Allegations that the city hall has been stuffing the payroll on the basis of political patronage have got closer to the mayor in recent months and Republicans smell blood.
"The arrogance of Richard Daley is appalling," said Gary Skoien, the local Republican chairman. "The corruption is so pervasive, so extensive and has been going on so long that most of these insiders don't even have a clue that their actions are illegal. We hope that this reward will inspire someone with critical knowledge to come forward."
The mayor's press secretary, Jacquelyn Heard, branded the offer "ridiculous, politically motivated and undeserving of further comment".
The most recent scandal involves two senior members of Mr Daley's administration who have been accused of fraudulently giving jobs to well-connected applicants. One man was declared the best-qualified candidate even though he was dead. Another was said to have scored highly in an interview even though he was in Iraq at the time.
Robert Sorich, of the department of inter-governmental affairs, and Patrick Slattery, of the streets and sanitation department, have been accused by the federal attorney, Patrick Fitzgerald, of being "part of a scheme involving massive fraud in the hiring process going back more than a decade".
Although Mr Daley was not himself implicated in the allegations, the two men came from Bridgeport, the same area where Mr Daley grew up, and where his brother remains a local political chief.
"It's like the water has risen from his chest to his neck," political consultant Don Rose told the Washington Post.
"What we have got," said Mr Rose, referring to Mr Sorich, "is a guy who was directly responsible to Daley, appointed by Daley, Daley knows his family. You can't get any closer, short of one of the Daley brothers".