Fiesta Bowl saga strong reminder that BCS system invites corruption
Dismissed Fiesta Bowl CEO John Junker is deplorable, but he's also a scapegoat
High-level bowls are scamming schools while universities bury heads in the sand
Why outsource biggest revenue generator to a system that invites corruption?
Want to know how a law-abiding citizen can pay state income tax in West Virginia only to have some of those dollars placed into a stripper's G-string in Phoenix by a corrupt bowl official? Follow the money.
Anyone who paid state income tax in West Virginia in fiscal 2007 probably helped pay for West Virginia University's athletics program. Only a handful of universities have truly self-sufficient athletics programs. West Virginia's program is not one of them. Public money must be used to subsidize the department, either through student fees, bond issues or transfers from the university's general fund. So chances are, any West Virginian who dutifully filed a return in April 2008 had some of his or her tax dollars diverted to the Mountaineers athletics program.
That year, the Mountaineers needed a little extra cash. In 2007, they won the Big East football title. That earned them a spot in the Fiesta Bowl. West Virginia fans, disappointed that a loss to Pittsburgh had cost the team a chance to play for the national title, purchased only 7,981 of the 17,500 tickets the Fiesta Bowl requires participating schools to buy. The school had to eat the cost of the tickets as well as pay a considerable amount to bring the football team, band, cheerleaders and various assorted muckety-mucks to Phoenix for a week. The Mountaineers beat Oklahoma on Jan. 2, 2008, but West Virginia's athletic department lost more than $1 million on the trip.
The ticket guarantee money went to the Fiesta Bowl, which later that year cheerfully paid the corporate American Express bill of CEO John Junker despite the fact that one of the charges on said bill was a $1,241.75 excursion in September to a gentlemen's club called Bourbon Street with a bowl employee and a consultant.
Still think the bowls are all about the student-athletes?
The revelations unearthed in the Fiesta Bowl's scathing self-report prove more forcefully than ever that high-level bowls are scamming schools while university presidents bury their heads in the sand. Employees interviewed in the investigation said Junker -- who was paid $592,000 to stage either two or three football games a year -- and other bowl officials used bowl money in the form of fake bonuses to reimburse employees for political contributions. If true, that is a violation of Arizona campaign finance law, and it could land Junker in jail.
Junker had stood accused of this since December 2009, but none of the educators involved in the process thought to investigate the accusations. They took at face value the Fiesta Bowl's initial farce of an investigation. The NCAA certified the Fiesta Bowl, and the presidents allowed Junker to stage January's BCS Championship Game. Put another way: In an age of dwindling university budgets, the presidents of some of America's most prestigious universities outsourced the championship of their most lucrative sport to an organization that may have been involved in criminal activity.
First, a debt of gratitude is owed to reporter Craig Harris of The Arizona Republic for first bringing the allegations against Junker to light. Another debt is owed to Playoff PAC, the organization that filed a criminal complaint with the Arizona secretary of state's office in December 2009 and kept the pressure on the Fiesta Bowl until bowl leaders saw no other choice than to expose the truth. But Junker, as deplorable as he is, is only a scapegoat. He is being sacrificed so the Fiesta and other bowls don't derail their gravy train.
I have explained before why the presidents' support of the BCS is fiscally irresponsible. Authors Dan Wetzel, Josh Peter and Jeff Passan explained it in even more detail in their excellent book, Death to the BCS. But these new details prove that the 120 Football Bowl Subdivision presidents are venturing into downright reprehensible territory if they continue to support the bowls as a means to crown a national champion in football.
This weekend, the NCAA will stage the men's basketball Final Four, the culmination of an event that will bring in an average of $771 million a year in television money over 14 years from CBS and Turner. A fraction of that money will go to run the NCAA. The rest will go to the schools. If Butler doesn't sell enough tickets, the school won't have to pay. The NCAA doesn't require schools to buy a certain number of hotel rooms; on the contrary, the NCAA pays for the hotel rooms. And it shares the largesse from the tournament with the conferences and schools.
