CHICAGO EXECUTIVE PULSE: Business leaders gear up for a return to ‘normal.’ PAGE 8
LAND RUSH: Warehouse builders pay top dollar for homes. PAGE 3
CHICAGOBUSINESS.COM | APRIL 26, 2021 | $3.50
CHICAGO’S
FLEETING MOMENT BRIAN STAUFFER
The COVID-19 pandemic added to an already complicated mix of reasons the city’s gun violence keeps on climbing. PAGE 15
State chases shot dodgers
New strategies and new faces show Hobson’s expanding influence at Ariel BY STEVEN R. STRAHLER
MELLODY MAKES HER MARK
Vaccination campaign deploys ‘hand-holding’ and targeted marketing
WHEN ARIEL INVESTMENTS’ JOHN ROGERS speaks to students, they have a uniform request, he says: “They all want to meet Mellody.” That would be Mellody Hobson, Ariel’s co-CEO, largest shareholder and, increasingly, its public face. In recent months, she has been putting her stamp on the $16 billion-asset mutual fund firm, pushing it into new lines of business, shaking up management and overhauling the board. For the first time, Ariel is moving into exchange-traded
BY STEPHANIE GOLDBERG AND A.D. QUIG Health officials across Illinois are scrambling to reignite waning demand for COVID-19 vaccines, which peaked sooner than expected, threatening the quest for herd immunity. Demand has evaporated in
See HOBSON on Page 25
some areas with less than 30 percent of the population vaccinated, confounding expectations that at least 50 percent of people would rush to get shots. Experts say 70 to 90 percent of the population need to be immune—either through vaccination or prior infection—to prevent the virus from circulating and mutating into new variants that might be impervious to existing vaccines. “The game has changed now,” says Illinois Department of See VACCINATIONS on Page 27
NEWSPAPER l VOL. 44, NO. 17 l COPYRIGHT 2021 CRAIN COMMUNICATIONS INC. l ALL RIGHTS RESERVED
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JOE CAHILL
YOUR VIEW
Carl Icahn will soon have a seat at a local firm’s table. PAGE 4
We are at an inflection point in the energy sector. PAGE 10
4/23/21 4:43 PM
2 APRIL 26, 2021 • CRAIN’S CHICAGO BUSINESS
GOP isn’t what it used to be on the North Shore
T
candidate who threw a fundraiser with the group’s help without disclosing that a good chunk of the proceeds were going to her consulting company. Conservative, far-southern Illinois? Or maybe the southwest suburbs? Nope, this group is from an unexpected locale. Its name: the New Trier Township Republican Organization. Yes, New Trier. As in the tony North Shore, between Evanston and Highland Park, long the unofficial headquarters of the business ARE THE REPUBLICANS TRYING TO wing of the Illinois GOP, the place where such leaders as onetime White House Chief WIN AGAIN THERE OR NOT? of Staff Donald Rumsfeld, U.S. Sens. Chuck Percy and Mark Kirk, “interfered in Georgia politics and voter integrity,” and how people can U.S. Reps. Bob Dold and John Porter, and even Gov. Bruce Rauner grew contribute to the Florida congressup or were based. man who is under investigation for That was then. Which ought to allegedly paying a 17-year-old for tell you something about how a Resex trips. Not to mention the pic a publican Party that’s in danger of befew weeks back of her schmoozing coming a nonfactor in the Chicago with a National Rifle Association area despite Democratic blunders board hopeful. Then there’s the double-endorsed may be only worsening its position.
heir Facebook page is one long paean to Donald Trump, complete with an invite to take the bus to Washington, D.C., and participate in a “March to Save America” at the Capitol. Not to mention the “Trump’s back” speech at the March CPAC conference. Their No. 2 official has tweeted in recent days about the “stupid diapers” “Tony Fraudci & Co.” want you to wear on your face, how “over one third of Americans” are “rejecting” Coca-Cola because the company
The leader of the New Trier Republican Organization is Kathy Myalls, a corporate attorney originally appointed to the post to fill a vacancy. In a somewhat contentious phone chat the other day, I asked her why she and Vice Chair Jasmine Velasco (the tweeter of above) are pushing so far to the contentious right, given that President Donald Trump got all of 25.37 percent of the vote in the township last November. “We are a Republican organization communicating with Republicans,” she replied. “Are we supposed to stop supporting Republicans” because Trump came up short? But why communicate far more about Trump than, say, soft-target Democrats such as former Speaker Mike Madigan? Or why take cheap shots at other Democrats such as Sen. Dick Durbin, who the group in one Facebook post said “is fine with rioters destroying and looting Michigan Avenue”? Her reply, in part: “These posts all are directly related to ensuring rights that are under attack by this (Biden) admin-
GREG HINZ ON POLITICS
istration and big tech.” Besides, she continued, her organization didn’t support violence at the Capitol on Jan. 6. That was the work of “a few dozen . . . pales in comparison to the number of people at the rally.” I couldn’t reach Velasco to discuss her personal tweets. I did get ahold of Julie Cho, who was endorsed by NTRO on its website in her recent bids for the board of New Trier Township High School and the Wilmette Library. She lost. One of the items on NTRO’s Facebook page is an invite to a Zoom fundraiser featuring the new Illinois GOP chairman, Don Tracy. Proceeds were supposed to go to help local candidates like Cho, and at least some did. But according to Federal Election Commission
records, the money actually was received by the Our America PAC, of which Cho is treasurer, with $25,600 of the $59,479.73 One America has raised this cycle going to Locke Consulting. Guess who runs Locke? Cho. When I spoke with Cho, she said her contributors “are smart enough to know that people can’t work for free” and that it was cheaper for her to do the work than to use an outside firm to produce campaign videos and the like. But Myalls and a spokesman for Tracy say they were not aware of that. Which brings us back to the beginning. Are the Republicans trying to win again on the North Shore or not? As one party insider sighs privately, “That used to be such a good organization.”
Springfield falls short on ethics reform—again
“C
orruption happens when people make bad decisions and are willing to disregard the law,” state Rep. Ann Williams said at a recent House Ethics & Elections Committee hearing. Williams said she was trying to understand what would “make a difference,” adding, “I just, again, have trouble finding a nexus between some of these issues . . . and the problems that we’re really facing in terms of restoring our faith in government.” Yes, corruption and fraud happen when people make bad decisions. Yet it’s evident from the many public officials indicted in recent years that stronger ethics regulations are needed to discourage people with bad intentions. During recent hearings in both the Illinois House and Senate, several lawmakers have left the impression they don’t want stronger ethics laws. The Senate’s Ethics Committee recently approved Senate Amendment 1 to SB4. It provides only for a six-month waiting period before former lawmakers can lobby, weakens a Chicago lobbying law and does nothing to empower the Legislative Inspector General. That approach isn’t going to stop people from making bad choices. It only will foster further distrust in government. Several House ethics committee lawmakers seem to agree with their Senate colleagues that stricter laws aren’t the solution, but Illinois’ ethics laws lag behind many others. A six-month period before former officials can lobby would leave Illinois among states with the weakest
such provisions. More than a dozen states have a two-year period and 36 have a one-year cooling-off period before lawmakers can lobby their former colleagues, notes Alisa Kaplan, executive director of Reform for Illinois. Illinoisans ought to be able to trust that their elected officials are working in their best interest, not in that of another client. Former state Rep. Luis Arroyo was charged in 2019 with crimes related to bribing former state Sen. Terry Link to support legislation that would have benefited Arroyo’s lobbying client. That alone underscores the need for a ban on lawmakers working as lobbyists. Illinois needs to fully empower its Legislative Inspector General so the office can launch probes and issue subpoenas without first seeking permission from lawmakers. Yes, you read that right. The legislature’s caged watchdog first must get permission from a panel of lawmakers before investigating them or staff. As current Legislative Inspector General Carol Pope noted at a recent House ethics hearing, her office has to contact lawmakers’ staff members when she wants to ask to investigate someone. That has the practical effect of spreading the word to more people that someone is accused of wrongdoing, thereby increasing the chances of a leak. Pope also noted one of the people she has asked to investigate sat on the panel that currently must give her permission to do her job. If that doesn’t point to the need for change, I don’t know what does. The Legislative Inspector General
needs to be independent and fully empowered. The annual economic interest statements lawmakers must file also need vast improvement. Many local and state governments and the federal government require disclosure of sources of income in much greater detail than Illinois. Doing so allows the media and public to gauge whether elected officials have conflicts of interest. Ending the revolving door of lawmakers becoming lobbyists, empowering the legislative branch’s watchdog and beefing up financial disclosures represent the bare minimum Illinois lawmakers ought to
MADELEINE DOUBEK ON GOVERNMENT
approve to begin to restore trust. House Speaker Chris Welch has said boosting ethics was one of his top priorities. Gov. J.B. Pritzker called for ethical improvements more than a year ago, saying that protecting a corrupt culture or “tolerating it is no longer acceptable.” The Legislature’s spring session is winding to a rapid close and, to
date, we’ve seen nothing but lawmakers trying to protect the status quo. Minor tinkering simply isn’t an ethical option. Madeleine Doubek is the executive director of Change Illinois, a nonpartisan nonprofit that advocates for ethical and efficient government.
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CORRECTIONS The listing for Balasa Dinverno Foltz in the Best Places to Work feature April 12 should have said that voluntary turnover was 6 percent. The list of Chicago’s Largest Privately Held Companies on April 19 should have said that Citadel Securities employs 500 locally and 1,000 worldwide. JPMorgan Chase agreed to co-invest up to $200 million alongside Ariel Investments to fund minority-owned businesses. An April 19 story about the gap in lending to entrepreneurs incorrectly described the relationship between the firms.
P002_CCB_20210426.indd 2
Banking products provided by Wintrust Financial Corp. banks. Securities, insurance products, financial planning, and investment management services offered through Wintrust Investments, LLC (Member FINRA/SIPC), founded in 1931. Trust and asset management services offered by The Chicago Trust Company, N.A. and Great Lakes Advisors, LLC, respectively. Investment products such as stocks, bonds, and mutual funds are: NOT FDIC INSURED | NOT BANK GUARANTEED | MAY LOSE VALUE | NOT A DEPOSIT | NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY
4/23/21 3:33 PM
CRAIN’S CHICAGO BUSINESS • APRIL 26, 2021 3
High hopes for new pot shops unfulfilled Social-equity applicants, the state and growers have been hurt by stalled license process BY JOHN PLETZ
JOHN R. BOEHM
Katherine Anderson says she and her husband, Arthur Eichorst, received enough money in the sale of their Mohawk Terrace house to buy a Las Vegas condo free and clear.
A LAND RUSH IS ON AROUND O’HARE Developers want to replace subdivisions with warehouses—and they’re paying top dollar to do it BY ALBY GALLUN
DEVON LIVELY
Seefried development 6 parcels
WOOD DALE
Mohawk Terrace 106 homes
MITTEL
390
THOR
NDAL
E
Nippon Express building 30 homes BUSSE
Being surrounded by big industrial buildings doesn’t sound like the American Dream to most homeowners. But it turned out quite well in the end for many residents of the Mohawk Terrace subdivision in Bensenville. The owners of a two-story house on Edgewood Avenue just sold it for $875,000. They paid $420,000 for it less than three years ago. A split-level over on Spruce Avenue just fetched $700,000, up from its prior sale price of $240,000 at the end of 2018. Longtime resident Joe Fiore was the big winner, receiving $1.7 million, the highest price in the entire subdivision, for his house on Indian Hill Drive. He estimates it’s really only worth about $700,000.
Illinois marijuana shops are likely to ring up more than $1 billion in sales of recreational weed this year. That total would be 15 to 20 percent higher if the state had issued 75 new retail licenses by May 1 as originally planned, according to research firm Brightfield Group. But nearly a year later, the new licenses have not been issued. “The delay in additional retail licenses in Illinois has depressed sales as many consumers opt to continue to turn to their legacy-market sources of cannabis instead of traveling a fair distance to a dispensary to procure product that remains more expensive,” Chicago-based Brightfield, which forecasts recreational sales of $1.3 billion this year in Illinois, writes in a statement. The licensing process, first delayed by pandemic disruptions, has since been stalled by legal challenges and a political outcry over problems with scoring applications. Fewer pot stores means lower sales, less tax revenue, fewer jobs and continued dominance of the industry by about two dozen companies that own the licenses issued under the medical-marijuana program that began six years ago. There also are political ramifications. Social-equity applicants, who either lived in communities hit hardest by the war on drugs or had been arrested or jailed for low-level cannabis possession crimes, were at the center of the
See BENSENVILLE on Page 25
See MARIJUANA on Page 26
It’s sweet to be a utility company in Illinois Thanks to state laws, monopolies grow earnings like they’re tech giants BY STEVE DANIELS Just how good has Springfield been to local utilities since Commonwealth Edison first won the right in 2011 to set its delivery rates each year via a formula? It’s a good question as state lawmakers embark on their third crack at comprehensive energy legislation in the last decade. Since the beginning of the “formula-rate era,” yearly earnings growth at ComEd, suburban natural gas utility Nicor and Chicago’s Peoples Gas have
P003_CCB_20210426.indd 3
topped all but a handful of Chicago’s 20 largest publicly traded companies, according to a Crain’s analysis. Since 2015, when Milwaukee-based Wisconsin Energy acquired the Chicago-based parent of Peoples, earnings at the Chicago utility soared 113 percent to a record $187 million last year from $88 million in 2015. That’s a compounded annual growth rate exceeding 16 percent over those five years. Only one of Chicago’s top 20 on Crain’s list of the largest pub-
licly traded companies—Northbrook-based insurer Allstate— exceeded that profit growth during the same period. To put that in perspective, the earnings growth rate at Chicago’s gas utility wasn’t too far behind the 19.4 percent turned in over those years by the poster child of a growth stock, the parent company of Google. “That’s one of the highest growth rates in the U.S. regulated utility sector,” says Paul See GAS on Page 24
GOOGLE OR PEOPLES GAS? Annual five-year earnings growth for ComEd, Nicor and Peoples Gas was 8.4%, 11% and an eye-popping 16.3%, respectively. Commonwealth Edison Nicor Gas Peoples Gas NET INCOME $664
$638
$426 $378
$136 $88
$688
$567
Source: SEC and FERC filings
$160
$132 $124
$171 $132
$199 $156
$229 $187
$66
Note: Adds back the $200 million ComEd paid last year in bribery-scandal fine
4/23/21 4:28 PM
Map:coun Map:town MAP:NEW
4 APRIL 26, 2021 • CRAIN’S CHICAGO BUSINESS
JOE CAHILL
CHICAGO COMES BACK
ON BUSINESS
With its biggest buyout ever, Middleby is acquiring a major rival and a strong-willed new shareholder known for driving significant change. Billionaire activist investor Carl Icahn owns more than 8 percent of Welbilt, a restaurant equipment maker that Elgin-based Middleby has agreed to buy in an all-stock deal valued at about $3 billion. At the deal’s exchange ratio, Icahn would get about 2 percent of Middleby, which manufactures commercial and residential kitchen equipment. Although 2 percent is far from a controlling stake, it’s a big enough platform for Icahn to press for structural changes at Middleby, if he chooses to. “It’s 2 percent plus Carl,” says Erik Gordon, a professor at the University of Michigan’s Ross School of Business. “Carl doesn’t need 10 percent.” Icahn has been silent about any ideas he might have about Middleby’s future direction, but his track record speaks volumes. He has agitated successfully for transformational action at com-
ICAHN’S TRACK RECORD SPEAKS VOLUMES. panies much larger than Middleby, which would have about $3.7 billion in annual revenue after acquiring Florida-based Welbilt. His targets have included Apple, AIG, eBay and Hertz. Icahn seems to have a particular fondness for Chicago-area industrial companies. Over the past decade or so, he’s worked his will at such local stalwarts as Motorola, Navistar and Tenneco. It’s possible that Icahn has no particular agenda in mind for Middleby. He’ll come by his shares in a merger, rather than open-market purchases that suggest a more intentional approach. On the other hand, I doubt Welbilt would have agreed to an all-stock deal if Icahn didn’t want to own Middleby shares. Icahn surely also wants to get the best possible return on those shares, and he’s rarely short of ideas for increasing the value of companies he owns. His ideas tend to be big. “His ideas are structural ideas, such as divesting a division or selling the company,” Gordon says. “In extreme cases, he’s urged companies to get a new CEO.” Noting that Icahn won’t get a board seat at Middleby, company spokeswoman Darcy Bretz emphasizes that he backs the deal and says “this transaction is consistent with his view of synergistic foodservice companies being together.”
