The Full Story of the Emma’s Landing Grift Will Never Be Known, But What Is Known is Ugly
This is page 2 of the Minutes of the Secret Session of the Geneva City Council from April 20, 2020. The audiotape of this meeting was destroyed in November 2022 even though a FOIA request had been made for it. As will be demonstrated below the Council did not deliberate over the selling price. Rather the Council schemed over how to put lipstick on the lips of porcine grift. The Council “rushed to a decision behind closed doors,” to use its own description. The Council kept the Burton Foundation informed but hid its planned ambush of its own constituents. The “May 4” meeting never occurred for reasons shrouded is mystery, but probably because of insufficient votes cast and gathered secretly. Ironically, the mayor-inspired donation plan was abandoned in the waning hours of the process. The donation never occurred but the ruse fooled the State Authorities into awarding bonus points to Emma’s application. All this while the Geneva community was focused on a pandemic. What is hidden by the redaction of minutes of a meeting where a land deal was consummated two years earlier? What was the Open Meetings Act exemption used to allow this material to be redacted?
On November 7, 2022, the Geneva City Council finally released partial minutes of its April 20th, 2020, secret session. Although a FOIA request had been made for the minutes and tape of that secret meeting, the tape was destroyed anyway. The released minutes were redacted, so the release was only partial. The OMA exemption from transparency cited by the City Council does not exist for several of the closed sessions. The Council often invented an exemption by combining two provisions into one. The fragment of the April 2020 minutes made public reveals the council discussed a donation of the Emma’s Landing site, not the “sale or lease” of the property. No OMA exemption exists for discussion of the donation of public property. The Council on April 20 also discussed “pending litigation” but failed to cite the legal action that was pending.
The nuances of the Illinois Open Meetings Act (OMA) are many, and judicial case law is sparse. OMA_Reference_Guide.pdf (champaign.il.us) Given that no duty or requirement exists that closed secret session minutes be redacted or that verbatim recordings be destroyed, why is the City of Geneva so zealous in covering its Emma’s Landing tracks? The Geneva administration and City Council claim this: “The City of Geneva’s mission is to conduct government business in an open and transparent manner for all of our community stakeholders.” Government Transparency | Geneva, IL – Official Website
The City of Geneva talks the virtuous talk, but does it walk the straight and narrow path to transparency? Presented here is an example of one closed secret session, that of April 20th, 2020. The subject matter was both contentious and emotionally charged. The context is important. The meeting took place during the darkest days of a novel pandemic: Sars CoV-2 (Covid-19). The governor claimed emergency powers (some still “in force” today) that, among other things, suspended the Open Meeting Act. The legislature voluntarily disbanded. The governor did not call the legislature into an emergency session. The governor urged and advised but never ordered that only “emergency” measures be addressed by local governments during the crisis. On March 20, 2020, the governor ordered, without any due process, that citizens be detained by issuing a universal “stay at home” decree. (The mayor introduced an ordinance that would have the Geneva police cite and fine Genevans who “violated” this decree.) Pritzker also banned gatherings of ten or more people. The time was ripe for Rahm Emanuel’s “You never want a serious crisis to go to waste. And what I mean by that is an opportunity to do things that you think you could not do before.” Quote by Rahm Emanuel: “You never want a serious crisis to go to waste….” (goodreads.com)
The Geneva City Council Archivist at work.
Please note that the land donation was discussed secretly several times, including on February 10, February 24, and April 20, 2020. Here are copies of the minutes of the three secret sessions minutes (the other minutes refer to an unrelated land matter):
The document below was also acquired via FOIA from IHDA. “11831” was Emma’s Landing file number of its application for federal and state grants. “Site Control” was mandatory and “land donation” garnered the application extra points.
Below is the State of Illinois Press Release (see page 2) that Emma’s Landing was a “winner” of IHDA approval for funding and that wrongfully claims that the site was donated by the City of Geneva. after the Press Release is another improper communication with the Burton Foundation providing it with information unavailable to Geneva citizens. The Mayor and Council were obsessed with the delusion that they could tax and spend Geneva into affordability.
Above is another entry in Emma’s Landing QAP application to IHDA that explains how the “donation” grift was perpetrated. The red box emphasis was placed by IHDA. The applicant was privvy to the inner workings of the Geneva City Council but Genevans were not. Poor “Peter” did not get the approval on April 20th. But his “hurry up” offense won the game by stampeding the City Council into precipitous last-minute changes. What about the four aldermen who suggested the “next cycle” for a well-thought-out and transparent plan? They either resigned or got cold feet, apparently.
