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The Electric Connection 

How Com Ed Plugs Into the Power Structure

We're all connected to Commonwealth Edison. It's as close as the nearest electrical outlet, as pressing as the latest bill. But some of us are better connected--really plugged in. While most of us get the business from Com Ed, some get lucrative business--thousands, even millions, of dollars of business.

Because of its size (annual revenues of $5.6 billion, of which the "average" customer pays $1,867), Com Ed can make some powerful connections. It is one of the area's largest (in some cases the largest) builders, employers, bank customers, advertisers, charitable donors, and legal clients. Many powerful Chicago institutions, politicians, charities, banks, lawyers, and media are beneficiaries of one of the nation's most expensive sources of electricity. So many big shots are plugged in that Com Ed's critics find it difficult to get funding to study or analyze the company, or to publicize or circulate their findings.

Despite the omnipresence, if not omnipotence, of Com Ed, public knowledge of its connections is fairly limited. Com Ed's budgets, customers, clients, and beneficiaries do not get the kind of media scrutiny devoted to politicians and less powerful public bodies. In government, even minor patronage and influence-peddling matters get prominent play by the media; Com Ed's patronage connections are not even discussed.

Few of us know, for instance, that the Chicago Association of Commerce and Industry--a stalwart defender of Com Ed and a sharp-tongued critic of its antagonists--gets major donations from Com Ed. Fewer know that Com Ed once pulled its TV advertising from Channel Five after a series of news reports on safety at Com Ed nuclear plants.

Given the impending expiration of the city's exclusive franchise with Commonwealth Edison and the debate over possible alternative sources of electricity, Chicagoans need a scorecard to keep track of Com Ed's beneficiaries. We publish this guide to some of the more important players so the next time someone speaks out you may be able to trace the electrical connection.

Com Ed's Board of Directors: The Major Circuits

The company's directors are wired to major institutions in the corporate, academic, financial, and nuclear-energy worlds. Being a Com Ed director is more than a privilege, more than a civic responsibility. Each director gets a cool $20,000 a year as a retainer and $750 for each meeting; they should have no problems paying their monthly electric bills.

From the corporate world come directors: Edward A. Mason, vice president of research for Amoco, the oil and energy giant; Harvey Kapnick, former head of Arthur Andersen & Company, leading accountants in the city, and president of his own investment firm; Patrick Ryan, head of the Aon Corporation, an insurance holding company; and for ethnic balance, George Johnson, head of Johnson Products Corporation, a black hair-care and cosmetics firm. For geographic balance, there is downstate Belvidere National Bank & Trust chairman R. Robert Funderburg, whose area of influence includes the home of Com Ed's embattled Byron nuclear facility.

The Ryan connection is intriguing in that he is one of Mayor Daley's $100,000 campaign contributors. Ryan was also identified by business writers as one of Daley's primary business advisers. The Daley administration, despite talk of tough negotiations and reforms in the city's energy policy during the campaign, has been silent on the impending expiration of the Com Ed franchise. It also pulled the plug on the Washington and Sawyer administrations' public-education campaign on the future of the city's electric franchise. The administration's action/inaction has helped turn one of the city's hottest issues into a nonissue. Few of us seem to care, because we have been given little reason to care.

Directors from the academic world are Donald P. Jacobs, dean of Northwestern University's Kellogg School of Management, and Thomas Martin, president emeritus of the Illinois Institute of Technology.

From the world of the nuclear-power industry--of which Com Ed is one of the nation's leading practitioners--comes Byron Lee Jr., head of the Nuclear Management and Resources Council, which got $245,700 in Com Ed dues in 1987. Just retired from the board is Eugene T. Wilkinson, former head of the Institute of Nuclear Power Operations, which got $2,143,401 in Com Ed money in 1987.

Directors from the nonprofit world include the ubiquitous James Compton Jr., head of the Chicago Urban League and president of the Board of Education. (Some of Chicago's newer schools are all-electric--even the heat--and are among the city's most inefficient in terms of energy use. Nearly 30 percent or $35 million of the Chicago public schools' budget is spent on electricity. That's $10 million more than is spent on textbooks.)

Another director from the nonprofit world is A. Dean Swift, chairman of the board of the Executive Service Corps of Chicago, whose members--retired executives--provide free management help to other nonprofits.

