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Thursday, April 1, 2004 03:32 pm

Casino flap

Last fall, Gov. Rod Blagojevich took a brief but nasty beating in the Chicago media.

Thick smoke from a superhot fire killed nine people in a Loop office high-rise. One of the building's managers, Elzie Higginbottom, was a Blagojevich campaign contributor. When the city and county's investigators dragged their feet, the Chicago media demanded that the governor step in. When he refused, he was mercilessly slammed. Though he eventually changed his mind, the damage was done.

That very same Elzie Higginbottom is also the chairman of the Illinois Gaming Board. And when Higginbottom announced recently that suburban Rosemont would host the state's newest riverboat casino, the political world exploded around him once again.

This time, Blagojevich immediately demanded a full investigation.

The gaming board's decision was controversial partly because it had ignored a staff recommendation to award the license to Des Plaines -- a decision it never explained. And government officials in struggling Waukegan, the third finalist, were also upset: The city had banked on a new casino to help anchor its redevelopment efforts.

But the real source of the anger was Rosemont itself. Right or wrong, Rosemont is often found in news stories along with the phrase "mob-related."

The guy who has run Rosemont since its inception is Mayor Don Stephens. Twice the FBI has tried to nail Stephens, without success, which proves to some that he hires good lawyers and proves to his friends that he's getting a bad rap.

Mayor Stephens, a Republican, also happens to be a longtime Blagojevich supporter. Stephens backed Blagojevich for the Illinois House, the U.S. Congress, and the governorship.

Stephens' closest allies in the General Assembly have been deeply involved with helping Blagojevich pass his legislative agenda. And one of the governor's closest pals, Tony Rezko, had, until recently, an agreement with Stephens to build a hotel near the casino site.

Last year, another close Blagojevich friend, Chris Kelly, tried to influence some of the gaming board's decisions at the governor's behest.

Then there are the inconvenient facts that the gaming board is appointed by the governor and that chairman Higginbottom gave $65,000 to Blagojevich's campaign.

All of that combined could lead to some serious conspiracy-mongering. As they say in the business, Blagojevich needed to "get out in front of the story."

But rather than ask Illinois Attorney General Lisa Madigan to investigate, Blagojevich appointed his own person. Madigan would be the logical choice because she has full investigative powers over the gaming board.

Blagojevich's appointee, Eric Holder, is a former U.S. Department of Justice lawyer who, coincidentally, endorsed Lisa Madigan's opponent in the 2002 Democratic primary campaign. One of Blagojevich's top media advisors reportedly recommended Holder.

The Blagojevich crowd has been paranoid from the beginning that Madigan wants to run against their guy in 2006, or at least use her office to undercut him.

An investigator they could control would be a better option. And appointing someone himself would allow the governor to once again hoist the glittering banner of reform and distract attention from his own Rosemont connections.

Give the governor points for acting quickly, but subtract most of them for putting style before substance.

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