Penn State had spent $3.2 million on legal fees and crisis communication stemming from the child sex abuse scandal as of the end of 2011, according to information the university released Monday.
On a new website, openness.psu.edu, the university outlines costs for legal fees, consultants and public relations. The website also has answers to a list of frequently asked questions and information about how much top administrators are getting paid.
The initiative comes as the university is trying to recover from the fallout of the scandal and reaction to trustees’ decision to terminate Graham Spanier and Joe Paterno, who since died from lung cancer.
President Rodney Erickson and the new leaders of the board of trustees have pledged greater openness in the aftermath of the Jerry Sandusky scandal. Erickson and board Chairwoman Karen Peetz said the website is in keeping with that pledge.
“It provides a lot of information that the media and individuals from the Penn State community have been asking for,” Erickson said.
The university will update it regularly. Over the past three months, the university has fielded questions on the status of the investigation it has commissioned, the cost of that investigation, the number of civil suits that have been filed and the impact of the scandal on the university’s fundraising, admissions and recruiting, Erickson said.
The $3.2 million includes costs from the investigation by former FBI director Louis Freeh, that investigation into how the university responded to the Sandusky allegations is under way, along with one by the NCAA, the U.S. Department of Education and the state Attorney General’s Office ongoing investigation.
Here is a breakdown of spending as of Dec. 31, 2011:
• $2.5 million: the Freeh Group and Kekst Public Relations, and attorney Reed Smith with Ketchum Public Relations
• $468,000: legal and defense services to the university from Saul Ewing, Duane Morris, Lanny J. Davis and Associates, and Schnader Harrison Segal & Lewis LLP
• $50,000: legal representation for external investigations from Light-foot Franklin and Margolis Healy
• $210,000 for legal defense of former administrator Gary Schultz, former athletic director Tim Curley and former President Graham Spanier. Erickson has said that university insurance will cover those legal costs.
He has also said that any legal fees the university’s insurance policies don’t pick up will be paid with funds from interest on investments, not tuition or state dollars.
Schultz and Curley are facing criminal perjury and failure to report abuse charges. The state Attorney General’s Office alleges they perjured themselves when they testified to the grand jury investigation allegations of abuse by Sandusky. Lanny Davis, hired as counsel to the university, said Spanier’s legal expenses that he knows about come from the attorney representing him in discussions regarding termination of his contract.
The new website provides some information unrelated to the scandal along with salary contracts for top-paid administrators. Erickson has a base salary of $515,000, acting Athletic Director David Joyner is making $396,000 a year, and Senior Vice President for Finance David Gray is being paid $355,000.
The “frequently asked questions” section of the website details the university’s response to the situation and touts its accomplishments in other areas.
Erickson said the website offers “one-stop shopping.”
“We’re very pleased to take this step, and we hope the citizens of the commonwealth and beyond and members of the Penn State community will find it informative and useful,” he said.
Alumni and other fans expressed anger and disbelief about the decision to terminate Paterno. Trustees cited his response to the Sandusky allegations as not meeting his moral duties.
Erickson said the university’s public outreach efforts are ongoing.
“It’s a process,” he said. “It’s not a one-shot situation we’re in. I think we recognize this will go on for the foreseeable future.”
Anne Danahy can be reached at 231-4648.
