OR Treasury catches Rob Mullens raiding Knight Arena bond reserve fund, makes him pay it back

4/24/2021 update:

When I first wrote about this earlier this month a reader emailed me wondering if UO had notified the investors holding the Knight Arena bonds that UO VPFA Jamie Moffitt had loaned out the reserve fund. It turns out that she hadn’t even told the Oregon State Treasurer. So I did.

Today I got the email below from the Oregon Treasury Dept. They had a talk with UO’s finance people, Mullens had to pay the money back with interest, and Treasury is going to keep an eye on UO’s auditor, who seems to have missed this impropriety and who knows how many other ones:

On Apr 24, 2021, at 11:53 AM, … @ost.state.or.us> wrote:

Mr. Harbaugh,

We appreciate your bringing the issue related to the Arena Reserve Fund to our attention.  We likewise alerted University Finance staff to the requirements associated with the use of the Arena Reserve Funds and specifically that amounts credited to the Arena Reserve are to be used only to pay Arena Bond debt service.  Treasury staff met with University Finance and Athletics staff this week to review Arena Reserve Fund conditions and constraints. We have confirmed that moneys have been transferred back to the Arena Reserve Fund, including applicable interest earnings, to bring the Fund in alignment with the Bond issuance requirements.  University staff have assured us that they are taking necessary steps and putting processes in place, including working with the University internal auditor, to ensure that such a mistake does not occur in the future. Treasury staff will also institute a periodic certification process to validate that the Arena Reserve Fund is being maintained in accordance with the 2008 General Obligation Bond requirements.

Again, we do appreciate your bringing this matter to our attention. Please contact me if you have any questions.

Best regards, …

4/07/2021: Ducks raid Knight Arena Bond Reserve Fund for coaches pay:

Back in 2007 or so when the state agreed to let UO sell $235M in bonds for the Knight Arena – ultimately guaranteed by future UO tuition revenue and the full faith and credit of the university – they insisted the athletic department set aside $1 of every ticket over $8 for an emergency reserve fund in case ticket revenue and Uncle Phil’s Legacy Fund couldn’t cover the deficit. The prediction was that this would build to $7M by 2019, but ticket sales have been slow and it is actually only $5.8M.

Now President Schill has let our VPFA lend it all to Duck Athletics at 0% interest, so they can keep paying the coaches:

Full agreement here.

The money is of course fungible, and will allow the Ducks to keep paying the bloated salaries of their coaches, despite the language in their contracts making clear that UO does not have to raid the rest of the budget for them. E.g.:

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14 Responses to OR Treasury catches Rob Mullens raiding Knight Arena bond reserve fund, makes him pay it back

  1. OMA says:

    Does this scare anybody else? Or just me?

    I would say a “Holy Shit!” is in order… Or even a WTF?

    • charlie says:

      I’ll give you a WTF! How many employees and corporate execs are in prison for emebezzlment? The AD just ups and pilfers $5 million, and no one did anything to stop them. No one except a prof that pays attention. If this doesn’t underscore why admins despise shared governance, nothing will. Forget shared, admins have proven they’re incapable of doing their jobs….

  2. charlie says:

    What was the length to time prior to bond maturity? Twenty five years, thirty years? And the reserve fund is…gone? Asking for a friend….

  3. DuckFury says:

    Another example of Schill’s BS about a firewall between athletics and academics $$ – more like a piece of wax paper.

  4. Richard Bohloff says:

    The latest scoop is that Mr. Knight is livid UO didn’t do more to prevent Lane County from getting slapped with another high risk designation. He thinks UO bears responsibility for his olympic trials not being able to have a packed audience. The new marching orders are to to get butts in seats at any cost.

    • charlie says:

      Well, looks as if the flagship is doing a really, really, really bad job at following orders. Announced today that thousands of tickets to the Oly Trials will be refunded. As of now, only 15% stadium capacity will be allowed.

      If Kate carries through with her threat of shutting down the state next week if covid numbers don’t reach some benchmark, then the Olys are done. Who would be so stupid to pay full ticket price. fly from anywhere in USAAmerica, book accommodations, when there’s a very good chance this thing will be shut down? PK can demand anything he wants, but he can’t force anyone to attend…

      • Dog says:

        Here are the average spike rates, in units of new cases a day for Oregon:

        March 20, 2020 – Apr 4, 2020 peak 27 – 74 in 15 days ~ 3 per day

        May 16, 2020 – July 30, 2020 peak 64 – 361 ~6.5 per day

        Sept 16,2020 – Dec 8, 2020 peak 192 – 1279 ~14 per day

        Mar 21, 2021 – April 23, 2021 190 – 1014 ~ 25 per day

        The highest slope in any time period is:

        Oct 27 – Dec 4 367 – 2147 in 37 days ~ ~ 48 per day

      • Richard Bohloff says:

        I don’t think you fully understand. Livid about the refunds but the orders are to get Lane County back on ttack to pack seats at the last minute. However it appears first we will be upgraded from high to extreme in the near future

        • charlie says:

          To begin with, the Oly Trials weren’t suppose to be held in Eugene. They were initially awarded to Mt. San Antonio College, in Walnut, CA. Lanana and a couple of other Nike clowns strong armed the USATF to move the event to Eugene on the pretext that a civli lawsuit regarding construction problems would delay completion. All this after MT. SAC had taken on millions in debt for the buildout. Mt. SAC officials quickly resolved the matter. As Mt. SAC pointed out, Hayward Field wasn’t yet close to completion at the time their award was pulled, yet, they were near finishing the project.

          Along with all that, a criminal RICO investigation regarding how Eugene was awarded the World Championships is still in progress. So, how the hell does any governing body continue to allow Eugene to host the Trials when a criminal lawsuit, not a civil one, is extant? This isn’t about Phil Knight’s mood swings, it’s about athletic governing agencies’s corruption…

    • just different says:

      In the case of Lane County, Uncle Phil is probably correct. But it’s hard to see how UO can be blamed for the rest of the state, or the Oregon GOP for that matter.

  5. Environmental necessity says:

    Brilliant! There are some in Johnson Hall and the Athletic Department that loathe you Harbaugh.

    Wear their loathing with pride.

  6. LemonCrisp says:

    Surely the people responsible for violating the debt rules and lending this money will be fired … right? Or maybe they’ll be allowed to quietly resign? Or at least they’ll be given a stern talking to (and only a modest bonus).

    In a just world these are the kinds of scandals that bring people down, I would think.

  7. OMA says:

    And they spend twice the amount they tried to “borrow” on 20%++ coach pay raises? Who is minding the shop? Is it time to revive the Oregon University System to keep an eye on what look like–at best–stupid people doing self interested shit?

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