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Icahn’s involvement at other local companies sheds some light on how he might be thinking about Middleby. After investing in Motorola in the late 2000s, he pressed the struggling telecommunications equipment maker to split its cellular phone unit from its public safety business, an idea then-CEO Ed Zander resisted. Before too long, Zander was out and his replacement was overseeing the breakup. There are parallels between Middleby and Tenneco, where Icahn became a major shareholder after selling automotive supplier Federal-Mogul to the Lake Forest-based auto parts maker in a stock deal. Icahn successfully pushed Tenneco to separate its powertrain and aftermarkets parts businesses, although the breakup later stalled and remains in limbo amid auto market uncertainty. At Navistar, Icahn helped push out one CEO and complained about his successor until the Lisle-based truck maker settled on a replacement Icahn approved of. Navistar agreed late last year to be acquired by European truck manufacturer Traton. Icahn may see similar options for Middleby. For example, Middleby’s residential kitchen business could become a divestiture candidate after the Welbilt deal tilts the company’s portfolio even more heavily toward commercial equipment. Perhaps Icahn will encourage Middleby to continue its role as a serial acquirer, snapping up dozens of small competitors in the fragmented kitchen equipment market. Or he might prefer to cash in on industry consolidation by putting Middleby on the sale block. Middleby CEO Timothy FitzGerald can expect to hear about any strategic or structural changes Icahn would like the company to pursue. He’d be well-advised to listen and give Icahn’s proposals full consideration. If FitzGerald chooses to reject Icahn’s ideas, he’d better have reasons compelling enough to persuade other shareholders to stand by him. When a CEO reflexively rebuffs Icahn, he doesn’t hesitate to lobby the company’s large institutional investors to back his cause. With their support, disposing of a recalcitrant CEO becomes short work, as Zander and others have learned. Conversely, CEOs who give Icahn a fair hearing and adopt his ideas when they make sense for the company can have long tenures. Just ask Greg Brown, who’s still CEO of Motorola a decade after he followed Icahn’s suggestion to spin off the mobile phone business.
Classism has to be the next tough conversation
GETTY IMAGES
What is Carl Icahn cooking up for Middleby?
It’s a worldwide phenomenon: Socio-economic disadvantages prevail everywhere. Why isn’t the discussion more prevalent when we consider workplace diversity? BY EMILY DRAKE AND TODD CONNOR Chicago Comes Back is a weekly series on ChicagoBusiness.com providing leadership insights to help your business move forward, written by leadership consultants Emily Drake and Todd Connor. Drake and Connor facilitate Crain’s Leadership Academy. Drake is a licensed therapist, owner of the Collective Academy and a leadership coach. Connor is the founder of Bunker Labs and the Collective Academy and is also a leadership consultant. Check out previous installments at ChicagoBusiness.com/comesback. TODD CONNOR: We’ve been exploring and elevating how companies acknowledge and promote seen and unseen diversity in their ranks, not just because it is the moment we find ourselves in as a society, or because it is the right thing to do but also because it’s a confounding problem for most companies and leaders. Fifty-seven percent of employees think their companies should be more diverse, 40 percent think there is a double standard against hiring women, only about 3 percent of executive positions are held by Black employees, while 41 percent of managers report being “too busy” to implement diversity initiatives. Taken in this light, there likely is not an issue for companies today that is so widely recognized as important, yet so woefully addressed. EMILY DRAKE: It’s an issue, indeed, and also an opportunity, given that racially diverse teams outperform non-diverse teams by 35 percent and teams with an equal number of men and women earn 41 percent more revenue than non-balanced teams. We expect—and hope, for that matter— that this conversation will be at the forefront for businesses for some years to come. TC: We recently came across this Harvard Business Review article that elevated another diversity category we do not generally talk about, but has profound implications: class. Workers who come from lower social-class origins in
the United States are 32 percent less likely to become managers than those who come from higher social-class origins. This, it turns out, is a worldwide phenomenon, with social class disadvantage prevailing in every major economy in the world. Why isn’t the conversation about class more prevalent when we consider diversity in the workplace? ED: That’s a big question, and I’m not sure there’s one answer. It is true that while companies have a number of employee resource groups, very few (only Uber, according to the research of the author) explicitly has an employee resource group based on social class. The conversation can, perhaps, feel stigmatizing. People are uncomfortable talking about wealth, social class and having grown up poor or to parents who did not receive a college education, yet these things can have real-world impacts on our opportunities in life. But it does matter because the implications are real. TC: Companies would do well to ask themselves “How do people build relationships here” and “How do things informally get done here?” Therein often lie some of the hidden clues for how people get ahead, but also how people get left behind. If playing 18 holes of golf is how deals get done, then we can presume that a lot of people—namely, those who don’t golf, can’t afford membership at a golf club and can’t
regularly give four hours a month to playing golf—won’t be participating. This isn’t to say we need to stop everything we are doing to build culture, but we should pause and see who is naturally opting in and who may not be. ED: I think noticing has to be the right first step. We talked at the start of the pandemic about how the “water cooler” conversation would be replaced by some virtual version. Some worried about how to create cohesion without those informal mechanisms, and we pushed back and thought maybe there’s a more transparent or effective workforce that does not rely as much on those mechanisms. The question becomes what doesn’t get resolved through the actual meeting, such that the “water cooler” conversation becomes necessary?It’s less often overt discrimination and more often the soft structures at play in the spirit of “getting work done.” TC: You and I, Emily, have had these conversations about other talent that might be left behind because of cultural imprints. I reflected on my time in the military that above a certain rank it was hard to take command if you weren’t married because there was an informal and ceremonial role that spouses were expected to play. It wasn’t illegal to be single, but the mental model for how a command role would be fulfilled just was not quite there. Suffice it to say those kinds of mental models that are not related to performance potentially leave a lot of women, single folks, people of color, divorced people, older folks or potentially employees from lower-income backgrounds behind. ED: And leaving people behind is not something that we can afford. Our businesses certainly can’t afford it.
4/23/21 4:06 PM
Moving forward together
in Chicago
Over the past year, we’ve all been challenged in one way or another by this health crisis — physically, emotionally, financially. And while questions remain about what lies ahead, we know one thing for certain: The only way to move forward is together. To that end, Bank of America remains fully committed to supporting the health and economic recovery of our clients, communities and teammates. We know that small businesses, so critical to our local economy, have been greatly impacted. Through the Paycheck Protection Program (PPP), to date we’ve delivered 478,731* PPP loans — totaling nearly $34.5 billion* in funding — to help our clients continue to operate and pay their employees. Importantly, more than 99% of those loans went to companies with fewer than 100 employees. Partnering with local nonprofits, we’ve distributed more than 27 million masks for vulnerable populations as part of our ongoing efforts to address health-related disparities accelerated by the coronavirus. We’ve offered new and expanded benefits to help our employees balance family and work, including over 3.7 million days of back-up child and adult care. That’s an investment of more than $370 million in child and adult care reimbursement. I’m so proud of the way our community has come together to help those who need it most. And I’m certain that Chicago has the power to be stronger than ever as a result.
Helping Chicago move forward: • Delivered PPP funding to over 10,988 of our small business clients for more than $883 million in relief • Distributed 660,640 masks through our local partners including: – Alivio Medical Center – Children First Fund • Expanded benefits for our employees to include additional child and adult care services plus virtual medical and behavioral health consultations at no cost
Paul Lambert President, Bank of America Chicago
Go to bankofamerica.com/chicago to learn more about the work we are doing with our incredible partners.
*PPP data as of 04/04/2021 Bank of America, N.A. Member FDIC. Equal Credit Opportunity Lender. © 2021 Bank of America Corporation. All rights reserved.
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After losing its original financial partner last year as the coronavirus swept into Chicago, North Park Ventures found a new one to back the condo deconversion BY ALBY GALLUN It takes persistence to buy a condominium building and convert it into apartments—a complicated deal even in a normal market. Try doing it in the middle of a pandemic. North Park Ventures managed to
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CRAIN’S WEBCAST
REAL ESTATE
Updates on Invest South/West
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Thursday, May 13 | 1-2 p.m. Mayor Lori Lightfoot’s ambitious $750 million Invest South/West program is aimed at revitalizing underserved neighborhoods on the South and West Sides of Chicago. The initiative comes at a challenging time in the FLW\ȇV KLVWRU\ -RLQ XV IRU D OLYHO\ ȴUHVLGH FKDW between City of Chicago Commissioner of Planning and Development, Maurice Cox and Crain’s Real Estate reporter, Danny Ecker, as we check in on this important city project.
Featured Speaker Maurice Cox Commissioner of the Department of Planning & Development City of Chicago
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do it in Lakeview, leading a venture that just paid $32.3 million for the Barry Quad, a 115-unit condo complex in Lakeview. The deal, reached in October 2019, fell apart the following March, as the coronavirus swept into Chicago and North Park’s financial partner backed out. But North Park, a Chicago-based real estate investor, eventually found a new partner to back the acquisition, another in a series of Chicago condo deconversions that began several years ago. “It was a long journey but it was well worth it,” says Rob Sekula, managing partner of North Park. Now, Sekula is moving forward with a major renovation of the property, a three-building complex on the 800 block of West Barry Street. North Park plans to spruce up kitchens and bathrooms and install washers and dryers in all the units, he says.
HARD-FOUGHT DEALS
Condo conversions became a popular investment as the Chicago apartment market took off several years ago. Apartment values rose so much that developers could buy entire condo buildings, usually paying a significant premium over what units in a property would fetch in an individual sale. But the deals are tough to execute because many condo owners are unwilling to sell, even at above-market prices. Holdouts, if there are enough of them, can kill a sale: Under state law, the owners of at least 75 percent of a condo property must vote to approve a bulk sale for the deal to move forward. The Chicago City Council made deconversions even tougher in 2019. Amid concern that deconversions were pushing some residents out of their longtime homes, the council passed an ordinance raising the required approval vote to 85 percent. The Barry Quad owners approved the sale to North Park on Oct. 15, a day before the new ordinance went into effect. The sale received close to 85 percent support, says Andy Friedman, a broker hired by the Barry Quad condo board to sell the property. “We probably could have got this one over 85, but we didn’t want to take the chance,” says Friedman, an adviser at Chicago-based Kiser Group. North Park still needed to close the deal. In March 2020, just days after Gov. J.B. Pritzker issued his stayat-home order, the firm’s financial partner pulled the plug. With financial markets tumbling and many unknowns about the future, many real estate investors did the same thing. “Most of the capital markets were on the sidelines and following a wait-and-see approach,” Sekula says. But the Barry Quad condo board agreed to give North Park more time to line up a new partner.
KISER GROUP
Royal Bank offers commercial loans with attractive rates and terms.
Condos-to-apartments property in Lakeview fetches $32 million
Barry Quad, a three-building, 115-unit condo complex on the 800 block of West Barry Street. “They were understanding, and we kept it alive long enough to put Humpty Dumpty back together again,” says Friedman, who represented the board with his partner, Kiser Advisor Jake Parker. Sekula declines to identify North Park’s original or replacement partner. He also declines to disclose how much the firm plans to spend on the renovation, saying he’s still working through the budget. He does volunteer that he’s especially eager to remove shag carpet seating from the property’s party room. “I don’t think it’s been cleaned in a while,” Sekula says. Built around 1916, Barry Quad was converted from apartments to condos in 1981. Its condo board hired CBRE to sell the property in 2016 but couldn’t consummate a deal. Kiser Group began marketing the property in August 2019.
LOOKING FOR THE NEXT PROJECT
With deconversions in the city harder to pull off nowadays, some investors are looking for opportunities in the suburbs, which still fall under the 75 percent state vote requirement. North Park, for instance, paid $17 million last June for a 91unit condo building near Northwestern University’s Ryan Field in Evanston. But Sekula hasn’t ruled out more deconversions in Chicago. Founded in 2017, North Park owns a couple dozen properties in the city, mostly apartments on the North Side. Though the pandemic put a scare in many apartment investors, the neighborhood markets where North Park owns property have held up well, considering. Occupancies within its portfolio are strong, but rents have fallen slightly, Sekula says. North Park is currently offering one month rent-free to attract tenants, he says. Friedman and Parker, meanwhile, are marketing a few other smaller North Side condo properties for deconversion, including a 12unit building in Wrigleyville. They’re hoping not to encounter as many twists and turns as they did with the Barry Quad deal. After that one, Friedman says, “I could write a novel.”
4/23/21 3:31 PM
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N2323 Sylvan Ln / Linn / $5,750,000 Bob Webster | 262.949.3618
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154 Wood St Pier 331 / Williams Bay / $5,600,000 Linda Tonge | 262.949.6419
1341 St Andrews Rd, #19-22 / Geneva / $829,000
9 S Walworth Ave, #502 / Williams Bay / $819,000
Marjorie Krantz | 847.927.1650
Clancy Green | 815.382.0170
1691 Geneva Club Ct / Geneva / $1,295,000 Janis Hartley | 262.745.3630
670 Linden Ave / Fontana / $1,399,000 Tricia Forbeck | 262.745.1145
3 Dartmouth Rd Pier 340 / Williams Bay / $3,036,000
N6246 Highway 12 / Elkhorn / $3,500,000 Clancy Green | 815.382.0170
SOLD
2705 Bieneman Rd / Burlington / $2,250,000 Janis Hartley | 262.745.3630
SOLD
Photo from previous model
Linda Tonge | 262.949.6419
1120 S Lake Shore Dr, #34 / Lake Geneva / $1,249,000
Bob Webster | 262.949.3618
Geneva National / Geneva Marjorie Krantz | 847.927.1650
Headquartered in Lake Geneva, WI since 1943, Keefe Real Estate has worked with Chicagoland lakefront property buyers and sellers for decades. Keefe has closed 20,637 transactions in the past 25 years, totaling a sales volume of $5.18B, and Keefe agents have more experience selling than any other firm. If you are looking for a home away from home, or are considering a change in lifestyle, contact us today to learn how our experience will help you find your Wisconsin getaway.
262 .249.5450 | KEEFEREALESTATE.COM
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8 APRIL 26, 2021 • CRAIN’S CHICAGO BUSINESS SPONSORED CONTENT
talking
WEALTH
PLANNING FOR FINANCIAL SUCCESS Today’s economic outlook is quite different from just a year ago. The vaccine rollout, a more open economy, and increased government spending have dramatically changed the calculations for financial success. Now is the time to plan ahead. Before making any investment decisions, reevaluate your personal financial plan or put one in place. Successful investors have goals and know what rates of returns are required to accomplish their goals. What are your short, medium and long-term objectives? Evaluate your personal balance sheet—assets and liabilities. Consider taxes, estate planning, and overall risk management measures. Maybe you need more cash this year for college tuition or a new house. With a solid plan in place, here are four timely factors to consider for financial success in 2021. What will your tax rate be? A lot of tax planning took place after the Partner passage of the Tax Cuts and Jobs Act of 2017. Plante Moran But now the equation looks different. The Wealth Management government is providing trillions of dollars of 312-928-5297 stimulus to blunt the effects of the pandemic. Tax hikes to fund the spending are likely. Ryan Linenger is a leader in the Capital gain tax rates could go up substantially Plante Moran Wealth Management for higher income individuals and personal practice. He specializes in helping income taxes could rise too. Tax planning people achieve their financial strategies differ depending on each individual’s goals through investment and situation and whether you itemize deductions risk management, tax and estate or take the standard deduction. Although some planning, charitable giving deductions went away or were more limited strategies and retirement planning. by the 2017 tax law change, deductions for charitable giving are still considerable. For those who expect higher than normal income in a particular year, one approach is to “bunch” charitable deductions into that tax year. However, with the potential for higher rates in the future, 2021 makes tax planning that much more important!
