The Blago Trial

Mayor Daley was displeased when Jarrett lost Spiegel, a catalog company which had operated warehouses in Chicago for 88 years. Daley wanted a more aggressive effort from the Department of Planning and Development. The company wanted to relocate its old warehouses. Her department proposed six sites, but Spiegel found all of them to be deficient. The best site was covered with 20 to 30 feet of water. Jarrett promised that the site could be filled-in in time to meet Spiegel’s deadline, but the company did not believe it.

As a result, more than one thousand people lost their jobs, and Chicago lost hundreds of millions of dollars. Jarrett was far from apologetic. She claimed her department “moved heaven and earth to exceed [Spiegel's] expectations. We didn’t drop the ball. I will sleep well.”

Spiegel Inc. doesn’t know where it wants to relocate its South Side distribution center, but it knows it won’t be in Chicago.

And that decision, called “gut-wrenching and emotional” by the catalog/retailing company, will rob the city’s economy of up to $510 million annually and put 2,000 jobs in jeopardy.

. . .

The economic impact of Spiegel’s exodus would be at least $410 million and could hit as high as $510 million, said Sam Mitchell, president of the Chicagoland Chamber of Commerce.

. . .

Valerie Jarrett, the city’s commissioner of planning and development, said her staff “worked very hard” to put together a package that could keep Spiegel here. “Since our proposals met and even exceeded their criteria, we don’t understand why they are leaving the city.”

However, sources close to Daley say he was disappointed that the Planning Department’s efforts weren’t more aggressive. The city knew last week Spiegel was lost, they say.

It’s another black eye for Daley, who has been forced to abandon his plan for a Lake Calumet airport and has seen his dream of a casino complex become mired in controversy.

(Chicago Sun-Times 9/10/92)

Thirty feet of water kept Spiegel Inc. from replanting its roots in Chicago.

That’s the depth of water that would need to be filled with dirt if Spiegel relocated its Bridgeport distribution facilities to a site near Lake Calumet.

“If you go out there right now, where the building was to be situated, I’d hope you were a very good swimmer because you’d be in 20 to 30 feet of water,” Michael Moran, Spiegel vice president and general counsel, said Thursday.

And that was the best of six proposals the city of Chicago pitched to Spiegel in order to keep the distribution center and 2,000 jobs within Chicago.

But Spiegel declined the site, which came with a lucrative package of incentives. The Downers Grove-based company Wednesday announced it would relocate its distribution hub to one of four communities – Plainfield, Downstate Champaign and Decatur, or Columbus, Ohio.

When Spiegel began studying its existing facilities on 35th and 39th streets, it told the city what it would need in a new site and asked for suggestions. Five parcels were offered, none of which met the company’s criteria.

Either the sites didn’t have the 150 to 200 acres of land Spiegel required, or the land was poorly configured, Moran said. “We felt they’d come up short. We asked the city to come back again,” Moran said.

The city then submitted a site adjacent to land Mayor Daley originally sought to use for a third regional airport. The proposal was the city’s strongest offer, and involved the city improving the land, and hauling in tons of landfill, before Spiegel started construction.

Ultimately, Spiegel decided it couldn’t pin its future on promises of speedy work made by the city that Spiegel found hard to believe. Spiegel wants to break ground on a new distribution center in November and relocate its South Side operation there in 1994.

Thursday, the city said the Lake Calumet property was always on the table and the final proposal for that land surpassed all of Spiegel’s requirements. Furthermore, the city had every confidence it could meet the timetable, said Valerie Jarrett, the city’s commissioner on planning and development.

“We moved heaven and earth to exceed their expectations,” Jarrett said. “We didn’t drop the ball. I will sleep well.”

(Chicago Sun-Times 9/11/92)

In an editorial, the Chicago Sun-Times criticized her comments and the offer of “swampland” to Spiegel.

How can Mayor Daley’s commissioner of planning and development say she’s sleeping well at night when the best relocation option Chicago offered to keep Spiegel here was filled with up to 30 feet of water?

The retailer said last week it will be moving from Chicago, after calling Bridgeport home for 125 years. It was a “gut-wrenching and emotional” decision, the company said.

Unfortunately, some 2,000 current employees will suffer the consequences of a move Spiegel now has narrowed down to Plainfield, Champaign, Decatur or Columbus, Ohio.

