A staffer at the center of virtually every major downtown zoning decision for nearly a decade has abruptly resigned from her post, the latest chapter in a quintessential Chicago tale involving big money, weak city ethics laws and lots of political intrigue.

Leaving as a building and zoning aide to Ald. Brendan Reilly, 42nd, is Madeleine Doering Hill, who had worked as his chief of staff paid by the city and, more recently, as a consultant and adviser paid by Reilly's campaign fund. She's also worked as a registered lobbyist for at least two developers, though never on projects involving the 42nd Ward, says Reilly, who doubles as the city's vice mayor.

"She didn't want to be a target for my political opponents," including people with ties to Gov. Bruce Rauner, Reilly told me in an interview yesterday. "She's conducted herself to the highest standards. Mr. Kahn has done her a great disservice."

That's Faisal Khan, a former inspector general for the City Council who was let go earlier this year after Reilly and other aldermen concluded he was not doing enough to earn his $200,000-a-year salary.

After his office was merged into that of city Inspector General Joe Ferguson, Khan set up a new investigative group, Project Six.

Last month it published a web story accusing Hill of violating city ethics laws. It came out just four days after another internet story on the same general subject by the Daily Line, a local political newsletter.

DIFFERENT CONCLUSIONS

Both Khan and Daily Line's Mike Fourcher say their stories were derived from tips and were developed independently of each other. But though both question whether Hill should have been paid simultaneously by Reilly and developers, they reached different conclusions as to the legal significance.

Fourcher suggested Hill found "a loophole" to exploit. Being a lobbyist and consultant "is not illegal, nor is it officially unethical, according to advisory opinions posted by the Chicago Board of Ethics," he reported.

But Khan concluded otherwise. In his piece and in an interview with me, he said records he obtained from Reilly's office via the Freedom of Information Act indicate that it's clear Hill continued to act as chief of staff even after leaving the city payroll in 2013 to work for Res Publica, a Chicago public affairs company, and then to run her own business.

By negotiating zoning deals on Reilly's behalf, she also was acting as a "contract manager," Khan says. Either post should have required Hill to be on the city payroll, subject to rules banning such conflicts of interest, he asserts.

Emails obtained by Fourcher and Khan do indeed show Hill routinely handled zoning matters, including negotiations with developers on the size and shape of their projects, from 2011 to 2016. On Reilly's political payroll, she'd been making $10,000 a month. But neither article offered any proof that Hill worked on zoning matters in the 42nd Ward for her lobbying clients, Wirtz Realty and M. Fishman, though both at times have had routine matters come before the City Council.

Reilly says she got a green light from the Board of Ethics before beginning her dual roles as consultant and lobbyist.

Hill did not return calls and emails seeking comment.

'WE HAD A FIREWALL'

Hill is "a brilliant zoning mind," Reilly said. And with the 42nd Ward now in the middle of a building boom, with 44 major projects under construction, "I can't run this office and do a good job with the two and a half people" that each alderman gets as part of his or her city expense allowance. "So, I paid for it myself. . . .We had a firewall" that Hill could not lobby on any project involving the 42nd Ward.

Khan "got lots of stuff wrong," Reilly told me. Such as a focus on whether her last name is Hill or Doering. In fact, her maiden name is Doering, her married name is Hill, and now that she's getting a divorce she's using Doering again, Reilly said.

In turn, Reilly, who worked for Illinois House Speaker Mike Madigan before becoming alderman, charged that Khan has a personal ax to grind and that Project Six is affiliated with the Illinois Policy Institute, a libertarian organization that is a strong ally of Rauner.

He also noted that the Project Six story was quickly redistributed by another Rauner associate, political activist Dan Proft, whose group spent millions of dollars trying to unseat Madigan loyalists in this year's elections and who was involved in a bitter, profane twitter war of sorts with Reilly.

Khan denied that he has a personal grudge with Reilly: "I had no relationship with him." He conceded the "privately funded" Project Six "worked with" the Illinois Policy Institute to get on its feet and that his spokesman, Nathaniel Hamilton, used to work for the institute. But "our work is purely independent," he said.

Proft, in a phone interview, said there's no truth to Reilly's charge that he's trying to recruit a candidate to oppose the alderman's expected re-election bid in 2019. "When the facts aren't with you, you come up with a conspiracy of people you don't like."

The Board of Ethics said its policy is not to comment on advice it gives city staffers who request legal guidance.

Meanwhile, Reilly says his regret is that he's losing a key adviser on the ward's mass of building projects.

"I don't believe there was an effort here to game the system," he says. "She didn't ask me (for the consulting gig). I asked her."

The spelling of Madeleine Hill's first name has been corrected.