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Tues October 21, 2002
What They
Didn't Tell Us About the Cuts

By Thomas Hobbs, Staff Writer


    [Editor's Note: The following discussion and analysis provides an overview of the financial position and activities of the California State University for the year ended June 30, 2002 in its entirety, including recognized auxiliary organizations. Click here to download the official and most recent official  California State University Audited Financial  Statment & a pdf note on the resulting fiscal crisis.]


©1958-2003 Bulldog Newspaper Foundation. All Rights Reserved.


October 10, 2003
Save Mart Center
Bond Status Questions

By Howard E. Hobbs Ph.D., Editor & Publisher

Save Mart Tower     FRESNO STATE -- Universities like Fresno State that sell tax-exempt bonds to pay for construction of athletic venues like The Save Mart Center and then make lucrative deals to sell the naming rights to the facility might soon have to face the loss of purported tax-free status of those bonds.
     Then, the Internal Revenue Service quietly issued a ruling just made public in recent days, that the privileges gained by individual donors and corporations that purchase naming rights to such facilities as the Save Mart Center, count as a "personal-business use" of that property.
     Tax law states that if the value of personal-business use exceeds a certain proportion of the value of the property and the costs of debt service on it, the bonds' tax-exempt status is revoked.
     Public institutions like California State University, Fresno can only make deals worth up to 10 percent of the value of property and 10 percent of the amount of debt, while most private nonprofit organizations have a maximum of 5 percent. Of course, the rule does not apply to for-profit entities, which cannot issue tax-exempt bonds.
     Fresno State would appear to fall under the categories of public and private institutions covered by the decision. However, because the finding was made in a private-letter ruling, it only settled how existing law applied to one particular case and cannot cited at this time as precedent in other cases, according to IRS spokesperson, Anthony Burke.
     Some experts are worried about how the IRS interpretation will affect those who bought tax-exempt bonds to help finance the Save Mart Arena. The ruling could have a big effect on many colleges and university athletic facilities like Save Mart Center.
    Linda B. Schakel, an expert on tax-exempt bonds, who is president-elect of the National Association of Bond Lawyers told reporters, when she worked for the Treasury Department in 1997, she helped write the law on which the IRS based the private-letter ruling, she says. "It's a little bit different than controlling how your name appears on concessionaires' cups and janitors'
     Joseph R. Irvine, a tax lawyer for Ohio State University, told reporters, this week, "...any institution that sold tax-exempt bonds to pay for any new construction should be concerned." Most issuers, including colleges, he says, "will see that this is the position the IRS would take on an audit."
     Universities, colleges and schools often seek o pay for new construction with tax-exempt bonds through their local or state governments. The tax-free status of the bonds makes them attractive to potential buyers, who would be upset if they found out after purchasing what they were told was a tax exempt security, to find out later that they owed back-taxes and penalties on them after all.
  Selling naming rights to the Save Mart Center also brought in big bucks to the University. In the biggest tax bond deal of its kind we know of, Fresno State is getting $40-million over 20 years from Save Mart Corp., a regional supermarket chain, for naming the arena its "Save Mart Center."
     But naming rights carry with them particular effects on any tax-exempt bonds used to finance the construction, according to tax attorney, Gregory V.
Johnson, a specialist in public finance in the Denver office of Patton Boggs, a law firm. "It's not just putting your name on a building, it's putting your name on a building for a business purpose."
  For example, if John Doe personally donated $20-million to his alma mater, and, in gratitude, it named a stadium for him, the bonds would be tax-exempt. But if his company paid the institution $20-million to put its name on a stadium for advertising purposes, the bonds might be taxable. Their status would depend on whether the institution was public or private, and whether the payments met either the 10- or 5-percent maximum, respectively.
     The ruling will affect colleges more than cities and municipalities because colleges tend to build smaller facilities, Mr. Johnson says, explaining that the proportional value of naming rights increases as the size and cost of facilities decrease.
     Mr. Irvine believes that a naming-rights gift for Ohio State's new arena, as an example, falls safely below the 10-percent ceiling. The university used tax-exempt bonds to build the facility, where its basketball and hockey teams play and other events are held. OSU received $12.5-million in 1998 from the Schottenstein family, which owns Value City, a national discount-store chain, to name the facility the Value City Arena at the Jerome Schottenstein Center.
    Deborah Adishian-Astone, executive director of auxiliary services at Fresno State, told reporters Fresno State sold it's tax-exempt bonds to finance the Save Mart Center.
    According to Treasury Final regulations, sale of naming rights and tax exempt bonds may not give rise to investment-type property if it is made for a substantial business purpose.

