Anonymous donation to Winnetka Park District could rival that of billionaire at center of beach controversy

An anonymous donor has come forward to offer the Winnetka Park District $3 million to shore up funding for the Elder Lane and Centennial beach project, but questions remain how this new donation could impact a similar one made by billionaire Justin Ishbia.

The donation and a letter regarding it were presented to the Winnetka Park District Board during a Dec. 14 meeting by the anonymous donor’s attorney, who stated the donation would be unrestricted.

“Our client’s hope for this gift is that it will grant the Winnetka Park District greater flexibility and autonomy in planning the future of these unique public spaces,” Elizabeth O’Brien, a partner with Levenfeld Pearlstein LLC said. “Our client has no interest in receiving any public recognition for this gift and prefers to remain completely anonymous.”

Ishbia’s proposed donation has caused trouble in the village with some residents angry the Park District has continued to negotiate with the future resident who already has an unfulfilled contract with the Park District.

Commissioner Cynthia Rapp shared this sentiment, saying during the meeting she is concerned about getting into another contract with Ishbia. She also took issue with the board and public receiving an updated donation agreement three hours before the meeting.

A land swap agreement, signed in October 2020, would see Ishbia swap his property at 261 Sheridan Road with a similar stretch of land at the southern end of Centennial Park owned by the Park District. Residents opposed to the land swap say the Park District shouldn’t be giving away public land to private citizens even if doing so would realize a long-standing dream to unite Elder and Centennial beaches into one stretch.

Despite the land swap deal being signed, deeds have yet to be exchanged and the deal has been labeled as “dormant.” A lawsuit by resident Rob Schriesheim arguing the swap is in violation of the public trust doctrine, which states the land under Lake Michigan is held in trust by the Park District for residents, has also stalled the land swap. The suit was struck down by Cook County Circuit Judge Eve Reilly in October but has since been refiled in accordance with court guidance.

Ishbia also owns a 3.7-acre lot immediately south of Centennial, where he plans to build a $43.7 million mansion for his family.

His donation, which was initially described as coming with “no strings attached,” has included several stipulations, with the most recent draft requiring the Park District keep structures it has planned to build during the Elder/Centennial beach renovations in place for 50 years. Other stipulations require the Park District to pay back the proposed $3 million donation if the contract is breached.

Previous drafts of the agreement required the Park District to keep the structures — defined as the dog beach, its fence, the ADA accessible pathway to the beach at Centennial and the stone breakwater and walkway at the northern edge of Centennial — for 100 years.

If permitting agencies require the plans to be changed, the donation agreement could fall through if Ishbia chooses, according to Park District counsel Adam Simon.

“There’s no risk of the Park District ever losing any property rights or anything as result of this covenant,” Simon said. “It doesn’t restrict anything about what activities occur on the tableland. It doesn’t restrict what improvements we can put on the tableland. It doesn’t restrict what people are allowed to come and go. It doesn’t grant anyone the power to use, posses or exclude anyone from the Park District property.”

The payment schedule for the donation has also changed in the new draft with two payments instead of three. The first $1 million would be given at the start of the project and the remaining $2 million would come within 30 days of the project completion and arbiter review.

Other concerns were raised about the appointment of outgoing Winnetka Park District Executive Director John Peterson as arbiter for the Ishbia donation agreement. The unpaid role would see him determining if the Park District remained faithful to the agreement once the project is built. Some commissioners expressed concern about the appointment, made by Ishbia according to Peterson, saying Peterson cannot be considered neutral as an arbiter should be. Others said even though it would be favorable to the Park District to have Peterson as the arbiter, the optics are poor.

“I can assure you that the place that I am going does not have any connection with Justin Ishbia or any of his direct holdings,” Peterson said.

He went on to say he saw the chance to work as an arbiter would be an honor and give the Park District the best opportunity to make sure plans are done accordingly.

Commissioner Colleen Root embraced the idea of an alternative donation but questioned if now is the time to consider it. The Park District hasn’t been able to look into potential grant funding as permits from several agencies are required first. Park District staff is in talks with the village on its new permitting process and once completed will then take permits to other required agencies.

Some residents argued donation talks should be put on hold until new executive director Shannon Nazzal comes on board in February.

Commissioner James Hemmings informed the board he received a call earlier in the week from the anonymous donor’s attorney and was told there would be some conditions for the donation. The board would be required to drop the Ishbia donation and land swap agreement along with not allowing Ishbia the opportunity for naming rights on the project.

Naming rights were included as part of initial talks for the donation but were quickly dropped.

“None of those things were raised this evening by Ms. O’Brien,” Hemmings said. “There’s none of that in this letter. There may be an implication ... that there is perhaps a condition on the donation agreement but we don’t know about anything else.”

Hemmings and board President Christina Codo will move forward with talks on the alternative donation and see if the conditions are still part of the offer.

“I feel like this is a very welcome donation offer but I’m concerned that it may turn out to be as thorny for us,” Codo said.

She stressed the need to have a working relationship with Ishbia because he is a neighbor to the project on several sides and his cooperation is needed for maintenance of the parks even once the project is complete.

“Regardless of the source of funding to bring it to fruition, my family and I remain supportive of the WPD Board’s approved plans to activate, stabilize and enhance the Elder and Centennial parks and beaches,” Ishbia said in an email. “If the Park District chooses to proceed with an alternative source of funding, I would be happy to discuss contributing to another WPD project in the future.”

Those in attendance at the meeting appeared in favor of the new donation, clapping as O’Brien sat down.

“Thanks to an anonymous donor, you can now get out from under the oppressive conditions of the Ishbia Family Foundation that they have attached to the so called donation,” resident Irene Smith said. “Accepting $3 million from the anonymous donor we heard about tonight is like accepting a life preserver. ... It is a dream come true.”

A potential vote on the Ishbia donation has been rescheduled for the Jan. 18meeting.