NCAA and Colleges and Universities and Indiana University and Education & Workforce Development and College Sports and Sports Business

Sampson scandal may repel IU donors

February 25, 2008

IU Foundation President Curt Simic says he had 50 personal conversations with donors in the week after news broke of the latest athletic department controversy--the potential firing of men's basketball coach Kelvin Sampson over alleged NCAA improprieties. Based on those conversations, the chief of Indiana University's philanthropic arm says he has little fear that what's happening in the basketball program will affect financial support to the school.

But Simic is acting like a man who understands the value of damage control and realizes the potentially destructive impact this volatile situation could have on IU.

At IBJ deadline, IU was staring down the barrel of its third controversial basketball coaching change since 2000 and was expected to announce Sampson's fate within 24 hours. The resolution of the controversy, IU supporters said, could affect the finances of the athletic department--and possibly the entire university--for years to come.

Predictably, many IU officials have gone underground. The school's trustees are referring all questions to the university and everyone in the athletic department has remained mute. But that hasn't quieted the hue and cry from the Hoosier faithful.

"They're on strike two with a lot of fans and supporters," said Mike Pegram, who has operated a Web site dedicated to IU sports since 1998 and is online coordinator for Inside Indiana Magazine. "The next step they make will be very, very critical."

Though many IU alums and supporters said they would continue to stand behind their school, there's a stunned silence among the Big Red masses.

"We're all just sitting here, asking, 'How in the world did this happen?'" said Stephen Helmich, president of Cathedral High School and a 1972 IU graduate. "This couldn't come at a worse time."

The latest flap--stemming from NCAA allegations of five major rules violations by Sampson and his staff--comes as IU is conducting a $1 billion capital campaign, $80 million of which is earmarked for the athletic department.

The athletic-department campaign--dubbed "For the Glory of Old IU"--was launched in 2006. Of the $80 million the department hopes for, $54 million has been raised. But much more than the $80 million will be needed if school officials follow through on plans to replace Assembly Hall. Several major donors said they've already been approached about donating to that project, which IU officials estimated last year would cost $130 million to $160 million.

The accusations that Sampson made impermissible phone calls to high school recruits and lied about it to university and NCAA officials are a distraction as new IU President Michael McRobbie is working to distinguish the school internationally in such areas as life sciences and informatics.

To compound matters, Purdue University also is making a push to secure donors to improve its academic and athletic facilities, beginning what some are calling an arms race between the two institutions.

Righting the basketball program is especially critical at IU because it generates more than one-fourth of the athletic department's revenue. Meanwhile, it uses less than one-tenth of the department's $41.5 million budget, which has teetered on the edge of being in the red in recent years.

Cathedral's Helmich, who played football at IU and earned a master's degree there in 1974, said he hopes IU leaders realize the gravity of the situation.

"This is a very big deal," he said. "Everyone I know who supports the university thinks that it is. The school and its leaders right now are under a microscope. Whether they like it or not, this is big business, and there's a lot at stake."

Greenspan on hot seat

While most alums IBJ interviewed support McRobbie, they were almost unanimous in wanting Sampson fired. There is less consensus--but no less passion--about Athletic Director Rick Greenspan, who was hired away from Army in the fall of 2004 specifically for his fund-raising prowess. Greenspan helped increase fund raising at West Point 300 percent during his 1999-2004 tenure.

"Businesses fail for one reason: bad management," said Indianapolis businessman Bart Kaufman, who earned an IU undergraduate degree in 1962 and law degree in 1965. "IU's athletic department has failed for the same reason."

A major IU donor who endows the William Oliver Chair at IU's law school, Kaufman thinks there's no room for Greenspan at his alma mater.

"The athletic department is a shambles, in my opinion," said Kaufman, CEO of locally based Kaufman Financial Corp. "If we fire the basketball coach and athletic director, I'd be happy. If they just fire the basketball coach, I'd be disappointed."

Kaufman complains that Greenspan scheduled too many lightweight basketball and football opponents, and that he bungled the hiring and oversight of Sampson, who'd committed NCAA violations at his prior school, the University of Oklahoma.

