In March 2004, then-Mayor Richard M. Daley announced a deal that promised to save taxpayer money, reduce natural gas consumption and bring “green” jobs to Chicago.
But taxpayers might see red when they learn how the deal turned out. More than seven years later, the initiative has been quietly suspended amid problems with some of the equipment — and acknowledgements by city officials that taxpayers will probably lose money on the deal and never realize the energy savings that Daley touted, the Better Government Association has learned.
The arrangement centered on solar-powered hot water heating systems made by North Carolina-based Solargenix Energy LLC with technology designed at the University of Chicago.
The city agreed to spend up to $5 million on the eco-friendly systems, and install them on more than 100 public buildings, such as firehouses and police stations, yielding an estimated $7 million in energy savings over 30 years.
In exchange for that commitment — and an additional $1.7 million no-interest loan through the Daley administration — Solargenix agreed to open a factory in Chicago, employing at least 15 workers, and build the solar equipment there.
OK, let’s begin with the “back of the envelope math”.
$5 million dollars for the start up plus a $ 1.7 million NO INTEREST loan (to create 15 jobs) all to save the city $7 million over 30 YEARS !!!!!!!!!!!!!
That’s less than $250,000 of “savings” per year !!!!
Chump change for the city of Chicago !!!
BUT WAIT !!!!
There’s more !!!!!
But the deal never lived up to expectations. The city didn’t anticipate the high cost of installation, while Solargenix lost money and hasn’t seen its business flourish in Chicago as hoped. The company’s Bridgeport plant was eerily quiet on a recent weekday – no panels were being made and only two workers were seen on the factory floor.
In the end, the BGA found that one of the few beneficiaries of the deal appears to be a businessman with close ties to Daley: United Service Cos. President and CEO Rick Simon, the former chairman of the Chicago Convention & Tourism Bureau and a South Loop neighbor of the ex-mayor.
A venture led by Simon owns the building at 3622 S. Morgan St. where Solargenix opened its factory. Simon bought the structure in April 2003, three months before Solargenix signed a contract with the Daley administration, public records show. The factory was ready for business around the time of the March 2004 news conference with Daley, and Solargenix remains on a month-to-month lease with Simon.
So the only winner in this is a “friend” of da Mayor !!!!!!!!!!!!!!!