CHICAGO – The University of Illinois system is launching a national search to replace Walter Knorr, who is retiring after 10 years as the system’s chief financial officer and a decades-long career in municipal finance.

Knorr, who is 67 and a former Chicago chief financial officer, will retire on Aug. 31, said university president Tim Killeen.

Walter Knorr
University of Illinois Chief Financial Officer Walter Knorr, a former Chicago CFO, is retiring after a long career in public finance.

“Walt has been a key member of a team that has steered the U of I System through the deepest financial downturn since the Great Depression and an unprecedented shortfall in state support and delays in payment,” Killeen said. “His careful and innovative financial management has helped maintain our excellence and has routinely earned praise from credit rating agencies.”

Knorr managed all financial functions and oversaw all revenues, costs, capital expenditures, investments and debt. He worked on the development and implementation of an annual budget that has grown from $3.6 billion to $5.7 billion since he began his tenure.

The university has gone without $765 million in expected aid over the last two years due to the state’s budget gridlock. The system’s strong liquidity, broad reach for students, and diverse revenue streams initially helped insulate its ratings from the hits seen by the state’s regional public universities most of which are now rated at the junk level. But that’s changed as the impasse has dragged on.

S&P recently downgraded the university, giving it an A-minus that puts it at the bottom of state flagship schools. The rating is capped at three notches above the state's which is rated BBB-minus.

Moody’s recently lowered U of I’s $1.1 billion of auxiliary facility system revenue bonds and $258 million of certificates of participation to A1 from Aa3; $47 million of south campus bonds to A2 from A1; and $85 million of health system bonds to Baa1 from A3.

Killeen said an interim CFO will be named at a later date and will serve during a national search for a successor.

In the spring of 2002, Knorr announced he was leaving his post as Chicago’s CFO after 13 years to join Citi’s public finance banking group. A higher paying private sector job appealed to him as his two children were nearing college age.

He returned to government in 2004, taking a position as comptroller for Cook County. He left in 2007 to take the university post.

An accountant by trade, Knorr accepted a CPA position at Arthur Young & Co. after graduating from Ohio's Wittenberg University. His connection to Chicago city finances began while working as an accountant auditing the city’s books.

Knorr worked as city comptroller in the 1980s under former Chicago Mayors Jane Byrne and Harold Washington. He was ousted from the position during Washington's tenure and returned when Richard M. Daley won the mayoral race in 1989. He was elevated to the CFO's post in 1995. He also worked in investment banking at Northern Trust.

Knorr reflected on his city career in a 1999 speech during which he touched on how the 1992 Great Chicago flood of underground tunnels made it into city disclosures, the trials of managing through several recessions, struggling to explain swaps to City Council members and aiding the rebuilding of Chicago Public Schools’ finances and ratings after the city regained control in 1995. A highlight was his restructuring of defaulted Chicago Skyway toll bridge debt that set the stage for the bridge’s eventual recovery that would pave the way for city’s ground-breaking $1.8 billion 2005 asset lease.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.