National media attention; the cost of a scandal
The different athletic/academic scandals at UNC had caused small national ripples at times over the previous three years, but never had any truly moved to the forefront of the national media. That finally showed signs of changing, however. The New York Times published an article on the scandal that appeared online late on December 31, 2013, and then in print on New Year’s Day. BusinessWeek followed with a series of articles that began on January 2. There was an in-depth CNN report by Sara Ganim on January 7. Incidentally, Ganim was the reporter who had uncovered many key details during the early stages of the Penn State case involving Jerry Sandusky. The New York Post contributed a piece on January 11, and then a crippling episode of ESPN’s investigative show “Outside the Lines” aired on January 14, 2014, blatantly calling out UNC for the apparent fraud that benefitted athletes, and the NCAA for refusing to take any action.
The implications of so much attention from national media sources meant that it might be extremely difficult for the NCAA to ignore the issues going forward. Why that had even transpired for so long was truly a mystery, especially when considering past similar cases. Several years earlier the NCAA had ruled that Florida State had been guilty of major violations in a widespread academic fraud case from 2006 and 2007. An online music class was apparently taught irregularly, a former learning specialist had typed portions of papers for three student-athletes, and answers were provided to an athlete for an online psychology course. The case involved 61 athletes, all of whose individual records were eventually expunged. Furthermore, a total of 12 wins by the school’s football team were retroactively erased by the NCAA for the use of ineligible players. The number of classes and affected student-athletes in FSU’s case paled in comparison to the AFAM fraud at UNC.
At the University of Georgia in 2003 a former player – Tony Cole – claimed that an assistant coach had paid some of his bills, done schoolwork for him, and taught a sham class on coaching. Cole said he never attended the class, but along with two other basketball players received an A. That seemed extremely similar to the AFAM scandal, except for the fact that it was only one class and three student-athletes at Georgia – compared to hundreds of courses and student-athletes at UNC. The Georgia basketball program self-banned itself from the 2003 postseason, but then the NCAA added further penalties: the loss of future scholarships, the vacating of numerous wins over a three-year period, and the expunging of players’ records.
A scandal surfaced at the University of Minnesota in early 1999. A former basketball office manager said she had written papers for at least 20 men’s basketball players over a period of several years. Two days after the story first ran, the NCAA suspended four current players. Following a full investigation a number of violations were uncovered, and the school was ultimately stripped of all postseason awards, titles, personal records, and statistics dating back to the 1993-94 season. Later, the Big Ten conference vacated the school’s 1997 conference title, and the school also returned 90% of the profits earned by the team during various appearances in the NCAA tournament. There were stark similarities between Minnesota’s and UNC’s cases. But once again, the situation in Chapel Hill appeared to dwarf what had happened at the other school. If the same scrutiny were given to UNC as to Minnesota (a full-fledged, external investigation), the vacated results and titles would be much greater.
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Often over the past several years fans of UNC had complained that the media and other factions were “out to get” the school, and were determined to have the basketball national championship banners removed. What those individuals likely did not realize was that the basketball team was a massive part of the school’s image, and people often associated the success of those year-to-year teams with their overall perception of the university. In essence, when the team did well, in various areas the school also did well. For example, a March 19, 2009, article on wral.com was titled “Heels merchandise head and shoulders above rest.” The article stated that the Tar Heel brand name was a money-maker, and had generated $25.9 million for the university, according to a then-recent analysis by Forbes magazine. Those sales had made UNC the most valuable men’s basketball program in the country. As a result, it became clear that UNC and its leaders likely weren’t just trying to protect the banners that hung in the rafters of the Dean Smith Center, but also the revenue that poured in due to those teams’ successes.
Retailers in Chapel Hill spoke to wral.com about the ease of selling UNC-branded clothing, mugs, and other items. “I told somebody the other day there’s only four things that people need. That’s food, gas, shelter and Carolina souvenirs, and we happen to be in the latter part of that, so we’re very fortunate,” said Genny Wrenn, manager of a store on Franklin Street. Carolina Brewery manager Thomas Transue said his restaurant was usually packed during the NCAA Tournament, especially when UNC was playing. “There is such a strong background. We’ve had folks coming in for years for the Tar Heels,” he said.
