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Article updated: 12/5/2012 6:30 AM

Suburban mayors accuse agency of mismanagement, nepotism

By Jake Griffin

The Illinois Municipal League was formed as a way for towns across the state to stand as one on legislative and other issues that affect them. Now, however, the group itself is divided, with several suburban mayors claiming mismanagement of the taxpayer-supported organization and calling for the jobs of agency leaders.

While nearly half of the League's $2.5 million budget comes from taxpayer-funded dues, conference fees and educational training, the agency's operations are largely shrouded in mystery because it is not subject to the state's Freedom of Information Act laws and provides very little financial information on its website. Most employees at the agency are eligible for public pensions upon retirement.

Several board members -- mainly from the suburbs -- are questioning hiring practices, construction projects and financial management of the Springfield-based agency, according to letters and documents obtained by the Daily Herald between League officials and board members of the agency.

"The two biggest issues are the upper level management and personnel issues," said Woodridge Mayor Bill Murphy, a past president of the League's board and current member of its executive committee. "Those can be resolved with the timely resignation of Executive Director Larry Frang, who should be allowed to retire with dignity sometime in 2013. Earlier, than later."

Frang, a 38-year employee of the League who has led the agency since 2007, said he has no plans to retire immediately from his $231,795-a-year job and expected to stay on through the 2018 legislative session.

"In broad terms, I have 1,129 municipalities in the state with lots of opinions, and clearly from time to time some of my board members and other mayors not serving on the board might have issues with the way I'm running things," Frang said. "Generally speaking, I have broad support."

That support could be put to the test at the League's winter meeting this weekend in Chicago.

"It has been indicated that there is desired some type of motion to terminate the executive director," Danville Mayor Scott Eisenhauer said in an interview. He became president of the League's 49-member board of directors in October.

If such a vote is taken, it will be the second vote on terminating personnel taken by a League board this year. In February, a motion to fire Deputy Director Roger Huebner from his $192,474-a-year post was rejected 7-5 by the board's executive committee.

That vote came on the heels of Huebner's daughter being hired to a $32,500-a-year post as the League's media relations specialist, a position that didn't exist before her hiring.

Frang said the League has employed public relations personnel in the past, but not for several years. A new position was created at the behest of the board, but at a much lower salary than had been offered for the post in the past, he said. Frang said he received seven applications for the job, despite posting the position on a national job search website.

Some of the opposition mayors question how so few applications could have been received from a nationwide posting.

"I fully understand that someone would say that, but I only know what the facts are," Frang said. "I interviewed three of the seven and Jayde Huebner was absolutely the best qualified candidate."

In addition, another of Huebner's daughters was awarded an unpaid internship at the agency over the summer and received college credit for her work at the League, according to the documents.

"Good judgment and integrity would dictate you don't hire the daughters of a deputy director," Murphy said.

The agency created an anti-nepotism policy in May, but some mayors said it doesn't go far enough.

Eisenhauer said the issue will be re-addressed at this weekend's meeting, but he defended Jayde Huebner's hiring as well.

"What we have seen from her production has been outstanding," he said.

The opposition mayors also expressed concern about more than $720,000 in renovations to the League's offices in Springfield over the past six years that were not put up for bid.

Frang said some of the work was done before he took charge of the League and all the work was done with the board's knowledge and approved by committees. In response to criticism, all contracts of more than $10,000 will be reviewed by board leadership in the future.

Most recently, League leaders have come under fire after the results of the agency's 2011 audit. A new auditor was hired and initially gave the agency an "adverse opinion" because finances did not conform with standard government accounting practices.

In a July 16 letter, Crystal Lake Mayor Aaron Shepley blasted Frang for not providing all the financial documents the auditor requested. While Shepley acknowledges the audit did not find any malfeasance at the League and that the initial outcome was a technicality, he contends such an audit would have been looked upon unfavorably by legislators.

Eventually, a new audit was conducted to government accountability standards, but that raised more questions with Shepley regarding the move of $3 million in 2010 from the League to its risk management association, which controls a pool of insurance money for about two-thirds of the League's members. That means some towns were paying for something that would never benefit the residents.

"We shifted the money, but the audit doesn't indicate whether it was necessary even though leadership called it an emergency at the time," Shepley said. "We still don't know."

Frang acknowledged an accounting anomaly discovered by the auditor that wasn't being recorded "properly" in the past, but said the $3 million transfer two years ago was still a necessity.

The public spat is fairly unprecedented in the 100-year history of the organization. Along with mayors, regional municipal organizations like the DuPage Mayors and Managers Conference and the Northwest Municipal Conference have expressed concerns about the League's operations.

"We're in the camp of concern," said Mark Fowler, executive director at the Northwest Municipal Conference that represents more than 40 suburbs in Cook, Lake and McHenry counties. "It's imperative for all organizations like ours to be good stewards of taxpayers' dollars and that's the bottom line. I think there are significant questions that some board members have that need to be answered by the organization."

Frang said he believes he will survive any vote for his termination.

"There are always some people who feel someone else could run the railroad better," he quipped. "I've dedicated my entire professional career to helping municipalities. I'm certainly not happy that this has been a distraction."

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Contact Jake at jgriffin@dailyherald.com or (847) 427-4602. Follow him at facebook.com/jakegriffin.dailyherald and at twitter.com/DHJakeGriffin.

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