logo
    • Magazine
    • Membership
    • Donate
  • Racial Justice
  • Economic Justice
    • Collections
  • Climate Justice
  • Health Justice
  • Leadership
  • CONTENT TYPES
  • Subscribe
  • Webinars
    • Upcoming Webinars
    • Complimentary Webinars
    • Premium On-Demand Webinars
  • Membership
  • Submissions

A Conflict of Interest: Chicago Taxpayers File Suit over Purchase of Land for Schools

Michelle Lemming
March 15, 2016
Share
Tweet
Share
Email
Print

March 11, 2016; Chicago Tribune

Gregory Hobbs, the president of a Chicago school district’s foundation, personally profited to the tune of $195,000 in 2007 when he negotiated the sale of 100 acres of farmland for the school he represented. His multiple roles, including serving as the president of the Lincoln-Way School District’s foundation, the owner of the realty firm used for the negotiation, and the lead on the project, have continued to raise questions of conflict of interest, and is one of several concerns leading to a lawsuit filed by taxpayers.

Eight years after the sale, the district’s string of bad decisions to expand schools in response to projected population growth came to a community blow-up. Lincoln-Way had previously invested $225 million in two new high schools and had already purchased 80 acres to build a third when the 100 acres were purchased for the exact same reason. In response to the purchase of another 100 acres of land, then–school board president Ron Kokal had said that the board felt the purchase was a good decision. He said that the land may not be available or affordable in the future, and as for the extra 80 acres already available for expansion, he said that another school could be needed at a future date.

Whether these decisions to expand were in the best interest of the district were further questioned when local school officials announced they needed to shut down one of four high schools in 2015 in order to save the $5 million a year the high school expended in operations to “get off of the state’s watch list” and address the district’s “current financial situation.” Outraged community members formed Lincoln-Way Area Taxpayers Unite (LWATU) and filed a lawsuit against the district: a 530-page document, including a 60-page complaint with 470 pages of supporting documentation, filed against the Board of Education in December of 2015 that outlined “financial irregularities and mismanagement.”

Among other concerns, the filing listed the $195,000 commission paid to Hobbs as the owner of Manhattan Realty, in addition to concerns that the district did not obtain an appraisal on the property to assure the sale was conducted fairly.

Sign up for our free newsletters

Subscribe to NPQ's newsletters to have our top stories delivered directly to your inbox.

By signing up, you agree to our privacy policy and terms of use, and to receive messages from NPQ and our partners.

The farmland, known as the Cooper Farm, was owned by the Trust of Stanley and Violet Cooper. When interviewed, Violet Cooper’s daughter, Priscilla Lantka, a trustee, said that Hobbs was the district’s representative who originally contacted the family. This would mean that he clearly represented both the district and the realty company, who had profit to gain from the transaction. When Hobbs and the district’s former superintendent, Lawrence Wyllie, were asked to discuss the lawsuit, they both declined comment, and Hobbs responded, “Quite frankly, it’s none of your business.”

LWATU attorney Steve Eberhardt said, “I have no idea what their rationale was in even thinking of buying the property. They bought [it] already being in possession of a property to build a school on.”

In a 2007 Nonprofit Quarterly report, “Now You See It, Now You Don’t: Conflict of Interest Demands More Than Just Policy,” readers were reminded that even when conflict of interest policies are in place, “a big ‘danger ahead’ sign should flash when we do not recognize them.” The article points out that one of the most obvious conflicts is when individual and corporate interests are intertwined—which seems manifestly the case when it comes to Lincoln-Way and Hobbs. Not only did an involved and official representative of the district financially gain from a transaction, that same individual took the lead on the project. What layers of oversight were missed by those surrounding Hobbs, and how can others learn from what is currently taking place in Chicago?