Planning Commissioner Valerie Jarrett, meanwhile, claims her department “moved heaven and earth to exceed (Spiegel’s) expectations. We didn’t drop the ball. I will sleep well.”

Moving heaven and earth amounted to offering the retailer six possible sites for its new distribution facility. The best of those, Spiegel said, was near Lake Calumet.

“If you go out there right now, where the building was to be situated, I’d hope you were a very good swimmer because you’d be in 20 to 30 feet of water,” said Michael Moran, Spiegel vice president and general counsel.

While a sure thing – existing city jobs – slips away, Daley gambles the city’s economic future on his mega-projects, first the Lake Calumet airport and now the casino complex.

He maintains manufacturing is “gone” from the city despite an Economic Development Commission report last year that indicated the city could retain or create 150,000 jobs if it could somehow accommodate the pent-up demand for more space by the industrial firms already located here.

Offering them swampland is no way to achieve that goal.

(Chicago Sun-Times 9/17/92)

Jarrett Failed; Black Workers Suffered

BOB EDWARDS, Host: This is Morning Edition. I’m Bob Edwards. For 88 years, all of the goods ordered through Spiegel Catalog have been shipped from a warehouse complex on the south side of Chicago. Spiegel’s decision to move the warehouse operation to Ohio means 2,000 people will lose their jobs. Many of them have worked for Spiegel for decades. NPR’s Edward Lifson reports.

EDWARD LIFSON, Reporter: All the way down from 35th to 39th Street, amid the heavy manufacturing soot that made Chicago grow, Spiegel’s name is cast in concrete on these 10- and 12-story brown brick, industrial, Victorian warehouses. These are the buildings known from TV game shows of the fifties, sixties and seventies, as in `Contestants on this program receive a certificate from the Spiegel Catalog, Chicago 60609.’ Each year, the company ships over a billion dollars worth of clothing, home furnishings and electronics from here.

The workers are nearly all African-American, from the impoverished south and west sides. Fifty-year-old Jonathan Edmunds [sp] waits for his car pool after work. He’s been a master receiver at Spiegel for 17 years. He makes $13 an hour. Though he’s going to lose his job soon, Edmunds says this Christmas was no worse or better than any of the others at Spiegel.

JONATHAN EDMUNDS, Master Receiver, Spiegel: No, but they gave away turkeys [laughs]. First year since I’ve been here, you know. It never happened before. I mean, give ‘em a turkey, they’d be happy.

LIFSON: Perhaps because the workers have known for two years that the site was going to close, or perhaps because the reality won’t set in until the last paycheck comes early next year, employees here just seem resigned.

Greg Harris [sp] is in his thirties, has six kids and is a Spiegel merchandise handler.

GREG HARRIS, Merchandise Handler, Spiegel: I hope they stay, but they not, so I got to start all over. It’s life. I was on public aid when I got this job – Project Chance. And they was telling me that I had to work for my check and my food stamps, and then they told be about Spiegel, so I came down here, you know, and I tried it. And I got hired. And I’ve been here ever since – four years.

LIFSON: As a company, Spiegel is doing well. Net earnings were nearly $50 million last year. Profits have grown steadily since the German mail order giant Otto Versand [sp] bought Spiegel in 1982. At the elegant new headquarters the company built in a far west suburb of Chicago, one county removed from the city, corporate spokeswoman Debbie Coopman [sp] displays a photo of the new Spiegel warehouse in Groveport, Ohio.

. . .

Vim Veeveld [sp] researches urban economic development at the University of Illinois at Chicago. He says that the Spiegel workers will probably end up taking two or three short-term low-paying jobs before they even begin to approach earning what they’re making now. From his office on the 27th floor of University Hall, Veeveld surveys the untamable chaos of the city.

(NPR Morning Edition 12/26/94)

Over a Thousand Chicago Jobs Lost

In the summer of 1992, the catalog clothing company Spiegel rejected the City of Chicago’s final offer of incentives to keep the national warehousing and distribution center in Chicago and decided to leave for Columbus, Ohio, taking more than one thousand jobs with it. Public criticism was swift and strong – why did the city not offer more? Was its package too little, too late?

(Government Finance Review 10/1/95)