Freeh report: Jerry Sandusky's retirement benefits played a role in sex crimes

McClatchy NewspapersJuly 16, 2012 

— Jerry Sandusky was too involved in The Second Mile to succeed head football coach Joe Paterno.

That’s what Paterno told him. So, Sandusky began negotiating for a number of fringe benefits from Penn State as part of the retirement deal he was pursuing with senior officials in 1998 and 1999.

Along with a $20,000 annuity that ended up as a lump sum $168,000 deposited in his bank account, Sandusky was able to negotiate a generous retirement package with unusual bonuses from men who knew he had been investigated in 1998 for potentially inappropriate behavior with a boy in a shower.

Sandusky wanted an official title as well as access to athletic facilities, such as a locker and weight rooms. He also wanted to maintain his visibility in the community and keep Penn State football’s association with The Second Mile, the charity that he founded.

Those details were revealed in the scathing Freeh report issued last week that blames senior university leaders for risking the safety of young boys to protect the university. The report provides the closest look yet into the circumstances and events surrounding Sandusky’s exit as the Nittany Lions’ defensive coordinator into a new role with The Second Mile.

But the details that emerged from the report also show how the provisions of the retirement, such as access to facilities and the association he asked for between the university and The Second Mile, played a role in the sex crimes of which he was convicted last month.

As former FBI director Louis Freeh said last week, his investigation concluded that Sandusky’s retirement, in June 1999, wasn’t brought on by Penn State police’s probe in 1998 into a report Sandusky showered with a boy. Freeh said his investigation found that decision was made before the 1998 incident, which was in May.

Freeh investigators got a handwritten note from Joe Paterno’s home office that shows his thoughts about Sandusky not succeeding him. “If there were no 2nd Mile then I believe you belief (sic) that you probably could be the next Penn State FB Coach. But you wanted the best of two worlds and I probably should have sat down with you six or seven years ago and said look Jerry if you want to be the Head Coach at Penn State, give up your association with the 2nd Mile and concentrate on nothing but your family and Penn State. ... You are too deeply involved in both.”

Paterno had “made it clear” to Tim Curley, then the athletic director, as Curley wrote in an email to then-president Graham Spanier Feb. 8, 1998. Curley wanted to see if Sandusky would take a post as an assistant athletic director, but Sandusky turned that down as he wanted to continue coaching. (Freeh’s report recommends that all coaching positions and assistant athletic director posts are advertised externally.)

On May 28, 1999, Sandusky signed a letter that acknowledged he would not be the next head coach. This same letter outlined Sandusky’s options for the future, such as the ongoing relationship between the university and his charity.

Sandusky was contemplating retirement amid the Pennsylvania State Employees’ Retirement System’s 30- and-out deal at the time, which let people retire with 30 years of service, instead of the regular 35 years, or at age 60, without a penalty. Sandusky had until June 30, 1999, to decide.

On June 13, 1999, Curley emailed Spanier to say it looked as though Sandusky would retire if he could get a $20,000 annuity, but Curley wasn’t comfortable with the annuity, he wrote in an email, according to the report. The next day, former senior vice president Gary Schultz met with Sandusky about the annuity.

The sides appear to have agreed to a lower annuity amount of $12,000, according to the draft agreement drawn up by Wendell Courtney, then the university’s outside counsel. The agreement gave Sandusky free use of the weight rooms, fitness facilities, even an office where investigators found old documents Sandusky had stored there, such as letters to one of the victims.

The draft agreement was amended because of some unidentified issue over taxing the annuity, so the sides agreed to a lump sum payment of $168,000 that hit Sandusky’s bank account June 30, 1999. After taxes, it was $111,990.18.

According to Freeh’s report, senior officials told his investigators they’d never heard of such an arrangement for a retiring employee.

Sometime while Sandusky was contemplating retirement, he was looking into starting a football program at Penn State’s Altoona campus. Sandusky talked about financing it with a businessman and a university feasibility study was done but found that it couldn’t be financially supported.

And a day after Sandusky officially retired, Curley rehired him as an emergency hire for the upcoming football season. Sandusky worked for 95 days at his salary and got a 6 percent cost of living increase.

On Aug. 31, 1999, Rodney Erickson, who was then the provost, OK’d giving Sandusky emeritus status, essentially reserved for a professor or someone of high academic standing who retires with honor. Spanier apparently had promised Sandusky that rank, although it was an unusual move, and Erickson later said he was uneasy about it.

Freeh’s report shows that in retirement, Sandusky kept up his association to the university.

Sandusky was compensated by Penn State 71 separate times for things like meals, lodging, speaking engagements, and other activities from Jan. 5, 2000, with the last on July 22, 2008. One was a speech to the American Football Coaches Association in 2000 and a speech at a Penn State leadership conference in 2007. That same year, he was also the commencement speaker for the College of Health and Human Development.

Sandusky made $57,000 a year plus travel expenses working for The Second Mile, according to a memo dated Aug. 23, 1999, that was presented to the charity’s board. That was to start in January 2000. His role lasted through August 2010 — after the grand jury investigation had begun.

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