Since 2000, Arce’s company has gotten more than $13 million in taxpayer money to provide eye exams and glasses for more than 60,000 uninsured students from Chicago’s public schools, as well as providing vision tests for his rapidly growing Medicaid business, which has become one of the biggest in the state. Arce makes the glasses for the uninsured students, though not for the Medicaid recipients, whose glasses are made by Illinois prisoners.
Arce’s business pulled in more than half of the $13 million in the past four years, after a new state law began requiring the Chicago Board of Education to provide vision tests and glasses for uninsured students.
The legislation’s lead sponsor was state Rep. Edward Acevedo (D-Chicago), who has gotten more than $65,000 in campaign contributions from Tropical Optical and Arce’s PAC.
Once the law was passed, Blagojevich and Illinois legislators gave Chicago’s school system a grant of $3 million a year to pay for those exams and glasses in 2006, 2007 and 2009. (The program was suspended in 2008, after Blagojevich vetoed the grant during a political battle with Illinois House Speaker Michael J. Madigan.)
To handle the tests and glasses for students, Chicago school officials picked Arce, whose company submitted the lowest bid for the job in 2006. Since then, no one bid against Arce.
To negotiate his three contracts with the Chicago Board of Education, Arce hired the Chicago law firm Chico & Nunes, headed by Gery Chico, a former chief of staff to Mayor Daley and former Chicago school board president who is now chairman of the City Colleges of Chicago.
Arce’s current contract — a three-year deal — doesn’t expire until next year, but he stopped providing the exams and glasses last June, when state funding ran out.
Chico — whose father owns Kopico Printing, a subcontractor on Tropical Optical’s school contracts — says his law firm has lobbied state officials on Arce’s behalf, hoping to get money to restart the vision program. But that’s unlikely, since the state is struggling with a record budget deficit of $13 billion.
Under the state grants, the Chicago Board of Education was required to audit Arce’s contracts — but it never did. Now, after the Sun-Times inquired, all three years will be audited, schools spokeswoman Monique Bond says.
With the Blagojevich administration more than tripling what the state pays for vision exams starting in 2007, Arce’s business began taking more Medicaid patients. The state passed a law in 2008 requiring all children to get eye exams before beginning school.
Last year, Tropical Optical was paid more than $1.4 million by the state for seeing 21,918 Medicaid patients — nearly four times as much money as it collected in 2006, when it had 13,552 Medicaid patients, state records show.
Arce has other government customers, too. Employees who work for Chicago City Hall, the city’s schools and Cook County government can get their glasses at Tropical Optical under their health insurance plans.
Though Tropical Optical’s list of government customers is growing, Arce says that has nothing to do with his campaign contributions.
“Frankly, we are insulted by your insinuation,” Arce says in an e-mail in response to questions from the Sun-Times. “I and my family make decisions to support those candidates that we believe have a proven track record of accomplishment and promise for our community. We expect nothing in return but their honest and best service.”
Arce and Acevedo, along with other Hispanic legislators, are all on the board of the Illinois Legislative Latino Caucus Foundation, a not-for-profit group run by state legislators, lobbyists and businessmen to develop “a comprehensive Latino agenda” to increase state funding for housing, education and health care. They also give scholarships to students.
Tropical Optical was started in 1971. That’s when Arce’s late father, Eusebio, an optician, opened his first store on 26th Street in Chicago’s Little Village neighborhood. He went on to open four more stores in other largely Hispanic neighborhoods before he died in 1994. His widow, Guadalupe, and their children now own the business.
In 1999, Tropical Optical had a small share of the state’s welfare business — it collected $141,123 from Medicaid — when Paul Vallas, then the Chicago schools chief executive officer, and Chico, then school board president, decided to expand the vision-screening program to include eye exams and glasses for uninsured kids, paid for by the school system.
Tropical Optical was hired, along with a second company, Mobile Vision Services. But most of the school work went to Arce’s company, which was paid nearly $1.2 million between 2001 and 2003, when the program ended, records show. Chico resigned from the school board in May 2001.
In December 1999, Chico abstained from voting when the school board agreed to negotiate a contract with Tropical Optical. At the time, city records show Tropical Optical was a lobbying client of the Chicago law firm Altheimer & Gray, whose lobbying business was run then by Chico, though Chico disputes the accuracy of those records.
“I can find no record of Tropical being a client of Altheimer & Gray in 1999-2000, city records notwithstanding,” says Chico, responding to questions via e-mail. “We operate under an abundance of care and may have simply shown the company for some reason despite the fact that we did no work for them.
“The likely reason I abstained was that I did not want there to be the appearance of favoritism or impropriety because of my relationship with the Arce family. I often came down on the side of caution when these matters came before our board.”
Two years after leaving the school board, Chico ran in the Democratic primary for a U.S. Senate seat ultimately won by now-President Obama. During that campaign, Tropical Optical’s owners contributed $24,000 to Chico’s campaign.
“The owners of Tropical Optical have been friends of our family going across several generations,” says Chico. “I welcomed their contributions.”
– BY TIM NOVAK Staff Reporter, WITH THE BETTER GOVERNMENT ASSOCIATION – Chicago Sun Times – 4/12/2010