There were other measurable benefits to having a basketball program that accomplished great feats. Based on a December 19, 2012, article in the News and Observer, the prior year’s profit from the school’s basketball team had been $16.9 million. It had also ranked number one in a recent ESPN assessment of top 50 college basketball programs based on wins, championships, and lack of NCAA sanctions. During the 2012 fiscal year, donations to the school’s Ram’s Club, which funded student-athlete scholarships and capital projects, had increased to $33 million.
The positive effects of a strong public perception could spread to other areas of the university, as well. Statistics had long shown that freshman applications to a school often increased following a sports championship – of which UNC had won three since 1992. Based on data from the school’s own uncnews.unc.edu site, the application rate continued to climb. The site reported that in the fall of 2013 the university enrolled nearly 4,000 first-year students from a record 30,836 applications. Furthermore, the school was 9th among leading private and public research universities for the level of federal funding devoted to research and development in all fields. It was also among the top 100 U.S. colleges and universities awarding undergraduate degrees to minority students, according to a 2011 issue of the magazine Diverse: Issues in Higher Education. The school ranked 2nd for graduating African-American students majoring in area, ethnic, cultural, gender, and group studies. Unfortunately, that last statistic might be viewed in a somewhat critical light going forward due to the extensive AFAM scandal.
How many of those donations, applications, honors and awards were connected to an image carved at least in part by athletes and their successes? That would be a matter of opinion, obviously, unless one could find specific quotes from people who stated they were influenced by such athletic accomplishments. The fact that UNC men’s basketball merchandise was the top seller in the entire country, however, spoke to the mindset of influence and desired conformity. The fact that UNC sold merchandise, received applications, and were given grants was not just beneficial to it as a university and brand. It also conversely had a negative effect on other area schools – schools that were actually doing things the right way, instead of simply claiming to do so. Those schools that followed and played by the rules may have lost out on merchandise sales, and may have lost out on potential applications. And while less likely, it cannot be said for certain that they didn’t lose out on grants and funding from certain entities, as well.
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Based on the numerous instances of public documents having been withheld, misinformation uncovered, and “no comments” often given, UNC made a conscious choice as to how to approach its problems over the past several years. Those choices had come at a price – both in terms of reputation, but also one of monetary value. Some of the figures have been discussed earlier in the book, but when looked at as a whole they become even more daunting. An article appeared on the online site of Synapse Magazine in mid-November 2013 which gave an in-depth breakdown of some of the tolls incurred by UNC over the past three-plus years.
Titled “The Cost of a Scandal,” the piece gathered its data from both publicly-released information as well as figures provided by the school itself. The total amount spent for the academic and athletic portions of the university’s troubles reached nearly five million dollars. Almost $500,000 was spent on lawyers during the initial 2010 football revelations and the first round of academic issues that arose afterwards. That bill was picked up by two funds, the article reported. About $219,000 came from the UNC Foundation, a portion of the University’s endowment that drew its funding entirely from private donations. Approximately $248,000 of those first legal fees came from the athletic budget, university spokeswoman Karen Moon said. The athletic budget typically did not set aside funds for unexpected expenses (such as legal fees), according to Martina Ballen, chief financial officer of the school’s athletic department. She said extra revenue from men’s basketball and football from that year helped offset the costs.
Other dollar amounts were related to employee payouts. When Butch Davis’ contract was terminated by the university, the choice was made to pay him a severance package of $2.7 million – even though wording in his contract suggested that he could have been fired with cause and paid nothing. Disgraced assistant coach John Blake resigned, yet the university paid him $74,500. Both of those monetary payouts came from the athletic budget.
