Latest news with #RichardM.Daley
Yahoo
3 days ago
- Business
- Yahoo
‘A lesson in worst practices': Shocking audit reveals Chicago parking meters have made $2B for private company
Have you ever been strapped for cash? Perhaps you took a payday loan, sold a long-term asset or even made an early withdrawal from your 401(k). And chances are, you've later regretted it. This is the situation the City of Chicago finds itself in — and the cost may have been billions. Privatizing public infrastructure is a growing trend among cash-strapped cities that need fast revenue. Back during the 2008 financial crisis, Chicago was broke and needed to raise money. Rather than make the unpopular move of raising property taxes, then-mayor Richard M. Daley chose to privatize public assets. Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 5 of the easiest ways you can catch up (and fast) Nervous about the stock market in 2025? Find out how you can access this $1B private real estate fund (with as little as $10) 'If we didn't have money for a long-term debt, you're talking about a serious economic crisis then for Chicago,' Daley said at the time, according to NBC 5 Chicago. So, Chicago City Council struck a deal to lease the city's 36,000 parking meters to investment consortium Chicago Parking Meters LLC, a group of global investors led by Morgan Stanley. The investors paid nearly $1.157 billion to receive the revenue from the meters for 75 years — and the city must reimburse them whenever the parking meters are taken offline, such as for festivals or construction. The deal was essentially rubber-stamped 40-5 in favor by the council, which had only a few days to review it before voting — turning out to be what the Better Government Association later called 'a lesson in 'worst practices.'' Soon after, a report issued by the then-inspector general found the city was paid at least $974 million less than it could have made from operating the parking meters itself over the term of the deal. While an analysis done by 32nd Ward Alderperson Scott Waguespack — who voted against the deal — found the deal could have been worth $5 to $10 billion, reported NBC 5. Now, a 2024 audit by accounting firm KPMG has found that, with another 58 years still left in the agreement, the private investors have already recouped their initial investment. In 2023, the meters generated a record $160.9 billion in income, bringing the total income from the start of the deal to $1.97 billion. 'It's just one of those deals that I would beg people never to replicate anywhere in the United States,' Waguespack told NBC 5. Still, many Americans can relate to the situation that faced Mayor Daley. When we're desperate for funds, we can make rash decisions that negatively affect our long-term financial health. Almost 4 in 10 (37%) U.S. adults would not be able to cover a $400 emergency expense with cash savings, according to the Economic Well-Being of US Households in 2024 report from the Federal Reserve Board of Governors. And while many of these people say they could cover the expense some other way, such as using a credit card, borrowing from family or friends or selling something, 13% would not be able to pay the expense by any means. About 58% of Americans are 'living paycheck to paycheck and experienced a cash emergency in the past 12 months,' according to The 2025 Cash Poor Report from peer-to-peer lending platform SoLo Funds. Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says — and that 'anyone' can do it These 'cash-poor' Americans may not be who you think they are. Forty percent have a full-time job and one in seven cash-poor households earn more than $75,000 per year. The top unexpected expenses, according to the report, are auto repairs, medical bills and utility bills — common expenses that can happen to any of us. To cover these expenses, some may turn to short-term financing options that could end up costing them more money in the long term. For instance, buy now pay later (BNPL) services come with an average borrowing cost of 23%, according to The 2025 Cash Poor Report, which can increase substantially if the borrower incurs repeat late fees. Another option is a payday loan, which is one of the most expensive ways to borrow. The industry average cost of borrowing for payday loans is 35%, according to the report, but origination fees, late fees and processing fees can push this as high as 49% of the principal borrowed. Increased borrowing and missed payments can also affect your credit score, which in turn can limit your future ability to borrow. People might also look to sell long-term assets such as stocks, bonds or mutual funds, but this too can have long-term financial costs. If you're 30 years