Other Com Ed directors include Jean Allard, a lawyer and partner of Sonnenschein, Carlin Nath & Rosenthal, and three top Com Ed executives: Bide L. Thomas, president, Wallace B. Behnke Jr., vice chairman, and of course James J. O'Connor, chairman.

O'Connor is Com Ed's ambassador to the world beyond. He has so many outside connections that you might wonder who's minding the store. At last accounting, O'Connor sat on the boards of directors of the following corporate giants: Corning Glass Works, the Midwest Stock Exchange, United Air Lines, the First Chicago Company, First National Bank of Chicago, and the (Chicago) Tribune Company. (First National, by the way, is Com Ed's banker, getting millions in deposits and auxiliary business.)

O'Connor seems even busier in service, charitable, and nonprofit endeavors. He has been a board member of Lyric Opera, the Museum of Science and Industry (ever see an exhibit there on the dangers of nuclear waste?), United Way Crusade, Catholic Charities, Northwestern University, Michael Reese Medical Center, the Leadership Council for Metropolitan Open Communities, Saint Xavier College, and the Associates of Harvard University Graduate School of Business Administration. He is also a member of the Illinois Committee for the United Negro College Fund.

Media

A utility with some of the highest rates in the nation needs to spend a lot on its public image, and Com Ed does. You can rely on Commonwealth Edison to tell us via television commercials how well it's doing.

In 1987 the company spent $5 million for media--with $3 million of it going to four major television channels: Two, Five, Seven, and Nine, which each got roughly $750,000 in Com Ed advertising.

Print media also got some Com Ed money. The Tribune, which has O'Connor on its board, got the most: $878,226. The Sun-Times, a little more outspoken on energy matters, got $496,052. Other media beneficiaries were Crain's Chicago Business ($73,610), Chicago magazine ($57,510), and Time, Newsweek, and Ebony, getting a total of $45,000.

Radio stations that got Com Ed's commercials were neither the rockers nor the rappers. The big winners were classical-music outlet WFMT ($142,000), WGN ($33,168), and WBBM AM ($33,168).

Overseeing the Com Ed advertising budget were the Leo Burnett Company, which got $3,576,529 in Com Ed advertising business for the gringo media in 1988, and Jorge Caballero & Associates, which got $376,938 for advertising in the Spanish-language media.

Also working on Com Ed's image was the up-and-coming PR firm of Jasculca-Terman, which got $251,000 in 1988 and created the brochure that tried to make "activists" a scare word to Com Ed customers. Jasculca-Terman has close connections to Mayor Daley's office, having just completed a study of the city's public relations and being still under contract to improve the mayor's scheduling operations.

Lawyers, Pols, Pals, and Lobbyists

It's difficult these days to separate Com Ed's lawyers from its lobbyists and political friends. That's because so many of its prominent lawyers, lobbyists, and defenders have critical political connections, Democratic as well as Republican, inside and outside of government.

Com Ed's legal bills are large. In 1987 it spent $26 million, in 1988, $30 million for outside lawyers and consultants for one rate-increase case alone. It also spent $8.2 million for in-house legal work.

Com Ed uses about 20 major Chicago law firms. Leading the pack is Sidley & Austin, which got $5 million in company business in 1988. One of Sidley's partners has been Sam Skinner, former U.S. attorney and current U.S. secretary of transportation; another Sidley partner is Newton Minow, a Democrat and President Kennedy's head of the Federal Communications Commission. Another Sidley powerhouse partner is Howard Trienens, who also represents AT&T in its litigation and is chairman of its board of trustees.

Another top-ranking Chicago law firm with Com Ed business is Winston & Strawn, whose partners include Dan Webb, former U.S. attorney and legal troubleshooter for high-ranking public officials of both parties. Other Winston & Strawn partners and lawyers active as Com Ed lobbyists are Jim Fletcher, former deputy governor of Illinois and campaign chairman for Governor Jim Thompson; Mike Hasten, chairman of the Illinois Commerce Commission (ICC) in 1982, when it approved a huge rate increase as well as a controversial construction program for Com Ed; and R. King Poor, former attorney for the ICC under Hasten.