Next would be the fees for various public relations experts. Those companies and/or individuals were hired at the urging of the school’s Board of Trustees and the UNC System’s Board of Governors. In former Chancellor Holden Thorp’s own words, “Our board was uneasy about whether we were doing the best things we could in terms of public relations.” That led to the hiring of at least three communication experts, with a combined bill of over $530,000. Sallie Shuping-Russell, secretary of the university’s Board of Trustees, tried to justify the high costs. “It was no longer just about the athletics program,” she said. “It became about the integrity of our school. We were dealing with a level of issues that we didn’t have internal people to sufficiently handle. It wasn’t like our internal team was just issuing the news – suddenly, we were the news.” However, the hiring of the public relations experts didn’t bring about transparency and the truth, but rather a well-crafted message that was passed off to the public. Many onlookers were intelligent enough to see the scandalous situations for what they truly were, and thus saw through the PR attempts.
The infamous Martin investigation cost the school over one million dollars, much of which was paid to the Baker Tilly firm. Even after spending all of that money for months of work, the company was still forced to recant one of its most vital findings when the local News and Observer newspaper showed it to be false. All of Baker Tilly’s costs were also financed by the UNC Foundation. All told, about a third of the money spent during the two scandals came from that Foundation. It was a financial holding tank for the university that primarily funded scholarships, professorships, and fellowships, but in times of controversy the Foundation was said to be able to help with the load. An issue that remained unaddressed was whether the numerous alumni, outside affiliates, students, and faculty who had donated money were satisfied knowing that part of their contributions had gone not towards the advancement of education, but rather to help pay off the effects (and suspected cover-up) of scandals.
Hodding Carter, a UNC professor of leadership and public policy, told the magazine that far too often consultants were only hired to support the position of the administration. “If you’re going to hire outside anything,” he said, “you better be damn well sure that those outsiders are ruthless, unyielding in their demand for information and absolutely committed beyond their paycheck.” Based on how much information on the scandals those outside entities either missed (or purposely overlooked), it certainly did not appear that they fit the stringent parameters of which Carter referred.
On the flip side of the coin was Jan Boxill. The faculty chairwoman of the university had come under heavy fire for her suspected role in tampering with reports in an effort to dissuade the NCAA from returning to campus. Not surprisingly, she toed the company line when it came to defending the use of extravagant outside sources, saying that external consultants were crucial for attempting to keep a unified faculty. “I think if we had the faculty running investigations, the situation would have been more contentious and split,” Boxill said. “It would have divided the faculty. We wanted to bring consensus.” To that effect, near-total consensus was exactly what UNC’s leadership got: other than Mary Willingham and Professor Jay Smith, virtually every other faculty member refused to speak out and stand up for what was moral and right.
With regards to the handling of public relations, Stanley Katz offered a different and more sobering viewpoint. A professor of public and international affairs at Princeton University, Katz gave his professional opinion that external help was inexcusable for public relations. “Universities ought to be able to handle their own public relations,” he said. “If the university sees the problem as a public relations issue, then it isn’t internalizing the fact that there is a problem with the way (the university) handles (itself).”
Former Chancellor Thorp indicated that the current situation in which the university found itself could have possibly been reached more cheaply and with less turbulence. Then, almost as a recurring punch line to an overused joke, he ended the article with the very same tired PR message that had been rolled out by university leaders for several years: “But it was a tough situation, and I think Carolina is in a good position to move forward.”
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The essential (and unanswered) questions:
-- Would the influx of national attention given to UNC’s scandals finally cause the NCAA to take appropriate action?
-- Other schools had been punished by the NCAA for much lesser infractions. Why had they not shown public outrage over the preferential treatment that UNC seemed to be receiving?
-- How much money had UNC taken in – from merchandise sales, applications, and other sources – as a direct or indirect result from athletic successes that had possibly been built and achieved through fraudulent academic acts?
-- Why weren’t alumni, outside affiliates, students, and faculty who had donated money to the UNC Foundation not showing public displeasure at the arguably moral misuse of their contributions?