MSU's $500,000,000 offseason

Submitted by throckman on March 26th, 2018 at 10:52 AM

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.

 

 

Comments

MGoArchive

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.

stephenrjking

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.

 

Njia

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. 

Njia

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.

almost as old …

March 26th, 2018 at 1:25 PM ^

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.

bronxblue

March 26th, 2018 at 1:22 PM ^

Yeah. People like Hollis, Simon, the people who knew or should have known, they should be punished to the fullest extent. But there are lots of people at MSU who knew nothing and are as disgusted as anyone and still will feel the pain, probably well before the names I just mentioned. So I'm not going to dance on the school's grave if they had to close or severely reduce their services. The world needs good schools.

Also, shouldn't the USGA and other parties that knew also be responsible? I get MSU AD should be on top of it, but these other agencies should also be on the hook

Ramblin

March 26th, 2018 at 4:43 PM ^

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.

umich1

March 26th, 2018 at 11:12 AM ^

We should do our best to help. I nominate sending the bankruptcy expert, David Brandon, up to East Lansing. He can ensure failure, errr, I mean recovery.

KungFury

March 26th, 2018 at 11:13 AM ^

Do you live in Michigan? Who do you think pays this bill? They’re going to kick and claw and do everything they can to pass this on to taxpayers and students. Their negligence is going to continue to screw over people and no one wins.

Ramblin

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.

PopeLando

March 26th, 2018 at 2:52 PM ^

Do you honestly believe this, or are you just one of the people who yells "taxpayer money" whenever anything happens to a public institution ever?

I agree that MSU is going to try to pass on the costs, but it'll be to an insurance company or their (tiny) revenue stream from the School Aid Fund (which they would receive anyway). At the very most, they'll try to bond for part of this.

If your taxes go up because of this...you have bigger problems than being wrong on a message board...and I'll have bigger problems than the lemon I will certainly consider eating

Wolvmarine

March 26th, 2018 at 11:21 AM ^

Zero sympathy. Burn it down. Make an example so something like this never happens again. First Penn State, then Baylor.......the MSU thing is worse, and the MSU response has been to completely circle the wagons. They need the death penalty. They fucking hid the most prolific serial molester in American history for decades. Burn it down.