from retirement and sell $10,000 of an asset today that's earning 7% per year, then you'll have about $76,000 less when you retire due to the loss in compounding interest. Plus, research has shown that time out of the stock market can be costly — and missing the best days in the market can be devastating to your long-term returns. And, if you make an early withdrawal from a tax-deferred account such as a 401(k), you'll also pay a 10% tax penalty. To avoid high-cost borrowing in an emergency or cashing out long-term investments during a downturn, start by building an emergency fund that could cover unexpected expenses. A rule of thumb is to have three to six months' income in an accessible account, such as a high-yield savings account. While desperate times may call for desperate measures, it's worth consulting with a financial advisor (or a free counseling service) to discuss your options before getting saddled with debt or selling long-term assets. Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you'll need a substantial stash of savings in retirement Robert Kiyosaki warns of a 'Greater Depression' coming to the US — with millions of Americans going poor. But he says these 2 'easy-money' assets will bring in 'great wealth'. How to get in now Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Like what you read? Join 200,000+ readers and get the best of Moneywise straight to your inbox every week. This article provides information only and should not be construed as advice. It is provided without warranty of any kind. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
3 days ago
- Business
- Yahoo
‘A lesson in worst practices': Shocking audit reveals Chicago parking meters have made $2B for private company
Have you ever been strapped for cash? Perhaps you took a payday loan, sold a long-term asset or even made an early withdrawal from your 401(k). And chances are, you've later regretted it. This is the situation the City of Chicago finds itself in — and the cost may have been billions. Privatizing public infrastructure is a growing trend among cash-strapped cities that need fast revenue. Back during the 2008 financial crisis, Chicago was broke and needed to raise money. Rather than make the unpopular move of raising property taxes, then-mayor Richard M. Daley chose to privatize public assets. Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 5 of the easiest ways you can catch up (and fast) Nervous about the stock market in 2025? Find out how you can access this $1B private real estate fund (with as little as $10) 'If we didn't have money for a long-term debt, you're talking about a serious economic crisis then for Chicago,' Daley said at the time, according to NBC 5 Chicago. So, Chicago City Council struck a deal to lease the city's 36,000 parking meters to investment consortium Chicago Parking Meters LLC, a group of global investors led by Morgan Stanley. The investors paid nearly $1.157 billion to receive the revenue from the meters for 75 years — and the city must reimburse them whenever the parking meters are taken offline, such as for festivals or construction. The deal was essentially rubber-stamped 40-5 in favor by the council, which had only a few days to review it before voting — turning out to be what the Better Government Association later called 'a lesson in 'worst practices.'' Soon after, a report issued by the then-inspector general found the city was paid at least $974 million less than it could have made from operating the parking meters itself over the term of the deal. While an analysis done by 32nd Ward Alderperson Scott Waguespack — who voted against the deal — found the deal could have been worth $5 to $10 billion, reported NBC 5. Now, a 2024 audit by accounting firm KPMG has found that, with another 58 years still left in the agreement, the private investors have already recouped their initial investment. In 2023, the meters generated a record $160.9 billion in income, bringing the total income from the start of the deal to $1.97 billion. 'It's just one of those deals that I would beg people never to replicate anywhere in the United States,' Waguespack told NBC 5. Still, many Americans can relate to the situation that faced Mayor Daley. When we're desperate for funds, we can make rash decisions that negatively affect our long-term financial health. Almost 4 in 10 (37%) U.S. adults would not be able to cover a $400 emergency expense with cash savings, according to the Economic Well-Being of US Households in 2024 report from the Federal Reserve Board of Governors. And while many of these people say they could cover the expense some other way, such as using a credit card, borrowing from family or friends or selling something, 13% would not be able to pay the expense by any means. About 58% of Americans are 'living paycheck to paycheck and experienced a cash emergency in the past 12 months,' according to The 2025 Cash Poor Report from peer-to-peer lending platform SoLo Funds. Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says — and that 'anyone' can do it These 'cash-poor' Americans may not be who you think they are. Forty percent have a full-time job and one in seven cash-poor households earn more than $75,000 per year. The top unexpected expenses, according to the report, are auto repairs, medical bills and utility bills — common expenses that can happen to any of us. To cover these expenses, some may turn to short-term financing options that could end up costing them more money in the long term. For instance, buy now pay later (BNPL) services come with an average borrowing cost of 23%, according to The 2025 Cash Poor Report, which can increase substantially if the borrower incurs repeat late fees. Another option is a payday loan, which is one of the most expensive ways to borrow. The industry average cost of borrowing for payday loans is 35%, according to the report, but origination fees, late fees and processing fees can push this as high as 49% of the principal borrowed. Increased borrowing and missed payments can also affect your credit score, which in turn can limit your future ability to borrow. People might also look to sell long-term assets such as stocks, bonds or mutual funds, but this too can have long-term financial costs. If you're 30 years from retirement and sell $10,000 of an asset today that's earning 7% per year, then you'll have about $76,000 less when you retire due to the loss in compounding interest. Plus, research has shown that time out of the stock market can be costly — and missing the best days in the market can be devastating to your long-term returns. And, if you make an early withdrawal from a tax-deferred account such as a 401(k), you'll also pay a 10% tax penalty. To avoid high-cost borrowing in an emergency or cashing out long-term investments during a downturn, start by building an emergency fund that could cover unexpected expenses. A rule of thumb is to have three to six months' income in an accessible account, such as a high-yield savings account. While desperate times may call for desperate measures, it's worth consulting with a financial advisor (or a free counseling service) to discuss your options before getting saddled with debt or selling long-term assets. Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you'll need a substantial stash of savings in retirement Robert Kiyosaki warns of a 'Greater Depression' coming to the US — with millions of Americans going poor. But he says these 2 'easy-money' assets will bring in 'great wealth'. How to get in now Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Like what you read? Join 200,000+ readers and get the best of Moneywise straight to your inbox every week. This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
Yahoo
3 days ago
- Business
- Yahoo
‘A lesson in worst practices': Shocking audit reveals Chicago parking meters have made $2B for private company
Have you ever been strapped for cash? Perhaps you took a payday loan, sold a long-term asset or even made an early withdrawal from your 401(k). And chances are, you've later regretted it. This is the situation the City of Chicago finds itself in — and the cost may have been billions. Privatizing public infrastructure is a growing trend among cash-strapped cities that need fast revenue. Back during the 2008 financial crisis, Chicago was broke and needed to raise money. Rather than make the unpopular move of raising property taxes, then-mayor Richard M. Daley chose to privatize public assets. Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 5 of the easiest ways you can catch up (and fast) Nervous about the stock market in 2025? Find out how you can access this $1B private real estate fund (with as little as $10) 'If we didn't have money for a long-term debt, you're talking about a serious economic crisis then for Chicago,' Daley said at the time, according to NBC 5 Chicago. So, Chicago City Council struck a deal to lease the city's 36,000 parking meters to investment consortium Chicago Parking Meters LLC, a group of global investors led by Morgan Stanley. The investors paid nearly $1.157 billion to receive the revenue from the meters for 75 years — and the city must reimburse them whenever the parking meters are taken offline, such as for festivals or construction. The deal was essentially rubber-stamped 40-5 in favor by the council, which had only a few days to review it before voting — turning out to be what the Better