In football, four bowls form a cartel called the Bowl Championship Series to negotiate a television contract worth $125 million a year. That money is redistributed by conference, with the six most powerful getting a guaranteed share and the five least powerful ones getting significantly less. If the presidents allowed the NCAA to run an FBS football tournament, conservative estimates put the value of the television contract at three times what the BCS makes. Such an act wouldn't kill the existing bowls because they are far too valuable as television inventory. (In fact, ESPN owns and operates some of the worst bowls simply because they make for excellent late-December programming.) A move to an NCAA tournament would, however, reduce the possibility of corruption by reducing the financial stakes for those who run bowls.
So why do presidents continue to support the current system? Because unlike bowl directors, some of whom make high six-figure salaries for laughably easy jobs, university presidents make six-figure salaries for incredibly difficult jobs. Football isn't their only concern, so they leave it to their athletic directors and conference commissioners to advise them on such matters. But that's part of the problem.
Why? Because if those advisors are ACC commissioner John Swofford or one of 40 FBS athletic directors, they're enjoying a four-day, all-expense paid cruise to the Bahamas courtesy of the Orange Bowl. (Here is the 2010 Orange Bowl Summer Splash passenger manifest, obtained by Playoff PAC.) Why would an AD advise a president to do anything different when the BCS guarantees a massage on the Lido Deck?
Or maybe those ADs are in Phoenix at the annual Fiesta Frolic, a three-day junket loaded with golf, hospitality suites and swag. (If you're buying gifts, Colorado AD Mike Bohn likes an XX-large golf shirt and size 12 shoes in his swag bag.) The Fiesta pays for this junket every year, yet bowl officials had the audacity to consider asking for a $300,000 government subsidy in February 2010.
Speaking of subsidies, the Sugar Bowl received more than $5.3 million in government grants in fiscal years 2006-08. Meanwhile CEO Paul Hoolahan (annual salary for staging one football game: $645,386 in fiscal 2008) happily supported the circumvention of the NCAA's enforcement system to allow five Ohio State players guilty of NCAA violations to play against Arkansas in his game this past January. Why was he so happy? The bending of rules preserved "the integrity of this year's game," Hoolohan told The Columbus (Ohio) Dispatch.
Oh, by the way, not one of the BCS bowls pays taxes. They are run as 501(c)3 charities.
Some of them actually are charitable. The Rose Bowl, despite considerable digging from watchdog groups, appears to be exactly what it claims: an active community organization that happens to stage a popular football game. That's probably why Hoolahan makes more in salary than the Rose Bowl's top three executives combined.
The Sugar and Orange also have done good work in their communities. The Sugar has donated $800,000 -- less than one-sixth of the amount received in government grants over that three-year period -- to help rebuild New Orleans' City Park after Hurricane Katrina. In recent years, the Orange has donated $3.2 million to help renovate Miami's Moore Park. Thanks to the bowl's generosity, a generation of inner-city children will have a place to play. But the Orange might also have considered donating to another worthy organization: Virginia Polytechnic Institute and State University. Virginia Tech has won the ACC and played in the Orange three of the past four seasons, and as a result the Orange Bowl has scammed the school out of millions in ticket guarantees.
When the Fiesta Bowl's report came out Tuesday, BCS executive director Bill Hancock and Penn State president Graham Spanier -- the chair of the BCS presidential oversight committee -- were quick to condemn Junker's actions and to suggest the Fiesta may be kicked out of the cartel. That no doubt stirred the blood of Jerry Jones, whose Cowboys Stadium now hosts the Cotton Bowl, the game that probably would replace the Fiesta if it gets booted.
Here's a better suggestion: All 120 FBS presidents should get together and examine the rest of the bowls. Then, after all the warts are exposed, they should decide if they want to keep outsourcing their biggest revenue generator to a system that invites corruption.