Rezko Reality

But the deal did not put $14 million into Rezko's pocket. That figure represents the total development cost for the project. According to the Chicago Sun-Times, Rezko and his partner, Allison Davis, netted about $855,000. That's not pocket change, but it's a far cry from $14 million. And the tenants of the building benefited too.

Moreover, the ad's claim that Obama wrote the letter as a favor to Rezko is without factual support. Both men deny that Rezko asked Obama to write them, and Obama says his district office frequently sent letters supporting "worthy" community projects, so routinely that "I wasn't even aware that we wrote the letter." Rezko's attorney, Joseph Duffy, told the Sun-Times in 2007 that "Mr. Rezko never spoke with, nor sought a letter from, Senator Obama in connection with that project." And Obama told Sun-Times reporters in a March 2008 interview:

Obama (March 15, 2008): [He] did not solicit that from me. ... This was a project that was well-regarded in the community, has done well, and was supported on its own merits, and it was essentially a form letter of the sort that I did all [the] time.

Can support for a low-income housing project be a "favor" to the developer if the developer didn't ask for it? You decide.

Million-Dollar Mansion
As for that claim about Rezko helping Obama buy his house, well, we've dealt with that one before. The gist of the story: In 2005, Barack and Michelle Obama found a house that they wanted to purchase. The property had been divided into two parcels, one containing a house and the other undeveloped land. The owner had listed the properties separately. After considerable haggling, the seller accepted the Obamas' third bid of $1.65 million for the parcel containing the house. Tony Rezko's wife, Rita, purchased the adjoining lot for $625,000.

When the Obamas wanted to increase the size of their yard, they approached the Rezkos about purchasing a strip of the adjacent parcel. Obama told the Sun-Times that a 10-foot strip of the 60-foot lot appraised for $40,000. The Obamas nevertheless paid Rita $104,500 (or 1/6 of the total purchase price of her lot) for the strip. In 2007, Rita sold the remaining lot for $575,000 (or roughly a $54,500 profit on the overall property).

McCain's ad, however, is worded in a way that could leave a false impression. It says Rezko "helped him buy his million-dollar mansion" by "purchasing part of the property he couldn't afford." That's true, but only because the seller wanted to sell the two parcels as a unit and the Obamas couldn't afford both. Rezko did not make a gift of any property to the Obamas. Furthermore, the fact that his wife sold her lot for more than she paid for it contradicts any suggestion that the Rezkos overpaid for their part of the deal as a way of getting the seller to lower the price to the Obamas for their part.

Convicted Felon
The McCain ad says of Rezko, "Now, he's a convicted felon." That's true; Rezko was indicted in 2006 and convicted of corruption charges on June 4, 2008. But those charges came after the 2005 Obama home purchase and had nothing to do with that or with the $14 million project mentioned in the ad.

Obama has conceded that purchasing the land from Rezko, whom Obama knew to be under investigation at the time, was "boneheaded." As we reported in December, Obama has donated campaign contributions from Rezko and his associates to charity.