Government Association later called 'a lesson in 'worst practices.'' Soon after, a report issued by the then-inspector general found the city was paid at least $974 million less than it could have made from operating the parking meters itself over the term of the deal. While an analysis done by 32nd Ward Alderperson Scott Waguespack — who voted against the deal — found the deal could have been worth $5 to $10 billion, reported NBC 5. Now, a 2024 audit by accounting firm KPMG has found that, with another 58 years still left in the agreement, the private investors have already recouped their initial investment. In 2023, the meters generated a record $160.9 billion in income, bringing the total income from the start of the deal to $1.97 billion. 'It's just one of those deals that I would beg people never to replicate anywhere in the United States,' Waguespack told NBC 5. Still, many Americans can relate to the situation that faced Mayor Daley. When we're desperate for funds, we can make rash decisions that negatively affect our long-term financial health. Almost 4 in 10 (37%) U.S. adults would not be able to cover a $400 emergency expense with cash savings, according to the Economic Well-Being of US Households in 2024 report from the Federal Reserve Board of Governors. And while many of these people say they could cover the expense some other way, such as using a credit card, borrowing from family or friends or selling something, 13% would not be able to pay the expense by any means. About 58% of Americans are 'living paycheck to paycheck and experienced a cash emergency in the past 12 months,' according to The 2025 Cash Poor Report from peer-to-peer lending platform SoLo Funds. Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says — and that 'anyone' can do it These 'cash-poor' Americans may not be who you think they are. Forty percent have a full-time job and one in seven cash-poor households earn more than $75,000 per year. The top unexpected expenses, according to the report, are auto repairs, medical bills and utility bills — common expenses that can happen to any of us. To cover these expenses, some may turn to short-term financing options that could end up costing them more money in the long term. For instance, buy now pay later (BNPL) services come with an average borrowing cost of 23%, according to The 2025 Cash Poor Report, which can increase substantially if the borrower incurs repeat late fees. Another option is a payday loan, which is one of the most expensive ways to borrow. The industry average cost of borrowing for payday loans is 35%, according to the report, but origination fees, late fees and processing fees can push this as high as 49% of the principal borrowed. Increased borrowing and missed payments can also affect your credit score, which in turn can limit your future ability to borrow. People might also look to sell long-term assets such as stocks, bonds or mutual funds, but this too can have long-term financial costs. If you're 30 years from retirement and sell $10,000 of an asset today that's earning 7% per year, then you'll have about $76,000 less when you retire due to the loss in compounding interest. Plus, research has shown that time out of the stock market can be costly — and missing the best days in the market can be devastating to your long-term returns. And, if you make an early withdrawal from a tax-deferred account such as a 401(k), you'll also pay a 10% tax penalty. To avoid high-cost borrowing in an emergency or cashing out long-term investments during a downturn, start by building an emergency fund that could cover unexpected expenses. A rule of thumb is to have three to six months' income in an accessible account, such as a high-yield savings account. While desperate times may call for desperate measures, it's worth consulting with a financial advisor (or a free counseling service) to discuss your options before getting saddled with debt or selling long-term assets. Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you'll need a substantial stash of savings in retirement Robert Kiyosaki warns of a 'Greater Depression' coming to the US — with millions of Americans going poor. But he says these 2 'easy-money' assets will bring in 'great wealth'. How to get in now Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Like what you read? Join 200,000+ readers and get the best of Moneywise straight to your inbox every week. This article provides information only and should not be construed as advice. It is provided without warranty of any kind. Connectez-vous pour accéder à votre portefeuille
Yahoo
02-06-2025
- Business
- Yahoo
Editorial: Chicago didn't ruin Boeing, but the company paid a price for moving out of Seattle.