RYAN LINENGER
Will you have a taxable estate? Today’s favorable estate tax environment may not last long. The federal exemption for 2021 is $11.7 million. Married couples can protect up to $23.4 million. This exemption level is set to expire at the end of 2025 and based on President Biden’s pre-election statements (and the current bill introduced a couple of weeks ago by Senator Bernie Sanders and Senator Sheldon Whitehouse) there is a potential for this exemption amount to be lowered considerably. So, this is a critical time to consider what you need and what you want to leave to others. Substantial gifting and wealth transfer strategies could make sense to consider with your estate and financial planners. Illinois residents should be aware that the state’s estate tax exemption is only $4 million and they do not offer portability of that exemption for spouses. That amount covers all assets—real estate, life insurance, investments, other items—which can quickly add up. Should you be concerned about inflation? The focus is on healing the economy and getting everyone back to work. But concern is growing about an uptick in inflation. Stimulus funds are flowing and certain sectors, such as residential real estate in many areas of the country, are roaring back. Rising inflation, followed by a sharp rise in interest rates, can impact portfolio performance. This shouldn’t be overstated, as economic growth is also likely to continue to rise, however, now is a good time to assess how your investment strategy could be impacted. Can stock prices keep rising? Prices are at all-time highs. But the revenue behind many eye-popping company prices is real. Much of the economy has recovered from last year, and the industries left behind are improving. With so much government stimulus, low historical interest rates, economic growth heating up, and an accommodative Federal Reserve, the equity markets still have room to grow. That said, strategic rebalancing is an important priority. Consider trimming stocks with high valuations that have become a larger piece of your portfolio. Value stocks may be a good alternative. Investors should continue to be rewarded over time for living with short-term volatility for long-term gains. Bottom line: Plan ahead. That’s the key to financial success in 2021. For more information, talk with a wealth management expert. Start the conversation today: www.plantemoran.com/wm/contact
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Business leaders gear up for return to ‘normal’
JOHN R. BOEHM
What are the top factors to consider in 2021?
The latest Chicago Executive Pulse survey shows business leaders’ attention might be turning away from COVID and toward longer-term issues like taxes and education BY WILLIAM JOHNSON
Whether it’s the crack of the bat accompanied by the roar of the crowd or children spilling out of school buildings, ready to play on a beautiful spring afternoon, simple but long-absent sights and sounds are returning to Chicago. Dare we say that a return to normality, or at least arriving at a new normal, is in the air? Windy City business leaders certainly seem to think so, according to the third wave of the Crain’s-Harris Poll Chicago Executive Pulse survey. Partnering with Crain’s Chicago Business, we have taken quarterly surveys of more than 200 area business leaders (owners, C-suite executives, vice presidents and directors) with the dual aim of tracking their views of the city over time while also digging into issues of the moment. Not only does the latest edition of the survey paint a picture of business leaders increasingly gearing up for a return to normal, but it also highlights three key issues on which city leaders can close the deal. Despite the fact that the state’s push toward transitioning to what Gov. J.B. Pritzker has called a “Bridge Phase” of reopening has stalled, signs abound that business leaders are pleased with the overall direction of the fight against COVID-19. Substantial majorities rated the federal (56 percent), state (61 percent) and local governments’ (56 percent) handling of the vaccine rollout as good or excellent, for example. This positive progress is trickling down to our summer plans. The majority of business leaders (53 percent) now expect large gatherings such as concerts and sports events to resume with limited crowds within the next quarter; and a plurality (46 percent) expect them to return with social distancing and masks in the same time period. That Cubs and White Sox games will have crowds at up to 20 percent capacity shows that this is not wishful thinking. Perhaps most important, views of the economy have become markedly rosier. The percentage of business leaders who say Chicago’s economy will be good or
EMPLOYMENT WORRIES SUBSIDE More leaders are worried about taxes, budgets and bureaucracy since last year. “In your opinion, what is the biggest issue holding back Chicago?” March 2021 23%
Taxes
November 2020 20%
Employment
22%
17%
Cost of living
20%
17%
Budget (pensions)
14%
16%
Regulation (bureaucracy) 5%
11%
Education
13%
11%
Infrastructure
8%
6%
Survey responses collected between Nov. 13 and Nov. 24, 2020, and between March 9 and March 26, 2021 Chart: Numbers may add up to more than 100 due to rounding. Source: Chicago Executive Pulse via Crain’s Chicago Business and the Harris Poll
very good in six months jumped a dozen percentage points to 56 percent; the same figure for the state’s economy jumped 14 percentage points (also to 56 percent) and 12 points for the country (to 60 percent). Business leaders are, in other words, feeling good about the direction things are going. But no one is ready to declare pandemic victory; normal may on the horizon, but it is not a done deal. See the nearly two-thirds of business leaders who plan on their office-space footprint shrinking; or, again, the stalled progress toward the “Bridge Phase.” City leaders cannot rely on positivity alone to carry us through.
TAX-BURDENED
Drilling down, three key issues—taxes, crime and education—emerge which bear improvement in the eyes of business leaders. They identified taxes as the single biggest issue holding back both the city of Chicago and its businesses (in both cases making jumps up from third on the respective lists three months ago). This renewed concern about taxes comes in the wake of the city in November increasing property and gas levies, with the higher property rates being felt this month. No wonder 60 percent of Chicago business leaders rate the city’s handling of taxes as “fair” or worse. There is an opportunity for local leaders to step up and, if the economy does as well as expected,
readjust rates—or at minimum do a better job of communicating why they’re not. Asked what the most important factors in deciding to keep their businesses in the Windy City, leaders cited public safety more than any other issue. Here again, city policymakers can do better with 54 percent of respondents rating the city’s handling of the issue as fair or worse. Opinion trends are going in the right direction (a net 10 percent improvement over three months ago) but there is still a lot of room for positive growth. Finally, while a majority (51 percent) of business leaders rate the city’s handling of education as good or excellent, that trend is going in the wrong direction (down from 55 percent three months ago). The school openings will undoubtedly help that, but the latest flare-up in the long-running feud between the teachers’ union and the mayor’s office has the majority of business leaders (56 percent) blaming both the union and Mayor Lori Lightfoot equally. That taxes, crime and education are key issues may itself seem like a return to normal. But the extent to which Chicago’s leaders are able to make progress on them will dictate whether the new normal is a better normal. William Johnson is CEO of the Harris Poll, a public opinion, market research and strategy firm based in Chicago.
4/23/21 3:30 PM
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10 APRIL 26, 2021 • CRAIN’S CHICAGO BUSINESS
In
EDITORIAL
Much-needed change for much-criticized TIFs
T
CARROLL’S BILL REPRESENTS A LONG-OVERDUE STEP TOWARD GREATER TRANSPARENCY. IT DESERVES SWIFT PASSAGE AND THE GOVERNOR’S SIGNATURE. Another problem with TIFs, at least in Illinois, is that the governments that create them and the investors who benefit from them are not nearly accountable enough to taxpayers. A new bill gaining momentum in Springfield seeks to fix the latter problem. In a perfect world, TIFs are meant to finance neighborhood investments by essentially wagering that tax revenue will rise as a result of that investment. While the level of tax revenue that came in prior to the city’s intervention continues to fund
State Rep. Jonathan Carroll
city services, the new revenue sparked by the investment flows to things like paying down bonds, reimbursing investors and helping to finance other civic priorities. But until now, it’s been tough to tell if all this financial maneuvering really delivers. Sure, new developments may spring up in areas where they didn’t exist before, but at what true cost? Under a measure sponsored by Rep. Jonathan Carroll, D-Northbrook, at the re-
REPJONATHANCARROLL.COM
he acronym for tax-increment finance districts—TIFs—has become shorthand for a political money grab in the minds of many taxpayers. And for good reason. For decades, too many mayors have treated the money generated by TIF districts as an economic-development tool to be wielded at their discretion, showering their largesse on favored neighborhoods and projects—even if those recipients strained the TIF’s original purpose.
quest of Illinois Comptroller Susana Mendoza, TIF developers would have to begin reporting annually to Mendoza how well their projects are doing in terms of creating jobs and new property tax revenue, or increment. That way, voters would know whether a project in line for TIF subsidies is as productive as real estate developers promised. As Crain’s political columnist Greg Hinz reported April 22, those annual reports
also would have to include figures on debt service and borrowing as well as verification from an independent auditor on a development’s projected rate of return. Beyond that, the consultants who project increment and jobs when a TIF deal is struck no longer could be hired by the developer. Instead, the municipality that created the TIF district would select the consultant, presumably providing a more objective forecast on whether a city should subsidize a project. Mendoza, in a statement, says her intent is to “help taxpayers better understand” what’s happening with TIFs, which in Chicago alone had revenue of more than $926 million in 2019, the most recent year for which complete data is available. In the same statement, Thomas Bertrand, executive director of the Illinois Association of School Boards, says the bill “represents a major step toward providing the type of oversight, accountability and transparency” needed to reform a municipal finance tool that’s often criticized for depriving schools and other services of their share of tax revenue growth. Carroll’s bill represents a long-overdue step toward greater transparency. It deserves swift passage and the governor’s signature. If we must have TIFs—and there’s reason to believe they can do good by attracting investment to places developers would normally overlook—then we need to have a much better grip on who benefits, and how.
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The coming energy-storage revolution
tion is aiming for net-zero carbon fter a century of powerpower by 2035, and a 100 pering cars with gasoline and cent clean economy by 2050. Furproducing electricity using ther, they aim to electrify the encoal, we are at an inflection point tire federal fleet and install more in the energy sector. Batteries, than 500,000 charging stations considered the “holy grail” for deacross the country. These policies carbonization of transportation are going to increase demand for and the electric grid, are at the batteries significantly. heart of this transition. Third, investors are seizThe problem is batteries have ing the opportunity. In the last been considered the key technol- Dr. Venkat Sriniogy for this transition for two de- vasan is director of year, more than twenty cleantech companies, from material cades. Which begs the question: Is the U.S. Departproducers to battery makers to this time any different? ment of Energy’s electric vehicle companies, have I believe it is, with a caveat. Argonne CollabFirst, the good news. We are fi- orative Center for raised between hundreds of millions to billions each in capital nally seeing market signals that Energy Storage from public and private markets suggest we are ready for this tran- Science and sition. Tesla is now the world’s deputy director of to ramp up production. The confluence of growing demost valued automaker. GM has the Joint Center announced a goal of selling only for Energy Storage mand and availability of massive amount of capital means that we electric vehicles by 2035. Every Research. are going to see a rapid increase major automotive company has a plan for electrification. And every time there in battery manufacturing capacity. Conare power outages because of wildfires or servative estimates suggest that we need polar vortices, the importance of storage as to expand manufacturing twenty– to thirty-fold to satisfy the demand in the U.S. the savior becomes apparent. Exciting times indeed. However. Second, government policies, critical for Most lithium-ion batteries use cobalt and private sector commitment, are moving in the same direction. The Biden administra- nickel as raw materials—minerals that are
not mined in the U.S. due to cost and demand issues. Developing novel methods to cost-effectively exploit domestic reserves has to occur to satisfy the demand. But this is not enough. The economically viable mineral reserves in the U.S. do not appear to be enough to satisfy the growing demand. The challenge becomes more significant if we aim to electrify the entire vehicle fleet. While we need to ramp up domestic mining to satisfy the demand, the reality is that our mineral supply is at risk. Other countries, some not necessarily our allies, have a stranglehold on the supply chain. Recycling of these metals, an important opportunity to bridge the supply gap, will need to play an increasingly important role. However, most batteries are not collected for recycling and the process remains expensive for most components. Developing low-cost recycling methods remains critical to meeting the growing need for batteries. Focusing on these challenges is crucial to rapidly move towards decarbonization. Beyond cars, we need to decarbonize heavy-duty trucks, rail, maritime vessels and aviation craft—applications where the energy density requirements exceed that possible with lithium-ion batteries. Similarly, stabilizing the electric grid un-
Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited. Send letters to Crain’s Chicago Business, 150 N. Michigan Ave., Chicago, IL 60601, or email us at letters@chicagobusiness.com. Please include your full name, the city from which you’re writing and a phone number for fact-checking purposes.
P010-P011_CCB_20210426.indd 10
der conditions where there are significant (greater than 60 percent) renewables requires storage with performance not satisfied by lithium-ion batteries. The magic widget to decarbonize these sectors may not even be a battery. While the climate emergency requires immediate action, it appears the energy storage device that will reverse carbon emissions to achieve the 2035 goals will not be the same energy storage device that will enable full decarbonization by 2050. The latter requires sustained research focused on inventing new storage concepts that are made from earth-abundant elements, are recyclable and made using environmentally benign approaches. We need an energy policy that encompasses this dual timeline: one that rushes toward solutions to reverse the effects of climate change in the short term while incentivizing the invention of sustainable technologies for the long term. This approach comes with an important benefit for the country: the deployment of new clean energy technologies that help revitalize the U.S. economy by creating high-paying jobs across the country. The coming energy storage revolution signals a brighter future for us all.
Sound off: Send a column for the Opinion page to editor@ chicagobusiness.com. Please include a phone number for verification purposes, and limit submissions to 425 words or fewer.
4/23/21 4:15 PM
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CRAIN’S CHICAGO BUSINESS • APRIL 26, 2021 11
LETTERS TO THE EDITOR
Insurance bosses win, we lose. Lawmakers should change that.
I
llinois insurers are profiteering off a chaotic health care system during a pandemic. The top executives at Blue Cross of Illinois’ parent company got big raises last year, as health insurance corporations emerged largely unscathed from the economic fallout of the pandemic (“Blue Cross bosses pocket pay hikes,” April 16). The two executives who shared the CEO role in 2020 received a whopping $22.8 million last year. Adding insult to injury, insurers are overpricing premiums in the individual market, so much so that they had to return money—$2.1 billion—under the rules of the Affordable Care Act. Rebates are not a long-term fix and represent a problem: the overcharging of consumers. And such high
costs just force most people to opt out of unaffordable annual coverage. Meanwhile, COVID-19 hit the lives of Illinoisans hard: Everything from health issues, job loss, housing instability and food insecurity drove people into economic hardship and poverty. The pandemic laid bare disparities in health care affordability. Numerous studies show that Black and Latino people, including small-business owners, are more likely than white people to find health care unaffordable. A recent report by the Illinois Department of Insurance and Department of Healthcare & Family Services states, “in Illinois, racial and ethnic disparities in health insurance coverage and access are reflected
in people of color being more likely to be uninsured and more likely to go without care due to cost.” The report also noted employer-sponsored insurance is not available in industries with a high proportion of workers of color, such as home health care, grocery and retail. So, while insurance executive salaries and profits are sky high, who is looking out for the average Illinoisan to ensure their health care is affordable? It is the job of the state Department of Insurance to help protect health care consumers and efficiently regulate the insurance industry. Unlike 38 other states, DOI has no power to reject unreasonable health insurance rates.