The Geneva City Council on April 20, 2020, did not deliberate on the sale price for the Emma’s Landing site. Rather the Council schemed on how to waive permitting fees and gifting the site to the Fellhaurs, AKA, Burton Foundation. The Posse Comitatus night riders even went so far as to discuss how to darkly grease the deal past their own constituents. Is fraud too strong of a term when the City attorney secretly corresponds with an outside party and provides “the form” of a document not even yet seen by the City Council? From where in the Municipal Code does the City Administrator get the authority to set the Council’s agenda? Or does a wink and nod from the mayor suffice?
If the City of Geneva lasts a thousand years, people will look back and declare “This was their darkest hour.”
As Usual, More Questions than Answers about the Rules of the Shell Game: The Dunkin’ Shuffle and The Emma’s Landing Grift
The City of Geneva’s annual budget document is not an audited financial report. The budget is a planning document. Still, it provides insight into the City’s priorities and planning prowess.[1] The 148-page document contains not a single explanatory footnote, and the puzzling entries and ommissions are plentiful.
FIGURE 1: City of Geneva Budget Summary
A recent Brenda Shory report in the Kane County Chronicle correctly highlights capital spending as a significant component ($14 million) of the FY 2024 total budget, which is 13% higher ($128mil) than FY2023’s $113mil total. And renowned economists debate where inflation comes from? So, an examination of the Capital Projects Funds is in order. “The budget plan proposes more than $14 million in capital projects.” [2]
First, please raise your hand if you understand the ~$75K in the “Foreign Fire Insurance” revenue line. This is a classic Illinois “where’s the peanut” tax. A non-elected “Board” is empowered to expend Foreign Fire Insurance Tax proceeds for the “maintenance, benefit, and use of the Fire Department.” This Board cannot expend tax proceeds for projects not given budget approval by the City Council. The City Council cannot authorize the expenditures of tax proceeds for projects not approved by the Board.
Consequently, the system requires the City Council and the Board to mutually agree on the expenditures. A more transparent line-item title would be “Firemen’s Slush Fund.” Some municipalities have declined to levy this tax because of the “shared” power with a non-elected board. Geneva keeps its snout in the Fire Insurance trough.
As seen in FIGURE 1, Geneva’s Tax Increment Finance districts’ budgets and actual revenues are mystifying. Take TIF #2, for example. The payments for FY years 2021, 2022, and 2023 are $258K, $251K, and $266K [3] are pretty much in line. The 2022 budget called for $992K in TIF2 revenue. The superficial explanation for this is simple if you understand that the East State Street [Capital] Improvement Project has been slated to begin “next year” every year for almost a decade. Of course, the start did not happen again. And about $1.5MIL in Federal CMAQ grant money is sloshing around in the TIF #2 slush bucket. That money appears and disappears like a rabbit in a hat.
Where was the extra $750K that was budgeted stashed? TIF #2 expires this year, yet $852K is budgeted in 2024 and forecasted at $746K in 2025. How does an expired TIF generate $746K? The two TIFs combined had a $2,419,650 revenue “miss” for FY2022. What happened? Where is the footnote that explains this smoke and mirror exercise?
Before leaving page one of the budget, another question is, where is the revenue from SSA #34? This is the Special Service Area for Emma’s Landing. Remember the non-factual “Fact Sheet” the City of Geneva promulgated, which stated that the property tax on Emma’s Landing would be paid:
“Question: Do affordable housing developments pay real estate taxes? If so, are affordable housing developments assessed at the same rate as market-rate developments? Answer: Affordable and market-rate developments are taxed at the same rate as determined by the Geneva Township Assessor.” [4] FACT: LIHTC projects like Emma’s Landing are taxed under an income-based algorithm that results in the actual tax rate of about 1/3rd of the normal” “EAV” assessed valuation algorithm rate. Emma’s Landing passes two-thirds of its EAV along to the rest of the township taxpayers. Of course, zero rates (see Figures 2 and 3) are 100% lower than your property tax rate.