He also faults Greenspan for not including a buyout clause in the contract of women's basketball coach Sharon Versyp, who was hired away by Purdue in 2006. Such a clause would have forced Versyp to pay the university to get out of her contract.

While Greenspan has been quick to distance himself from Sampson's 2006 hiring, an IU donor said the athletic director told him two years ago that "I am the search committee." Much of the blame for the Sampson hire now has fallen to former President Adam Herbert.

"It wasn't Adam Herbert who didn't put a buyout clause in the women's basketball coach's contract," Kaufman said. "It wasn't Adam Herbert who didn't execute proper oversight on Kelvin Sampson's program."

Kaufman isn't willing to say his unhappiness will cause him to withhold financial support from IU, but he thinks others will.

"School officials will never admit it, but when people get mad at the university, they don't give as much," Kaufman said. "I think this could hurt the school for many years to come."

Rising tide of contributors

Simic points out that, in the wake of the firing of legendary basketball coach Bob Knight, giving to the university actually increased. The year following Knight's 2000 dismissal, IU for the first time raised more than $300 million in a single year.

It's difficult to draw a connection between athletic department problems and overall giving to IU, in part because large, one-time contributions can skew the picture. One key indicator is the number of contributors, which has grown from 101,542 in 2004 to 112,195 last year.

IU supporters speculate the resurgence of the football program under the late Terry Hoeppner and the relative calm--until this month--and success of the basketball program had a lot to do with that increase.

Now, with the football and basketball coaching situations in question at IU, the tables have turned. Hoeppner died in 2007, just two years into rebuilding the school's football program. Hoeppner's assistant, Bill Lynch, was given the head-coaching job at the end of last season despite a losing record in his pre-IU head coaching jobs.

The football issues, however, pale in comparison to those facing the basketball program, which could be staring at a postseason ban in 2009 and beyond. Indiana has until May 8 to provide a written response to the NCAA on the allegations. The NCAA's committee on infractions is expected to give the matter a hearing at its June 14 meeting.

"People's impressions of the university has to be subject to what's going on," said Phil Isenbarger, a member of IU's 1981 NCAA basketball championship team and a partner in local law firm Bingham McHale. "It's a mess. Just a mess."

IU needs to take decisive, immediate action to mitigate the marketing nightmare that awaits them, said Larry DeGaris, director of academic sports marketing programs at the University of Indianapolis. He thinks IU must make decisions about the coaching situation before the NCAA drops the hammer.

"They have to reach a quick conclusion and move forward," DeGaris said. "To a large extent, given the high-profile nature of the program, that coach is the face of the university. If they let this situation fester, it will be disastrous."

With an important signing period for basketball recruits approaching in April, Pegram said moving quickly to resolve the coaching situation will be crucial to maintaining the team among the nation's elite. It's also important to get a new coach in place to retain current players, Pegram said.

Can IU win clean?

But there are even bigger concerns, college basketball experts said. The Sampson situation illustrates that IU will not tolerate cheaters at any level. IU alums applaud that. But that could have a chilling effect on many college coaches.

Sonny Vaccaro, who worked for Nike, Adidas and Reebok and conducted the nation's biggest post-high-school player camps, said Knight set the bar so high at IU it makes it difficult for subsequent coaches. Vaccaro wasn't just talking about winning.

When asked by Yahoo Sports to assess how many truly clean coaches are among college basketball's elite, Vaccaro chose his words carefully, pondering national championships won and Final Fours made.

"I guess three coaches, maybe four. I'm not 100 percent for sure about one guy," Vaccaro said. "And even among that group, Knight stands alone, stands above. I've never heard a single thing about him, never heard anything. Nothing. He's the cleanest one."

Vaccaro wondered aloud if such a feat can be accomplished again--at IU or anywhere. But IU supporters are demanding just that.

"We want a program that is 100 percent pure, and I think that's achievable," Kaufman said. "You can win and not cheat. That's the way it has to be at Indiana University."

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