Currently, a bill in the state Senate Insurance Committee—SB 1590—would give DOI the authority to reject unreasonable, discriminatory or inadequate rates on behalf of individuals and small businesses. This bill faces fierce opposition by the insurance industry and has stalled. We urge our elected officials to let community voices be heard, pass this piece of legislation and empower the department to protect consumers from unfair price increases. JULIE SAMPSON Co-director, Citizen Action/Illinois STEPHANI BECKER Associate director of health care justice, Shriver Center on Poverty Law
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12 APRIL 26, 2021 • CRAIN’S CHICAGO BUSINESS
JOHN R. BOEHM
Northern Trust on track to forgo $250 million in fund fees this year The projected fee waivers for 2021 add up to about 4 percent of Northern Trust’s $6.14 billion in revenue last year.
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Fees ordinarily charged to investors parking cash in money-market funds are being waived at a clip beyond what was seen after the Great Recession BY STEVE DANIELS
ing the same effects. They reported first-quarter earnings this month and saw their stock prices drop meaningfully in response to the high level of fee waivers. Northern’s stock price, on the other hand, closed up 1.1 percent April 20 on a down day for the market.
Northern Trust is on course to set the wrong kind of record this year. Waivers of fees normally charged to investors parking cash in the bank’s money-market mutual funds are on track to well exceed $200 million in 2021. That would easily best the peak waiver total for ChicaPOSITIVES go’s largest locally headquarInvestors seemed more pretered bank in the aftermath of pared for Northern to report the Great Recession. bad news on money-marIn 2014, the last round of ket fees. And other aspects of waivers peaked at $130 million. Northern’s quarter were more In 2021, Northern is projected positive. to lose out on $250 million in It added back to earnings money-market fees if short- $30 million it had previously term interest rates stay about reserved for future loan losses. where they are now. To put That helped blunt the impact of that amount in perspective, it’s the $50 million in fee waivers. about 4 percent of Northern’s Most banks that had set aside $6.14 billion in revenue last substantial amounts for loan year. losses during the early stages of Northern Chief Financial Of- the pandemic have been pleasficer Jason Tyler disclosed that antly surprised at how little in jarring bit of bad news on an April 20 earnings call “IT’S A VERY, VERY DIFFICULT with analysts. DYNAMIC WE’RE FACING. . . .WE’VE Northern, like other big banks SEEN OVERNIGHT REPO AT (EXTREMELY catering to wealthy individuals and LOW RATES), AND THAT’S VERY institutional invesDIFFICULT FOR A $275 BILLION POOL tors, doesn’t collect the fees on the OF MONEY-MARKET FUNDS.” low-return funds because interest Jason Tyler, chief financial officer, Northern Trust rates are so low that, if a fee were added, investors bad loans they’ve had to write would have to pay to park their off. cash. Longer-term interest rates Likewise, Northern laid off have begun to lift from ultra-low hundreds in the first quarter, levels last year and early this year, reducing employee-compenbut short-term rates haven’t fol- sation expenses—something lowed suit, Tyler said. investors applauded. At the “It’s a very, very difficult dy- time, CEO Michael O’Grady namic we’re facing,” he said. “As cited the revenue pressures much as we’ve seen the 1-year, tied to rock-bottom interest 5-year, 10-year up, we’ve seen rates. overnight repo at (extremely low The bank also resumed share rates), and that’s very difficult repurchases, buying back $136 for a $275 billion pool of mon- million of its own stock. ey-market funds.” Revenue was flat compared with the same quarter last year despite double-digit increases HEADING HIGHER Northern waived $50 million in assets that Northern either in money-market fees in the manages or holds and processfirst quarter. In future quarters, es for investors. Ordinarily, at current rates, that will in- a robust stock market means crease to between $65 million higher fees for Northern, but the fee waivers helped negate and $70 million, Tyler said. Northern’s chief competi- that. Net income rose 4 percent tors, Boston-based State Street to $375 million. Earnings per and New York-based Bank of share rose 9 percent, thanks to New York Mellon, are suffer- the buybacks.
4/23/21 3:29 PM
Thank You To All Of The Employers Across Illinois Who Support Families’ Access To High-Quality Child Care And Early Childhood Education.
We — the undersigned Illinois business executives — call upon our state and federal policymakers to prioritize the resources necessary for child care and early childhood programs and their essential workers to stabilize our entire workforce, restoring and revitalizing our economy.” Jack Lavin President & CEO, Chicagoland Chamber of Commerce Greg Case CEO, Aon, Chicago Francie Schnipke Richards Vice President, Social Responsibility, The Allstate Foundation Christa Markgraff Vice President, Nicor Gas, Naperville Lisa Weitzel President, Illinois Association of Chamber of Commerce Executives, Springfield Rob Stewart Senior Vice President, State Farm Jennifer Steans CEO, Financial Investments Corp., Chicago Maureen Kahn President & CEO, Blessing Health System, Quincy John Blasi Information Security Technology and Operations Lead, Accenture, Chicago Mike Paone Vice President, Joliet Region Chamber of Commerce & Industry
Charles Moore President & CEO, McLean County Chamber of Commerce, Bloomington Chris Hembrough President & CEO, The Greater Springfield Chamber of Commerce Mirinda Rothrock President, Decatur Regional Chamber of Commerce Marin Gjaja Managing Director and Senior Partner, The Boston Consulting Group, Chicago Nick Scodro Head of Business Development, RBN Insurance Services, Chicago Brian McGuire President & CEO, Associated Equipment Distributors, Schaumburg Keith Krutz President, IMS Buhrke-Olson, Arlington Heights Lisa Savegnago President, Nameplate & Panel Technology, Carol Stream Manny Sanchez Founder/Managing Principal, Sanchez, Hoffman & Daniels, LLP, Chicago
To read the full statement and find out more, see www.familiesfirstil.com/for-employers/
Employers for Child Care & Early Learning
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PEOPLE ON THE MOVE
Advertising Section To place your listing, visit www.chicagobusiness.com/peoplemoves or, for more information, contact Debora Stein at 917.226.5470 / dstein@crain.com
BANKING / FINANCE
CONSTRUCTION
ENGINEERING
LAW
J.P. Morgan Private Bank, Chicago
Clune Construction, Chicago
Bowman, Chicago
Clune Construction is pleased to announce that Lisa De Lor has been promoted to Vice President, Director of Human Resources. Lisa has 12 years of experience in Human Resources in the construction industry. Clune benefited from De Lor’s leadership during the COVID-19 pandemic. She also leads Clune’s innovative benefits program. De Lor has a Bachelor’s degree from Purdue University and is a certified Professional in Human Resources by the Human Resource Certification Institute and SHRM.
Bowman is pleased to announce that Paul Kovacs, PE is joining Bowman as a principal, civil engineer, and key leader for the Lisle and Chicago, IL offices. He will play an integral role in providing insights into prospective clients’ needs and expectations, building partnerships with other project stakeholders, and developing successful strategies for Bowman’s pursuit of infrastructure projects, not only in the Chicago area, but nationwide.
Croke Fairchild Morgan & Beres LLC, Chicago
Stephen Pendleton is a Vice President at J.P. Morgan Private Bank in Chicago. In this role, he advises owners of privately held businesses, corporate executives and family offices, and provides guidance advice across the entirety of their balance sheets. With more than a decade of experience, he specializes in highly customized investment strategies, and supports clients across pre- and post-liquidity planning, concentrated stock positions, tax minimization, lending, banking and philanthropy.
FINANCIAL SERVICES
Lakeshore Financial Group, Chicago
CONSTRUCTION
Clune Construction, Chicago
CONSTRUCTION
Clune Construction, Chicago Clune has named Will McGowan Senior Vice President, Project Executive. McGowan has 24 years of construction industry experience, overseeing a diverse portfolio of high-end interior build-outs for some of the Chicago area’s most respected companies. He has earned a reputation for adhering to a project’s schedule and budget, while maintaining strong industry relationships. McGowan has a Bachelor of Science Degree in Building Construction Management from Purdue University.
CONSTRUCTION
Clune Construction, Chicago Clune Construction has named Denise Moy Duffy Senior Vice President, Marketing. Denise has 14 years of marketing experience in the CRE industry. Duffy brings a unique and well-rounded perspective to Clune’s Marketing team, and was named to Crain’s Notable Executives in Marketing in 2020. She is a member of Chief, a private network of women leaders, and has a Bachelor of Business Administration in Marketing, and a Bachelor of Arts in Asian Languages and Literature from the University of Iowa.
Clune is happy to announce that Liza Jessen has been promoted to Vice President, Senior Project Manager. With 15 years of construction industry experience, Jessen has proved herself to be an impactful team player at Clune. She is involved in all phases of a project, from pre-construction through close-out and is a trusted resource for Clune’s top clients. Jessen has a Bachelor of Science in Civil and Environmental Engineering from Villanova University.
Lakeshore Financial is pleased to announce that Timothy Sedivy has joined the firm as a Financial Services Representative. Tim comes to us as a certified Business Valuation Strategist. He works with small business owners to discover the value of their business and what it means in their financial world. He’s looking forward to being part of a team that supports and grows its financial professionals as well as developing and mentoring new professionals as they enter the business. TC120473(0421)1
FINANCIAL SERVICES
Schechter, Chicago / Birmingham, MI
CONSTRUCTION
Clune Construction, Chicago Dan Nielson has been promoted to Vice President, Senior Project Manager at Clune Construction. He began his career at Clune as an Intern, and now has 12 years of construction industry experience. During his tenure, he has completed more than 1.5 million square-feet of high-end interior build-outs. Nielson has a Bachelor’s degree in Construction Management from Western Illinois University.
Schechter Investment Advisors (“SIA”), an independent registered investment advisor firm, has announced the addition of Joseph Drozd, Jr., CFA® as a Senior Investment Advisor. This is the fourth high-level hire for Schechter since Q4 2020. Drozd, who will be based in Chicago for Schechter, is an accomplished and entrepreneurial portfolio manager and family office professional with over 12 years of experience in deploying capital into private companies, real estate, hedge funds, and alternatives.
LAW Latham & Watkins LLP, Chicago
To order frames or plaques of profiles contact Lauren Melesio at lmelesio@crain.com or 212-210-0707
Nathan Davis has joined the Chicago office of Latham & Watkins as a partner in the Mergers & Acquisitions and Private Equity Practices with the Corporate Department. Davis advises private equity firms and their portfolio companies on mergers and acquisitions and other corporate matters, including divestitures, leveraged buyouts, joint ventures, and recapitalizations. He also has experience representing public company clients and their boards on mergers and acquisitions.
Michael Frisch joins Croke Fairchild Morgan & Beres as Partner after serving as Senior Advisor and Legal Counsel to Mayor Lightfoot, advising city leaders on legal, policy and labor issues. Frisch Michael will lead the firm’s Government Litigation and Investigations Practice. His career to date has involved guiding clients through complex and high-stakes investigations, enforcement matters, litigation, and negotiations Dixon at the intersection of government and business. Danielle Dixon joins the firm from Kirkland & Ellis as a Senior Associate. Her practice focuses on the structuring, formation and management of investment funds, and their related management companies, ranging from first-time funds of around $10 million to funds of over $17 billion.
LAW Dussias Wittenberg Koenigsberger, Chicago Dussias Wittenberg Koenigsberger LLP congratulates attorneys Daniel Kessler and Kathleen Opal on their promotions to partnership. Both Daniel and Kathleen focus their Kessler practices on family law matters, serving clients facing a wide range of issues, including custody/allocation of parental responsibilities, pre- and post-nuptial agreements, contribution to college education, Opal enforcement matters, and the disposition of marital and non-marital assets. Daniel is noted for his sensitive and sophisticated handling of cases involving medical and mental health concerns. Kathleen has deep experience in litigating complex financial matters, including business valuation and the tracing of assets, related to divorce.
TECHNOLOGY Discovery Partners Institute, Chicago Discovery Partners Institute (DPI) is pleased to announce that Gina Grant and Charity Freeman have joined the DPI team. Gina Grant joins as the Associate Director of K-12 Student Grant Programming for middle and high school students, to help them start careers in computer science and related fields. Charity Freeman joins as the Associate Director of Teacher Training and is responsible for Freeman the implementation of teacher training programs within DPI’s community education unit, focusing on computer and data science/analytics at the high school and community.
TECHNOLOGY Hyzon Motors, Chicago Hyzon Motors Appoints Adam Kroll as Chief Administrative Officer: Hyzon Motors Inc., a leading global supplier of zero-emission hydrogen fuel cell-powered commercial vehicles, has appointed Adam Kroll as Chief Administrative Officer. Mr. Kroll has an extensive career in corporate finance having spent almost 20 years in banking, followed by roles in internal finance. Over his career, he has executed more than $150 Billion in M&A, debt and equity transactions. He is based in Chicago.
TECHNOLOGY IRI®, Chicago IRI®, a global leader in innovative solutions and services for consumer, retail and media companies, has appointed Kirk Perry as President and CEO and a member of its Board of Directors, effective May 17, 2021. Mr. Perry succeeds Andrew Appel, who has successfully led a transformation of IRI for nearly a decade. “I am honored to lead IRI and its immensely talented team,” said Mr. Perry.
LAW
WEALTH MANAGEMENT
Laner Muchin, Ltd., Chicago
Strategic Wealth Partners, Chicago
Laner Muchin is proud to welcome Christina Wernick as Of Counsel to the firm. She represents unionized employers in collective bargaining, grievance proceedings, arbitration and benefit contribution litigation. She regularly assists employers with resolution of grievance actions, collective bargaining agreements, project labor agreements, prevailing wage issues, jurisdictional disputes, and key man agreements. She previously served as in-house counsel to a prominent Chicago construction union.
Strategic Wealth Partners, an independent wealth management firm, is delighted to announce the hiring of Jessica Pickens as Chief Operating Officer. With significant experience in the industry, she joins the firm’s leadership team where she is responsible for operations and administrative functions, including human resources, technology, compliance and finance. She will also assist with the firm’s growth. Previously, Jessica was with Willis Towers Watson as Chief of Staff, Delegated Solutions.
