Who Pays?

The NCAA has taken time out from its primary task of trying to guarantee that the big-time college football and basketball programs it represents are able to benefit from free labor on the playing field. The sanctions imposed on Penn State seem intended to repair the image of college sports following the Sandusky scandal. Now that these punishments have been announced, let's look more closely at who is hurt by them.

Penn State has been fined $60 million, the money to go to child abuse prevention and treatment. In addition, the Big Ten athletic conference has taken away Penn State's share of bowl revenue for the next four years, another $13 million. Penn State has announced that the $60 million fine will be taken from the athletics reserve fund, the capital maintenance budget, and if necessary, an internal bond issue. The athletics reserve fund contains $17 million, so the majority will have to come from capital maintenance. The phrase “capital maintenance” does not appear in the online version of the 2012-13 Penn State budget. In general, capital maintenance refers to the amount of capital, either financial or physical, an institution wishes to maintain. My best guess is that they plan to spend less money maintaining their physical facilities, although their budget indicates that they already have a substantial backlog of deferred maintenance. At the present time, it's impossible to tell what percentage of the fine will ultimately be taken from the university's operating budget, and what percentage will come from private contributions.

Whenever a university announces that they're spending big bucks on a nonacademic project, they try to pacify students, faculty and the public by assuring us that the money will come only from private contributions. But given the relative ease with which universities can transfer funds one budgetary category to another, this is about as credible as the claim that proceeds from the state lottery “benefit senior citizens.” The athletics reserve fund, for example, could be temporarily drawn down, but quietly replenished a few years later when no one is paying attention. The fact that Penn State is a private university, not subject to Pennsylvania's sunshine law, makes budget manipulation easier. As they file into their delapidated classrooms or try to cope with the latest round of cuts to the “Paterno Library,” students and faculty might want to ask themselves what that $73 million would have been used for had it not been spent on paying the fine.

By the way, 14% of Penn State's operating budget comes from state appropriations. If all $73 million ultimately comes out of the operating budget, that means the citizens of Pennsylvania have just been fined $10.22 million by the NCAA and the Big Ten. I'm not sure what gives them the right to do that. I must have missed that meeting.

The number of new football scholarships at Penn State is reduced from 25 to 15 per year for the next five years. Obviously, this delivers a big hurt to a small number of prospective students on the football team.

There is a four year ban on Penn State bowl game appearances.

These last two punishments, along with the ruling that current football players may transfer to other universities and play football without the usual waiting period, will affect the competitiveness of the Penn State football team, since it will be less attractive to new recruits. This will have a negative ripple affect on the economy of central Pennsylvania, especially hotels, restaurants and bars, which depend on the football season for much of their revenue.

All of Penn State's wins from 1998 to 2012 are vacated. This primarily affects Joe Paterno's legacy. He will no longer be referred to as the winningest coach in the history of college football. I'm O. K. with that.

Penn State is placed on probation for five years. The consequences of this are unknown.

The primary losers appear to be the students and employees of Penn State and the citizens of Pennsylvania. None of these people have been specifically identified as folks whose behavior requires modification.

These penalties are not directly relevant to the NCAA's claim that Penn State's football culture had come to dominate the university, at the expense of academic and moral values. To address this issue, the university is required to take “other corrective actions,” including adopting some of the recommendations of the Freeh Report (“especially section 5.0”) and appointing a full-time athletics integrity monitor.

Section 5.0 of the recommendations chapter of the Freeh report, entitled “Athletic Department: Integration and Compliance,” deals with claim that it had been allowed to become a closed community, not subject to university rules and procedures. The section contains recommendations that are somewhat related to that claim, such as revising the organizational structure of the Athletic Department and ensuring that it is subordinate to the university's Athletic Compliance Office.

Section 1.0 is entitled “Penn State Culture,” but all it seems to do is appoint a large committee with representatives from all university interest groups to study the local culture and suggest changes.  (For an interesting take on the culture of the Alabama region of Pennsylvania, see this article by a former Penn State instructor.)

In my judgment, none of the NCAA directives address the real problem. Athletic Departments, especially men's football and basketball programs, have become directly involved in university fund-raising. They play a major role in entertaining wealthy alumni. The university becomes dependent on them. This gives them special access to these large contributors. When they don't get their way, coaches and athetic directors can threaten to go over the heads of administrators, including the President of the university, in order to influence university decisions. Administrators know this, so they comply with the Athletic Department's wishes.

Jerry Sandusky's behavior was tolerated for 14 years primarily because Coach Paterno was able to persuade his nominal bosses to look the other way. It's too bad we have no transcripts of their conversations, because I'm not sure “persuade” is the right word to use. Maybe he made them an offer they couldn't refuse.

Addendum

Sportswriter Dave Zirin has pointed out that neither the Freeh Report nor the NCAA have questioned the role that former Attorney General, now Governor, Tom Corbett played in delaying the prosecution of Jerry Sandusky. While the Attorney General's office began investigating Sandusky in 2009, he was not charged until November 2011. Corbett assigned only one or two—depending on whom you believe—staff members to conduct the investigation. Zirin argues that Corbett delayed charging Sandusky until after the 2010 gubernatorial election in order to avoid offending Central Pennsylvania's wealthy ruling class, on whom he was counting for political and financial support during the campaign. For example, he received $650,000 in political contributions just from board members of Second Mile, Sandusky's charitable foundation.

While Corbett has built a successful political career around prosecuting high profile political corruption, many would argue that he manipulated those prosecutions in a partisan manner. Corbett has stated that state legislators from both the Elephant and Jackass parties used taxpayer money for political purposes, but Corbett, an Elephant, ensured that the Jackasses took most of the blame by prosecuting them first with a series of highly publicized show trials, while allowing the Elephant defendants to quietly plead guilty later on.