection 23: "Payment of miscellaneous, ordinary and necessary expenses incurred in connection with the performance of an alderman's official duties." There are only 8 prohibited kinds of expenditure, mostly involving capital purchases, including buildings and cars, and campaign expenses (although rent and all related expenses for a ward office, which usually doubles as a campaign office, are expressly allowed).

The provision does expressly prohibit any expenditure that leads to "the direct monetary benefit of an alderman or any of his or her relatives ... or any person in whom the alderman has a financial interest," but according to another article in the Chicago Tribune, at least one alderman who rented a ward office from a company owned by himself and relatives said that he didn't see a problem with the arrangement, which appears to have been discovered by reporters researching the story.

This alderman is seeking an opinion from the city's ethics board, but the only legal issue is whether this exclusion applies to a company owned by relatives, since the provision expressly excludes companies in which the alderman has an interest, but not companies in which relatives have an interest. However, this seems like splitting hairs (how direct is the monetary benefit?).

Or at least it does until you read what has been said by the chair of the council committee assigned to advise aldermen about the use of their expense allowances. The chair's spokesperson said, ""We told them what is legal. It is up to them to determine what is appropriate." In other words, our advice encourages aldermen to split hairs rather than providing them broader ethics advice about dealing responsibly with conflicts among public, political, and personal interests.

The chair's own conduct also sends the wrong message. Although the chair has the use of an unmarked Chicago police car, he leased a big SUV for $9,712 in 2008 (another aldermen beat him by spending $16,000 leasing a Lexus, enough to buy a small car outright). Such an expenditure, although completely legal, sends a clear message that the expense allowance is being used for personal purposes.

While Suarez spent only $23,000 of his expense allowance last year, more than half of the 50 aldermen spent over $70,000, that is, all of what they were allotted. And the rules do not require that aldermen say what they're doing with the money they get. Some have had checks made out to them or their charge card companies, with no accounting of what the money purchased.

The rules clearly need to be rewritten. Limits must be placed on how much can be spent on ward offices and expenses, automobile leases, etc. And the word "direct" should be stricken from the relatives' financial benefit exclusion, so it's clear that a corporate fiction cannot make handing public money to relatives okay. And if these changes were made, would the amount have to be so high?

In any event, if government officials are going to get large expense allowances, their expenditures should be accounted for in detail and placed up on a website, not hidden in piles of documents that require a major investment from the news media. If the rules are to be relatively open-ended, at least let the people of each ward determine whether they want to pay for their alderman's car, personal expenses, and campaign office (but not the campaign offices of those running against them). Let bloggers have a field day with the information. Perhaps aldermen will compete to show how responsibly they're spending their expense allowances once they know they're being carefully watched.

Robert Wechsler
Director of Research, City Ethics