In the News

Chicago Tribune, July 16, 2010

In the weeks since Metra Executive Director Phil Pagano stepped in front of a train just before he was going to be fired, the story of his brazen abuse of authority has gotten worse and worse:

•In 2008 and 2009, Pagano gave himself and his top aides a total of more than $400,000 in extra compensation in the form of 401(k) contributions, according to a Tribune report. He also awarded an extra week's vacation to himself and four top aides to "establish consistency" among senior executives — without consulting the Metra board.

•Also in 2008, Pagano approved payments totaling $131,000 for unused vacation and sick days — in violation of Metra's policy — to get two top aides to stay past their retirement dates, according to an audit done for the Regional Transportation Authority, which oversees Metra. Those payments also had the effect of increasing the employees' pension benefits.

The same year, Pagano and five others got $133,000 in vacation pay they'd supposedly been shorted, and Pagano advanced himself more than $111,000 in vacation pay, the audit found.

•While top execs got big bumps, rank-and-file workers were raking in the overtime, according to a Sun-Times/Better Government Association report. Metra paid $20 million in overtime last year, or 11 percent of its payroll. One police officer more than doubled his salary, thanks to overtime, and 14 Metra cops collected at least $40,000 in OT.

•State Sen. Susan Garrett, who's getting a healthy taste of how easy it isn't to obtain records under the Illinois Freedom of Information Act, is questioning the $3.5 million Metra paid a Washington lobbying firm over the last five years. The contracts were awarded without competitive bids, extended by Pagano and expanded through change orders.

Garrett, D-Lake Forest, says her research shows that Metra spends more on lobbyists than any transit agency in the country, and she questions whether the returns justify the expense. Metra is now seeking bids for its legislative consulting contracts.

We keep coming back to the same question: Where was the Metra board while all this was going on? It's clear now that Pagano had been playing fast and loose with the rules — and the money — for much of his 20-year tenure at the top. It's also clear that his behavior went undetected because he operated with virtually no oversight. Nobody called him on it until he forged the board chairman's signature to get an advance on next year's unearned vacation pay. That's when the board found out that he routinely cashed out his vacation, in advance, whether or not he actually took any time off, and that by the way, he was claiming 10 weeks of vacation per year. The board's explanation? It trusted Pagano too much.

We may have to wait for the U.S. attorney's investigation to learn the full extent of Pagano's misdeeds. Metra, meanwhile, has ordered an outside audit designed to diagnose and correct the practices that allowed it all to happen. The board also hired an interim inspector general and is seeking a permanent one. And some board members, finally, are asking tough questions. But we agree with Garrett: It's not enough.

Shortly after the Pagano saga became public, Garrett filed a bill to establish an independent Metra inspector general, appointed by the governor, to assure that taxpayer money is being safeguarded. Metra responded by sending its lobbyists to help stuff the bill in committee. We don't like the idea of stationing an inspector general at the door of every government agency, but we've grown increasingly skeptical of Metra's ability to police itself as more details have emerged. The board has been blind to both corruption and wasteful spending. Metra needs a watchdog, and not one that answers to the board.

Garrett said she's likely to renew her call for outside oversight following a July 28 legislative hearing to discuss ways to increase accountability and transparency at Metra. We think a thorough public airing is a good thing. Over the years, Pagano was able to authorize ever-larger lump-sum payouts for himself and others without the knowledge, much less the permission, of Metra's fiscal guardians. How is this possible?

The short answer is that Metra isn't the CTA — which is to say, it isn't perpetually on the brink of a financial meltdown — thanks, by most accounts, to Phil Pagano. Even in tough times, with fares rising, non-union salaries frozen and the executive director running amok, Metra officials keep pointing out, the trains have run on time.

Sure. Pagano was doing a fine job. And so were they.