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Responsible and Responsive Public Governance

This article series ran
in the November/December 2010 print issue of PA TIMES. Contact Editor
Christine Jewett McCrehin ([email protected]) for more information on
how to receive the print issue.

Emergence of DuPage Airport Authority in County West of Chicago

Paul M. Green, Roosevelt University; Peter A. Creticos, Institute for Work and the Economy

Illinois is legendary for the blurry line separating government service from personal gain. While Illinois politics may provide great theater, the public grows cynical as it witnesses the constant parade of public officials in criminal court. It is little wonder that the press and government watchdog groups look warily at any unit of government that is rich in jobs and lucrative contracts. What is remarkable about the DuPage Airport Authority (DAA) is that in less than a decade it developed a well-deserved reputation as a reliable steward of the public trust.

The lesson is that an agency, when guided by the right leadership and by adhering to policies of customer service, transparency, professional management, sound financial oversight, and competent leadership, can overcome the cultural norm and be held in high regard irrespective of whatever else is happening around it.

The DuPage Airport Authority dates its existence as an airport to 1927, when two Chicago entrepreneurs purchased a few parcels of land in western DuPage County and used it for barnstorming. The U.S. Navy requisitioned the airport in 1941 and later sold the airport to DuPage County for $1. By 1985, plans were implemented to greatly expand the footprint of the airport and by 1992, airport-owned land increased 3-fold from 900 acres in 1985 to 2,800. (Aviation International News, May 2006) Key steps were taken during this time that resulted in the financial and land use cornerstones of the airport complex today. Not coincidently during this period of rapid growth, political controversy also grew over allegations of patronage and contracts to the well-connected, lavish spending and the occasional federal investigation.

Changing the Culture of Exceptionalism
Political leaders find themselves in trouble when believe that rules simply are made for someone else to follow. Reform efforts generally fail because reformers grossly underestimate the difficulty of changing the status quo or because they find that the public is simply inured to bad government and lack the moral outrage that is needed to cause real change rarely materializes. Although efforts to reform the DuPage Airport Authority began in 1994 when then DuPage County board chair, Gayle Franzen, appointed seven independent-minded citizens to the Authority board, it was not until 2003, when DuPage County businessman Daniel Goodwin was elected as chair, that five fundamental changes were begun through his and the collective leadership of other directors. These were: greater clarity of mission that is customer focused, greater transparency, greater professional management, responsible financial stewardship, and political independence.

Clarity of Mission–Customer Focus
Mission statements are dismissed often as hortatory. In the case of the DAA, its stated mission comprises the DNA of the organization and routinely guides the decisions of both the board and management. First, it underscores that the foremost responsibility of the Authority is to provide aviation services and foster related businesses on its land. The result is a highly focused effort to improve operational efficiencies and lower costs so as to make DuPage airport the choice of Chicago area businesses and general aviation enthusiasts.

Second, as a property tax-supported agency, the DAA is obligated to reward the taxpayers in the area by generating greater revenue for local communities and reducing, and ultimately eliminating, the reliance of the DAA on property taxes. The Authority is working to reduce and ultimately eliminate the need for real estate tax support by improving revenues, reducing operating costs, and by capturing value of non-operating assets through the addition of a golf course and business park on airport land. The result is that long-term debts were retired by 2007 and budgeted property tax support, which only goes for infrastructure, was reduced in FY2009 to a level that is less than a quarter of all revenues.

Finally, the DAA is obligated to support greater economic development and job growth in the immediate area by generating long-term land-related revenue and greater aviation fees. While it has been successful in improving net revenues from operations, broad economic conditions and changing markets, especially in commercial real estate, have virtually halted development of the business park.

Exceptionalism is a product of and is sustained by government opaqueness. The less that the public is able to see, it is more likely that private deals form the basis for hiring and government contracts. The DAA has implemented a series of changes since 2002 to open itself to public scrutiny, including: A comprehensive ethics ordinance requiring full disclosure by all contractors and vendors, including disclosure of political contributions to DuPage county elected officials, and of any business or familial relationship between a contractor and any airport employee or DAA board member; Full management reports beginning with the Fiscal Year 2003 audit; Significant improvements in the corporate by-laws that clearly define the roles for the chair and board members; Improvements in decision-making processes and a rational committee structure with clearly defined duties and responsibilities; and finally, Clarity regarding the responsibility of the DAA board for comprehensive oversight ensuring the proper implementation of policies and official procedures.

Professional Management
It is easy to point to the addition of a professional airport manager in 2004 as the executive director of the DAA and conclude that improvements in the professional integrity of the organization are the result of his arrival. In fact, the gains are the result of a partnership between the board and the executive director that are intended to elevate the overall quality of airport management. Some senior executives found that they no longer fit in the overall vision of the organization. Several other senior staff members were able to adapt and grow in a new culture that prohibits patronage and special favor. The board, and later the executive director, provided the structure through which the basic rules were clearly stated and fairly enforced.

Financial Stewardship
Corruption and exceptionalism have insidious effects on the cost of government by discouraging fair competition. Consequently, a fundamental change made in 2003 was in how the airport conducts it purchases. Today the process is open to all qualified bidders. The board articulates impartial parameters and standard criteria for all contracts. It ensures objectivity in the decision process. And, the staff is asked, while on the record, for their recommendations on all purchasing decisions.

Good procedures are important if the results of these decisions are also tracked and ultimately verified. The board now requires current monthly financial reports at every board meeting. It implemented improved accounting controls and cash management practices, and requires public disclosure of the annual audit with an in-person presentation by the auditors at meeting of the board. In addition, the chair presents an annual report to the DuPage County Board on the operations and financial standing of the Authority.

Political Independence
One of the key factors in the success of the DAA is that it is governed by a board comprised of members who put great stock in professional airport managers and who act on the authority of their best judgment and not simply at the behest of political leadership outside the board. While this begins with the chair, Dan Goodwin, who is by reputation and practice ordinarily able to keep his distance from the day-to-day politics of DuPage County, the rest of the board is comprised of members who also value their independence. This provides invaluable political “cover” for both the staff and for the authority as a whole. As a result, the board is able to deflect political criticism to itself and thereby leaving the staff to do their jobs.

The DuPage Airport Authority remains a work in progress and there is no assurance that the recent gains will not be undone. The hope is that the public, having seen effective and honest government in action, will not countenance a return to exceptionalism.

Paul Green is the director of the Institute for Politics at Roosevelt University. Email: [email protected]

Peter A. Creticos is president/executive director of the Institute for Work and the Economy. Email: [email protected]

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