Penn State aftermath: Fired former president denies knowing of abuse

Sandusky was convicted last month of 45 counts related to the sexual molestation of 10 minors, all male, over a 15-year period. He is currently awaiting sentencing.

Penn State’s famed athletic program, meanwhile, will likely be damaged by the sanctions levied against it Monday by the NCAA, but some sports analysts say the program ultimately is expected to survive since the school was spared the NCAA’s harshest punishment, the so-called “death penalty,” which would have shut down the football program for at least a year.

“They’re going to survive but they’re not going to thrive for quite awhile,” says Ray Sauer, a sports economist at Clemson University in Clemson, S.C. “The scholarship limitation is a very serious handicap for them. Basically, it relegates them to among the also-rans in their conference.”

Already there are signs of financial blowback to Monday’s sanctions: State Farm Insurance announced Tuesday it was pulling 2012 sponsorship of the football program. “It’s a result of all the information that has been going on with Penn State over the last year,” said spokeswoman Arlene Lester.

But, while more sponsorship money will likely exit, experts say because Penn State’s endowment is nearing $2 billion, the university’s financial burden will not run deep. Despite the scandal, Penn State received more than $208 million in donations for the fiscal year that ended June 30, the second-highest donation total in university history.

Those numbers amplify the point made by some sports analysts who say the university deserved even harsher punishment for the scandal and who maintain that the entire saga makes the case that long-term changes are needed in collegiate sports.

“I don’t think the action will have very much affect on the larger problem, which is the incredible influence that big time college sport now has on university governance in general,” says Allen Sack, a professor in the sports management program at the University of New Haven. “The irony here is that the NCAA actually created this system that contributed to [the cover-up] that were taking place at the school.”

The gap in spending on academic and athletic programs have widened in recent years says the Knight Commission on Intercollegiate Athletics. Between 2005-09, for example, academic spending per student increased 22% to $13,471 while athletic spending per athlete increased 50% to $91,053.

Universities generate revenue from cash donations, ticket sales, television contracts, and local sponsorships.

The Knight Commission estimates that athletic budgets for most top university athletic programs will exceed $250 million by 2020, which executive director Amy Perko says is untenable compared to the small student athlete population it services, sometimes numbering around 600.

“Those revenues need to be distributed in a way that strengthens the core mission of the university. If all it has done is reward the football team that made the playoff then the system itself is contributing to a culture where teams and schools may place performance above the educational values,” Ms. Perko says.

A recent Knight report recommends more transparency in disclosing spending on athletic versus academic programs at universities.

Perko also says a new playoff system for collegiate football announced in late June presents an opportunity for the NCAA Board of Directors to legislate how to distribute revenues. She applauded a recent eligibility ruling for postseason championship play that requires at least 50 percent of team players are on track to graduate.

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