The open hand of government and thug politicians

Editorial: Ford gets a lesson in Chicago muscle

Why did Ald. Daniel Solis stall a business that wants to put people to work?

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If you wonder why this jobs-hungry city has a reputation as a hard place to do business, read on. Looks to us like developers of a big Ford dealership planned for the North Side got tutored in Chicago-style political muscle.
It's a familiar story in a city and state where elected officials, in the words of Illinois Chamber of Commerce chief Doug Whitley, treat potential investments as opportunities for "threat, coercion, a union squeeze, a minority holdup, a double-dip, a no-show job, a kickback and a sweetheart deal."
The proposed $57 million Fox Motors project got off to a promising start. The city Plan Commission unanimously approved it in June. Chicago Ald. Scott Waguespack had done extensive groundwork for the development, which would create dozens of temporary and permanent jobs in his 32nd Ward, contribute millions of dollars in tax revenue to City Hall and replace an obsolete building with an attractive new showcase. Then Waguespack and the Fox folks ran into an unexpected roadblock.
Contrary to the usual practices of the City Council, another alderman held up the project. Daniel Solis of the Southwest Side's 25th Ward says he wanted to send a message that Ford Motor Co. needs to do more to recruit car dealers of Hispanic heritage. Solis was using his power as chair of the council's Zoning Committee to block the 32nd Ward project.
Turns out that Solis' political organization had received at least $6,800 in contributions from a Chicago-area Hispanic businessman who, Solis knew, wanted to get into the car business. The donor, Jose Diaz, also had contributed smaller amounts to other members of the council's Hispanic Caucus.
On Wednesday, Solis' committee is scheduled to reconsider the dealership's application. This time, the project appears likely to be approved.
What changed? Nothing to do with zoning:
•Mayor Rahm Emanuel heard about Fox Motors' travails in late July and stepped in to break the impasse. A story by Crain's Chicago Business columnist Greg Hinz about the politically imposed delay attracted public attention, including the scorn of Illinois Chamber President Whitley.
•Fox negotiated an extension of its Aug. 1 deadline to go forward with the development at 2501 N. Elston Ave. It also hired the law firm of Gery Chico, a Hispanic politician with City Council connections, to address the concerns of aldermen about the planned development and Ford's commitment to minorities.
•The giant automaker reached out to Diaz, the Hispanic Caucus' donor. Ford says it has invited Diaz to apply for a program that provides up to $750,000 in matching financing and introduced him to dealers who might be interested in selling out to him if he can raise the necessary capital. Diaz declined to comment.
So the stage is set for a happy ending, Chicago-style.
Did Solis block the Ford dealership to benefit his donor? "That's not what happened at all," Solis tells us. "I'm not advocating for any particular individual to get a dealership. Our concern was Ford and its lack of (minority) representation."
Ford and the nation's other major car companies have struggled to expand their network of minority-owned dealerships. At the end of 2012, only 5.1 percent of 3,286 U.S. Ford dealerships were owned by minorities, down from 5.2 percent the previous year. The major automakers cut back on dealerships during the Great Recession, shutting down weak operations. They've focused on strengthening existing dealerships rather than starting new ones. The Michigan-based Fox Ford bought a defunct dealership at 2401 S. Michigan Ave., where it plans to operate until it moves to the new North Side location.
Solis and other aldermen raise a good point, but it isn't the point in this saga: Investors seeking to spend $57 million to create trade and jobs and tax revenue in Chicago have nothing to do with Ford's national policies for minority engagement.
Blocking the deal sent a message all right, but not the one Solis says he intended. Instead, Solis and his colleagues on the Hispanic Caucus have reinforced the prevailing view that Chicago's elected officials put their political interests above the economic welfare of this city. They sent the message that if you want to do business in Chicago, you'll do it their way or no way.
Businesspeople who want to bring jobs to Chicago despite its history of public corruption should be welcomed, not thwarted.
It's past time for the City Council to get out of the way and encourage this deal.