MSU's $500,000,000 offseason
From yesterday's Wall Street Journal:
Costs From Nassar Case Likely to Exceed $500 Million for Michigan State
https://www.wsj.com/articles/costs-from-nassar-case-likely-to-exceed-50…
Lowlights include:
“I don’t know if it would force bankruptcy (for the university) or not,” Mr. Engler said in a Michigan State Senate appropriations subcommittee hearing earlier this month. “I hope not.”
"Michigan State’s primary insurance policy, reviewed through a public records request by The Wall Street Journal, caps coverage for sexual assault at $39 million per policy year."
Part of me feels sorry for the hardships this will cause MSU, but part of me has zero sympathy for an incestuous BoT that's half former athletes, a former president, and former athletic director who chased a 'national athletics brand' at all costs instead of actually improving the academics of the university.
March 26th, 2018 at 10:57 AM ^
March 26th, 2018 at 10:58 AM ^
They deserve to lose every penny.
But don't say hop until you're over the fence - last I heard MSU was trying to absolve themselves of any financial penalties and was looking to be removed from a civil suit that's currently in federal court in Grand Rapids. I haven't heard an update on the case status.
March 26th, 2018 at 10:59 AM ^
March 26th, 2018 at 11:00 AM ^
With something this large, it's probably useful to bifurcate the affected parties. "MSU" is a pretty large umbrella.
There is the corporate institution that allowed Nassar to perpetrate his abuse, and I have no sympathy for it. I'm not the hater of the new interim guy that some are, but when he says that bankruptcy is on the table, I say, tough rocks.
However, there are a lot of people who had nothing to do with the Nassar situation all, who aren't attached to the athletic programs, who would be affected by something that big. They consider themselves part of the MSU family, and I would feel sorry for them.
March 26th, 2018 at 11:21 AM ^
Like it or not, as a state institution of higher learning, it's to the benefit of everyone who lives in this state (as I do) that MSU has a thriving academic environment. That attracts employers, raises the standard of living, and contributes to social vitality.
The hit that the endowment will take is going to materially hurt the university in its ability to fulfill its academic and societal missions. MSU doesn't enjoy the benefits of a large endowment like U-M does; that became apparent less than 10 years ago when MSU was cutting whole programs, schools, faculty, and the like, while Michigan was hiring new faculty. And, make no mistake, the endowment will be one of the sources of funding to pay for the judgments against MSU associated with Nassar's decades of abuse. That's neither here nor there in the sense that MSU shoulders a tremendous burden because of their actions and inaction, and should be punished accordingly.
But there will be fallout. A better, more broadly-focused cadre of leaders from the BoT, to the current and former administration, to athletic staffs, and various hangers-on would have known that.
March 26th, 2018 at 11:58 AM ^
The endowment will definitely take a hit from reduced contributions but I'm not sure that the funds can be used to pay penalties that aren't related to the administration of the endowment.
March 26th, 2018 at 12:07 PM ^
what qualified academic would want anything to do with MSU.
Just goes to show why good universities would never allow someone like LouAnn to homestead like she did.
March 26th, 2018 at 12:29 PM ^
I'm not sure of the legal limitations, and whether state (or federal) law permits litigants to include the endowment in total funds available to MSU. Nevertheless, even if the funds come solely from the general fund and other operating budgets, the balance may come from the endowment to keep the university financially viable. So, whether directly or indirectly, the endowment is probably going to get drained.
March 26th, 2018 at 12:52 PM ^
Money is fungible. It is open season on the endowment.
If the endowment funds were in a different legal entity, such as a trust, I'd be surprised if it would be subject to attack from creditors.
yes, while one dollar is generally like another, in government situations fund accounting often makes certain dollars from certain sources ineligible for certain payments. For example, our township kept a water plant officially incomplete but still operational in order to spend construction dollars on operations, a big no no (for which they, meaning we all) got our fingers rapped and our wallets raided. So, no, I would suspect at MSU all dollars are not like each other.
March 26th, 2018 at 11:24 AM ^
March 26th, 2018 at 11:47 AM ^
This whole saga is a huge blow to the entire state of Michigan. People on this blog should consider that before they say the want to see every square inch go up in flames.
when the WSJ arrived at that figure. It's in line with another forecast I saw.
This hurts the entire state. The perpetrators escape (except Nassar obviously) while the innocent are punished.
March 26th, 2018 at 11:00 AM ^
March 26th, 2018 at 11:16 AM ^
I don't understand the talk of bankruptcy. They had almost $3 trillion in their endowment fund as of 2017. What am I missing?
March 26th, 2018 at 11:20 AM ^
March 26th, 2018 at 11:21 AM ^
March 26th, 2018 at 11:22 AM ^
March 26th, 2018 at 11:23 AM ^
I might have read it on RCMB. Or the LSJ. Either way.
March 26th, 2018 at 12:33 PM ^
That guy is a huge douche. I think that's the same guy who said MSU players should dive and take out Devin Gardner's knees.
March 26th, 2018 at 11:24 AM ^
March 26th, 2018 at 11:26 AM ^
I know what i meant. It was actually 2.7 billion, but I rounded up to 3 trillion.
and that has to make a difference.
March 26th, 2018 at 11:42 AM ^
They're then missing $2,997,000,000,000.
that the endowment is for buildings, labs, etc. It can't be used to pay off lawsuits. So, MSU will be bankrupt with 3 billion dollars in the bank and the taxpayers will foot the bill. I think it really is that crazy.
March 26th, 2018 at 11:10 AM ^
Burn it all down...
March 26th, 2018 at 11:26 AM ^
How did they get that many couches inside the stadium? #countrystrong
March 26th, 2018 at 11:12 AM ^
March 26th, 2018 at 11:13 AM ^
March 26th, 2018 at 11:20 AM ^
Be absorbed by the other universities in the state.
March 26th, 2018 at 11:42 AM ^
Michigan's voters elected the clowns on the MSU BoT. Maybe when their taxes go up as a result of this circus, they'll elect people who are qualified to lead an R1 university instead of a bunch of former athletes and coaches.
Note UM's Board of Regents is comprised of physicians, lawyers, and businesspeople.
March 26th, 2018 at 11:57 AM ^
Just let them say "our bad" and move on? That will ensure that this keeps happening over and over and over again. Maybe that's where we are. It's too damn expensive to stop this from happening so keep it up Pedo State, Larry Nassar U, Baylor Rapes R Us? Buck has to stop at some point. Don't elect incompetent scumbags to run a major University or Detroit anymore.
March 26th, 2018 at 11:14 AM ^
March 26th, 2018 at 11:20 AM ^
It's going to include the cost of a coke.
March 26th, 2018 at 11:21 AM ^
Avatar appears to be screaming your statement.
March 26th, 2018 at 11:39 AM ^