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Penn State fined $60m, avoids football ‘death penalty’

Posted by Angela Nelson, Boston.com Staff  July 23, 2012 09:18 AM

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By Erik Matuszewski, Bloomberg News

Pennsylvania State University was fined $60 million as college sports’ governing body penalized the school for its handling of a child sex-abuse case involving assistant coach Jerry Sandusky. It avoided the stiffest punishment, a shutdown of the football program that was at the center of the scandal.

The school also was stripped of all its wins from 1998 through 2011, barred from postseason games for four years and lost 20 total scholarships annually for four seasons, according to a release from the National Collegiate Athletic Association.

The discipline announced by the National Collegiate Athletic Association avoided the so-called death penalty against the program where Joe Paterno, the coach who won a record 409 games, became a focus of the scandal. Paterno’s record will also lose the victories he recorded as coach from 1998 through last season.

The NCAA acted against the State College, Pennsylvania- based school less than two weeks after an investigation found Paterno, who died of lung cancer in January, and other school officials tried to cover up abuse allegations. Sandusky, a football assistant coach for 31 years, was convicted last month on 45 criminal counts tied to the abuse of 10 boys over a 15- year period starting in 1994.

While Penn State avoided having its football program shut down, the NCAA’s “corrective and punitive measures” probably will severely affect a school that ranks sixth all-time with 827 victories at college football’s highest level and won two national titles during Paterno’s 46-year tenure as coach.

It also will have an immense effect on the school’s finances. In the fiscal year ending in 2011, Penn State’s athletic department generated $116.1 million in operating revenue and posted a $14.8 million operating profit, according to school records.

Sports Profits

Of Penn State’s 29 sports teams, only football and men’s basketball were profitable last year, with football generating an operating profit of $43.8 million on $58.9 million in revenue. The Nittany Lions had a 9-4 record last season.

A shutdown of the football program would have cost Penn State and the surrounding community more than $70 million, according to an economic study commissioned by the university for the 2008-09 school year. That included $51.1 million spent on hotels, souvenirs, food, services and entertainment by out- of-state visitors, which represent about 15 percent of those attending games at Beaver Stadium, which has a capacity of more than 106,500.

Penn State has an endowment of $1.3 billion, the Pittsburgh-Post Gazette reported in March, citing Graham Spanier, who was dismissed as university president in the scandal.

Freeh Report

The school removed a statue of Paterno outside the football stadium yesterday, 11 days after former Federal Bureau of Investigation Director Louis Freeh issued a report that said Paterno, Spanier and other university officials tried to conceal Sandusky’s abuse of children to protect the school from “bad publicity.” Freeh said his seven-month probe -- commissioned by the university’s board of trustees -- found that the abuse could have been stopped in 1998.

Sandusky, 68, was a defensive assistant for 31 years under Paterno, who won a Division I-record 409 games during his Penn State tenure and led the Nittany Lions to five unbeaten and untied seasons.

NCAA President Mark Emmert said in a July 16 interview with the Public Broadcasting Service that he had “never seen anything as egregious as this in terms of just overall conduct and behavior inside a university.”

Ellen Staurowsky, a professor of sports management at Drexel University in Philadelphia, said the NCAA was right not to impose the death penalty because it would have financially affected an entire community, not just the football program, and wouldn’t address the multiple accountability failures at the school.

Punishment Fits

Geoffrey Rapp, a sports law professor at the University of Toledo in Ohio, said yesterday that the death penalty would have been the only punishment that fits Penn State’s crime.

“The failure here was at the highest levels of Penn State’s leadership, and as the Freeh Report indicates, the only solution involves a major change in institutional culture,” Rapp said in an e-mail. “Anything less than a break from football would not address the fundamental cultural shift needed.”

Southern Methodist University’s football program was closed in 1987 after it was found that 13 players received $61,000 from a slush fund provided by a booster. The Dallas-based school was unable to field a team in 1988 and had one winning record over the next 20 years after it returned in 1989, before bowl game appearances in 2009, 2010 and last year.

Shut Down

The NCAA also shut down the University of Kentucky basketball team for the 1952-53 season; the basketball team at the University of Southwestern Louisiana for two seasons from 1973-75; the men’s soccer team at Morehouse College in 2004 and 2005; and the men’s tennis program at MacMurray College for two seasons from 2005-07.

The change at Penn State started yesterday, when a 7-foot- tall statue of Paterno outside the football stadium was draped in a blue tarp and then taken down behind a fenced-off area.

Penn State President Rodney Erickson said the statue, which will be stored in a secure location, had become a “source of division and an obstacle to healing” at the university.

Paterno’s family objected to the decision to remove the bronze sculpture, saying it didn’t serve the victims of Sandusky’s “horrible crimes.” Paterno’s name remains on the university library, which was named after the coach and his wife, Sue, in 1994.

Failed Action

Freeh said in his report that Paterno, whose motto was “success with honor,” had known of accusations against Sandusky before and after the assistant’s retirement in 1999 yet didn’t ban him from the university and failed to act aggressively to protect victims of potential future abuse.

Paterno, who was fired four days after Sandusky was arrested Nov. 5, was prevented by the university from telling his side of the story when the allegations emerged. Paterno told Freeh he wanted to talk to him, but died of lung cancer in January at the age of 85 before an interview could be arranged.

During Paterno’s tenure, the Penn State football program became one of the country’s elite, with five undefeated seasons and Associated Press national championships in 1982 and 1986.

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