Bloomsburg University and President Bashar Hanna were just two of four total defendants ordered to pay former university Dean Jeffrey Krug over $3.9 million in damages and lost pay. This total included $1.5 million in damages for pain and suffering and $400,000 levied against Dr. Bashar Hanna. 

However, with the university currently holding a deficit of over $28 million, some on campus have been asking, where will this money come from?

In a written statement issued over email, Dr. Bashar Hanna clarified what the expenses were for the university’s defense during the length of the trial, saying, “The Pennsylvania Office of Attorney General provided all legal representation in this matter in accordance with the Commonwealth Attorneys Act and the university did not expend any university funds as part of that defense.”

However, while the university won’t see any financial impact coming from the cost of their defense, the cost of the damages for Krug is a different story.

Hanna stated in his statement, “The recent verdict will be covered by the university’s reserves, ensuring that it will not impact student services or result in increased costs to our students.”

Elaborating further, he wrote, “While we are mindful of the university’s current financial challenges, including the existing deficit, we are committed to managing this situation in a way that ensures we continue to provide high-quality education and support to our students in the most affordable way possible.”

During a later interview over Zoom, Dr. Hanna explained what the university reserves are: “Typically, what university reserves are used for are for unforeseen events, unforeseen things that the university requires.” 

Dan Knorr, the Executive Director of Economic Development & External Affairs, revealed the current status of the university reserves. For the end of the fiscal 2023/2024 year, the balance is $65, 209,027, with the balance accounting for estimated costs associated with the verdict. 

When asked for clarification as to whether the reserves would pay for the liability of the university and Dr. Hanna, the following statement was given over email by Nikki Keller, Executive Director of Strategic Communications and Marketing:

“Consistent with Chapter 39 of Title 4 of the Pennsylvania Code, a determination is made at the time of offering representation from the Office of General Counsel, through the State System of Higher Education, as to whether an individually named defendant is provided both representation and indemnification based on the actions being both within the individual’s scope of employment and a good faith exercise of the individual’s authority. When indemnification is provided, the Commonwealth or agency of the Commonwealth is obligated to indemnify (or pay for) the expense of any judgment awarded. President Hanna and Interim Provost Krause were both provided both representation and indemnification with respect to this matter and will be indemnified for the judgment.”