CRAIN’S CHICAGO BUSINESS • APRIL 26, 2021 15
CANNABIS CASH: Violence prevention efforts get boost from from state’s marijuana tax revenue. PAGE 16 TIME TO ACT: A call for policymakers to fix flaws in Illinois’ firearms licensing system. PAGE 20
GUN VIOLENCE AND COVID-19
FROM THE FRONT: Two violence prevention leaders’ views on working through a pandemic and politics. PAGE 23
CHICAGO’S
BRIAN STAUFFER
FLEETING MOMENT The COVID-19 pandemic added to an already complicated mix of reasons the city’s gun violence keeps on climbing | BY DAVID MENDELL IT’S SPRING IN CHICAGO, a time of renewal, and a time when the daily drumbeat of gun violence always springs back to life, as well. Another shooting. Another Chicagoan lost from gunfire. And more than likely, it’s a young Chicagoan whose life is cut short. Just in the past couple of weeks, among those shot and killed was a child as young as 7. In another shooting that involved a Chicago police officer and caught on a bodycam video, 13-year-old Adam Toledo died in an alley in Little Village. The result has been nothing short of a community trauma. Following the video release by the Civilian Office of Police Accountability, Mayor Lori Lightfoot, noting that she has a 13-year-old of her own, grew emotional during a news conference talking about the boy’s gut-wrenching, all-too-vivid death by a single gunshot. Lightfoot blamed an adult for providing a handgun to the young teen in the
wee hours of the morning, essentially setting him up for the tragic incident, a response that resonated poorly in the community where the shooting occurred. During the days that followed, thousands of Little Village residents assembled in vigils and protests, calling for police reforms and greater attention on neighborhood violence. Full-throated activists, meanwhile, marched outside Lightfoot’s house and demanded her resignation for being slow to make reforms to the Police Department and for failing to bring a safe climate to troubled South and West Side communities. Lightfoot, after all, came into office 23 months ago proclaiming that ending Chicago’s unyielding neighborhood violence would be her top priority, only to see homicides jump 50 percent during her second year in office. The mayor has become the face of the city’s
inability to tackle the issue that never seems to leave us—neighborhood violence and murdered young people. In 2019, Crain’s Forum reported that Chicago had “a unique chance to embrace the methods cities like Los Angeles and New York have used to reduce their gun violence.” The story noted that the new mayor had hired a highly regarded anti-violence strategist as a deputy mayor and that there was optimism this new progressive city leader with new priorities and new devotion might finally change course. Less than two years later, Lightfoot’s touted deputy mayor is gone, Lightfoot is under political siege from all sides and still people keep dying on city streets. How did this happen again? And why does the city’s gun violence seem to go unabated? See GUNS on Page 18
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Cannabis tax revenue targets violence prevention 34 Cook County groups awarded grants that program leaders see as the start of a ‘long road’ BY A.D. QUIG At a time when homicides are projected to increase, on-theground organizations focused on preventing violence in Chicago are getting a financial boost from an unlikely source. Roughly $32 million in grants, funded with tax revenue from Illinois’ nascent legalized recreational marijuana industry, are being put to use as part of the state’s Restore, Reinvest & Renew program, or R3. Eighty organizations across Illinois—34 in Cook County—won grants ranging from $20,000 to $2.5 million to fund violence prevention, civic legal aid, economic and youth development, and re-entry efforts. The next few months will be a trial run of government efforts to repair some of the damage brought by what the state called the “failed war on drugs.” Rather than investing in policing or the criminal justice system, the grants are meant to be “restorative,” according to R3’s board chair, Lt. Gov. Juliana Stratton— focusing on direct investments in areas with high rates of gun injury, child poverty, unemployment, imprisonment and prison releases. One grantee is going to be using stipends to help fund a “Shark Tank”-style entrepreneurial contest. Another will help start a Girl Scout troop with curriculum centered on Michelle Obama’s book “Becoming.” A $600,000 grant to Cook County’s Justice Advisory Council will be broken up into several subgrants, including to CeaseFire in Roseland, which will mentor two dozen high-risk clients, and to trauma-related training at Youth Guidance’s Becoming a Man program in suburban Thornton Township High School. Springfield is still grappling with how minority owners can have a bigger stake in the burgeoning cannabis industry. But as the industry continues to expand and tax receipts grow with it, R3 will be authorized to dole out up to $125 million per year for grants like these and assess outcomes reported by grantees. The board’s efforts are just beginning. Experts have said setting aside dedicated funds is both long overdue and urgently needed. Demand for R3 grant dollars far outstripped availability. Nearly 400 organizations submitted proposals. And by the time the application deadline hit in July, Chicago-area violence seemed to be surging alongside COVID cases. Street outreach workers suggested the virus exacerbated many
Ghian Foreman leads the Emerald South Economic Development Collaborative, recipient of a $2.5 million grant funded by cannabis tax revenue. of the issues that lead to conflict: unemployment and underemployment; the fraying of safety net services offered at churches, schools and nonprofits; and a sense of hopelessness about the future. After years of declining homicide numbers, Chicago ended 2020 with 769 homicides and 4,033 nonfatal shooting victims, figures not seen since 2016. Experts at the University of Chicago Crime Lab are projecting that at the pace set as of the end of March, 2021 could end with more than 1,000 homicides. Anti-violence program leaders, however, acknowledge that R3 will not be a cure-all. “We know that there’s no magic pill or wand that can be waved that will fix all the systemic issues that arise from chronic disinvestment and lack of opportunity in disadvantaged neighborhoods and com-
munities all across our state,” says Matter announcements,” he says. Christian Perry, spokesman for the This could be a chance for corpoIllinois Criminal Justice Informa- rate Chicago to follow through, tion Authority, which is helping Foreman believes. Emulating a similar program administer the program. “This is a in Philadelphia, Emerald South’s long road that we’re starting on.” The Emerald South Economic grant plans call for hiring about 40 Development Collaborative got people to serve as a green corps to R3’s largest single grant, $2.5 mil- clean up and landscape 20 to 30 lion. Launched in 2018 in partner- acres of vacant land in the South ship with the Obama Foundation, Side. The efforts will be paired with the University of Chicago, the city and other community CHICAGO ENDED 2020 WITH groups, its goal is to improve collaboration and quality of life 769 HOMICIDES AND 4,033 in communities along the lake NONFATAL SHOOTING VICTIMS. on the South Side. President and CEO Ghian Foreman viewed the R3 grant as a other entrepreneurship and art chance to prove its South Side vi- programs. In that 2018 Philadelphia expersion to larger, long-term funders like Caterpillar, John Deere, Wal- iment, helmed by Columbia Unigreens, McDonald’s, Sunbeam and versity’s Mailman School of Public Chase. “I saw a lot of Black Lives Health, crews removed trash and
debris, graded the land, planted new grass and trees and added low fences to 110 clusters of vacant lots. Researchers examined police reports and polled neighbors about the impact. In areas below the poverty line, there was a 29 percent drop in gun violence near treated lots, per the police, a 22 percent drop in burglaries and a 30 percent reduction in nuisances like vandalism, public drunkenness and illegal dumping. Neighbors reported feeling safer and spending more time outdoors. Foreman, whose own father was incarcerated and whose daughter has lost friends to gun violence, says his plans are about “so much more” than plantings. He hopes those trained to do landscaping will launch their own businesses and win contracts to maintain green spaces throughout the city, that flower-cutting gardens will attract tourists who in turn will shop and eat more at local businesses and that neighborhood pride swells. “That $2.5 million is a little shot of trying to fix some of the stuff that created the conditions that make it OK to shoot someone on Lake Shore Drive, for a 13-year-old to carry a gun,” Foreman says, and “ultimately, make the people in the community value the land . . . hold each other accountable.” The Chicago Urban League and the Safer Foundation together won $1.9 million for a workforce development grant proposal, which will help fund re-entry programs for those exiting the criminal justice system. They will use the funding to boost their existing urban tech jobs program with Comcast, which provides an accelerated training program for long-term unemployed adults. “For our participants, we will look at recidivism—whether or not those individuals who are participating in our program find themselves back in prison or back in jail or reoffending—that will be a clear measure,” Urban League President Karen Freeman-Wilson says, as well as “how many people do we get into the job market and how long can they stay in as a result of the tools we give them?” The Urban League won a separate planning grant to fund four researchers who will work with community members to think through potential reparations programs. Freeman-Wilson says she hopes R3 forges new partnerships and collaborations and helps find solutions that work. Thirty million is a lot of money, but also not enough “for a state this size for the needs people have,” she says. By the same token, “there has to be—for us included—a clear evaluation of the impact of the grants. If we can’t show that we are changing people’s lives or helping people to change their lives, then that money is not well spent.”
JIM KIRK PUBLISHER • ANN DWYER EDITOR • CASSANDRA WEST FORUM EDITOR • THOMAS J. LINDEN CREATIVE DIRECTOR • JASON McGREGOR DIGITAL DESIGN DIRECTOR • KAREN FREESE ZANE ASSOCIATE CREATIVE DIRECTOR • SCOTT WILLIAMS COPY CHIEF
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Exploring solutions to the biggest challenges facing Chicago and Illinois Each month, Crain’s Forum elevates the discussion around critical issues affecting the city and state, as well as the local economy.
2021 Topics
January 22 - Lake Michigan, Troubled waters February 19 - The Future of Capitalism, Socially conscious investing gains currency March 19 - Manufacturing, Quick rebound sets industry up for changing future April 23 - Gun Violence and COVID-19, Chicago's seemingly unabated tragedy
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18 APRIL 26, 2021 • CRAIN’S CHICAGO BUSINESS
GUNS
Continued from Page 15
who left that post in October, less than 16 months after being appointed. “But the pandemic, coupled with the loss of legitimacy of government in the post-George Floyd era, really brought forth a perfect storm, in terms of violence in the communities that were already suffering.” Lee and anti-violence advocates say the pandemic prevented street outreach workers from in-person communication that could intercept violent crimes before they occur. Also, community events that nonviolence groups and the city were beginning to regularly hold in neighborhoods were paused. Moreover, young people were thrown out of routines that kept them productive, such as going to school or work. Inmates at Cook County and other jails were released to the streets with no way to earn a sustainable living during THE PANDEMIC There’s little doubt that Light- a pandemic. Outreach efforts still have not foot’s initial, aggressive efforts to attack Chicago’s violence were returned to normal. For examfoiled by the pandemic. Chicago ple, recent neighborhood events was not alone in seeing murders assembled by the Institute for dramatically increase in 2020. Nonviolence Chicago, a street outWith millions tossed out of work, reach and counseling organizamajor cities like New York and tion, have been sparsely attended. “All of that had a dampening efPhiladelphia also saw a surge in killings in 2020. Most experts fect on the heroic work that these agree that the pandemic and civil neighborhood outreach practiunrest contributed to these homi- tioners are doing,” Lee says. Lee herself appears to be a pocide spikes. Homicides in Chicago climbed litical casualty of the pandemic. A highly regarded anstrategist “IN ANY KIND OF CRISIS . . . WHETHER ti-violence who was instrumental in taming Los Angeles’ IT’S A PANDEMIC, WHATEVER . . . violence problems, PEOPLE GO OUT AND GET GUNS.” Lee drew the wrath of some Chicago alderSusan Lee, former deputy mayor for public safety men, particularly in the Black caucus, for from 495 in 2019 to 769 last year. taking what they regarded as an In New York City, the number in academic approach to a street-lev2020 was 454, compared with 300 el problem. Lee helped assemble a city report in 2019. In Los Angeles, there were 347 murders, up from 254 in 2019. on violence and a task force to study This is not just Chicago’s problem, the problem, but she and Lightfoot were criticized for lack of transparbut Chicago leads the way. “Chicago has always had a vio- ency when the commission’s meetlence epidemic, by sheer volume” ings were held in private. In the end, Lee did not survive says Susan Lee, Lightfoot’s former deputy mayor for public safety, City Hall politics, resigning in Oc“It’s political; it’s institutional; it’s the Chicago way,” laments Lance Williams, a former anti-violence outreach worker on the South Side and now a professor at Northeastern Illinois University. He cites a litany of reasons why Chicago has been unable to solve its violence problem: hyper-segregated neighborhoods, dysfunctional local schools, traumatized families, endemic urban poverty, disinvestment, blame-game politics, a city awash in handguns and, perhaps most of all, human desperation. But the biggest impediment, Williams says, is a lack of will and commitment to end violence. “We’re spending what, $16 million, on anti-violence? This is a multibillion-dollar problem that has been with us for generations.”
ZAC OSGOOD
A prot sands
Outreach team and victim advocates from the Institute for Nonviolence Chicago on the streets of Austin in mid-April. tober to return to the nonprofit sector. She still advises the mayor but now works at Chicago CRED, a South Side anti-violence and “social impact” organization. Lee was the key City Hall official who was leading Lightfoot’s approach to tame gun violence by community-driven solutions rather than a law-enforcement strategy. Replacing Lee on an interim basis is Norman Kerr, a former director of CeaseFire who moved onto the city’s team under Lee. Kerr oversees the Office of Violence Reduction, funded by $31 million in city and federal money. Its mandate is to coordinate anti-violence efforts throughout the city with an emphasis on funding street outreach agencies and helping those agencies cooperate with city law enforcement. Kerr says the office is still in its infancy and Chicago’s anti-violence efforts will need sustained funding for a decade or more, a strategy other major cities have successfully undertaken, if shootings and homicides are to be suppressed. Critics of Lightfoot and Lee
might agree that the pandemic pushed the city over the brink, but they also say the mayor’s approach to stemming violence has fallen short of what’s necessary. Lightfoot drew significant criticism for spending pandemic-related resources on policing rather than on root causes of community poverty and disillusion. Lightfoot devoted $281.5 million from a federal relief package passed last year to police payroll and benefits. “And for what? We wound up with the highest crime rate in 30 years,” community activist Ja’Mal Green says. “We’ve been lied to since the beginning of this administration so much that the people have lost hope,” Green says. “I don’t think she’s ready to make this bold change, to take down this racist system.”
AWASH IN GUNS
Without question, the “sheer volume” of Chicago violence that Lee refers to is mirrored by the sheer volume of something else in our region—the number of guns. “Tell me why you need an
assault weapon if you are a civilian,” Lightfoot said during a news conference in mid-April, when asked about the city’s violence. “It is insane.” In Illinois, the number of background checks, which is a barometer for gun sales, went through the roof in 2020. More than 7.4 million background checks were run last year, compared with 4.9 million in 2019, according to data from the National Instant Criminal Background Check System. That’s compared to 1.6 million in California and just 507,940 in New York. “It’s like the quintessentially American response to any crisis— people want to get guns to protect themselves,” Lee says. “In any kind of crisis, whether it’s protests or whether it’s a pandemic, whatever it is, even if it’s a natural disaster, people go out and get guns.” Williams, the Northeastern Illinois professor of urban community studies who worked in violence interruption for two decades, says young men reach for guns when they feel powerless and believe they are left with no other options. Often, schools have failed them,
INSIDE CHICAGO’S HOMICIDE NUMBERS
BACKGROUND CHECKS SURGE
In three years, Chicago’s homicides dropped from 769 in 2016 to 495 in 2019. Then 2020 happened, and 769 people were murdered in Chicago. That’s a 55 percent increase from 2019. While homicides were up nationwide, Chicago outpaced other large cities.
In 2020, the FBI conducted more than 7.4 million firearms background checks on people in Illinois. That leads the nation. In 2019, the FBI conducted 4.9 million Illinois background checks.
CHICAGO’S DAILY HOMICIDES (2020)
FBI FIREARMS BACKGROUND CHECKS (2020)
CHANGE IN HOMICIDES (2020 vs. 2019)
20
Chicago
7.5 million
Illinois 55.4%
15
10
51.3% Los Angeles
5
3.3 million
Kentucky
New York
Texas
2.3 million
Indiana
1.9 million
Florida
1.9 million
36.6% 0
Jan.
Feb.
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.
Sources: Chicago Police Department, Crain’s reporting, National Instant Criminal Background Check System
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parents have failed them and society itself has failed them, he says. Toss in a pandemic and access to weapons, and a bad situation becomes a desperate one. The release of inmates from the Cook County penal system because of COVID concerns made for an even more toxic blend, Williams believes. Lightfoot, meanwhile, points to the pause in criminal trials due to the pandemic and says they must be restarted immediately. “You’ve got all these guns out there, and you’ve got a new pop-
ulation of shooters and criminals released with no way to sustain themselves during COVID,” Williams says. “And then the third part is the policing changes. The police are being portrayed in the community as racist because of George Floyd. And this is on the heels of Laquan McDonald. So the police are incensed, and they’re looking around and thinking, ‘I can’t make any arrests because there is no place to put these people anyway.’ So the result is, there’s just no accountability in the streets, no engagement with
GETTY IMAGES
GETTY IMAGES
CRAIN’S CHICAGO BUSINESS • APRIL 26, 2021 19
Community activist Ja’Mal Green, right, attends a rally April 15 in protest of the killing of 13-yearold Adam Toledo by a Chicago police officer in March. law enforcement, and everything just got completely out of control, and violence goes way up.” Says Lightfoot: “This is madness. We are allowing very violent people back onto the streets, and they are terrorizing our communities over and over again.”
