BANK’S TOLLWAY EXIT
PNC, which employs new Illinois Tollway chairwoman, will decline future bond work from agency
PNC Bank, where new Illinois State Toll Highway Authority board chairwoman Dorothy Abreu is an executive, will step away from bond work with the tollway agency to avoid potential conflicts of interest.
The bank, based in Pittsburgh, has worked on deals with the tollway involving more than $2 billion in borrowing over the past decade, records show.
How much the company has made off those deals, which helped pay for roadway construction, isn’t clear. In one underwriting arrangement last year under Abreu’s predecessor Will Evans, the fees came to at least $420,000.
“PNC has taken immediate action to avoid the potential for conflicts of interest and had, in fact, committed to withdrawing from the state and tollway bond pools prior to the announcement of my appointment,” said Abreu, a senior vice president for PNC’s corporate and institutional banking group. “I am equally committed to acting in a fully transparent manner and acting in the best interest of the tollway authority and our customers.”
Gov. J.B. Pritzker appointed Abreu on Feb. 18 while announcing that Evans — a former Peoples Gas executive whose tenure at the tollway was marked by controversy since Pritzker appointed him in 2019 — was retiring.
The Chicago Sun-Times asked the tollway agency about PNC’s work for the agency on Feb. 22. PNC’s Robert Dailey sent a letter dated Feb. 23 to tollway official Bill O’Connell pulling back from tollway bond work, records show.
“I write on behalf of PNC Capital Markets LLC to notify the Illinois State Toll Highway Authority of PNC’s withdrawal from the following Illinois Tollway contract: Bond Underwriting Services,” wrote Dailey, managing director and head of public finance for PNC Capital Markets in Philadelphia.
“Withdrawal from the tollway underwriting pool is in the interest of the tollway and PNC to avoid any potential conflicts of interest or the appearance of such conflicts that might arise as a result of the appointment of PNC employee Dorothy Abreu as chair of the board of the Illinois State Toll Highway Authority,” Dailey wrote.
Pritzker spokeswoman Jordan Abudayyeh said, “As soon as the administration determined Dorothy Abreu was an exemplary candidate for the chairwoman position that they wished to pursue, the administration contacted PNC to discuss the need for the company to withdraw from contracts with the tollway and other state entities.
“The first conversation with PNC regarding conflicts took place on Jan. 19, 2022,” according to Abudayyeh. “PNC withdrew from the Illinois State Toll Highway Authority’s bond underwriting pool on Feb. 23, 2022 . ... Out of an abundance of caution, the Governor’s Office of Management and Budget will no longer be using PNC going forward for work in capital markets.”
A tollway spokeswoman says, “We don’t have any other banking relationship with PNC.”
But officials wouldn’t explain why PNC’s bond withdrawal letter came when it did or discuss how Abreu would handle other possible conflicts, such as when there’s a vote on a contract for a vendor that uses PNC or one of its competitors.
With Abreu’s appointment, Pritzker has said, “I am confident her two decades of banking experience in the private sector and her impressive work with government entities and nonprofit organizations will lend itself to continued growth and fiscal responsibility at the tollway.”
PNC, a publicly traded company, reports $558 billion in assets. Bankers have served on the tollway board in the past, among them Joseph Gomez of Byline Bank and James Banks of Belmont Bank & Trust, though they didn’t chair the board.
Former tollway board Chairman Robert Schillerstrom’s law firm had done bond work for the tollway but stopped when he was appointed.
The board oversees top tollway staff and votes on major contracts. Its chair also has a large say on what makes it onto the board’s agenda for discussion and votes.
Tolls were first instituted in Illinois decades ago to pay for the construction of certain highways. The fees were supposed to eventually stop. But they’ve remained and fund an agency, under the governor’s control, that now oversees nearly 300 miles of pavement, most of that through the suburbs.