Scandal won’t stop U of L from moving forward, Postel promises lawmakers

University of Louisville Interim President Greg Postel struck an upbeat tone with state lawmakers about the future of Kentucky’s second-largest university Thursday despite a swirling sports scandal that caused him to put the school’s athletic director and men’s basketball coach on administrative leave a day earlier.

“While there is a need for continued diligent work to resolve the problems of the past, we really must spend the bulk of our time preparing for the future,” Postel said at a meeting of the legislature’s budget review subcommittee on education.

A federal investigation revealed Tuesday comes just a year after the NCAA severely penalized the men’s basketball team for parties that introduced strippers to recruits and their families. On Tuesday, investigators unveiled a series of arrests and indictments involving payments made by Adidas, U of L’s official apparel maker, to coaches and recruits to steer students to certain schools. No one associated with U of L was charged, but a federal indictment said a Louisville assistant was being monitored and was allegedly involved in a pay-for-play scheme to secure a highly regarded recruit for the Cardinals that involved employees of Adidas.

Postel also acknowledged the massive problems U of L faces outside of athletics, including probation status by the school’s accrediting agency, a $48 million deficit, and spending and oversight problems under former President James Ramsey that prompted reorganizations of the school’s board of trustees and foundation board.

Most importantly, Postel said, internal budget cuts and reduced spending have erased the $48 million budget hole, and the 2017-2018 budget is currently balanced. That has happened in spite of a tuition freeze, which accounts for about 60 percent of U of L’s budget, he said.

“We are not interested in solving our financial problems on the backs of students,” Postel said.

The Southern Association of Colleges and Schools (SACS) made a site visit last week, and resolved seven of the nine issues that put the school on probation, Postel said. SACS originally put the school on probation after Gov. Matt Bevin dissolved the board of trustees, a move that forced Ramsey out. SACS found other issues, including finance and oversight.

Postel also said a reorganized U of L Foundation will work with more discipline than in the past, when it approved generous compensation packages for university executives and complex real estate deals without the knowledge of the full board of trustees.

Financial stewardship has been “a problem in the past … we like to think it will not be a problem in the future,” Postel said.

Postel said he was encouraged that enrollment had not fallen. Research expenditures reached $185 million in the last year, the highest in the university’s history, he said.

He struck an optimistic note about continued donor support, thanks to the ongoing culture changes on campus, including a new approach to make donors feel appreciated.

“That’s been lost in the past,” he said.

“We are not allowing current events and distractions to prevent the university from moving forward in the areas that are aligned with our mission and the needs of our community and students and faculty,” Postel said.

Legislators commented on both athletics and academics. Rep. Kelly Flood, D-Lexington, said she would like more details on the Adidas contract with U of L, as well as the University of Kentucky’s contract with Nike.

“I do believe those contracts and the setup of those contracts played a role” in the current scandal, Flood said. “We need to know from here forward.”

This story was originally published September 28, 2017 at 12:34 PM with the headline "Scandal won’t stop U of L from moving forward, Postel promises lawmakers."