We have been fighting the construction of the Obama Presidential Center in Chicago’s historic Jackson Park for the past four years. The center, which is scheduled to open in February 2025, is being built in a dangerous place. The water table is high enough to require constant drainage—a peril that will be compounded by major storms off Lake Michigan. An award-winning alternative design on private land west of nearby Washington Park would be less costly and safer to build and would provide far better access to the South Side community that is the center’s target audience.
The Obama Foundation just released its annual report and 990 tax forms for 2021. Together they show that the Obama Presidential Center’s financial foundations are as rickety as its physical ones. The Foundation’s 2020 annual report exhibited some financial candor, estimating that $300 million in annual donations for four straight years would be necessary to meet all future construction and operating costs. The 2021 return revealed that the foundation had raised only $159 million, about 8% less than it raised in 2020. Those dollars must pay for all foundation activities, including payroll, fundraising, public relations, and scholarship and grant programs.
The foundation also reported that last year it spent about $115 million on construction costs, without indicating either the total project construction costs or the estimated timeline to completion. It is crystal clear that no sudden reversal of fortune will allow the foundation to meet its 2020 targets (adjusted for inflation) of raising more than $1 billion.
Last year the foundation needed to do some fancy accounting footwork to close on the Jackson Park property. A May 2019 master agreement with the city contained two strict “condition precedents.” Under the first condition, the foundation had to certify that it had “received” more money than the anticipated cost of the building as of March 2021. The foundation barely appeared to meet that target, but then insisted that it wasn’t required to retain those dollars for constructing the building. What, then, was the point of the condition? As its own cost estimates ballooned from $350 million in 2018 to about $700 million in 2021, the foundation ignored its contractual obligation to update its financial projections before closing.
Don't be shocked if the Obama Center gets Climate Change money or something in the near future. Rent-seeking can work when you have connections.
