Under pressure to stabilize his finance team before an investors conference and a pre-election budget battle, Mayor Brandon Johnson has chosen a senior director at Fitch Ratings to serve as his new chief financial officer.
Ashlee Gabrysch replaces Steven Mahr, who abruptly resigned, along with his top deputy, just days before veteran Budget Director Annette Guzman followed both men out the door.
Gabrysch currently serves as senior director and mid-central region manager at Fitch Ratings. Since 2019, she has served as Fitch’s lead analyst for both Chicago and Illinois.
That makes the new CFO familiar with the city’s $36 billion pension crisis and the marathon budget battle that saw a City Council majority reject Johnson’s corporate head tax and pass an alternative city budget. The spending plan, includes revenues the mayor continues to oppose — and that have fallen short of projections.
That has left the city with a $90 million mid-year shortfall. As a result, Mahr and Guzman raised the prospect of employee layoffs and pulled back on their commitment to make the second half of a $260 million advance pension payment at the center of the budget battle.
Civic Federation President Joe Ferguson said “somebody with the right credentials could make a difference,” and Gabrysch fills the bill.
“What nobody can really know is how she will handle… what is likely to be the resistance to, let’s call it more conventional, mainstream guidance on critical financing issues for the city,” Ferguson said.
As Fitch’s Chicago analyst, Gabrysch knows that the full pension advance is “one of those anchors” that investors and Wall Street rating agencies “have looked at for stabilization purposes,” Ferguson said.
Ferguson predicted that there will be “direct questioning” about the pension advance at the investors conference and that Gabrysch’s responses will be “very telling.”
“She knows exactly the importance of these signals and knows exactly how they factor into rating agency considerations, and market considerations as well,” Ferguson said.
Justin Marlowe, director for the Center for Municipal Finance at the University of Chicago, called Gabrysch a “stabilizing pick” because she is a “known commodity to bond investors” with a “strong view… about the need to make the full advance pension payment.”
“Knowing Ashlee, I think it will not only be, `You need to make the second half of the payment,’ [but], `Let me help you find a path toward finding the money to do that,’“ Marlowe told the Sun-Times.
“Whether the mayor takes that advice is a separate question, of course. But she has made very clear that the advance pension payments have been a real important part of stabilizing the city’s credit quality over the last few years, and that the market will see not making that payment as not only a pause in progress, but potentially backsliding.”
Gabrysch could not be reached for comment.
A City Hall press release quoted her as saying she is “honored… to serve the city that has shaped my professional career in public finance.”
“I have spent more than a decade studying and working on the fiscal issues facing Chicago and Illinois, both inside government and from the perspective of the municipal markets,” Gabrysch said. “I know the seriousness of the challenges before us, but I also know the strength and resilience of this city. I look forward to bringing my experience, analytical rigor and commitment to public service” to the job and working with the City Council and others to “build a stronger and more sustainable financial future.”
The rapid-fire resignations of Mahr, his top deputy and Guzman have raised serious questions about financial instability, largely because of the timing of those departures and the enormity of the city’s fiscal problems.
Mahr replaced Jill Jaworski, who left City Hall in January for a job at Navy Pier shortly after a City Council majority rejected Johnson’s corporate head tax and muscled through an alternative city budget.
Chicago faces a $90 million mid-year shortfall, a $1 billion budget gap next year and a $36 billion pension crisis that has two of four city employee pension funds hovering dangerously close to insolvency — even after receiving a city loan to avoid selling assets to pay liabilities.
The city is weeks away from a grueling election-year budget season, and days away from an investors conference. Johnson has tried to ease concerns about the high-level turnover by claiming that, so long as he is the mayor, Chicago has all of the stability it needs.