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ISU Athletics Director resigns after questions about spending for Big Ten trip on Aaron Rossi’s plane

Kyle and Terri
Emily Bollinger
ISU Athletics Director Kyle Brennan announced his resignation on Thursday, effective April 30. Here he is with former ISU President Terri Goss Kinzy at the 2022 groundbreaking for the new Indoor Practice Facility.

Illinois State University Athletics Director Kyle Brennan has resigned following questions raised by WGLT about spending on a donor trip to Indianapolis on one of Aaron Rossi’s private planes.

WGLT was planning to publish a story Thursday about the December 2021 trip when ISU pre-emptively announced Brennan’s resignation. Brennan and another top Athletics administrator spent over $23,000 on the trip. The one-day junket included a stop at a strip club.

The trip sheds new light on ISU Athletics’ relationship with Rossi, who quickly became a multimillionaire after his company emerged as a COVID-19 testing giant during the pandemic. Less than two months after the trip together, Rossi pledged a $3 million donation to Athletics’ new Indoor Practice Facility. ISU won’t say if that money ever materialized; Rossi was indicted on federal tax fraud charges weeks after the pledge, and a judge restricted his ability to spend money. Rossi and his company, Reditus, remain under federal investigation.

The trip, which has not been previously reported, was at least partly paid for using money held by the ISU Foundation, the university’s fundraising arm. The ISU Foundation’s own guidelines prohibit “lavish” or “extravagant” spending, even for donor events.

Brennan declined a request for an interview prior to his resignation. In response to questions from WGLT on Wednesday, ISU acknowledged spending that “appears to be inconsistent with the University’s mission and values” and pledged a full financial review of Athletics.

“The Redbird community has a deep loyalty and commitment to Illinois State as shown by the rich culture of philanthropy at the University. Donor relationships fostered with individuals and organizations seek philanthropic investments that help advance the ISU experience for students, faculty, and staff,” ISU said in a statement. “While donor cultivation activities are an integral part of building and maintaining donor relations, they are expected to be fiscally reasonable and responsible, and to be consistent with the University’s mission and values. These practices are continually under review. The University has been made aware that spending for some cultivation activities appears to be inconsistent with the University’s mission and values. The University will be conducting a full financial audit of the Department of Intercollegiate Athletics.”

In Thursday’s resignation statement, ISU said “a decision regarding who will serve as acting athletics director is forthcoming. Until that announcement is made, Athletics staff will report to Interim President Aondover Tarhule.” One of Brennan's top deputies, Mark Muhlhauser, was also on the Indianapolis trip. Muhlhauser remained on staff Thursday.

“I want to thank Kyle for the energy and dedication he brought to this position,” said Tarhule. “Under his leadership Redbird athletes have achieved great success in the classroom and in competitions. I wish him the very best in his future endeavors.”

A national search will be conducted for a permanent replacement.

The itinerary

The trip to Indianapolis happened Dec. 4, 2021, for the Big Ten football championship game between Michigan and Iowa, records show. Brennan and Muhlhauser were on the trip, according to financial records, calendars, and emails reviewed by WGLT. Also on the trip were a small number of prospective or current donors, including Rossi.

The trip was apparently planned in haste. Records show Brennan bought nine 100-level club game tickets on StubHub within a day of kickoff, in three separate transactions – four tickets, two more tickets, and then three more tickets. Those tickets cost $18,754, according to a voucher Brennan submitted to the ISU Foundation showing “donor stewardship” as the purpose of the trip.

They flew from Bloomington’s Central Illinois Regional Airport to Indianapolis on a Falcon 900 jet owned by Rossi, according to flight records obtained by WGLT from FlightAware. They arrived at the Million Air private hanger in Indianapolis and took Ubers and Lyfts into downtown Indianapolis for the football game, according to receipts reviewed by WGLT.

Michigan won the game. Back home in Normal that evening, the Redbird men’s basketball team lost a home game against Jackson State.

It’s unclear what exactly the ISU Athletics staff and donors did in Indianapolis after the Big Ten football game ended, although some in the group apparently ended the evening at the Red Garter Gentlemen’s Club in downtown Indianapolis. That’s a short walk from Lucas Oil Stadium.

At 2:21 a.m. Sunday (about three hours after the game ended), Muhlhauser or someone with access to his Lyft account booked a $144 Lyft ride from 437 S. Illinois St. (the address for Red Garter) back to the Hampton Inn & Suites in the Indianapolis suburb of Avon, according to Lyft receipts provided by Muhlhauser to the ISU Foundation as part of a voucher for “donor stewardship” on the trip. That 20-minute ride was in a Lyft XL, which can generally seat up to five passengers.

On the Lyft receipt submitted to the ISU Foundation for the 2:21 a.m. trip, the words “Lucas Oil à Hotel (Hampton Inn)” are written. It’s unclear who wrote that.