Another example is the Dunkin site at the corner of Crissey and Route 38. The Dunkin owner paid $715,000 for the two PIN number property in 2019. In 2018 the two parcels were assessed at a value of $336049+$103, 411, or $439,460. In 2021 the assessed fair market value was $390,343+97,717, or $488,060, after spending at least $150,000 on remodeling, equipping, repaving, lights, etc. The $850,000 investment was assessed at less than $500,000. The tax bill went from $10,532 to $10,972.60 on the parcel with the building. About 20% of the tax money went into the TIF #3 slush fund bucket. The property was sold for unpaid taxes and then redeemed. This is a mess of Burnsian proportions and will only worsen. Here is a copy of the latest tax bill for one of the Dunkin parcels:
Here is an example downloaded today of a tax file for one of the Emma’s Landing Planned Unit Development affordable townhome parcels:
FIGURE 2: Property Tax Information for Emma’s Landing PUD Lot 3. The dollar amount on Parcel Number 12-08-225-004 is $576,000. But that number was the sale price of the entire parcel, not just PUD LT 3. However, the above file shows the “Property Class” as “8000-Exempt.” The “Tax Status” is listed as “Exempt.” The total tax is given as $0.00.
Below is what pops up when you click on the green box “print tax bill” in the Geneva Township Assessors site for the parcel 12-08-225-004 described above.
Figure 3: The result of clicking on the green “Print Tax Bill” in Figure 2.
Here is a link to the statute that is used to calculate the Illinois Property Tax for Section 42 Low-Income Housing Tax Credit (LIHTC) Projects:
I suspect that none of the ten Geneva City Council Members understood what they were doing when they passed the Ordinance that created Emma’s Landing. At least, I’d like to believe this was the case. The alternative assumption is almost unthinkable. According to records in the public domain cited here, Emma’s Landing did not receive a property tax bill for 2022. The City sold the property in July 2020 for $576,000. The Illinois Housing Development Authority was duped by the City and Burton Foundation into believing the property was donated. (11831 was the IHDA file for Emma’s Landing application – see document below obtained via FOIA from IHDA.) This “donation” ruse raised Emma’s QAP Score in the competition for IHDA grant money. I’d like to believe that the motto “If You Are Not Cheating, You Are Not Trying” is not Geneva’s.
With apologies to the Scottish Bard: “Politicians’ inhumanity to taxpayers makes countless thousands mourn.”
$1.4 million taxpayer gift slated from TIF3 fund that contains no money.
At the Same Meeting the City Council Voted to Destroy the Tapes of the February 2020 Meetings that Created Emma’s Landing Fraud (See Footnote).
Geneva’s Next White Castle at 122-130 East State: Another TIF White Elephant Disaster in the Making. The Geneva City Council believes that the road to affordable housing is through the wallets of Geneva home owners. https://www.geneva.il.us/AgendaCenter/ViewFile/Agenda/_11072022-2047
Viewing the tape of the November 7th meeting at City Hall was deja vu all over again. Ironically, the only entrance/exit for the 6000 square foot retail, twelve apartment, three story building will be on Crissey Ave. opposite an exit from the Dunkin TIF project on Crissey. The new building will be on top of the site of the now-demolished structure where Forrest and Kate Crissey first lived in Geneva, and where Augustus Conant first preached. A block or so west of the new TIF building is the now vacant building of the failed Geneva Pharmacy, another “TIF money down the drain” City of Geneva gift recipient. Wasting millions of tax-payer dollars collected by Illinois’ most regressive tax (property tax) only makes living in Geneva less affordable for those already here.
The phrase “but for” was not heard in this discussion. The City must “find” factually that “but for” taxpayer largess, this project would not happen. Several Council Members lauded a similar project by the same developer in Naperville. When asked if that project had received Naperville TIF funds, the answer was “No.”
Has anyone seen the Geneva District #304 School Board in the last couple of years? Most of the TIF money will come from the School District via the property tax payers. Much of #304 is not in the City of Geneva, but those homeowners will also subsidize this project.
Footnote:
“Written on Veteran’s Day 2022: To the Geneva City Council – The Illinois Housing Development Authority believed that the City of Geneva donated the Emma’s Landing parcel. IHDA cited this donation in its announcement that Emma’s Landing was a “winner” of a large LIHTC grant. IHDA used a communication from City staff based on a February 2020 closed session improper vote to conclude the land was donated. Emma’s Landing IHDA QAP application was given “bonus points” based on a donation that never happened. In Geneva City Hall, if you are not cheating, you are not trying. “Transparency” does not exist.
This is my final FOIA request for the February 2020 closed session tapes from the City Council and Cow. I have requested them in the past.
Democracy died in darkness on your watch. The funeral is over.
Memorial Day is about remembering the individuals who knew where the devil lived and their duty lay. They knew that a single individual’s effort was unlikely to be acknowledged. Richard Best sank the IJN’s premier carrier, Akagi, at Midway on June 4, 1942, with a single one-thousand-pound bomb dropped from his Scout Bomber Douglas 4 (SBD4) dive bomber (“Slow But Deadly” to its pilots). Best accomplished this with a little luck but primarily by following his Navy doctrine and training coupled with skill and courage. Many other anonymous bombs and bullets also hit their marks that day.
