And the fight is not over.

On Saturday, March 13 at 10 a.m., the Coalition to Save Community Banking will meet at the Light of Liberty Church of God and Christ at 2 W. Washington Blvd. in Oak Park. The group will then march to Park National’s former headquarters at the corner of Austin Boulevard and Madison Street where it will stage a protest over the loss of the community bank that had invested heavily on the West Side. The coalition plans to assemble 300 to 500 people for the march.

“We’re gearing up a campaign around a Community Benefits Agreement that targets US Bank to continue the kind of community lending that Park National had,” coalition member and South Austin Coalition organizer Elce Redmond said.

The agreement “is a set of criteria [centered] around local hiring, around lending, around supporting community organizations,” said Redmond. “It’s about a seven- or eight-page document that we’ve had. And we’ve been trying to have negotiations with US Bank on this document.”

E-mails and calls to US Bank have not been returned. A receptionist told a reporter on Feb. 24 that no one could comment as things were still “floating.”

Mike Kelly, chairman of Park National and its parent company, First Bank of Oak Park, was known for lending to customers in Chicago’s impoverished West Side neighborhoods in Austin and West Garfield Park. After the 2007 closing of Austin High School, Park National extended a $22 million, no-interest loan to build Christ the King Jesuit College Preparatory School; students began attending class in the new building Jan. 4.

“This bank epitomized what community banking was; they loaned money to small businesses, community organizations, nonprofits,” said Redmond.

Attorney Kelli Dudley, a professor and program assistant in the Predatory Lending Program at John Marshall Law School, said Park National was well known in the community for giving “zero-percent loans to community organizations and schools, giving money to community organizations through grants” and did “things like cleaning up houses that had been subject to foreclosure and making them nice and livable and resalable and yet absorbing a little bit of that cost each time.”

Redmond also said he heard Kelly, a longtime River Forest resident, was considering filing suit against the Federal Deposit Insurance Corp. over how it handled the takeover.

“I don’t know what his specific intentions are,” said Dudley, who educates Austin residents on predatory lending and avoiding foreclosures. “There might just be some legal technical issues that would make it hard to sue the FDIC, but it does seem like that the community bank and the people affiliated with it and the people who relied on it should have some kind of legal recourse, because here a big decision takes place under cover of the night and they’re not given any opportunity to have any input into it.”

Kelly recently took legal action against JP Morgan Chase, which sued the FBOP last June over a loan Chase called in and which may have contributed to the worsening financial state and eventual government seizure of Kelly’s company.

“They [Chase] sued him and he filed a motion with that lawsuit,” said Dudley. “JP Morgan Chase, it is alleged, unfairly accelerated and called in a loan, and it was a huge amount percentage-wise of their [Park National's] portfolio, which caused them to look temporarily weak.”

The protest planned for March will come less than two months after dozens of Park National supporters traveled to Washington, D.C., to attend a congressional hearing on last year’s seizure and selling of Park National and its other banks. Kelly testified as members of the Coalition to Save Community Banking looked on.

Redmond, who made the round-trip bus trip with other coalition members, said several congressional members at the Jan. 21 hearing “put the FDIC on the hot seat.”

“The FDIC sort of admitted, ‘Well, it didn’t really need to happen,’” Redmond said, “But how do you reverse it? That becomes the big issue.”

There is also the issue of big bank versus small bank in the government’s eyes, as Dudley said: “There is a difference in the standards that are applied in evaluating whether the FDIC should come in and close down a Park National versus whether they should come in and close down one of the six largest banks in the country, and it’s just frankly not fair at all,” said Dudley.

Camille Lilly, the volunteer executive director for the Austin Chamber of Commerce, said the loss of First National still ripples through the community.

“They [Park National] were community banking,” she said. “We had the leadership, we had the commitment – we had all of that at Park National for the community to develop themselves, and when we remove that opportunity, the community struggles with developing themselves.”

Park National’s community philanthropy made it unique in the banking world, Dudley said. “Rather than making all of their decisions based on what will flow the most money to shareholders and what will flow the most money into the corporation, they made some decisions that were based on doing good in the community.”

Lilly and others worry about whether US Bank will perform some of these same community bank functions. “From what I’ve heard and read, it is not their philosophy to be community banking sensitive. That is not what they built their model on, so it’s a void in our community because we once had it.”

For more information about Saturday’s march, contact the South Austin Coalition at (773) 287-4570.

Mary Kate McLoughlin, the daughter of a Chicago precinct captain who works for state comptroller Dan Hynes and a secretary who works for the Chicago Library commissioner, said she knew to apply for a legislative scholarship because her parents “know about these things.” One of her older sisters also got a legislative scholarship.

And John Annes was able to pay for three years of medical school at the University of Illinois at Chicago. The cost to the medical school and the rest of its students? More than $120,000 over three years.

