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Penn State weighs option of $30 million loan

Beaver Stadium AP

The financial impact of massive sanctions is hurting Penn State’s athletic department, leaving the school to consider taking out a loan to keep the program running in the black.

Penn State was fined $60 million by the NCAA as part of the hefty sanctions levied against the university last year. The school is also not eligible for any postseason payouts from the Big Ten, leaving $2.3 million t be split among the eligible Big Ten schools and attendance has dipped since the implementation of a controversial seating program even before the startling revelations and fallout of the Jerry Sandusky scandal. Penn State’s home games still attract a solid number but the capacity percentage of Beaver Stadium continues to drop. With fewer people in the stands, there are fewer programs, hot dogs and beverages being sold. This all adds up and it is beginning to cost Penn State.

Penn State Athletics Director David Joyner has discussed the idea of a $30 million load to help the short-term budget concerns within the athletics department with the financial committee of board of trustees. According to a report by Ben Jones of StateCollege.com, “Penn State’s ending reserve balance over the next five years is projected to dip as low as 5.52 million dollars in the red.” According to the report, Penn State would use $5 to $10 million of the loan to open a line of credit to cover upcoming costs through 2016 while the remainder would be used to cover other short-term needs.

The budget crisis at Penn State may be a short-term problem. The current budget details do not take in to account any money Penn State receives through Big Ten television revenue, which the school is still allowed to receive while under sanctions. Penn State will be allowed to start receiving Big Ten bowl shares after the sanctions are served, and that should help Penn State start to recoup their losses relatively quickly.

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14 Responses to “Penn State weighs option of $30 million loan”
  1. mauldawg says: Sep 19, 2013 9:02 PM

    Boo Hoo you reap what you sow. Hope PSU goes under.

  2. madtownthrowdown says: Sep 19, 2013 9:20 PM

    Mauldog- the problem with what your saying, is that most of the SEC along with Ohio St and USC would all probably “go under”. If these schools were all held responsible. Lets not forgot Oklahoma St. either.

  3. whammy71 says: Sep 19, 2013 9:49 PM

    madtownthrowdown – the problem with what your saying is that the SEC along with Ohio St and USC DIDN’T ENABLE A PEDOPHILE!!!!

    Penn State’s penalties are justified and deserved for the hell they put their community through – all in the name of protecting the sacred football program.

    This is coming from a PSU grad and former believer in all things JoePA.

  4. madtownthrowdown says: Sep 19, 2013 10:00 PM

    Wrong is wrong Whammy. As a Penn state grad I would hope you don’t want your school to go under but hey, to each its own. Oklahoma St. Did enable hookers. Just saying. Nothing against them.

  5. madtownthrowdown says: Sep 19, 2013 10:03 PM

    Just to add. At least the hookers work for there money. Better then a lot of these Athletes.

  6. madtownthrowdown says: Sep 19, 2013 10:04 PM

    Their not there. That’s a damn big 10 education for ya.

  7. necr0philia says: Sep 19, 2013 10:43 PM

    You two guys seem to have it all figured out! I’m glad fans have no voice in these decisions.

  8. bigmatt1982 says: Sep 19, 2013 10:58 PM

    What everyone seems to forget is that the people who are paying with these bans and sanctions had nothing to do with the scandal. The people who did are either dead in jail or on their way to jail. Psu gained no competitive advantage and it was not tied directly to athletics other than Sandusky was a coach there. If this is the standard, Miami , Ohio state , Alabama should all be shut down, they are constantly breaking the rules .

  9. tommy57 says: Sep 20, 2013 6:17 AM

    I don’t see this as a negative or as an unexpected occurrence. PSU will likely need to make other financial adjustments in the coming years. Lower attendance at home games was likewise expected, although maintaining a 90K average isn’t too bad. PSU will get through this.

  10. kosarkid says: Sep 20, 2013 9:42 AM

    bigmatt1982 says:Sep 19, 2013 10:58 PM

    What everyone seems to forget is that the people who are paying with these bans and sanctions had nothing to do with the scandal. The people who did are either dead in jail or on their way to jail. Psu gained no competitive advantage and it was not tied directly to athletics other than Sandusky was a coach there. If this is the standard, Miami , Ohio state , Alabama should all be shut down, they are constantly breaking the rules .
    ================================

    To the best of our knowledge, Miami, Ohio State, and Alabama were not enabling a pedophile to roam the campus with kids.

    As far as the competetive edge goes, PSU had a defensive coordinator who was well adversed in attacking young men.

  11. kosarkid says: Sep 20, 2013 9:47 AM

    ***versed… sorry

  12. granadafan says: Sep 20, 2013 1:57 PM

    bigmatt1982 says:
    Sep 19, 2013 10:58 PM
    What everyone seems to forget is that the people who are paying with these bans and sanctions had nothing to do with the scandal. The people who did are either dead in jail or on their way to jail. Psu gained no competitive advantage and it was not tied directly to athletics other than Sandusky was a coach there.
    =========================================

    The current players enjoy top notch facilities and prestige built during the times when children were screaming out for help and in terror while being predated on by a member of the coaching staff and even after he left. Paterno and the university knew but didn’t want the tens of MILLIONS in donations, gate receipts, TV revenue, merchandising, etc to stop. So, YES, today’s Penn St absolutely deserves to be punished.

  13. mancave001 says: Sep 21, 2013 9:41 AM

    “Penn State” should not be punished….the people involved should be punished, and are being punished. “Penn State” is comprised of students, faculty, alumni and the community (businesses, residents, etc). The problem is that these people are now being punished for something they had zero involvement in. I’m so sick of people saying all the stakeholders should be punished because they “allowed” this to happen…as if anyone other than Sandusky, the administration and law enforcement are involved. Meanwhile, people like Tom Corbett (who declined to investigate and prosecute as AG) are scot-free.

  14. twoody50 says: Sep 21, 2013 10:09 AM

    The Penn State issue was a legal matter and should have been treated as so. The NCAA is too powerful, or believes it is and had no business in the matter. Any school if slapped with a 60 million dollar fine would have problems. PSU will be back.

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