$60 million PSU fine

Sen. Corman finds new fault with NCAA over $60 million fine

mdawson@centredaily.comMarch 30, 2013 

State Sen. Jake Corman has reworked his lawsuit against the NCAA over its $60 million fine against Penn State, and he has a high-ranking state official joining his efforts.

Now, the senator says in an updated version of his lawsuit this week that the NCAA is violating a new state law he got passed, which says any fines more than $10 million against a university have to be put into an endowment overseen by the state’s treasury. The lawsuit demands that the NCAA put $12 million Penn State set aside for its first payment in an endowment.

Corman’s original lawsuit sought to block the NCAA from spending the fine money outside the state. The changes to the lawsuit were made this week.

In a show of support, state Treasurer Rob McCord joined the lawsuit this week.

“Under state law as it currently stands, I have a responsibility to safeguard that money for the citizens of Pennsylvania, who support Penn State with public dollars,” McCord said in a statement. “The behavior that led to the penalties occurred in Pennsylvania, the victims were in Pennsylvania, and the funds should remain in Pennsylvania.”

Corman has been one of the most vocal opponents to the NCAA’s plan for how the fine money will be spent. Corman said he tried appealing to NCAA President Mark Emmert, even offering to go to Indianapolis to meet face to face, but the senator was rebuffed.

That is what led Corman to file the original lawsuit to stop the NCAA from spending the $60 million fine money on child abuse prevention programs outside Pennsylvania’s borders. Then he proposed that language in a law that Gov. Tom Corbett signed in February.

But the NCAA immediately countersued in federal court. The NCAA’s lawyers argued the law violates the U.S. Constitution by disrupting interstate commerce.

That makes three lawsuits that have entangled Pennsylvania lawmakers with the much-scorned NCAA.

Corman and McCord are suing the NCAA. The NCAA is suing Corman and other state officials. And Corbett is suing the NCAA to have the sanctions against Penn State overturned.

One of Corman’s keystone arguments against the NCAA is that the $60 million fine is so hefty that it has to come from the money Penn State gets from the state.

“The fine money is, and will continue to be, unavoidably (c)ommonwealth-sourced,” the lawsuit states. “The (c)ommonwealth provides such a significant percentage of Penn State’s discretionary budget that it would be impossible for payments to be derived solely from non-(c)ommonwealth funds.”

But that’s not true, Penn State has maintained in an official online posting about how it would pay for the fine. It is on a frequently-asked questions section on progress.psu.edu.

“We expect to pay the fine, which is five annual installments of $12 million that will support initiatives for the prevention and treatment of child abuse, out of football reserves, the deferring of capital and maintenance expenditures, and an internal loan to the Athletic Department,” the statement reads. “We will not use state or philanthropic money to pay the fine.”

Mike Dawson can be reached at 231-4616. Follow him on Twitter @MikeDawsonCDT.

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