Hobbs’ comment to the press that this was “not their concern” is ironic in a case gaining national attention as a result of taxpayers making a lack of enforcement of conflict of interest their concern. It is an important reminder for those in the sector that the creation and enforcement of conflict of interest policies is all of our business; these policies exist for a reason, are crucial to true organizational success, and protect the charitable practices of nonprofits and the community trust of public bodies. Even when there is innocent neglect or haste by leaders, versus intent, malice or ill will, this lack of due diligence and attention to oversight can so often rightly lead to distrust and lack of credibility. In the end, this can be painful at best, and ultimately detrimental to an organization and its good work.—Michelle Lemming

Share
Tweet
Share
Email
Print
ABOUT THE AUTHOR
Michelle Lemming

For the past fifteen years Michelle has served in Executive Director/CEO positons in the healthcare field. She is currently the founding CEO of the Texoma Health Foundation in North Texas and Southern Oklahoma, responsible for overseeing over $55M in public assets. Over her career, her core areas of focus have included access to uninsured services, healthcare disparity, integration of care, the built-environment, health information technology, lobbying, disaster recovery, foundation conversions, grantmaking, place-based philanthropy, family endowments and donor-advised funds. Over the last three years she has had the ability to gain experience in grantmaking tied to the arts and education. She has also had the privilege to serve as a national consultant, as well as a federal and state grant reviewer.

More about: conflicts of interest nonprofit real estateNonprofit NewsPolicy

Become a member

Support independent journalism and knowledge creation for civil society. Become a member of Nonprofit Quarterly.

Members receive unlimited access to our archived and upcoming digital content. NPQ is the leading journal in the nonprofit sector written by social change experts. Gain access to our exclusive library of online courses led by thought leaders and educators providing contextualized information to help nonprofit practitioners make sense of changing conditions and improve infra-structure in their organizations.

Join Today
logo logo logo logo logo
See comments

NPQ_Winter_2022Subscribe Today
You might also like
Cancelling Student Debt Is Necessary for Racial Justice
Kitana Ananda
To Save Legal Aid, Expand Public Service Loan Forgiveness
Zoë Polk
No Justice, No Peace of Mind and Body: The Health Impacts of Housing Insecurity for Black Women
Jhumpa Bhattacharya, Maile Chand and Andrea Flynn
The Human Impact of the Global Refugee Crisis Must Be Understood—And Acted Upon
Anmol Irfan
Black Americans Need Reparations: The Fight for the CTC Highlights the Roadblocks
Jhumpa Bhattacharya and Trevor Smith
Edgar Cahn’s Second Act: Time Banking and the Return of Mutual Aid
Steve Dubb

Popular Webinars

Remaking the Economy

Black Food Sovereignty, Community Stories

Register Now

Combating Disinformation and Misinformation in 21st-Century Social Movements

Register Now

Remaking the Economy

Closing the Racial Wealth Gap

Register Now
You might also like
Cancelling Student Debt Is Necessary for Racial Justice
Kitana Ananda
To Save Legal Aid, Expand Public Service Loan Forgiveness
Zoë Polk
No Justice, No Peace of Mind and Body: The Health Impacts of...
Jhumpa Bhattacharya, Maile Chand and Andrea Flynn

Like what you see?

Subscribe to the NPQ newsletter to have our top stories delivered directly to your inbox.

See our newsletters

By signing up, you agree to our privacy policy and terms of use, and to receive messages from NPQ and our partners.

Independent & in your mailbox.

Subscribe today and get a full year of NPQ for just $59.

subscribe
  • About
  • Contact
  • Advertise
  • Copyright
  • Careers

We are using cookies to give you the best experience on our website.

 

Non Profit News | Nonprofit Quarterly
Powered by  GDPR Cookie Compliance
Privacy Overview

This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.

Strictly Necessary Cookies

Strictly Necessary Cookie should be enabled at all times so that we can save your preferences for cookie settings.

If you disable this cookie, we will not be able to save your preferences. This means that every time you visit this website you will need to enable or disable cookies again.