    [Editor's Note: Go to related tax-exemption story. Also note that according to Fresno State, in the bond sale to fund the Save Mart Center – an unorthodox style of collegiate financing was devised in order to obtain public funds for the purchase of investment bonds that contractually obligate income streams, including naming rights, corporate sponsorships, private gifts, luxury suites seat licenses for the operation of an athletic facility on campus. Note that these bonds were put up as the sole source of security for the construction project. The Bulldog News has been informed that a sponsorship arrangement between Save Mart Supermarkets and Pepsi Bottling Group started the fund-raising melee back in 1998. The move soon led to Pepsi’s financial backing of the Fresno State Savemart Center following the university's strategic switch from its former Coca-Cola vending machines on campus. Local businessman Larry Shehadey then donated the eight-story clock tower at the main entrance.]


©1958-2003 Bulldog Newspaper Foundation. All Rights Reserved.

October 7, 2003

By Howard Hobbs PhD, Editor & Publisher

    FRESNO STATE - In the news, California State lawmakers have announced today another cut in the University of California's budget by 8 percent, or $248 million from last year.
     Worse yet, state funds for the California State University System fell by more than $345 million. The state's community colleges have been cut by 9.4 percent, a hefty $240 million.
    In passing the 2003-2004 state budget, Sacramento will delay by about a year the 10th UC campus at Merced, Calif. This in spite of enormous graduating high school seniors.
     Meanwhile, the California Community College chancellor, Dr. Thomas J. Nussbaum has recently announced his plans to retire in January 2004. A replacement has not yet been announced.


©1958-2003 Bulldog Newspaper Foundation. All Rights Reserved.

September 20, 2003
University Presidents’ Role
in NCAA Eligibility Legislation
By Dan Covell & Carol A. Barr
[Abstract from the Journal of Higher Education, Vol. 72, 2001]

        “A college which is interested in producing professional athletes is not an educational institution.” Robert Hutchins, president, University of Chicago. [1980]