The Red Garter Gentlemen's Club in downtown Indianapolis is a short walk from Lucas Oil Stadium.
Google Maps
The Red Garter Gentlemen's Club in downtown Indianapolis is a short walk from Lucas Oil Stadium.

The group stayed in at least eight rooms at the Hampton Inn booked under Muhlhauser’s name, according to a voucher and receipts submitted to the ISU Foundation. Those rooms together cost over $4,500, receipts show.

A separate Lyft receipt from Muhlhauser shows a trip from the hotel back to the Million Air private jet hanger before 9 a.m. Sunday. The same Rossi plane appears on FlightAware records as returning to Central Illinois Regional Airport shortly thereafter.

ISU employees who are traveling for work are generally asked to submit official documentation when they return, typically with a travel voucher and receipts related to the trip.

That happened in this case. In an email sent Dec. 14, 2021, a staffer with ISU Foundation’s accounting team told an Athletics accountant that the Indianapolis travel vouchers submitted for Brennan and Muhlhauser needed “more explanation” – specifically, who was riding in the ride-share vehicles and who attended the football game. The names of those attendees (other than Brennan and Muhlhauser) were redacted in a copy of the email reviewed by WGLT.

Spend money to make money

Cultivating and securing big donations from wealthy prospective donors like Rossi is part of the job for Brennan and Muhlhauser. Brennan was hired as ISU’s athletics director in late 2020 partly because of his fundraising ability, and it helped earn him a contract extension last summer. The donor-funded Indoor Practice Facility has been one of his top priorities. Construction is now underway.

“Philanthropic giving is huge with college athletics, because it’s kind of an arms race,” said Virginia Harrison, an assistant professor at Clemson University who has researched and practiced in fundraising and sports. “You want to make sure you have the best facilities, that you can recruit the best kids, that you’re able to say, ‘Look at our amazing athletics program.’ And that takes a lot of money.”

ISU Athletics’ budget is around $30 million annually, according to 2022 data from the Knight-Newhouse College Athletics Database. That’s similar or higher than other similar public institutions in the Missouri Valley Conference, the database shows, although just a fraction of the budget at big-time college athletics programs like Illinois ($129 million), Iowa ($151 million), or Michigan ($195 million).

Professional fundraisers often must spend money to bring in more money, such as donor-recognition events. The ISU Foundation publishes “cash disbursement guidelines” that lay out how contributed money can be spent. It’s OK to spend a “reasonable” amount on food and beverages (including alcohol) to entertain donors, for example, and documentation is required.

Some amount of spending on donors is simply the cost of doing business, said Lisa Delpy Neirotti, an associate professor with the sports philanthropy certificate program at George Washington University.

“They (donors) always get the best seat in the house. You take them to the suite. You show them a very good experience,” Delpy Neirotti said.

For fundraising events like a golf tournament, the rule of thumb is generally to keep your costs to 30% or less of your net proceeds, she said. But that figure should be less for cultivation of individual donors, she said. Rossi’s pledge was ultimately for $3 million – money that it’s unclear ISU ever will see.

“It’s not a good look, and I think they probably could’ve done it for a lot less,” Delpy Neirotti said.

ISU’s guidelines expressly prohibit “lavish or extravagant” spending of money held by its Foundation. Foundation officials may return unpaid vouchers to a department’s “fiscal agent” when additional information is needed or when requests are for inappropriate expenditures.

Harrison, with Clemson, said the definition of acceptable spending on donor cultivation or stewardship depends on several factors. First, she said the spending must provably help an institution achieve its mission. Second, the spending should be consistent among donors of a similar type. Without that consistency, some donors may feel like others are getting preferential treatment, she said.

“You have to assess fit and feasibility of getting that gift before you’re spending lots of money,” Harrison said. “Part of a fundraiser’s job is to do that research on the donor and make sure there’s that mission fit and personal fit. Does that person care about the mission? And does that person care personally about the organization? Something that’s going to help retain them long-term.”

It’s unclear why Rossi chose to support ISU Athletics; his pledge was never publicly announced, unlike others that helped fund the Indoor Practice Facility. But as Rossi became wealthy during the pandemic, his charitable giving was not confined to ISU Athletics. He also made or pledged gifts to Bradley University and his alma mater, Elmhurst University. Rossi’s now-defunct company, Reditus, also provided several hundred thousand dollars in donated COVID tests to Unit 5 schools.

Attorneys for Rossi did not respond to a request for comment from WGLT. ISU has declined to release pledge or donation information to WGLT, saying that information concerning donors is “personal information” and an “unwarranted invasion of personal privacy” and therefore exempt from Illinois’ public records law. WGLT has asked the Illinois attorney general’s office to review that decision.

WGLT is part of ISU’s School of Communication and receives financial support from the university. ISU administrators do not have any role in WGLT’s news coverage.

Ryan Denham is the digital content director for WGLT.