By AARON GETTINGER
Protect Our Parks has has accepted University of Chicago law professor Richard Epstein’s pro bono offer to lead its appeal against the city and Chicago Parks District after the federal district court threw out their case to prevent construction of the Obama Presidential Center (OPC) in Jackson Park.
Epstein, one of the country’s most-cited legal theorists, a libertarian who also has appointments at New York University and the Hoover Institution at Stanford University in California, argued against the OPC location in a January amicus brief.
He previewed arguments in a June 28 interview with the Herald. He said the Obama Foundation has all-but-ownership of its designated 19-acre campus in Jackson Park, which the city will own while allowing the Foundation to build and operate the OPC upon it. The planned Chicago Public Library branch is a strategic “diversion” for purported “multiple uses.”
“This is an exclusive lease for 99 years. That’s a transfer of property,” Epstein said. “How do you value a 99-year lease? What you do is you figure out the lease value for each of the periods, and then you discount them appropriately to their present value. If you’re talking about this property having some kind of value, 99-plus percentage of it is given to the Obama Foundation. All that the city has is free and clear use of the property after 100 years, maybe, which is of infinitesimal value.”
Secondly, Epstein noted the “collateral obligations” that he said will be incumbent upon taxpayers. He includes remedial obligations for a “way too big, way too tall, way too heavy” OPC on the Jackson Park site. He said the site has a high water table, which he suggested may require allocations of public funds to accommodate the size and weight of the Center. He pointed to the roadway configuration changes, saying the city’s $175 million estimated construction cost for roadways is an underestimation, and there will be “incredible burdens” incurred by closing Cornell Drive and transferring traffic to widened Stony Island Avenue and Lake Shore Drive.
What does it do to have “trustrees” [the city government] impose burdens on the taxpayer when they are making a “decision of this magnitude?” Epstein cited the business judgment rule in case law that recognizes problems when trustees are held liable for mistaken decision-making, because they did not consider various alternatives.
“I think it’s pretty clear, if you go through the record, that they did not with any degree of sophistication or seriousness” look at alternatives. “This was pushed very fast, very hard, and all you get is self-serving statements. You don’t get anything that looks as though they’re required to do this.” Substantively, Epstein said actors are beholden to behave fiduciarily. He compared it to controllers of a public company not selling to buyers willing to pay a higher price because they prefer another buyer for other reasons.
He said that the OPC would be better in the Washington Park-adjacent site, saying there is an “overwhelmingly powerful case that it offers at least as good if not a better location for the city” because of available space, lower costs to the city, “not breaking down a Frederick Law Olmsted park” and access to the Dan Ryan Expressway.
“You really have to have a pretty thorough explanation to explain why it is that this site that they chose is better,” Epstein said. “And the only explanation you can give in my judgment is that the Obamas preferred to have their Foundation and their Presidential Center in a high-rent, snazzy district.” Tourists, he said, would come to either OPC site.
Epstein said the Supreme Court is “beginning to tighten up and say that, when you … exercise deference” in decisions, “it’s not a carte blanche.”
“The retrenchment on vast public discretion is in fact one of the dominant trends in the United States Supreme Court,” and judges on the 7th Circuit Court of Appeals, “both the earlier appointments and the later appointments,” are “well-aware of that particular fact.”
In the lower court dismissal, Judge John Robert Blakey said Protect Our Parks tried to mischaracterize the public benefit of the OPC stands into a merely private purpose. The defendants’ attorney argued that the city found the Jackson Park site an acceptable location.
Epstein also called out “self-dealing” on the part of the city government, recalling Obama’s connection to Chicago and former Mayor Rahm Emanuel’s service as his chief of staff. “There’s a rule which says that in the case of conflicts of interest between the parties who are negotiating the deal and the parties who are getting it — if they’re on both sides of the transaction — there’s a real risk that what’s going to happen is there’s going to be a massive giveaway, and much higher scrutiny is required.”
“It is beyond comprehension that you can say that the city is a neutral decision-maker,” he said. “If this were a corporate transaction, this would be governed by the most strict scrutiny imaginable.” A court can abide neither corporate nor governmental giveaways; the public must come out better than it was before a transaction.
Epstein also posits that law requires the city to maximize profits. “Your job is not to give that money away to the Obama Foundation,” he said. The deal must be compared both with the status quo before and with what would be achieved through another decision.
Epstein said his co-counsel will be Michael Rachlis of the Rachlis Duff Adler & Peel law firm; Mark Roth and former Ald. Bob Fioretti (2nd) are no longer on the case.
Correction: An earlier online version of this story said that Protect Our Parks had hired Epstein to lead its appeal. Protect Our Parks accepted Epstein’s offer to work pro bono. The Herald regrets the error.