Daily Roundup: UNO’s Continuing Problems

Por en Chicago 02/13/13 3:35pm
Chicago mayor Rahm Emanuel has a laugh with UNO CEO Juan Rangel while sitting beside Illinois Governor Pat Quinn at the opening of the new UNO charter school in Chicago's Galewood neighborhood on Wednesday, September 19, 2012. Emanuel called for the group to "hold themselves accountable" after learning about their procurement processes. (Chris Sweda/ Chicago Tribune)

The Sun-Times has continued their impactful coverage of the procurement processes of influential Latino non-profit the United Neighborhood Organization, or UNO.

The latest development is that Miguel D’Escoto, UNO’s second-ranking executive, resigned on Tuesday.

D’Escoto’s resignation came eight days after the Sun-Times revealed more than one-fifth of the $25 million in taxpayer money spent on the UNO Soccer Academy Elementary Charter School went to four contractors owned by family members of UNO’s political allies and a top executive of the group.

The Sun-Times reported the following:

A company owned by a brother of Miguel d’Escoto , UNO’s senior vice president of operations, was paid more than $600,000 as the “owner’s representative” for the project.

Another d’Escoto brother landed a $4.4 million contract that included installing the school’s windows and distinctive metal exterior panels.

State grant money that was used to guard the construction site went to a security firm run by two brothers of state Rep. Edward Acevedo, a Chicago Democrat who voted to approve the UNO grant.

Two deals for plumbing work went to the sister of Victor Reyes , a lobbyist who helped UNO obtain the grant money to build the school.

In a statement on the organization’s website UNO CEO Juan Rangel said he was confident UNO had acted legally, but said its procurement processes were outdated. He added that UNO is undertaking a complete review of those processed that they expect to be completed within 45 days and that it would cease doing business with D’Escoto, Inc., a construction firm owned by Miguel D’Escoto’s brother.

The revelations and ensuing fallout came after parents advocacy group PURE called for an investigation of UNO’s financial practices and use of Illinois grant money by Inspector General Ricardo Meza.

The group took aim at UNO’s financial practices, saying that shows that each successive transaction has led to higher debt-per-student costs as UNO has nearly no other source of revenue other than public transfers via direct subsidies, publicly issued bonds and government contracts.

“If UNO fails to secure more buildings and more students, the growing financial burden will likely have an adverse impact on its students as per-pupil classroom spending will suffer due to an increasing portion of the network’s income being diverted to cover debt payments,” said a statement on PURE’s website.

The statement also criticized UNO’s receiving so much at a time when more than 100 Chicago public schools are slated to be closed.

“Our school has never gotten the programs and supplies our children need. Now CPS is planning to close a lot of schools, supposedly to save money. At the same time, UNO keeps getting millions of dollars to pull students from our school and put us in danger of being closed,” said Rosemary Sierra, local school council president at Pilsen Community Academy. “We thought the state had a budget crisis, but they seem to be able to find millions for the politically-connected people at UNO. Meanwhile, some of UNO’s schools have the lowest rating in CPS.”

UNO could have received $35 million had Senate Bill 24 been passed, but the likelihood of getting that money has diminished markedly, according to Rich Miller of Capitol Fax. He quoted a source who told him, “That cash was omitted from the supplemental approp bill which passed this week. There’s just too much heat on UNO right now.”

Part of the heat may be coming from Chicago Mayor Rahm Emanuel, an erstwhile staunch UNO supporter.

He struck a decidedly different tone after learning about UNO’s procurement practices.

“I know what the United Neighborhood Organization does — both as a neighborhood group and as an education group. And I know they’re gonna have to hold themselves accountable because I believe in being held accountable to the public,” the mayor said in the Sun-Times. “They’re getting public resources. The people [who] are the proper people will look into it and be held accountable so dollars aren’t misspent.”

We’ll keep you posted on the latest part of this rapidly moving story.