‘GOD’S GRACE’ IN THE NEIGHBORHOOD
For people existing in the midst of Chicago’s neighborhood violence, political protests and anti-violence strategies can sound like something from an ivory tower. They wake and look
around each day, just praying for survival—for themselves, their neighbors, their loved ones. Keauna Wise, 43, is a lifelong Roseland resident who has experienced an alarming amount of gun violence. Her brother and a stepson both were killed by gunshots. Her adult sons both have been shot and survived, the shootings spurred by various disputes with other young men in the neighborhood, Wise says. Suffering from various health conditions, including ovarian cancer, Wise has been living with her 85-year-old grand-
mother and helping to raise three of her grandchildren. Wise doesn’t blame others for the turmoil in her life. She says she was drawn to street and party life as a teenager, had children and then failed to be present enough in her sons’ lives to make sure they stayed free of trouble. Now, because the men have had altercations that resulted in shootings, grudges are harbored on all sides, and her sons have no choice but to arm themselves for protection, she says. Wise advocates a zero-tolerance policy for people involved in shootings, including her sons. She sees a punitive justice system as the only recourse but admits this is a cleanup strategy and not a prevention strategy. She advocates an end to bail bonds for people with any kind of gun charge. She is under no illusions about her present circumstances, she says. She is all too aware that the next gun death in Chicago could be one of her grown children. “By God’s grace, my sons are still here,” Wise says through a voice weary from health problems and psychological trauma. “But I pray every day for God to cover them. Every day, I pray, and I wait for that knock on the door and a man to tell me that one of my babies is gone.”
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20 APRIL 26, 2021 • CRAIN’S CHICAGO BUSINESS
EVIDENCE-BASED SOLUTIONS
Direct resources to those who need them most
L
sonally impacted by decades of ast month, President Joe over-policing, mass incarcerBiden announced the ation and economic neglect. American Jobs Plan, an These men and their peers are ambitious, multiyear economic 54 times more likely than the recovery plan that, among other average Chicagoan to be shot things, proposes investing $5 or killed. Eighty percent have billion in evidence-based comexperienced violence themmunity violence intervention selves, and even more have lost programs. If Congress passes a family member to violence. the proposal, this unprecedentThirty-four percent have been ed investment would be a bold Eddie Bocanegra shot at least once. These men, first step in addressing decades is the senior the vast majority of whom are of racist federal policies that director of READI Black, grew up watching their have systemically oppressed Chicago, a proBlack and Brown individuals, gram led by Chica- fathers, uncles and older brothresulting in a cycle of intergengo-based nonprofit ers killed or jailed. That takes a erational poverty, violence and Heartland Alliance psychological toll. If we truly want to “build back trauma. in collaboration better” after a year of unpreceSince President Richard with six local partdented crises, then we must use Nixon announced the “war ner organizations. this moment to address Ameron drugs” in 1971, the toll of It tries to reduce ica’s appalling legacy of racial enforcement-first policing gun violence by inequity. That requires we direct and punitive criminal justice connecting people policy has continued to mount, to transitional jobs, our country’s resources to end totaling an estimated $1 trillion. behavioral therapy this cycle of trauma, poverty and violence before it continues That’s more than $3.3 billion and supportive into another generation. spent annually to incarcerate fa- services. That’s what READI Chicago is thers, brothers and sons—entire designed to do. We connect people most families. Chicago alone spent more than impacted by violence with the mental $260 million incarcerating residents of our health supports they need to begin to heal five most violent neighborhoods between from complex trauma, and we help them 2005 and 2009 alone. develop skills to cope in stressful, someThe men we serve in READI Chicago—a times life-or-death situations. trauma-informed community violence But reversing decades of disinvestment intervention program that supports those and systemic oppression requires that we most likely to die from gun violence—are just don’t help communities heal, but we the sons and grandsons of people per-
empower them to succeed. READI does this by connecting individuals to paid transitional employment and job training, hiring people from the communities we work in, and investing in community organizations and infrastructure. Since our launch in 2017, we have paid $9 million directly to men most affected by gun violence through wages and stipends, and we have invested over $20 million into our community-based partner organizations to help build capacity. READI is being rigorously evaluated and, although the study is not done, the early outcomes show real promise in helping to keep men safe. Community violence intervention programs in Chicago like READI and Chicago CRED are helping individuals and communities heal, but we need more resources to get care to the people who need it most. President Biden’s proposed American Jobs Plan would make a multiyear commitment to addressing our country’s legacy of trauma, and members of Congress should pass the plan without delay. But our city and state leaders have an opportunity to help communities that are reeling from gun violence right now, and they too must act. The American Rescue Plan—which was passed by Congress in March—has already sent billions of dollars in federal relief to Illinois and Chicago to help address the impacts of COVID-19. Our leaders should allocate a portion of this funding to evidence-based community violence intervention programs today.
The high rates of violence we have seen over the past decades, and especially the past year, are a direct result of structures and systems that are denying access to safety, opportunity—and justice—in Black and Brown communities. For our busi-
PREVENTIVE MEASURES
Modernized FOID can stem gun-sales surge
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BLOOMBERG
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administrative delays and highrecord surge in gun sales lighting the need for upgraded could not have come at data infrastructure, additional a worse time for Illinois’ dedicated resources and a more aging firearms licensing system. streamlined licensing process so As guns deaths also spike in the FOID can realize its potential. region, policymakers must take In 2020 alone, the Illinois State steps to realize the promise this Police, the agency charged with system offers in reducing gun managing FOID, received more violence and saving lives. than 483,000 applications to Licensing systems—Illinois’ obtain a firearms license, nearly firearm owners identification Tim Daly is a sedouble the number of applicacard system is one example— nior program offimake sure that a comprehensive cer focused on gun tions in 2018 and almost triple background check is completsafety policy in the the number from 2017. This perfect storm—an aging ed prior to a gun sale and are Joyce Foundation’s FOID system, a tsunami of among the most effective tools Gun Violence Pregun sales and a spike in gun in ensuring guns don’t get into vention & Justice deaths—should be viewed by dangerous hands. States that Reform program. have successfully implemented The Joyce Founda- policymakers as a mandate to such a licensing policy have tion is a sponsor of strengthen Illinois’ firearms licensing system in order to save experienced lower levels of gun Crain’s Forum. lives. And given that this surge homicides and suicides. shows no sign of ebbing, policymakers However, the surging demand for firemust act now. arms in Illinois has put considerable stress Here are three actions Illinois officials on the decades-old FOID system, causing
should take: First, invest more time, money and effort into gathering better data. Not just on FOID applications, but on all data streams that feed into or are connected to the FOID system. And make this data publicly available in a timely, regular and accessible way. FOID’s data deficiencies were partly revealed in the aftermath of the February
2019 workplace shooting in Aurora. State police examined how data and communication gaps led to a significant number of individuals maintaining possession of their firearms after their FOID cards had been revoked. In the months and years that followed, state police have released new data on the FOID system and proposed new information-sharing practices.
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CRAIN’S CHICAGO BUSINESS • APRIL 26, 2021 21
CAUSES AND EFFECTS
A public health epidemic that must be addressed
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ate uniof their en foldata w
nesses, economy and country to thrive, we need to push our elected officials to put money where it is so sorely needed: in the communities where it’s been diverted from for decades. President Biden has given our leaders in Chicago,
Springfield and Washington the chance to advance racial equity, and we urge them to prioritize evidence-based community violence interventions that will lead to greater peace, equity and opportunity for all.
But significant data collection and analysis gaps remain that prevent effective administration of the FOID system, curtail oversight of state authorities and erode the public’s confidence. Second, secure federal funds to help. Before COVID-19, state funds were insufficient to adequately invest in the FOID system. With state funding now even more scarce, Illinois must take advantage of federal resources available to support firearms background checks. Since 2015, 48 of 50 states have applied for and received a combined $300 million in federal funding to improve their background check systems and the submission of prohibiting records through the National Criminal History Improvement Program and the NICS Acts Record Improvement Program. Only Illinois and New Mexico have not received—or even applied for—funding through these programs over that time. Meanwhile, several states have received significant support, including Arizona, which has leveraged nearly $12 million in federal funds since 2016 to maintain a statewide task force focused on improving the state’s background check records and closing data gaps. Finally, refresh the FOID policy itself. A 2019 report by the Johns Hopkins Center for Gun Policy & Research, commissioned by the Joyce Foundation, identified several weaknesses and gaps in the FOID law and offered recommendations
to help prevent future tragedies. Furthermore, the researchers found that the FOID policy should require the submission of fingerprints, a five-year permit (instead of 10) and dedicated resources to improve information sharing, support administration and the removal of guns from individuals whose FOID cards are revoked. The state police readily agrees with these updates, which have been incorporated into the Fix the FOID proposal, now pending before the General Assembly. If done right, modernizing the FOID system would have a profound impact in reducing gun violence. In Connecticut, implementation of a firearms-permitting policy led to significant reductions in gun violence rates, including a 40 percent drop in homicides and a 15.4 percent decline in suicides. Notably, Connecticut invested more than $27.5 million in improving implementation over time, mostly from federal resources. On the other hand, after Missouri repealed its permitting law and background-check requirement altogether, that state saw a 16.1 percent increase in firearm suicides and a 25 percent increase in firearm homicides. Illinois policymakers have a clear choice. They can make these sensible changes to help reduce gun violence or let the tsunami of gun sales wash over and drown the FOID system. The evidence makes the right choice obvious.
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to death each year. That means un violence is a public 1,800 empty school desks and health crisis, but at the chairs at family dinner tables. federal level we are neiBlack children and teenagers ther doing enough to prevent it are 14 times more likely to nor to mitigate its impacts. We be killed by a gun than white have seen the mass shootings children. that have claimed the lives of While I work with my colshoppers, salon workers and leagues on both sides of the pedestrians so far this year. aisle to advance gun violence However, what causes deeper prevention legislation, there is concern is how prevalent and U.S. Rep. Robin critical work that can be, and pervasive gun violence is in the Kelly, D-Ill., is is being, done by community daily lives of our community a co-chair of the leaders here in Chicago and members. Congressional across the nation to address the We are battling a public Gun Violence root causes of this epidemic. health epidemic, but we are Prevention Task Perhaps the most impactful not treating it that way. We Force and chair step we can take to reduce gun must address the far-reaching of the Congressioviolence is to follow the lead health risks of gun violence nal Black Caucus and the systemic racism that Health Braintrust. of these community organizations in community investnormalizes the deaths of young ment. There are many forms of successful Black men. Each life lost to gun violence community investment, but the purpose is a tragedy, and, unfortunately, deaths is to provide opportunities that did not are not the only impact. For every shootpreviously exist or were difficult for peoing, countless people are traumatized, ple to access. left to grieve a loved one, angered by the Many people, primarily our young event and left increasingly anxious about men, become involved in street viothe safety of their communities. lence because they cannot see a path for The mental health impacts of gun themselves outside of that life. Workforce violence are both cause and effect of this development, community partnerships tragedy. Without addressing the generaand mentorships, engagement and edtions of trauma some communities have ucational opportunities all have monuexperienced, we will not be able to pull mental impact on providing opportuniourselves out of this epidemic. Of course, there are also the physical and financial TREAT GUN VIOLENCE LIKE THE EMERGENCY IT IS. costs we must address. ties, improving community safety and People injured by gun violence often face reducing violence. As I often say, nothing challenging and expensive recoveries, stops a bullet like an opportunity. including surgeries and physical therapy. As Congress begins to consider apMany live with disabilities for the rest of propriations for fiscal year 2022, I am their lives. strongly urging my colleagues to increase For decades, the biggest threat to the funding to support the evidence-inlives and safety of children and teenagers formed, community-based organizations was automobile accidents. In response that are on the front lines of intervening we mandated the use of seat belts and to prevent gun violence. car seats and created stricter safety We have a long way to go in rebuildguidelines for automobile manufacturing trust and safety in our communities ing. Deaths by vehicle crashes declined plagued by gun violence, but if we begin significantly and have remained relatively to treat gun violence like the public low. health emergency it is, we can fundamenToday, firearms are the leading cause of tally change the future of these communideath for children and teenagers, with an ties for the better. estimated 1,800 children and teens shot
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22 APRIL 26, 2021 • CRAIN’S CHICAGO BUSINESS
V
EARLY INTERVENTIONS
Work to stop murders before they happen
From viole tiface resul outre there viole wors durin and in ke took Kerr who Gros coun edite
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helped me somehow. young man I know was I believed the idea of planting gunned down recently trees could help the scores of famwhile he was driving on ilies in my South Side neighborthe expressway. As of this writing, hood the same way that it helped there have been over 60 such me years before. After all, trees are shootings in Chicago this year enduring memorials that aren’t alone, and this number is sure to washed away by rain, blown go up as the summer approachout by wind or whisked away by es and more people start to go Streets & San. outside again. The trees were great, and the The fact that all too many young Tamar Manasseh families really did love having a people from the South and West is the founder and permanent memorial for their sides die unnatural deaths is no president of Mothloved ones, but one day I realized longer newsworthy. My friend’s ers & Men Against that this act wasn’t going to do murder barely warranted a Senseless Killings. anything to stop the violence and mention on the local newscasts. the killings. A 17-year-old came up to me at But there’s something else going on here. one of these tree planting and pointed to a Expressway shootings are reaching epidemic spot nearby. “That’s where I want my tree,” he proportions. And we need to understand told me plainly. At first I laughed it off, but the why in order to figure out how to get them more I thought about it, the more I realized under control. That’s how I approach everythat if I’m planting a tree, someone has died thing: from the need to truly understand it. and I’m already too late. Trees, religion or There’s no solution without first understandnostalgia weren’t going to stop the bullets ing the problem. from flying. I needed to find something that When I first decided I’d tackle Chicago’s gun violence problem, the first activity I un- would stop the bullets from flying. We needed to be proactive instead of reactive. dertook was planting trees. My inspiration And that’s when I came up with the idea for this was the Jewish holiday Tu B’Shevat, of sitting on blocks where the murders were which marks the new year for trees in happening, and not leaving. By creating Israel. I grew up giving money every year to a regular presence in the neighborhood plant a tree to mark major life-cycle events. and building a sense of community where I planted trees for births, bar and bat mitznone existed, I hoped to prevent murders vahs and graduations, but more often than before they happened. Over the years since not, for deaths. I planted a tree when my we first sat down at 75th and Stewart, the grandmother died. I planted a tree when organization I created, Mothers & Men my Uncle Marvin died. Even though there Against Senseless Killings, or MASK, has was sorrow, the idea of planting somebeen successful at reducing the number of thing after someone special had passed on
NOR Inter prev The expressway shootings pose a new and killings in Englewood. unique challenge to all of us, and I’d be lying Moreover, MASK’s mission is constantly if I said that I’ve figured out what to do about evolving in order to continue to meet the them. But I’m working on it. As always, the needs of the communities we serve. We cregoal is to proactively prevent these murders ated the “Door No. 3 program,” which sent young people who were the most likely to kill or be killed WHEN THE CORONAVIRUS HIT, WE REPURPOSED to trade school. Their options OLD SHIPPING CONTAINERS AND TURNED THEM were no longer dead or jail, and they had the opportunity INTO A LEARNING CENTER. to learn a trade and become productive members of from happening at all, not trying to figure out society. how to deal with their aftermath. When the coronavirus hit, we repurposed The Chicago Police Department would old shipping containers and turned them into be well served by pursuing a dialogue with a learning center where at-risk kids could get MASK and with other similar organizations. access to high-speed internet and the elecWith the police’s resources and our working tronic devices they need to ensure that they knowledge of the streets, together we can can continue to learn online, even when they confront gun violence head-on. can’t physically go to their schools.