Seattle and Boeing were together for decades until Chicago came along. But after the company moved its headquarters from a cloudy city to a windy one, it struggled. Was it us? The deep-dish pizza and Italian beef? The ongoing wait for another Super Bowl title? As this iconic aerospace giant tries to regain altitude after yet another turbulent stretch, it's fair to ask if its move to Chicago in 2001 put it on the wrong course altogether. When then-Mayor Richard M. Daley announced that the city had won a bidding contest for Boeing's headquarters, this page joined in the celebration. The company got over $60 million in public incentives for moving its boardroom to the Loop. Chicago got bragging rights. The move made sense to us at the time. Chicago gave Boeing's leadership team the convenient, centralized transportation hub they were missing in the Pacific Northwest. Settling in a more global city with a financially savvy workforce was widely considered a plus as well. Moving out of Seattle also put almost 2,000 miles between the company's top brass and its restive unions, which might have been one of the biggest attractions from the corner-office point of view. As it turned out, though, the move seems to have undermined an engineering-friendly culture focused on design, safety and quality. In retrospect, separating from the critical mass of aerospace experts in Seattle isolated the company's leaders from the heart of their business. Apart from the move to Chicago, the other 'X factor' in that transformation was Boeing's 1997 acquisition of McDonnell Douglas, a company better known for financial engineering than the aerospace kind. Its priorities were quarterly profits and returning money to Wall Street shareholders — priorities Boeing embraced after the deal closed, appointing a string of chief executive officers who collected massive paychecks but cut corners in making planes. One outcome of this change was the decision to upgrade a popular passenger jet instead of designing a new one with all the latest advances, as the perfectionists at old-school Boeing no doubt would have preferred. Extending the life of its workhorse 737s helped Boeing's bottom line in the short run. Over time, that approach opened the company to serious problems, including the notorious 737 MAX crashes. In October 2018, this newly modified version of the old 737 jetliner crashed near Indonesia. Five months later, another new 737 MAX crashed in Ethiopia. Boeing had reconfigured the MAX model with bigger engines that affected its aerodynamics, and federal regulators had given the company too much control over certifying the new design. A faulty flight-control system forced down the two planes despite their pilots' desperate efforts to keep them aloft, killing a combined 346 aboard. Instead of taking responsibility, the company reportedly tried to blame the foreign airlines and resisted grounding its MAX fleet in the interest of safety. Then-CEO Dennis Muilenburg spouted insincere baloney about safety being a core value, until he was finally ousted by a board that paid him off with a $62 million exit package. In the waning days of the first administration of President Donald Trump, Boeing reached a settlement with the Justice Department that protected it from prosecution over the MAX crashes. Shortly after, in 2022, the company moved from Chicago to Arlington, Virginia, closer to its No. 1 customer: Uncle Sam. Last year brought another shocking safety gaffe, when a door panel blew off in midair from a 737 MAX 9 operated by Alaska Airlines. A few months later, federal prosecutors determined that Boeing had violated its deferred prosecution deal by failing to implement a compliance and ethics program. In response, Boeing agreed to plead guilty to criminal fraud, but a federal judge in Texas rejected the plea deal because it included diversity goals. Now, with Trump back in power, Boeing appears likely to receive a lighter settlement that avoids a criminal plea. During a recent Middle East trip, Trump also publicly promoted Boeing jets — a reminder of the company's political clout and close ties to its largest customer: the U.S. government. Cozying up to a pro-defense administration may be giving Boeing's stock a boost, but it won't restore public trust or prevent future failures. Boeing recently published the sad results of an all-employee survey, its first in years. Most Boeing employees said they lack faith in senior leadership, and barely a quarter recommend the company as a good place to work. That's a big comedown from the old days. Still, Boeing stock has bounced back strongly this year and its new-ish CEO, Kelly Ortberg, says he is putting the company's problems behind it. Earlier this month, Ortberg told Wall Street that he's introducing 'new values and behaviors to the entire organization,' vowing to 'seize the moment to make the necessary changes within the company.' Ortberg also reportedly bought a house in Seattle last year, which we consider a positive step. If Boeing was going to move the headquarters anywhere from Chicago, and if it was serious about rebuilding its culture, it probably should have moved back to Seattle. Still, its time here left a positive mark: Boeing supported civic institutions, hired local talent and helped elevate Chicago's stature as a center for global business. Submit a letter, of no more than 400 words, to the editor here or email letters@
Chicago Tribune
02-06-2025
- Business
- Chicago Tribune
Editorial: Chicago didn't ruin Boeing, but the company paid a price for moving out of Seattle.
