Posted by Adam Jacobi
On the heels of the nightmare investigative report released by the Fiesta Bowl yesterday, there's been a great deal of consideration as to whether the Fiesta Bowl should retain its BCS status, or whether the controversy surrounding the bowl is too much for the BCS to deal with.
The BCS has established a task force on the issue and has tasked the Fiesta Bowl with proving that it deserves its BCS status, which certainly seems appropriate, but now the question is whether the rest of the BCS bowls are clean, or if the abuses are more systemic. Thus, the BCS finds itself in the difficult position of deciding whether or not to subject the other BCS bowls to heightened, public scrutiny. If the other bowls can survive an investigation, it makes the BCS look better, but if they can't we may have a house of cards situation, and one of the BCS's main priorities has always been self-preservation.
Unfortunately for the BCS, the Playoff PAC has no such compunction about whether to publicly scrutinize the BCS bowls, and recently released this statement about curious spending practices at those institutions. There's no allegations of campaign finance abuse, but if that's the best thing you can say about the bowls' case, they're not in a good spot. The release is printed in its entirety below.
The BCS's Fiesta Bowl fired its long-time CEO yesterday after an internal investigation revealed that the BCS Bowl used its charitable funds to unlawfully reimburse employees' political contributions and pay for top executives' weddings, four-day junkets to Pebble Beach, and four personal country club memberships. The Bowl's internal inquiry was initiated to "investigate the myriad allegations raised by Playoff PAC" in the PAC's legal complaints filed with the Arizona Secretary of State and the Internal Revenue Service.
Playoff PAC co-founder Matthew Sanderson said: "In the interest of self-preservation, the BCS is now painting this Fiesta Bowl scandal as isolated misconduct. This is wrong. Public records show the BCS's Orange Bowl and Sugar Bowl are also legally and ethically troubled. Any BCS effort to expel the Fiesta Bowl would be a hypocritical act, given the documented irregularities at these other BCS Bowls. And who's to say we won't find the same type of shockingly questionable behavior when the curtain is peeled back at the BCS's Orange Bowl and Sugar Bowl?"
THE BCS'S ORANGE BOWL AND SUGAR BOWL IRREGULARITIES
Playoff PAC found the following with respect to the BCS's Orange Bowl and Sugar Bowl, which have both organized themselves as public charities to obtain federal tax benefits:
- The Orange Bowl sponsors an annual Caribbean Cruise that the Bowl itself describes as a "complimentary getaway" for Bowl staff and college football officials that features no business meetings.
- One out of every $10 that the Sugar Bowl takes in ends up in the hands of its top 3 executives.
- Sugar Bowl Exec. Dir. Paul Hoolahan received $645,386 in FY 2009, a year in which the Sugar Bowl lost money despite receiving a $1.4 million government grant. Mr. Hoolahan collected $25,000 more than the Rose Bowl's top three executives combined.
- BCS Bowls use charitable funds to fly Bowl execs and spouses first-class, pay private club dues, and foot the bill for employees' personal income taxes. The Orange Bowl, for example, spent 756,546 on travel in FY 2009 for its personnel.
- The Orange Bowl spent $331,938 on "parties" and "summer splash" in FY 2004, $42,281 on "golf" in FY 2004 and FY 2006, $535,764 on "gifts" in FY 2006, and $472,627 on "gifts" in FY 2008.
- The Sugar Bowl benefited its insiders by paying six-figure sums for Bowl meetings and an average of $432,723 for "Football Committee" expenses the past three years.
- The Sugar Bowl spent $201,226 on "gifts and bonuses" and $330,244 on "decorations" in FY 2008.
Aside from these expenses, both BCS Bowls repeatedly describe expenses with vague verbiage. Given the Fiesta Bowl's revelations yesterday about questionable expenses that were once tagged with similarly indistinct labels, both BCS Bowls should fully account for these items.
- The Sugar Bowl spent $710,406 in FYE 2007 and FYE 2008 on a mysteriously vague category called "special appropriations."
- The Orange Bowl spends over $100,000 per year on "postage and shipping" (ten times the amount that other BCS Bowls spend annually).
- The Orange Bowl spent $1,189,005 on unspecified "entertainment" and "catering" in FY 2009, $1,017,322 on undifferentiated "event food" and "entertainment" in FY 2008, and $75,896 on "recruitment" in FY 2008.
QUESTION OF THE WEEK: WHICH BCS "TASK FORCE" MEMBERS ATTENDED FREE BOWL JUNKETS?
After the Fiesta Bowl scandal, the BCS trumpted a new task force to investigate the Bowl's findings. Records obtained by Playoff PAC show that at least one task force member (So. Mississippi's Richard Rianni) received a "complimentary getaway" in the Caribbean from the BCS's Orange Bowl last year--the same type of trip that will be the subject of any Fiesta Bowl investigation.
- Will Mr. Rianni recuse himself from the BCS task force's deliberations?
- Which other BCS task force members have accepted free trips from BCS Bowls, such as the Fiesta Bowl's annual "Fiesta Frolic"?
QUOTES OF THE WEEK: "FULLY COMPLIANT"
- "I'm disappointed because I just think it's a waste of state resources and our time as well." -- Fiesta Bowl Chairman Duane Woods, commenting in July 2010 on news that the state Attorney General would investigate the Bowl based on Playoff PAC's legal complaint.
- "The Fiesta Bowl is confident that it has always fully complied with tax laws and rules in its operations and activities." -- Fiesta Bowl statement in September 2010, reacting to Playoff PAC's filing of a tax-law complaint with the IRS.