Watson, McLoughlin and Annes were three of more than 60 students a team of Columbia College Chicago journalists interviewed during a three-month investigation done in collaboration with Illinois Statehouse News. In scores of other interviews with legislative staff and lawmakers themselves, ChicagoTalks discovered there’s little regulation of the century-old program with each of the 163 participating lawmakers deciding how to distribute the scholarships, which totaled $12.5 million in 2007-2008.

Because no state agency or central legislative office oversees the program, promotion of the scholarships – worth an average of $8,300 in 2007-2008 – is spotty, with hundreds of applicants applying to one lawmaker and only a handful submitting applications to another legislator. And no one checks whether the scholarship law’s one requirement – that students live in the district of their nominating lawmaker – is followed. It’s left up to each legislator to decide why a student should get the scholarships, so a top student may be selected in one area while a C student gets picked elsewhere.

Rep. Mary Flowers (D-Chicago) doesn’t go by grades because “grades are prejudice,” she said in an interview. Grades can be based on “how you look,” nationality, background, political affiliation, “what side-of-the track” you come from and are subject to interpretation, Flowers said.

Instead, she likes to look at the “human” side. Flowers said she reads the student essay that’s part of her application to get a feel for the person, and she considers how the parents, teachers and neighbors feel about the student. Grades are not the most important thing because there are scholarships for straight-A students, but the high schools are not making other students aware of what’s available to them, the lawmaker said.

Like many of the other 162 participating lawmakers, Flowers will give students, depending on their circumstances, more than one scholarship because she wants to see a student through to graduation day. “What’s the point in me giving out a one-year scholarship?” she asks, if she can help a recipient graduate, adding “there’s always room for give-and-take.”

Higher education experts say that makes sense as long as the legislative scholarships are going to students with great financial need who would not otherwise be able to get a college degree. But lawmakers don’t require applicants to complete the detailed financial aid form that is mandatory for students wanting to get grants and loans through the Illinois Student Assistance Commission.

Higher education experts and political scientists question the fairness of someone like Watson getting seven years of undergraduate and graduate education paid by the state when other equally deserving or even more needy students get nothing at all.

“There probably should be a limit on how many times you can have the scholarship if legislators are going to be allowed to give them,” said Dick Simpson, head of the political science department at the University of Illinois at Chicago.

But Watson, who received legislative scholarships from 2000 through 2006, says she deserved the help because she was a “broke, single white female” when she applied. Rep. Sara Feigenholtz (D-Chicago) awarded her scholarships the first five years, then Rep. John Fritchey (D-Chicago) gave her two more years after she moved into his legislative district.

“I’m not your average student,” said the 46-year-old Watson, who started school when she was 32.

It was nice to get a scholarship because it was “all based on academics” compared with other scholarships she knew about that required the applicant to be “poor, Hispanic or black.”

Watson said she was a waitress making less than $30,000 a year when she attended college. “In all honesty, I might have been able to pay for it,” she said, but for her that would have been “robbing Peter to pay Paul.”

When Annes was applying the first time for his scholarship, he added a lengthy essay –- in addition to the shorter required one — in which he described the premature birth of his daughter earlier that year. Annes said he was lucky to have had health insurance because his daughter’s medical bills topped nearly $200,000. He saw that other parents at the hospital did not have insurance and was moved to address health care reform in his essay to Rep. Fritchey.

Annes thinks the essay may have helped him receive the scholarship, which he felt “blessed” to get. It’s “been good for me [and] my family.”

He understands the medical school and the rest of its students absorbed the cost of his legislative scholarships: “If I was more altruistic, I might say, ‘I don’t want the scholarship.’”

McLoughlin, a speech pathology major at Illinois State University, received her free tuition from Rep. Kevin Joyce (D-Chicago) in 2008. She didn’t reapply for the scholarship because “they try to give it to different people each year to help out other families.”

Her advice for other students hoping to get a year — or more — of free college tuition: “I would say for high school — be really involved and volunteer at [the] 19th Ward,” she said. “Get your name out there.”

Stacey Alletto and Nicole Leonhardt contributed to this story.

Contact: [email protected]

View more than 6,000 scholarships awarded by current lawmakers.

Other stories from Day Two:

Some Lawmakers Turn a Right into a Requirement

Nobody’s Watching: Illinois Lawmakers Alone Decide How to Give Millions

Students’ Free Ride Proves Costly to Their Classmates

Stories from Day One:

One Scholarship, 163 Ways to Dole It Out

Evasive State Legislators Dodge Questions About Scholarships

Clout or Coincidence? Some Legislators Keep General Assembly Scholarships All in the Family

Scholarships for Some Grad Students a Big Burden for State and Schools

Stories from Day Three:

State Legislative Scholarships Could Be Eliminated

For Richer or Poorer? Legislative Scholarships Should Target the Needy

Experts Suggest Changes to Legislative Scholarships