MISSING ELEMENTS
City’s anti-violence plan needs more transparency, equity
M
Lee, a California native, was ayor Lori Lightfoot’s touted for reducing violence in plan to combat gun Los Angeles by implementing a violence in Chicago comprehensive strategy to adhas been a mixed bag. On the dress gang violence. Many in the one hand, she’s talked about Black community told Lightfoot, the expansion of social services like they told previous mayors, and massive investment in that only a fraction of violence communities most affected by in Chicago is gang-related. The violence, which, of course, are Black community wanted the good things. On the other hand, mayor to hire a person with strong she’s made politically motivated Lance Williams community ties and the lived key appointments, excluded the is a professor of public and grassroots organiurban community experience and understanding of zations from the anti-violence studies at the Jacob the unique landscape of Chicago violence. It didn’t make sense to planning process and supported H. Carruthers hire Lee, whose strategies target the inequitable distribution of Center for Inner gangs to combat the escalating funding to violence prevention City Studies at homicides. Nevertheless, the maygroups. When it comes to adNortheastern dressing violence in the city, the Illinois University or didn’t listen to the community and appointed Lee anyway. mayor says all the right things but and the author In less than one year, Chicago makes all the wrong moves. of “Culture and aldermen became frustrated with There is no doubt that the Perceptions of Lee’s “inability to respond to basic mayor has developed a solid plan Violence Related to combat gun violence. However, Behaviors Among questions” at Chicago City Council hearings. She was forced out her first big mistake was to apAdolescents.” and is now back at Chicago CRED. point Susan Lee as deputy mayor One positive of the mayor’s proposed for public safety in 2019 to lead the effort. plan to combat gun violence was reconShe previously was an executive at Chicago vening the Violence Prevention Planning CRED, a violence prevention organization Committee every six months to hold itself founded by former U.S. Education Secreaccountable and increase transparentary Arne Duncan.
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cy of its work and progress. Yet, the first and only meeting held last December was closed to the public. Not only was the meeting closed to the public, but the city also did not invite prominent African American-led violence prevention organizations to be part of the Violence Prevention Planning Committee. To plan without inviting organizations like Acclivus, the largest African American-led anti-violence agency in Chicago; Mothers Against Senseless Killings, or MASK, a team of moms who put on events and offer a safe space for kids in the community; and Project HOOD, a group that has been doing violence prevention work for decades in one of America’s most notorious areas, is unfathomable. How can you exclude groups like these and be taken seriously? People in the community look at this and say GTFO. Not only does the mayor’s effort to combat gun violence lack transparency and inclusion, but it also supports the inequitable distribution of violence prevention funding. Currently, the city invests $13 million in street-outreach violence prevention. Keep in mind that the annual cost of homicides in Chicago is $2.5 billion annually—so the city’s efforts are woefully underfunded.
Nevertheless, Chicago funnels all of the street outreach money through Metropolitan Family Services, one of the city’s largest social services agencies. MFS coordinates violence prevention street-outreach efforts. The problem with this is that MFS is an agency whose board of directors is mostly white, and its CEO is not Black. At the same time, 80 percent of the murder victims in Chicago are African Americans. No non-Black agency should control all of the dollars and coordinate street-outreach efforts, especially when there are highly qualified Black anti-violence agencies. There must be no more pass-through violence prevention funding to non-Black organizations and agencies that siphon off millions of dollars in administrative costs to solve a problem unique to the Black community. To address rising violence, the city will need to be transparent in carrying out its plan and not exclude people and groups that it feels may push back on its plan. The mayor will run into trouble if she doesn’t help bring equity to the violence prevention community. Thus far, the mayor has done a great job coming up with a solid plan to combat gun violence, but it must be more transparent and inclusive.
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Views from the front: The perils and the politics How did the pandemic change your mission and how you’ve gone about violence prevention?
BY DAVID MENDELL From City Hall to the city’s streets, violence reduction efforts are multifaceted and often produce mixed results. Public-safety officials and outreach workers acknowledge that there is no one answer to the gun violence epidemic, which has grown worse—and tougher to tackle— during the pandemic. Norman Kerr and Teny Gross, who both served in key violence intervention roles, took questions on the topic recently. Kerr is a former CeaseFire director who has moved to City Hall, and Gross oversees a street outreach and counseling agency. Following is an edited transcript. NORMAN KERR Interim director of violence prevention, city of Chicago CRAIN’S: Your office is dedicated to coordinating anti-violence efforts. It was launched by Mayor Lightfoot in 2019, and then we saw a huge spike in violence and homicides in 2020. How do you answer to critics who point that out? KERR: I understand the frus-
Norman Kerr
Teny Gross
tration. I’ve lived in Chicago most of my life. It’s always been synonymous with violence. This is something we definitely want to change, and it’s the reason I joined this office. We started in 2019, and street outreach workers were operating—street outreach was in effect then—and we saw decreases in violence happening. And the goal was to build on that for 2020. But we have to acknowledge the pandemic. This wasn’t just something that was solely impacting Chicago. This was a national situation, where just about every major city saw increases in violence, increases in shootings and homicides and carjackings. I mean, these are things that are a result of the pandemic, and they were chilling all around.
It’s changed everything around policing, about the way programs operate. We’ve had so many organizations that have closed during this time. We’ve had so many people that have been infected themselves with COVID, whether it’s police, whether it’s staff at different organizations. And even though we had a lot of people go inside because of COVID, we still had a lot of the young people in the streets, who stayed out there, and they were still involved at high levels when it comes to violence. So even though (for street outreach workers) their peers in other organizations were shutting down and working remotely, this was a group that couldn’t work remotely. We needed them on the streets because the levels of violence were continuing. So what’s the future for your office and anti-violence efforts here in Chicago? For those who are discouraged,
what I say is, we plan to see it through. We are going to continue with investments. We’re going to continue engaging community organizations and partners, because it’s an all-hands-on-deck approach. It’s not something that we can just give up and just quit after one or two years and just say it’s not working. We’ve seen in other cities where they’ve had a little success, then they let up. So we’re in this for the long term. This is not one or two years or three years. It’s 10, 15, 20 years. If you look at other cities that have had significant success, it took them 15 or 20 years of steady investment, steady programming and not letting up. So the mayor has been consistent that this is what the plan is. TENY GROSS Executive director, Institute for Nonviolence Chicago, a street outreach and counseling agency that operates on the South and West sides CRAIN’S: So you’re a couple of years into this now, and the city
has lost the deputy mayor, Susan Lee, who was your champion, the chief strategist for street outreach violence interruption. How do you react to that? GROSS: To fix this issue, it is going to take many things. It will take resources, it will take know-how on the streets and it will take working the politics in the right way. There are people who are doing things for the right reasons, and then there are people, politicians, and not just politicians, but others, who are not always in it for the right reasons. Susan was in the middle of all of that. How do we deal with the politics side? This is not just a Black issue. This is an American issue. Look at this country’s history—America created the violence, not just Black people. All Americans created this environment, and we need to put the best of our minds toward this and make our best effort to fix this. Everyone needs to work together and put the politics of Black and White aside.
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Earnings at Peoples Gas soared 113 percent to a record $187 million last year from $88 million in 2015.
Utilities continue push for guaranteed returns GAS from Page 3 Patterson, analyst at Glenrock Associates in New York. Earnings at Nicor, which delivers gas to most of Chicago’s suburbs, grew 68 percent to $229 million last year from $136 million in 2015. That’s an annual growth average of 10 percent. ComEd has watched its earnings grow to $638 million in 2020— adding back the $200 million fine for the company’s admissions of bribery in a federal probe of former House Speaker Michael Madigan—from $379 million in 2012, the year it first was allowed to set its delivery rates annually via a formula. ComEd’s profits grew 6.7 percent on average annually over those nine years. This is the kind of steady earnings growth most companies can only dream of, but it comes in monopoly businesses whose customer bases essentially haven’t changed in those years. Peoples, in particular, serves a shrinking customer base in only the city of Chicago. Its profit growth has come from rate increases tied to historically high levels of capital spending, endorsed by the Legislature in 2013. Then-Gov. Pat Quinn, who ironically built much of his public reputation fighting utilities on their rate hikes, signed the law, which allowed Peoples and Nicor to charge extra on gas bills to finance what has turned into billions in infrastructure work. For Peoples, that monthly surcharge now is well above $10 for the average Chicago household. The utility collected $137 million just from the surcharge last year, a 67 percent increase from $82 million the year before, according to filings with federal regulators. State regulators have concluded they have no power to rein in the surcharge thanks to the 2013 law. They do perform an after-the-fact study of the spending, in which they can force the utility to rebate amounts found to be inappropriate, but the Illinois Commerce Commission is years behind on those annual reviews. As he seeks legislation to put Illinois on a path to a 100 percent carbon-free power industry, Gov. J.B. Pritzker has called for an end to
formula rates, the annual rate-setting process that took away most of the ICC’s authority to push back on ComEd’s requests. But that hasn’t stopped utilities—and particularly their union allies whose members benefit from the unprecedented levels of capital spending—from continuing to propose provisions that would continue elements of the formula-rate era such as guaranteed returns for utilities.
PROPOSED SYSTEM
for green power to push mechanisms that will enable them to generate guaranteed returns and profit growth thanks to elevated investments in infrastructure they can argue is tied to carbon reduction. “Nicor Gas has calculated that even relatively small amounts of (renewable natural gas) production can produce very significant levels of carbon reduction—if just 1 percent of our current gas throughput is replaced with RNG, this would equate to approximately 400,000 metric tons of CO2 emission reductions,” a spokeswoman says in an email. The proposed “true-up” of returns each year would make rates “less volatile,” she says. A Peoples Gas spokeswoman says replacing old natural gas mains, which is an important part of the billions the utility has spent on infrastructure, is a matter of safety. “While we continue this important work, to be clear, a typical residential customer in Chicago paid 12 percent less in 2020 than in 2013 when the gas rider legislation passed. Additionally, Peoples Gas has not raised base rates since 2015,” she says. She does not note that 2020 was an unusually warm heating season and that each of the heating months in 2013 was colder on average than
The comprehensive energy bill put forward by the union coalition billing itself as Climate Jobs Illinois would replace ComEd’s formula rate with a system allowing the utility to continue charging ratepayers extra if it failed to obtain the returns it was “allowed” in the previous year’s rates. Before formula rates, one of the small financial risks utilities had to shoulder was ensuring the revenue they were collecting fell to the bottom line sufficiently enough to achieve their authorized return. That all ended after 2011. Likewise, Nicor is pushing a bill to authorize elevated spending on what it bills as its own carbon-reduction plan. That would permit Nicor (and Peoples as well, if it chose) to charge ratepayers to build gas lines connecting landfills “THAT’S ONE OF THE HIGHEST GROWTH to the larger pipe net- RATES IN THE U.S. REGULATED UTILITY work and using the gas they emit for fuel. For SECTOR.” the qualified spending, which is expansive, the Paul Patterson, analyst at Glenrock Associates, bill also would guaran- commenting on earnings at Peoples Gas tee Nicor’s returns—a benefit gas utilities don’t currently the same months in 2020. At least enjoy, unlike their electricity coun- half of a heating bill is the cost of the gas itself and the rest is what rateterparts. The House Public Utilities Com- payers pay Peoples to deliver the mittee approved both bills unani- fuel and maintain the system. A ComEd spokeswoman demously. They await floor action but are likely to be part of the intense fends the utility’s spending under negotiation over a broad bill that the 2011 law, citing improved relinow begins in earnest with hopes ability performance over that time. of concluding by the scheduled As for the legislation the union coalition is proposing, she says ComEd May 31 end of the spring session. Formula rates and infrastructure still is studying it. “We look forward to continued surcharges are ways for utilities— particularly in areas like northern discussions with Climate Jobs IlliIllinois where population growth nois and other stakeholders . . . and is nil and economic growth is slug- expect that this and the many other gish—to jump-start growth when energy proposals in Illinois will be otherwise there would be little. considered together,” she says in an They now are seizing on the push email.
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CRAIN’S CHICAGO BUSINESS • APRIL 26, 2021 25
BENSENVILLE from Page 3 “This was the opportunity of a lifetime,” Fiore says. The opportunity arose from an industrial real estate boom that has made land around O’Hare International Airport an increasingly precious commodity. So precious that a pair of developers just spent more than $64 million buying up the homes of Mohawk Terrace, at the southwest corner of Busse Road and Devon Avenue. The developers, Itasca-based ML Realty and San Francisco-based Prologis, plan to plow all 106 of them under and build two massive warehouses in their place. ML and Prologis tantalized Mohawk Terrace homeowners with lofty prices that were hard to refuse, well above what the homes would have fetched in a regular sale—but low enough for the development to be profitable. The developers paid an average of $615,000 per house, dropping more than $1 million on six, according to Blockshopper and DuPage County records. Publicly available sales data shows only five prior home sales in the subdivision exceeding $400,000. “In the end, I think money talks in every factor of the world, and I think it talked in this one,” says Fiore, 63, whose father developed the subdivision about six decades ago. The money says clearly that the local market for industrial real estate is heating up, especially on the DuPage County side of O’Hare, where property taxes are lower. Companies in e-commerce, distribution and logistics industries have continued to expand during the pandemic and are gobbling up warehouse space there. Some businesses want to be close to
the airport. Others just like the area’s proximity to nearby interstates and Chicago’s big pool of workers and consumers. “This is the bullseye of metropolitan Chicago,” says David Riefe, senior vice president of Atlanta-based Seefried Properties, which recently completed two 80,000-square-foot industrial buildings on Devon about a mile west of Mohawk Terrace. Boosting demand further is the recent extension of Illinois Route 390 to Busse in Bensenville, improving truck access to and from the west side of O’Hare. “You can get in and out more quickly,” says Nick Siegel, partner at Bridge Industrial, a Chicago-based developer.
COMPLEX TASK
Developers are responding by pouncing on whatever land in the area they can get their hands on. Assembling parcels into a buildable site is a routine part of the development process, but taking over a big subdivision is anything but. Negotiating individual contracts with dozens of sellers is complicated and time-consuming, and not every homeowner acts rationally. “It’s extremely challenging,” says Darcie Fankhauser, regional partner in the Chicago office of Houston-based Transwestern Development. “Imagine having upwards of 30-plus sellers, all looking for different things, different timing, different prices.” But land has become so scarce, and acquisition costs have risen so much, that more developers are willing to try. Fankhauser estimates that land in DuPage County near O’Hare sells in the mid-$20 per-square-foot range today, up from the mid to high
teens about five years ago. Seefried is among those developers, buying six residential parcels on Devon last year for its industrial development, which lies in Elk Grove Village. In Wood Dale, about a mile south of Mohawk Terrace, Transwestern bought 30 of about 100 homes in the Mohawk Manor subdivision, tore them down and built a 301,000-square-foot warehouse in their place. Nippon Express, a Japanese logistics company, recently moved into the building. Transwestern isn’t stopping there. The developer is in the process of buying out more Mohawk Manor homeowners to the south. It signed a contract to pay in the “$400,000 range” for a house in the subdivision where Colleen McCormick lives with her boyfriend, probably double what a residential buyer would pay, she says. The closing is scheduled for June 1. McCormick isn’t sure how many homes Transwestern is buying, and Fankhauser declines to discuss the developer’s plans for Mohawk Manor. “Some people feel like they’re being pushed out,” McCormick says. “Some are absolutely ready to go.” Up the road, at Mohawk Terrace, Katherine Anderson says she and her husband, Arthur Eichorst, are “100 percent happy” to leave and start a new life in Las Vegas. ML paid $435,500 for their one-story ranch on Indian Hill Drive, where she raised eight of her 11 children. They received enough money in the sale to buy a Las Vegas condominium without a mortgage. If they sold their Bensenville house to a residential buyer, “we would have been hard-pressed to get what we owed on it,” Anderson says. She and
ML REALTY
Industrial developers paying top dollar to replace subdivisions with warehouses
A rendering of one of the two warehouses planned on the site of Mohawk Terrace. her husband owed $256,000 on their mortgage, she says. Mohawk Terrace was a logical target for an industrial developer, surrounded on all sides by big industrial buildings. San Francisco-based Digital Realty runs a huge data center on the other side of Devon Avenue. ML made its move in fall 2019, sending letters to Mohawk Terrace residents expressing its interest in buying them out, says Fiore, who served as a liaison between the developer and his neighbors. But the subdivision also caught the eye of Prologis, which quietly bought a few houses in the subdivision while ML was still negotiating with other residents, he says. It was a shrewd move by Prologis, giving the company leverage over ML by disrupting its plans. ML “was a little upset by that,” Fiore says, but the two firms eventually agreed to form a joint venture to develop the site. ML and Prologis representatives decline to comment. ML is already courting tenants for the two warehouses planned for Mohawk Terrace. It expects to break ground this summer on the project,
which will total 605,000 square feet, and complete construction next spring, according to a March announcement from ML. The project “is strategically located in the center of the O’Hare submarket and will offer excellent access to all areas of Chicago via all major expressways,” the announcement says. It’s also “only minutes from both cargo entrances at O’Hare.” Many Mohawk Terrace homeowners are happy with the prices they received for their homes, but others are a little jealous of neighbors who pocketed more than they did. Some are scratching their heads at the $1.7 million Fiore received for his house—$472,000 more than the second-highest amount. Though Fiore worked closely with the developers to orchestrate the entire deal, he says he and the developers conducted themselves properly when it came to the sale of his property. He says didn’t get rewarded with a higher price for his role but negotiated a contract just like his neighbors did. “This was something that I advanced and felt I did for the community,” Fiore says. “In the end, everyone negotiated their own contract.”