    FRESNO STATE -- America is different. Its universities are unique in their efforts to please many constituencies, prospective students, donors, legislators, the general public. The growth of intercollegiate sports aptly illustrates the strengths and weaknesses of a constituency-oriented system of higher education.
     With enthusiastic support from students, alumni, and even government officials, our colleges have developed athletic programs that have brought great satisfaction to thousands of athletes and millions of spectators.
     Few aspects of college life have done so much to win the favor of the public, build the loyalties of alumni, and engender lasting memories in the minds of student athletes.
     College sport is what it is because the American public wants it so bad.... Now why the public wants it so much is a question for the public. Right?     These statements identify an elemental conflict between academics and athletics that exists in American higher education; that is, the belief that the simultaneous institutional pursuits of rigorous academics and "big time" intercollegiate athletic programs are difficult, if not impossible, to reconcile.
     Many critics of American higher education note that our institutions are beset with contradictory and unrelated activities both academic and nonacademic in nature. The transformation of American higher education over the last century has led to criticism of academic activities--such as research funded by for-profit corporations--that often contribute little to students who fund the institution, and an unchecked academic balkanization on campuses has created a separation between undergraduate and graduate studies, arts and sciences, and liberal and professional learning that has meant confusion about the specific missions of specific institutions.
     Combine this with a current push for distance learning fueled by technological advances and the need to reach more diverse populations of students to maintain institutional and programmatic viability, and critics cite that it has become nearly impossible to define precisely what is meant by higher education.
     This debate is made more complex when nonacademic components are also assessed in terms of their congruence with the mission of higher education. The adoption of the Cambridge/Oxford residential college model led to the incorporation of many nonacademic components within the traditional American higher education system, including intercollegiate athletics.
     This in part has led to the development of what Derek Bok, president, Harvard University, called the "constituency-oriented system of higher education," where schools use athletics and other nonacademic activities to foster a sense of community with students, alumni, and the general public.
     While the constituency-based system contains numerous potentially contradictory elements worthy of exploration, it is intercollegiate athletics that is often cited as a particularly aberrant aspect of American higher education, particularly at Division I National Collegiate Athletic Association (NCAA) institutions. The inevitable response of critics of the constituent system to this charge is, what do such activities have to do with the mission of higher education?
     The simultaneous pursuits of athletic success, related profits, and institutional academic integrity, say these critics, cannot be reconciled. To them, this is the glaring weakness in the constituent system. Supporters argue the strengths of the system, which the popular appeal of nonacademic activities are a vital complement to academic components and in keeping with the founding ethos of American higher education.
     Efforts to wed the athletic and the academic attempt to deflect this criticism of the wedding of the athletic and the commercial that is inherent in the constituent system. According to Helman (1989), this ideal notion of intercollegiate athletics and the student-athlete is legitimized through eligibility rules, which provide "standards that tether commercial athletics to the educational purposes of higher education". If Division I programs are to meet the standards set by the NCAA that demand this tethering (see below), then the programs must be maintained and legitimized through such eligibility rules.
     The question that arises from this charge is to whom within the academy this responsibility of tethering will ultimately fall. It is in the realm of academic tethering that school presidents, the individuals who are seen to have ultimate control over all components of the campus, have moved to the fore. When first student-athletes and then faculty oversight groups proved unable to deal effectively with the problems associated with intercollegiate athletics and the demands of constituents, many school presidents saw it as their role as institutional CEOs, those managers who serve as the public face of the institution and the ultimate internal decision maker, to address these issues.     Over time, certain groups of presidents have come to lead the associated public debate and NCAA organizational push for association-wide initial eligibility standards.
     Many other major concerns regarding Division I athletics--pay for play, controlling agent tampering, recruiting abuses by coaches, boosters and others, the recurring specter of gambling and point-shaving--have not elicited the same sort of demands for and responses of presidential leadership, because many presume that these are strictly "athletic" issues to be dealt with by professional athletic administrators.
     In an attempt to understand the roles of presidents in maintaining congruence within the constituency-based American higher education system, this article provides a detailed chronology of presidential efforts to deal with the conflicts related to the tethering of academic mission to athletic pursuits through the development of NCAA initial eligibility academic legislation.
     Such legislation impacts recruiting and admissions, the ultimate sport product on the field and the court, and the charge to tether commercial athletics to the educational purposes of higher education and to preserve the viability of the intercollegiate athletic enterprise.
     In response to criticisms that "big time" athletics has no place on campus and has no relation to institutional academic missions, the bylaws of the NCAA have been crafted to require that intercollegiate athletics be administered under an institution's academic rubric.
     The NCAA publishes annually the purposes of the association under Article 1 of its Constitution. The first stated purpose is, "To initiate, stimulate and improve intercollegiate athletics programs for student-athletes and to promote and develop educational leadership, physical fitness, athletics excellence and athletics participation as a recreational pursuit."
     Also included as stated purposes are, "To encourage its members to adopt eligibility rules to comply with satisfactory standards of scholarship, sportsmanship and amateurism," and "To legislate, through bylaws or by resolutions of a Convention, upon the subject of general concern to the members related to the administration." NCAA bylaws do not dictate whom schools may admit, as illustrated in Bylaw 2.5, "The Principle of Sound Academic Standards," which reads: Intercollegiate athletic programs shall be maintained as a vital component of the educational program, and student-athletes shall be an integral part of the student body.
     The admission, academic standing and academic progress of the student-athletes shall be consistent with the policies and standards adopted by the institution for the student body in general. An institution may admit any student, but the student may or may not be eligible to compete in intercollegiate athletics, depending on whether that student meets the initial academic eligibility criteria set by the NCAA membership.
     Division I schools must also recognize "the dual objective in its athletics program of serving both the university or college community participants, student body, faculty-staff, alumni and the general public community, area, state, nation, a verification of Bok's constituency-based assessment.

[Editor's Note: The California State University is the largest system of senior higher education in the nation, with 23 campuses, nearly 407,000 students and 44,000 faculty and staff. Since the system was created in 1961, it has awarded about 2 million degrees. The CSU mission is to provide high-quality, affordable education to meet the ever-changing needs of the people of California. For more information on The CSU, visit]

Sept. 19, 2003
What it costs taxpayers to
provide you with an education at
California State University, Fresno

By Edward Davidian, Staff Writer

     FRESNO -- Sacramento lawmakers cut the 2003-2004 University of California budget by $248,000,000 last week. Then went on to cut funds for the California State University system by $345,200,000. Community colleges were cut by $250,000,000.
     In the face of these drastic cuts present salary levels are on the block, as well. At present, average full-time pay for a professor is $108,180; assoc. professors $ 69, 534.
     The graduation rate form Fresno State is only 42%. Catch this, the total costs of operation of the statewide CSU System is a whopping $15,106,121,000 annually.
     The number of bachelor’s degrees awarded annually has increased over the past 3 decades, climbing from nearly 800,000 in 1969-1970 to over 1.2 million in 1999–20001 (U.S. Department of Education 2002)...More!

