Friday, April 17, 2015

How Wayne Watson Keeps His Job: It's the Jobs and Contracts Stupid

I think it fair to ask how someone with Wayne Watson’s record of dismal leadership can continue to hold positions of authority. The answer seems apparent: he is able to curry favor with his political benefactors by dispensing jobs and contracts to their friends, his friends, and political allies. This blog has already discussed Watson’s history of questionable hiring practices and his gift of more than $75 million in no-bid contracts to relatives of Emil Jones. Taking a look back at his history at City Colleges reveals another area in which Watson excels at giving taxpayer monies to well-connected cronies: outside legal work. Ultimately, this backward look will enable us to take a look forward and predict what might be in store for our school after Watson’s blighted regime departs.

A 2012 article in Crain’s took a critical look at the spending for outside legal work at City Colleges of Chicago. The article touched on the money spent by City Colleges on Emil Jones’ relatives, legal work assigned to law firms with connections to Richard M. Daley, and contracts to engineering firms with “political ties.” Although the author discussed these questionable expenditures, startlingly, he failed to mention Wayne Watson even once. The author went back only as far as 2008 in his comparison of City Colleges legal expenditure. However, City College Board Reports are available back to 1998. I will use these to construct a more accurate portrayal of the spending practices Crain’s found so troublesome. Wayne Watson emerges as the most prominent actor in this narrative.

During the Watson era, between 1998 and mid-2009, City Colleges of Chicago spent a minimum of $10.65 million on outside law firms. Notably, between 1998 and 2003, at least 15 months of data on legal expenses are not available in the extant records. Thus, the figure for the Watson years is likely to be closer to $12 million. For the 136 months of the Watson Chancellorship, his administration spent a minimum average of $78,334.65/month on legal fees to external law firms. Of that $10.65 million, a minimum of $3.53 million went to firms with ties to Richard Daley or Wayne Watson. Some of these names may be familiar: Laner Muchin, later apparently hired by Chicago State to investigate Phillip Beverly, reported in the Crain’s article to have ties to Richard Daley, received $981,000 from City Colleges for legal work between 1998 and 2009; another firm with reported ties to Daley, Franczek Radelet received $1.4 million; Chico and Nunes received $183,000 and Pugh, Jones and Johnson, the firm that defended Watson in the Jim Crowley case and a law firm with at least one lawyer who has been extremely useful to Watson and Angela Henderson, received $937,000.

The 2012 article noted that the General Counsel of City Colleges, James M. Reilly, “who is empowered to hire law firms without competitive bidding, was an aide to Mr. Daley before joining the school five years ago.” The author neglected to mention that Wayne Watson hired Reilly as General Counsel on September 17, 2007.

In 2012, new City Colleges Chancellor reportedly terminated an existing contract with a politically-connected engineering firm, Anchor Mechanical. Guess who awarded Anchor Mechanical its original contract then gave the firm a succession of three-year contracts for various services? If you said Wayne Watson, you are obviously paying attention. In 2003, Watson awarded the first of three successive no-bid contracts for a maximum of $85,000/year to the company. In the 9 years the contract existed, Anchor Mechanical stood to receive a maximum of $765,000 from City Colleges. The article quoted Ms. Hyman as saying: "We have to be good stewards of the taxpayers' money. We're making sure every contract is competitively bid, and we need to ensure that every contract is actually needed or if can be handled better in-house."

Just how does Hyman’s administration compare with Watson’s in terms of its stewardship of “the taxpayer’s money?” In the 66 months of the post-Watson era at City Colleges, legal expenses for outside law firms have actually decreased, down to $73,358/month compared to Watson’s $78,334. However, when the residual effects of the Watson Chancellorship are figured into the equation, the post-Watson era appears even more thrifty.

Just after Watson left City Colleges, Maria Moore filed her lawsuit for retaliatory discharge. As chronicled on this blog, she won a huge settlement from City Colleges and the City Colleges Board agreed to pay her legal fees (amount unknown). According to the Court Docket, three separate firms worked on Watson’s defense: Laner Muchin again, Gonzalez, Saggio and Harlan—last seen writing letters threatening legal action against this blog for ridiculous “trademark infringement” claims, and Ford and Harrison. Between July 2009 and May 2012, these three firms charged City Colleges over $679,000: totals of $481,000 for Laner Muchin; just under $104,000 for Gonzalez, Saggio; just over $97,000 for Ford/Harrison. Thus, the actual outside legal expense for the Watson years comes to over $11.3 million or $83,300/month, for the post-Watson era, City College outside legal spending totals $4.16 million, or an average of $63,000/month. Given the obvious increase in legal fees (hourly billing rate) since Watson served as Chancellor, this is a striking reduction in City College legal expenses.

Looking ahead, Watson’s various mouthpieces will find him blameless as Chicago State struggles to cope with the cost of his presidency. Even though it is supposedly impermissible to use monies appropriated for salaries for other purposes, Watson acolytes will attempt to construct a narrative that attempts to place the blame for the Watson administration’s unethical and illegal behavior on the administration’s victims: witness the discussion of how the Crowley judgment necessitates layoffs. This argument is completely groundless. First, because salary appropriations are sancrosanct; second, because the Crowley case has not cost the university a dime (for the plaintiff’s side) to this point; third, the responsible parties are Watson, Cage and the other administrators who participated in that outrage, not Jim Crowley. Nevertheless, as judgments drive the cost of this administration up, Watson will, as he has done his entire career, try to shift the blame onto his innocent victims. That is what I think we will see in the coming months.


  1. Lamer Muchin is a busy group. They have also been taking in the public's money through Governor's State University in the long and sickeningly malicious termination of a tenured professor. The State of Illinois is dumping so much money into the coffers of these firms.

    Why do these universities even have Boards of Trustees of the Boards are not acting in the best interests of Illinois citizens?

  2. Somewhere in the mist of time during the 2008-2009 CSU presidential search, many of us took seriously the task of that committee and naively thought that CSU was all about education and providing the “best” leadership possible for this “diamond in the rough.” Thank you for underscoring so cogently here what many of us have concluded since Wayne Watson was shoved down our throats by that board of trustees. CSU is not about education, it is about disseminating contracts and being a center of patronage for some very well-connected pols and their sycophants. The attitude is that if some students benefit, that is great, but we are here first for the business of distributing favors. The College of DuPage, UIC will be scrutinized, but CSU will not. We get it. We are supposed to be the mediocrity in the ILL state system—as long as we benefit the chosen.