Mellody Hobson is making strategic shifts and management shake-ups at Ariel HOBSON from Page 1 funds, which have been squeezing fee income collected by traditional money managers like Ariel. Ariel also recently disclosed novel plans to make direct investments in other companies under a program designed to create minority-owned firms and expand others. And a new office in San Francisco, its third, aims to corral tech and other West Coast wealth. Hobson’s expanding influence marks a turning point for Ariel, a leading Black-owned firm in Chicago. Founded by Rogers in 1983, it’s also one of the city’s few significant mutual fund companies. “They’ve tossed around the term Ariel 2.0,” Morningstar analyst Adam Sabban says of the thrust. Hobson, 52, has worked nowhere else since interning at Ariel as a college student. Two years ago, she bought 14 percent of Rogers’ stake, trading places with him as Ariel’s top shareholder, with just under 40 percent of the shares. Though both are co-CEOs, Rogers, 63, and Hobson have distinct roles: He picks stocks, supervising research and trading. She runs the company. Her outside profile is rising, too. Hobson appears on TV and chairs the Starbucks board. She
P025_CCB_20210426.indd 25
declined to be interviewed. Ariel’s fortunes have fluctuated over the past four decades. Compared with $21.4 billion in assets under management in 2004, the figure at the end of March was $16.2 billion. Still, that was a far sight better than the year-earlier $10.2 billion, as Ariel’s trademark “value” investing in solid but slower-growth companies rebounds during the pandemic and stock market recovery. Hobson has broader ideas. Sitting on the JPMorgan Chase board gives her a “front-row seat” to banker Jamie Dimon’s tutelage, Rogers says. Chase has committed up to $200 million to co-invest in projects under Project Black, part of Ariel’s minority-firm venture Ariel Alternatives. More than five years ago, according to a former Ariel employee, Hobson asked a colleague to look into exchange-traded funds, which offer investors trading and tax advantages. Nothing came of it. But now that Hobson is co-CEO—and ETF volume has sextupled over the last decade, reaching a third of the $19 trillion in mutual funds—Ariel is getting off the dime. This month the company and broker Charles Schwab filed for approval to establish an ETF targeting environmentally and socially responsible investments.
To step up Ariel’s game, Hobson has been scouring résumés, searching for applicants with better pedigrees. A quarter of Ariel’s 105 employees have come aboard since the beginning of 2020, including Chief Talent Officer Marlo Gaal from Groupon. Mary Cecola was hired as chief technology officer in 2019 from lender Antares Capital. Some top executives hired or advanced after Hobson became coCEO haven’t lasted. Among them are Adam Hodge, senior vice president for external affairs, and Roopa Weber, who had been promoted to chief marketing officer. Paul Lussow, arriving from Sterling Partners as chief operating officer, stayed less than a year. Maureen Longoria, chief financial officer since 2010, is on her way out. “The ramp-up is hard, and to be able to ramp up and execute at the same time is virtually impossible,” Hobson told Crain’s as Lussow departed, in a comment that stung some Ariel employees. Co-CEO Rogers says, “When a new leader comes in, it’s an opportunity to build out a new team. It’s natural.” Lussow hasn’t been replaced. Instead, Ariel is relying on David Vitale, a former banker and longtime director, to advise the operating committee. He’s among
four directors, including Vice Chairman Charles Bobrinskoy, a school chum of Rogers’, who are exiting the board, leaving only two insiders: Rogers and Hobson. Ariel said Vitale will serve as a liaison to Ariel Alternatives. Another departing director, Leslie Brun, was named its CEO. Hobson has been operating largely from California, where she lives with her husband, billionaire filmmaker George Lucas, a circumstance that Rogers maintains won’t jeopardize Ariel’s Chicago base. “She’s fully engaged in the fabric of Chicago,” he says, citing her vice chair role at economic development agency World Business Chicago.
ODD COUPLE
On the ETF front, Ariel is acting after investor costs have shrunk by half over the last 20 years, as more money flows to funds like ETFs “that don’t have embedded advice, marketing and distribution charges,” says Morningstar’s Ben Johnson. Ariel will pick the stocks for Schwab’s ETF, benefiting from a rule change that waives a requirement to disclose portfolio positions daily, as is the case with most ETFs. Instead, Ariel will report quarterly, on a 60-day delay, allowing it to
camouflage investing strategy. In bold type, a Securities & Exchange Commission filing warns this may increase risks for investors. The firms say they won’t comment before regulatory approval. With Schwab, Ariel is deepening what’s turned into a strange-bedfellows political relationship. As Rogers and Hobson oppose Republican efforts to restrict voting access, Schwab founder Charles Schwab has been a hefty contributor to Donald Trump and Republican causes. After the Jan. 6 Capitol riot, Schwab the company was roasted for donating to members of Congress who objected to the results of the presidential election. Schwab at first halted donations by its political action committee through 2021 and later closed it altogether, contending “It is unfair to knowingly blur the lines between the actions of a publicly held corporation and those of individuals who work or have worked for the company. Rogers points to a Black Investor Survey the firms have sponsored for more than 20 years, noting, “All I can say is, they share our love and interest in financial literacy. It’s had an impact—us shining a light on that problem.”
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26 APRIL 26, 2021 • CRAIN’S CHICAGO BUSINESS
H in
Illinois’ botched pot license rollout hurts social-equity candidates, cultivators original law, championed by Gov. J.B. Pritzker, who is up for re-election next year. “The rollout was not successful. Until we fix it and pass a law to get licenses out to Black and Brown people and women, it’s going to cost us,” says state Rep. LaShawn Ford, a Democrat from the West Side. “By not implementing the cannabis law as intended, communities that have been hardest hit by the war on drugs and are supposed to see the benefits of creating jobs— that’s been delayed.” Pritzker’s office did not respond to a request for comment. The licensing process in Illinois is being closely watched by other states that have voted to legalize recreational sales since Illinois passed its law two years ago. “Illinois was seen as the gold standard for the social-equity piece in legalization policy, as the state who did it right,” says Tim White, a lobbyist at River Crossing Strategy Group in New Jersey, where regulators are starting to craft licensing rules. “It looks like they’ve run into some delays.” Those delays mean that medical-marijuana license holders continue to have the recreational
A is
A
HIGH COSTS
The licenses are extremely valuable, especially in tightly regulated markets that limit the number of stores. Illinois has capped retail licenses at 500. It can cost $500,000 to $1 million to get a store up and running; successful dispensaries can do more than $1 million a month in sales and sell for $20 million. Under a bill filed by Ford on April 20, the state would hold a lottery among applicants who achieved perfect scores to dole out the 75 new licenses that were supposed to be awarded last year.
JOHN PLETZ
MARIJUANA from Page 3
cannabis market to themselves. At $669 million in sales, the recreational market was nearly twice the size of the medical-marijuana business last year. But the lack of new retail shops also has meant lower sales growth than anticipated for cultivators, many of which are owned by companies that also operate dispensaries that supply marijuana products to retailers. Ford is among the members of the Illinois Legislative Black Caucus who are trying to get things back on track. They’ve proposed changes to the law aimed at fixing a licensing process that has failed to deliver on promises to diversify ownership of the cannabis industry.
State Rep. LaShawn Ford wants to fix a licensing process that has failed to deliver on promises to diversify ownership of the cannabis industry. A second lottery would distribute 110 licenses to social-equity applicants who achieved at least 85 percent of the points allowed. A second lottery would counteract a little-noticed provision that gave extra points to veterans, which left many social-equity applicants out of the running for the initial 75 licenses.
Those licenses are being awarded through a tiebreaker lottery that’s limited to the highest-scoring applicants. If the legislation passes, it would more than double the number of dispensaries. But it could take six months to a year for the winners to get stores open. “We’re almost a year overdue,”
says Kianna Hughes, who owns a cannabis-training company called Elevated Education and is part of two applicant groups that received perfect scores. “We thought we would have had (a license) by now. But the beat goes on. If a bill is what we need to get this going, let’s do what we need to do.”
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CRAIN’S CHICAGO BUSINESS • APRIL 26, 2021 27
How Illinois is trying to reach out to those resistant to getting COVID vaccines VACCINATIONS from Page 1
JOHN R. BOEHM
Public Health Director Dr. Ngozi Ezike. “We’re switching to our ground game as we work with houses of worship, the chambers of commerce, the rotary clubs, we have rural missions. We are taking the vaccine to places instead of being at a site and waiting for people to just show up.” New strategies include shifting from mass vaccination sites to smaller clinics with longer hours of operation, setting up employer-sponsored events, enlisting more primary care practices and developing social media campaigns. As demand starts to plateau here, Chicago and Cook County officials are piloting walk-in access at mass vaccination sites. “Currently 50 percent of eligible individuals in Cook County have received at least one dose. This is good, but there is a lot of work left to do,” says Iliana Mora, chief operating officer of ambulatory services at Cook County Health, which will allow walk-ins at its Tinley Park and Matteson sites.
DOWNSIZING
In DuPage County, where vaccine appointments aren’t filling up as quickly as before, the health department is shifting away from mass vaccination sites that administer about 2,000 doses a day to smaller clinics with more convenient hours, says Karen Ayala, executive director of the DuPage County Health Department. To reach people who haven’t been lining up for shots, the health department aims to send doses straight to workplaces, Ayala says. Even if employers aren’t mandating that workers get vaccinated, Ayala hopes the convenience of workplace vaccination sites will encourage more people to get a shot. Meanwhile, Lake County plans to use social media to target 18– to 29-year-old residents—a group that historically has passed on flu shots and could be reluctant to get a COVID-19 vaccine, either because they have some immunity from a previous infection or they think they’re not at risk for a severe case, says Mark Pfister, executive director of the Lake County Health Department. The challenge is crafting an effective sales pitch. “Blanketing people with ‘Go get your shot’ or using fear does not work,” Pfister says. “It used to be that campaigns would say, ‘Go get your vaccination for your grandma because you don’t want your grandma to die.’ We now know that may work for a few, but it turns off a lot of people. We really need to have a better understanding with COVID-19 . . . why are people not getting vaccinated.” The state is working to identify groups that are reluctant to get in-
Karen Ayala, executive director of the DuPage County Health Department, plans to send doses straight to people’s workplaces to get them vaccinated. oculated and figure out how best to educate them about vaccines. Illinois in March launched a $10 million television, billboard and social media campaign aimed at building vaccine confidence among those who are uncertain. The most-viewed video from the campaign on YouTube is a 15-second clip featuring Dr. Robert Murphy of Northwestern Memorial Hospital. “It’s very important that everybody that can take the vaccine take the vaccine,” he says, straight to camera. “Polio, smallpox, measles, mumps, rubella—it’s incredible the number of diseases we’ve been able to prevent because of vaccines.” Another features 68-year-old Bonnie Blue, one of the first vaccine trial participants in the state, who discusses the dangers of catching COVID as someone with asthma. “Doing this was something that, it needed to happen, especially being an African American older person,” she says. Ezike says the state plans to target specific groups more precisely. For example, telling 16– to 18-year-olds that a vaccination would enable them to celebrate prom and graduation safely might convince more of them to get shots. For the 21 and older crowd, messaging could point out that widespread vaccinations would lead to easing of capacity limits at bars. “We’re educating and teaching and hand-holding, making sure all the questions are answered,”
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Ezike says. “It’s going to be slower to finish this out, but it’s definitely important so that we don’t leave anybody behind.”
‘YOU TRUST THE PEOPLE YOU KNOW’
Particularly hard to reach are people who don’t feel their personal or professional lives have been dramatically impacted by the pandemic. Ayala describes their mindset as “Why would I go out of my way to get a vaccine now?” Combating hesitancy is about “not only addressing the potential concerns that people have, but also promoting why it’s important for people to get a vaccination,” she says, noting that DuPage plans to offer educational webinars with local health systems to better address misinformation. Campaigns that come from local community leaders and physicians tend to be more effective, says Dr. Saralyn Mark, a women’s health specialist who has helped craft educational campaigns at the federal Department of Health & Human Services. “You trust the people that you know, especially in some of these smaller communities where there might be concern about trusting the government,” Mark says. Meanwhile, demand is drying up downstate, and local health officials face the headwinds of COVID fatigue, misinformation and difficulty getting the word out. More than half of all local health departments in Illinois recently told the state they don’t need additional
NO NEW FIRST DOSES ORDERED IN MORE THAN HALF OF ILLINOIS’ COUNTIES A slowdown in vaccinations has led more than half of Illinois’ counties— pictured here in red—to indicate they won’t order any new first doses the week of April 26. Red = No new orders
first doses at a time when vaccination rates are well below the herd immunity threshold. Many of the areas, including Pike and Wayne counties, have fully vaccinated less than 30 percent of their residents. With 23 percent of the Wayne County population fully vaccinated, county health department administrator Nicole Schoenborn says she’s surprised that so many people have gotten a shot, given the community’s hesitancy. The health department is working to combat misinformation, including the idea that vaccines contain tracker chips, Schoenborn says.
In Pike County, where 24 percent of the population of 15,611 have been fully vaccinated, inoculations peaked on Feb. 2, with 402 doses administered. Now the county is averaging just 28 inoculations per day, according to the state’s public health department. Pike was allotted 300 doses but ordered only 100 the week of April 19, says Sharon Bargmann, Pike County Health Department’s director of nursing. The state reports that Pike has been putting in reduced orders for several weeks. “We are just having trouble finding people to fill the slots,” Bargmann says.
Vol. 44, No. 17 – Crain’s Chicago Business (ISSN 0149-6956) is published weekly, except for the last week in December, at 150 N. Michigan Ave., Chicago, IL 60601-3806. $3.50 a copy, $169 a year. Outside the United States, add $50 a year for surface mail. Periodicals postage paid at Chicago, Ill. Postmaster: Send address changes to Crain’s Chicago Business, PO Box 433282, Palm Coast, FL 32143-9688. Four weeks’ notice required for change of address. © Entire contents copyright 2021 by Crain Communications Inc. All rights reserved.
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