Maryland U. Scholarships Put on Hold : Sanctions: A number of varsity players are expected to seek transfer to other schools in face of freeze on Terrapins.

The University of Maryland has frozen scholarships for all varsity sports, citing anticipated revenue losses of up to $4 million over the next two years stemming from recent sanctions imposed on the men’s basketball program by the NCAA.

“Rather than making commitments we can’t fulfill, we put the freeze on,” Athletic Director Lew Perkins said.

Perkins said the university will honor scholarships already accepted. The football and basketball teams have already signed virtually all of their players for next season, the Washington Post reported today.

Chuck Sturtz, the university’s chief financial officer, said “the department has operated at a deficit for some time. . . . We are clearly looking for them to put together a long-term plan” that includes a reserve for “any unanticipated blip in revenues.”

Meanwhile, Maryland basketball coach Gary Williams said senior guard Teyon McCoy has been granted a release and will probably transfer to the University of Texas. In addition, sophomore forward Jerrod Mustaf said Thursday night that he is going to ask Perkins for his release today.

In addition, freshman guard Curley Young said he probably will transfer to a mid-level Division I program to get more playing time, probably in the Colonial Athletic Assn.

“I’m not saying that I am going to leave Maryland,” Mustaf said. “I just want to explore my options, I don’t want to go into anything blindly.”

Perkins said the freeze covers all 23 varsity sports. However, he said he has allowed “a few coaches” to sign some athletes to whom they had made commitments. He declined to be more specific.

Football coach Joe Krivak and women’s basketball coach Chris Weller are waiting to sign one more player each, and Williams used his only remaining scholarship Wednesday to sign junior college forward Garfield Smith, The Post reported.

Maryland already has a sizable deficit, estimated as high as $1 million, because of a shortfall in past football and basketball gate receipts as well as the Terrapin Club, the school’s booster group, not being able to cover all scholarship costs.

An athletic department spokesman said the Terrapins’ total scholarship bill for the 1989-90 academic year will be $2.515 million, which is not included in the athletic department’s $9.4-million annual operating budget. Until three years ago, the Terrapin Club paid most, if not all, of the scholarships costs for both men and women.

“Inflation is absolutely killing athletics,” Perkins said. “The cost is going up quicker than people can afford to pay.”

The NCAA has banned Maryland from post-season play for the next two years and from live television next season. Maryland has also been ordered to return $407,000 in basketball tournament receipts. The sanctions were given to Maryland for basketball recruiting violations under Williams’ predecessor, Bob Wade.