Over the weekend, I visited the final resting place of another WWII Navy Vet who went from Brisbane in ’42 to Tokyo Bay in ’45. He was a meticulous man who believed that details mattered. The Navy made him the ship’s bookkeeper aboard Haddo (SS-255, Gato class submarine). She and several other U.S. submarines were tied up to the Poseidon, a submarine tender, near Missouri when War II ended on 2 September 1945. The Pacific submarine crews suffered a higher mortality rate (20%) than did the 8th Army Air Corps (7.5%) over Europe. Jack made it home and got a job as a record-keeper at the Mark 15 torpedo factory on Roosevelt Road in Forest Park.
Today the assaults on our liberty that earlier generations created and preserved for us are often subtle, difficult to identify, and easier to ignore. An urban myth holds that putting a frog in a pot of boiling water will instantly leap out. But if you put it in a pot filled with pleasantly tepid water and gradually heat it, the frog will remain in the water until it boils to death.
“Fraud” is any activity that relies on deception to achieve a gain. Fraud becomes a crime when it is a “knowing misrepresentation of the truth or concealment of a material fact to induce another to act to his or her detriment” (Black’s Law Dictionary). Frauds committed and then covered up by elected officials and their employees, whether out of personal avarice or for political gain, are acts of sedition and insurrection that destroy liberty.
Here is an example of a “knowing misrepresentation of fact:”
Above the self-proclaimed owner of the Emma’s Landing Planned Unit Development certifies that she is the owner of the PUD parcel and “caused same to be subdivided and platted…” But the City of Geneva owned the PUD parcel and caused (and then self-approved) the PUD to be platted.
Then consider that Joy Nelson was the owner of parcel 12-08-224-00 that abuts the Emma’s PUD and provided the access from Lewis Road for the Emma’s PUD that was actually owned by the City of Geneva on April 21, 2021. Also consider that Joy Nelson sold that abutting parcel to James Bergman on June 29, 2021 for $650,000. Mr. Bergman’s address on the deed is given as 2090 Larkin Ave, Suite 5A-1, Elgin. This happens to be the address of the Burton Foundation that is now listed on the tax bill as the owner of the former Joy Nelson property.
Geneva taxpayers sold the PUD to the Burton Foundation for less than $100,000 per acre while Joy Nelson received over $200,000 per acre, well above the City’s appraisal for Emma’s Landing. The City’s appraisal put the value of the Emma’s site at about $120,000/acre. No doubt Joy Nelson’s sale was contingent upon the approval of the Burton Foundation’s successful application for LIHTC funds which she improperly facilitated by a “knowing misrepresentation of fact.” Most Genevans were victims of that fraud, but some benefitted. Big losers were the 22 applicants for LIHTC funds whose applications were denied in favor of a fraudulent one.
But this could become much worse for Geneva property taxpayers. Both buyer (Burton/Bergman) and seller (City of Geneva) knew that the required PUD Plat was fraudulent, but the PUD Plat was also a required time-critical element for success in getting LIHTC funding from the Illinois Housing Development Authority’s once-a-year cyle. So the parties winked and nodded simultaneously, as per the “Geneva Way.'” The IRS, IHDA, the Kane State’s Attorney, HUD, the Illinois Attorney General and the HUD IG may not deign to take notice of the “irregularities” in violation of the Illinois Open Meetings Act, unauthorized changes in contracts, and the blatant falsehood that is represented by the Emma’s Landing Planned Unit Development Special Use Zoning Plat.
Ominously, a violation of a city’s zoning ordinance can render the title to Emma’s property unmarketable. https://www.tourolaw.edu/Academics/uploads/pdfs/5_Marketable_WWW.pdf The lenders for the Emma’s Landing project and the underwriters for the LIHTC income tax credits will not go quietly into the good night should the project go into default. Real estate held as collateral that has an unmarketable, clouded title could make those third parties, including the title insurer, anxious to be made whole by the purveyor of the bad title. Ultimately, that seller’s liability falls upon the Geneva voters and taxpayers.
Geneva has a city government focused more on what it can get away with than on what the statutes and ordinances require. No elected, appointed, or employed official has attempted to explain why this fraud was perpetrated. We have descended into local vigilanteism and worse. The devil often now dwells in the “minor” details, and so does the danger to life, liberty, and the pursuit of happiness.
Rod's Ramblings and Ruminations 