Sept. 11, 2003
Fresno State Hit With Ten
NCAA Rule Violations

Tom Hobbs, Staff Writer

     FRESNO - Men's Basketball is still trying to deal with the implications of the NCAA investigation findings announced this week. FSU was placed on four years probation on Wednesday. This, on top of self-imposed sanctions by the university in December of 2002, is a morale-buster for the Fresno State's Men's Basketball program.
    The NCAA cited numerous violations of bylaws governing academic fraud, recruiting, eligibility, financial aid (including awards and benefits), extra benefits, amateurism, coaching limitations and playing and practice seasons legislation, including a "lack of appropriate institutional controls" by the program's administrators.
   Because of FSU's self-imposed sanctions, which included a ban on last season's men's basketball postseason play and the elimination of three men's basketball scholarships, the NCAA imposed probation will be retroactive to December, 2002.
     Also, the NCAA mandated that Fresno State return 90 percent of the money earned during its appearance in the 2000 NCAA tournament and that the team's participation in the tournament be expunged from the record ...More!

September 9, 2003
Hitler's Filmmaker Leni Riefenstahl Dead at 101
Associated Press News Release

    BERLIN (AP) Leni Riefenstahl, the legendary filmmaker reviled and revered for movies she made about Adolf Hitler and his Third Reich, has died one of the last confidantes of the Nazi dictator. She was 101...More!

August 27, 2003
California Schools
Academic Scores Hit Bottom

By Amy Williams Staff Writer

    FRESNO STATE -- It appears that California teachers have little effect on students' academic performance of elementary, middle, and school students.
A California state study released today by the Public Policy Institute of California (PPIC) reports that students’ peers have a stronger effect on their achievement than the qualifications of their teachers or the size of their classes...More!

©1958-2003 Bulldog Newspaper Foundation. All Rights Reserved.

August 1, 2003
Krueger Killed Three

Dumped by UC Berkeley

Hired by National University
By Amy Williams Staff Writer

    FRESNO STATE -- Dr. Paul Krueger, the Penn State University prof who was to be hired by National University in San Diego learned yesterday that his job offer rescinded. Why? National just learned that when Krueger was a teenager in 1965, he and a friend killed three fishermen with a rifle. Krueger, at the time, was a runaway, according to local news accounts.


©1958-2003 Bulldog Newspaper Foundation. All Rights Reserved.

Stebbins Dean's Tarnished Brass [07/25/2003]
FRESNO STATE -- The CEO of the Fresno Chamber of Commerce has taken his place in history among the high-profile Fresno liars of all time.

Ethical Journalism Practices [06/26/2003]
BERKELEY -- Let’s talk about changes in the ethics of journalism. The century began with the Yellow Press, which is portrayed in most history books as being ethically challenged.

Moral Education Abstracts on Character [06/16/2003]
FRESNO STATE -- Throughout the history of American education there have appeared discerning movements which have redefined and redirected and in numerous ways made good our fundamental commitment to democracy.

College Newspaper Fight Lands in Courthouse [06/16/2003]
FRESNO STATE -- Finding a sponsor to underwrite development of a new 18,000 seat Event Center on the CSU-Fresno campus is still in a tail spin as the SaveMart Supermarket and Pepsi deal is taking a lot of heat.

Fresno State Officials Named in Cheating Slam! [06/09/2003]
FRESNO STATE -- Documents made public today in NCAA letters, link former Fresno State adviser to academic fraud.

Save Mart Center Tax Exemption Under Fire [06/07/2003]
FRESNO STATE -- Finding a sponsor to underwrite development of a new 18,000 seat Event Center on the CSU-Fresno campus is still in a tail spin as the SaveMart Supermarket and Pepsi deal is taking a lot of heat.

Annual Father's Day Fly-In Chandler Field [06/06/2003]
FRESNO -- Computer problems can leave you feeling helpless. When yours breaks, can you rely on a professional to correctly find the problem?

Stanford Professor Named Social Science Dean [06/01/2003]
MERCED, CA. -- Kenji Hakuta, Ph.D., is an experimental psychologist by training, a teacher and researcher by profession, and a builder of bridges by nature.

