How could it be done?
Penn State suckles at the teats of the state and federal governments. Those beneficent expressions of the common weal exempt legitimate institutions of higher learning from taxation. The common weal is not benefited by conferring this coveted exemption on a corrupt entity. End those exemptions.
Penn State also gets a large share of its funds from the Commonwealth of Pennsylvania. The Commonwealth could end that funding. As a major research university, Penn State also gets substantial funding from the U.S. government. End that.
And Penn State could be subject to criminal prosecution under the Racketeer-Influenced and Corrupt Organizations (RICO) acts at both the state and federal level. Penn State is both an organization and corrupt under the meaning of that legislation.