Journal Editor

The developers of a large section of downtown Des Plaines paid a referral fee---believed to be $200,000---to an area company for helping the firm land a multi-million dollar redevelopment project in downtown Des Plaines.

The company that was paid the fee is Rolling Meadows-based Prime Site LLC. One of its key employees at the time was James Dvorak, former Cook County undersheriff and ex-Republican Party leader who in the 1980s was convicted of income tax evasion and bribery. Dvorak was also a close friend of a top city official deeply involved in city redevelopment until he resigned from his city job earlier this year.

For many years, including the time when the referral fee was paid, Dvorak has been friends with Bill Schneider, a former top Des Plaines administrator. Since his hiring in 2000, Schneider has held the positions of acting city manager, Community Development director and Economic Development Commission executive director. In those roles, he has been largely responsible for carrying out the city's expanding redevelopment program. One of his key responsibilities was to attract developers to Des Plaines, including the downtown area.

Approximately two years ago, Des Plaines City Council approved hiring Tucker Development Co. to redevelop of nine acres of property north of Miner Street buildings between Lee and Pearson streets. Two other developers that had submitted proposals to the city were also finalists.

Schneider resigned his city job around May of this year after his friendship with Dvorak and a conviction for mail fraud in the mid-1990s became public. A few weeks earlier, Dvorak's association with Prime Site became public knowledge. Later, it was discovered that a one-year extension of the city's contract with Prime Site had been approved by someone in the city. An extension letter had Mayor Tony Arredia's signature stamped on it even though Arredia said he did not affix it nor did he know who did. After an investigation, city officials indicated that Schneider authorized and/or wrote the July 17, 2003 letter extending the city's contract with Prime Site. He did so, said city officials, believing he had the authority to do so. Also, the city concluded that the Mayor's secretary, Donna Catlett, affixed the Mayor's stamped signature at the request of Schneider.

In early August, aldermen approved a settlement with Prime Site. The agreement called for taxpayers to pay the company $215,000 for money it would be entitled to during the one-year extension period.

Last week, the Journal obtained a document dated July 11, 2002 which explains an agreement involving Prime Site and Tucker. The letter says that Prime Site is entitled to a $200,000 commission for helping procure a Development Agreement with the city for downtown Des Plaines. The document was authored by Michael Blonstein, principal of Prime Site and addressed to Richard Tucker of Tucker Development Corp. In August, a report on Prime Site's involvement with the city, authored by City Manager Dave Niemeyer, said that Tucker had paid Prime Site a referral fee for introducing the company to Des Plaines.

Niemeyer told the Journal Monday that after discussing the matter with Blonstein this week, he learned that Schneider approached Prime Site roughly two years ago about helping find a reputable developer for downtown Des Plaines. Niemeyer confirmed that the city sought formal Requests for Proposals from interested developers through a paid public notice at about the same time. He added that he was told that Schneider made it clear to Tucker and Prime Site that no city funds would be used to pay a referral fee to Prime Site.

"It sounds like the city had some knowledge of what was taking place," said Niemeyer. He said the city needs to do a better job of making sure that city officials disclose any connections they have with perspective developers.

Rich Tucker said Monday that his company paid Prime Site a "brokerage fee" for introducing it to the city. He would not say how much his company paid Prime site. Tucker explained that Blonstein called his company and "made an introduction between us and the city." Tucker recalled that he and Schneider "met somewhere in Des Plaines."