International SARS Health Alert [05/22/2003]
Sars is still spreading! The full text of all articles in the New England Journal of Medicine collection on the severe acute respiratory syndrome (SARS) is provided free.

Computer Repair Investigation [05/21/2003]
FRESNO -- Computer problems can leave you feeling helpless. When yours breaks, can you rely on a professional to correctly find the problem?

Burning Questions Remain [05/20/2003]
FRESNO STATE -- Emergency Traffic Advisory: University Police asked anyone coming to the campus this morning to avoid Barstow and Cedar Ave. approaches from the north side. A fire at an off-campus student apartment community has caused a traffic hazard.

Engineering Dogs Receive Honors [05/16/2003]
FRESNO STATE -- The men's North Gym bustles with friends and families of Engineering Dept. students waiting for their crowning achievement.

Parable of the Cave [400 B.C.]
ATHENS, Greece --  I said, let me show in a figure how far our nature is enlightened or unenlightened.

More Fraud Allegations Fresno State Sanctions [05/06/2003]
FRESNO, Calif. (AP) -- Fresno State will formally respond to the NCAA's investigation into academic fraud violations by the men's basketball team.

Charitable Choices in the Post-Welfare Era [04/26/2003]
FRESNO STATE -- Congregations and faith-based organizations have become key participants in America's welfare revolution. Recent legislation has expanded the social welfare role of religious communities, thus revealing a pervasive lack of faith in purely economic responses to poverty.

Local Stars Make It Big [04/25/2003]
FRESNO STATE -- Take a look at the Campus sky tonight through the Bulldog lens.

Colossal Vintage Days Celebration [04/24/2003]
FRESNO - California State University, Fresno is gearing up for a “colossal” 28th Annual Vintage Days celebration Thursday, April 24 through Sunday, April 27 with more activities for students, families and the public to enjoy the spring celebration on campus.

Chalk Dust on Bulldog Blackboard [04/25/2003]
FRESNO STATE -- Welcome to the Blackboard Student Orientation Course. Think of this course as your Digital Campus Reference Guide!

Friendly Fire is Major Cause of Coalition Casualties [04/06/2003]
WASHINGTON - Who goes there: Friend or foe? Soldiers, sailors and pilots - even with their high-tech military machines - often have a hard time telling the difference in the heat of battle.

Honor Award Goes To Madden Library Dean [04/07/2003]
FRESNO STATE -- Micharel Gorman, Dean of Library Services at California State University in Fresno, was elected to the Library Board at the ALA midwinter meeting in Philadelphia earlier this year.

Stanford Anti-War Activities Clash [04/02/2003]
WASHINGTON -- As student antiwar activists work to make their case against war persuasive to ambivalent classmates, the leaders of a Stanford University peace group have launched a different kind of campaign--to reform a conservative think tank on campus with dubious ties to the Bush Administration.

The New Terrorism Fanaticism and Mass Destruction [03/28/2003]
WASHINGTON D.C. -- Recent attacks in Oklahoma City, at the World Trade Towers, and at American embassies in Africa demonstrate the horrifying consequences of a terrorist strike.

Foul Shots: What did President Welty Know? [03/28/2003]
MARION, Ohio -- Michael F. Adams is in charge of his athletics department. Don't anybody think he isn't.

Assassinations Prolonged Vietnam War [03/26/2003]
PALO ALTO -- A compelling argument that if Kennedy had lived he planned to end American involvement in Vietnam and thus spare a generation who died fighting there.

Impartiality in Moral and Political Philosophy [03/05/2003]
NEW YORK -- In Justice as Impartiality Brian Barry takes the position, it is a commonplace that Anglophone moral and political philosophy has for the past decade been the scene of a running battle between defenders and critics of impartiality.

University Pay Frozen, Stanford's Fiscal Crisis [03/04/2003]
PALO ALTO -- Last month, Stanford's provost, John Etchemendy, announced a hiring freeze. The moratorium was to apply to all regular and academic staff positions, including temporary and casual employees, as well as staff members hired through employment agencies.

Hounds of War Unleashed on Baghdad! [02/21/2003]
WASHINGTON -   The George W. Bush administration has apparently begun moving along a broad front to pound Iraq with a deadly first strike that may cast the world into major economic disruption by early next week.

Challenger's Shadow Columbia Breakup! [02/08/2003]
WASHINGTON, D.C. -- As the Columbia investigation intensifies, we're hearing all kinds of sense and nonsense: It was an old shuttle; the tiles were always falling off; maybe it hit space debris...
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