Seattle and Boeing were together for decades until Chicago came along. But after the company moved its headquarters from a cloudy city to a windy one, it struggled. Was it us? The deep-dish pizza and Italian beef? The ongoing wait for another Super Bowl title? As this iconic aerospace giant tries to regain altitude after yet another turbulent stretch, it's fair to ask if its move to Chicago in 2001 put it on the wrong course altogether. When then-Mayor Richard M. Daley announced that the city had won a bidding contest for Boeing's headquarters, this page joined in the celebration. The company got over $60 million in public incentives for moving its boardroom to the Loop. Chicago got bragging rights. The move made sense to us at the time. Chicago gave Boeing's leadership team the convenient, centralized transportation hub they were missing in the Pacific Northwest. Settling in a more global city with a financially savvy workforce was widely considered a plus as well. Moving out of Seattle also put almost 2,000 miles between the company's top brass and its restive unions, which might have been one of the biggest attractions from the corner-office point of view. As it turned out, though, the move seems to have undermined an engineering-friendly culture focused on design, safety and quality. In retrospect, separating from the critical mass of aerospace experts in Seattle isolated the company's leaders from the heart of their business. Apart from the move to Chicago, the other 'X factor' in that transformation was Boeing's 1997 acquisition of McDonnell Douglas, a company better known for financial engineering than the aerospace kind. Its priorities were quarterly profits and returning money to Wall Street shareholders — priorities Boeing embraced after the deal closed, appointing a string of chief executive officers who collected massive paychecks but cut corners in making planes. One outcome of this change was the decision to upgrade a popular passenger jet instead of designing a new one with all the latest advances, as the perfectionists at old-school Boeing no doubt would have preferred. Extending the life of its workhorse 737s helped Boeing's bottom line in the short run. Over time, that approach opened the company to serious problems, including the notorious 737 MAX crashes. In October 2018, this newly modified version of the old 737 jetliner crashed near Indonesia. Five months later, another new 737 MAX crashed in Ethiopia. Boeing had reconfigured the MAX model with bigger engines that affected its aerodynamics, and federal regulators had given the company too much control over certifying the new design. A faulty flight-control system forced down the two planes despite their pilots' desperate efforts to keep them aloft, killing a combined 346 aboard. Instead of taking responsibility, the company reportedly tried to blame the foreign airlines and resisted grounding its MAX fleet in the interest of safety. Then-CEO Dennis Muilenburg spouted insincere baloney about safety being a core value, until he was finally ousted by a board that paid him off with a $62 million exit package. In the waning days of the first administration of President Donald Trump, Boeing reached a settlement with the Justice Department that protected it from prosecution over the MAX crashes. Shortly after, in 2022, the company moved from Chicago to Arlington, Virginia, closer to its No. 1 customer: Uncle Sam. Last year brought another shocking safety gaffe, when a door panel blew off in midair from a 737 MAX 9 operated by Alaska Airlines. A few months later, federal prosecutors determined that Boeing had violated its deferred prosecution deal by failing to implement a compliance and ethics program. In response, Boeing agreed to plead guilty to criminal fraud, but a federal judge in Texas rejected the plea deal because it included diversity goals. Now, with Trump back in power, Boeing appears likely to receive a lighter settlement that avoids a criminal plea. During a recent Middle East trip, Trump also publicly promoted Boeing jets — a reminder of the company's political clout and close ties to its largest customer: the U.S. government. Cozying up to a pro-defense administration may be giving Boeing's stock a boost, but it won't restore public trust or prevent future failures. Boeing recently published the sad results of an all-employee survey, its first in years. Most Boeing employees said they lack faith in senior leadership, and barely a quarter recommend the company as a good place to work. That's a big comedown from the old days. Still, Boeing stock has bounced back strongly this year and its new-ish CEO, Kelly Ortberg, says he is putting the company's problems behind it. Earlier this month, Ortberg told Wall Street that he's introducing 'new values and behaviors to the entire organization,' vowing to 'seize the moment to make the necessary changes within the company.' Ortberg also reportedly bought a house in Seattle last year, which we consider a positive step. If Boeing was going to move the headquarters anywhere from Chicago, and if it was serious about rebuilding its culture, it probably should have moved back to Seattle. Still, its time here left a positive mark: Boeing supported civic institutions, hired local talent and helped elevate Chicago's stature as a center for global business.