Lobbying on the Democratic side of the aisle in Springfield is former state representative Mike McClain, a western Illinois legislator who was once head of the house energy committee and a protege of house speaker Michael Madigan.

Com Ed has helped many former ICC employees make the transition from public to private life. In addition to finding work for Fletcher, Hasten, and Poor, it has given major consulting contracts to the firm of Palmer Bellevue, which has employed another former ICC chairman, Phil O'Connor, and former ICC staffers Jerry Keenan, San Xanders, and Jerry Benson.

Besides traditional Republicans and Democrats, Com Ed has even hired a political independent or two. Most recently, when community organizations with independent links were making noises over the leaking of cancer-causing PCBs from alley transformers in their neighborhoods, Com Ed had the foresight to hire a proactivist former 43rd Ward alderman, Marty Oberman, to negotiate a settlement.

As a rule, though, independents do not fare as well as regulars. Contributions to local pols--not as generous as the pin-striped patronage thrown to law firms--has amounted to less than $100,000 a year. The biggest beneficiaries were Illinois house speaker and southwest-side Democratic committeeman Mike Madigan, northwest-side congressman Dan Rostenkowski, former city treasurer and acting state's attorney Cecil Partee, and several aldermen connected with the Democratic machine: John Madrzyk, Patrick Huels, Edward Burke, William Krystyniak, and Theris Gabinski. For what it's worth, Com Ed chairman O'Connor was a boyhood buddy of Illinois Attorney General and Democratic gubernatorial aspirant Neil Hartigan.

Bookkeepers, Builders, Working Stiffs

Com Ed's accounting work goes to Chicago's largest keeper of the books and spread sheets, Arthur Andersen & Company, which got $777,800 of the utility's business in 1988. Much of the utility's five-year $3.6 billion construction budget goes to leading builders in the city--especially Chicago's premier engineering-architectural giant, Sargent & Lundy, which got $146,226,247 in 1987 and $93,167,491 in 1988.

Com Ed's major connection with the world of labor--and its own workers--is with the International Brotherhood of Electrical Workers and their main guy, Bob Dahlke. Some 11,000 of Com Ed's 17,500-person work force are IBEW members.

Com Ed Causes and Charities

Like the utility itself, Com Ed's nonprofit beneficiaries are safely mainstream. The Crusade of Mercy gets the most, a million or so a year. Northwestern University got $73,500 in 1987; the University of Chicago $72,000, and the Illinois Institute of Technology $60,000.

About $50,000 a year has gone to the Chicago Symphony, the Art Institute, the Field Museum, and the Lyric Opera.

Very little Com Ed money goes to issue-oriented grass-roots neighborhood organizations. While other Chicago donors are giving increasing amounts to grass-roots groups--which have done the most to promote energy conservation, affordable housing, recycling, and other critical development needs--Com Ed has played it safe, steering its donations to middle-of-the-road service providers.

Its largest community contribution--$50,000--went to the experimental Corporate Community Schools of America on the west side, a private school operated by big business for neighborhood kids. Some $48,000 to $50,000 was given in 1987 and '88 to the YMCA-YWCA, whose board was headed by Com Ed president Bide Thomas. (It was the YMCA that filed a friend-of-the-court brief on behalf of Com Ed in a recent rate-increase case.) Another $18,000 went to the Spanish Coalition for Jobs, which has lobbied on behalf of Com Ed and whose former director, Mary Gonzalez Koenig, is now head of the Mayor's Office of Employment and Training. Another of Com Ed's larger contributions went to the Chicago Urban League.

Groups getting slightly smaller grants include Gateway Foundation (drug treatment and rehabilitation), El Valor (services for the handicapped), the Leadership Council for Metropolitan Open Communities (a housing-integration group on whose board sits Com Ed chairman O'Connor), and the Abraham Lincoln Centre, a community-service organization on the south side that has also lobbied on behalf of Com Ed.

The list of Com Ed donations is not complete and can be somewhat misleading, for it includes none of the contributions made by district representatives and operatives to favored politicians, community groups, and charities. These district functionaries are well-known for buying lots of tickets to fund-raising events sponsored by local pols. Unfortunately there is no paper trail leading to these beneficiaries.

Art accompanying story in printed newspaper (not available in this archive): illustration/Tony Griff.

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