PASSHE Institutions Merging

[complaint_hopeful]

Greenstein took his show to the PA Senate today. Some interesting quotes:

From @APSCUF Twitter -

@ScottFMartin asks motivation and accountability to meet sustainability goals. Goals to be achieved by June 2022, @dan_greenstein says. Universities determine how to meet, he says. Four making less progress than one would hope, chancellor says. Watching with interest, he says.

I wonder which 4???

[complaint_hopeful]

I think that's a great point. Schools felt they had to take on more debt to construct buildings in order to keep enrollment high. And they felt that the improvements they were making was the reason for the growth so they wanted to do more and more.

[ironmaniup]

Indeed. It was pretty easy to spot coming. But, I think a lot of the schools thought their growth was coming due to things they did. ie Build new Residence Halls. And that even when the demographic fell, they would thrive...thru online or other similar things.

And obviously, it didn't play out that way.

And the decreased state funding was a trend that was recognized too. Armenti and his 'Privatized without a plan' talks. He was basically saying that by the state decreasing support, they were making these schools private...without a plan of actually making them private and how they survive. So now 10-15 years later, Greenstein comes in with the merger plan.

Their period of growth was essentially a bubble.

And let's be honest, University presidents and VPs don't get noticed by implementing a conservative austerity program while all the other universities are in a building bloom. Trustees don't get their name on a building by voting against proposed building projects. The fear was that by not building new dorms they would lose market share of the current students. The new dorms did increase enrollment for IUP initially, since the other western universities felt the pain first. Then we got the idea that raising the prices and bringing in poorer students at the same time was a good idea.

[complaint_hopeful]

I'm not sure how much was under PASSHE supervision. At IUP, the Dorms were built through the Foundation, with the expectation they would make money, so PASSHE was not directly involved -though there are indirect connections. Then, at IUP anyway, they made the clever move of raising housing costs to try to cover the loan debt. They have also done some restructuring, but you can bet that the banks who got the deals to finance this aren't going to be taking a loss on them.

Foundation and Student Associations are different animals from the University, so yes...some of that might occur outside of PASSHE view. Housing is a great example of something that may be built under those. Maybe some athletic stuff too.

But, like the Convocation Center at Cal U was built by the University and I believe the BOG would have approved that.

[ironmaniup]

No doubt. That's a good analogy.

So while the Universities didn't have sound plans. There was a lack of governance at PASSHE for how to navigate the upcoming rough times.

I'm not sure how much was under PASSHE supervision. At IUP, the Dorms were built through the Foundation, with the expectation they would make money, so PASSHE was not directly involved -though there are indirect connections. Then, at IUP anyway, they made the clever move of raising housing costs to try to cover the loan debt. They have also done some restructuring, but you can bet that the banks who got the deals to finance this aren't going to be taking a loss on them.

[complaint_hopeful]

I don't know ... Clarion is a nice school with a nice town/campus. It's not for everybody. It's remote. It's extremely white. You're in the mountains. The winters are awful up there. Clarion was never going to be a big school like IUP, but they were OK with what they were. I had a lot of friends go there and spent a lot of weekends up there. It's very different than our other campuses. Indiana feels like a big city compared to Clarion. If you're in to the whole mountain lifestyle -- hunting, fishing, kayaks, outdoors, etc., ... it would be great.

It goes back to the state funding. If PA would invest a little more in schools, they'd be just fine. Really all of the schools would be.

Probably no system in the US would be doing well if you took their state funding down to 2000 funding levels.

[complaint_hopeful]

Sounds a lot like the American housing market in 2005-2008. Oh, you make $80,000 a year ... you're approved up to $575,000 for a house. Take out this ARM mortgage. Let us know how it works out in 5 years. By 2011 those fancy new developments were abandoned ghost towns.

You can kind of see an ironic connection.

No doubt. That's a good analogy.

So while the Universities didn't have sound plans. There was a lack of governance at PASSHE for how to navigate the upcoming rough times.

[complaint_hopeful]

Long ago the Census Bureau data foretold the demographics that schools now are lamenting. It was not a hidden secret or something that took a PHD to understand.

Indeed. It was pretty easy to spot coming. But, I think a lot of the schools thought their growth was coming due to things they did. ie Build new Residence Halls. And that even when the demographic fell, they would thrive...thru online or other similar things.

And obviously, it didn't play out that way.

And the decreased state funding was a trend that was recognized too. Armenti and his 'Privatized without a plan' talks. He was basically saying that by the state decreasing support, they were making these schools private...without a plan of actually making them private and how they survive. So now 10-15 years later, Greenstein comes in with the merger plan.

Their period of growth was essentially a bubble.

[IUPbigINDIANS]

I don't know ... Clarion is a nice school with a nice town/campus. It's not for everybody. It's remote. It's extremely white. You're in the mountains. The winters are awful up there. Clarion was never going to be a big school like IUP, but they were OK with what they were. I had a lot of friends go there and spent a lot of weekends up there. It's very different than our other campuses. Indiana feels like a big city compared to Clarion. If you're in to the whole mountain lifestyle -- hunting, fishing, kayaks, outdoors, etc., ... it would be great.

[IUPbigINDIANS]

Cal is on track to run out of money by 2023. Their problem is the same as Edinboro, albatross debt payments combined with steady decreases in tuition revenue.

Passive governance at all levels. Benign neglect from the legislature.

They could be an episode on American Greed.

[IUPbigINDIANS]

One thing I want to point out about the ill-advised construction...and it was terrible. Certain schools built buildings taking on massive debt at their peak, when the demographic forecast showed rough times ahead. It wasn't just these schools that approved the construction. I believe that PASSHE and the BOG had to sign off too. So there were checks and balances...that failed.

Sounds a lot like the American housing market in 2005-2008. Oh, you make $80,000 a year ... you're approved up to $575,000 for a house. Take out this ARM mortgage. Let us know how it works out in 5 years. By 2011 those fancy new developments were abandoned ghost towns.

You can kind of see an ironic connection.

[GregD]

One thing I want to point out about the ill-advised construction...and it was terrible. Certain schools built buildings taking on massive debt at their peak, when the demographic forecast showed rough times ahead. It wasn't just these schools that approved the construction. I believe that PASSHE and the BOG had to sign off too. So there were checks and balances...that failed.

Long ago the Census Bureau data foretold the demographics that schools now are lamenting. It was not a hidden secret or something that took a PHD to understand.

[SW_Mustang]

*edit* error on my end, I apologize for the clutter.

[complaint_hopeful]

One thing I want to point out about the ill-advised construction...and it was terrible. Certain schools built buildings taking on massive debt at their peak, when the demographic forecast showed rough times ahead. It wasn't just these schools that approved the construction. I believe that PASSHE and the BOG had to sign off too. So there were checks and balances...that failed.

[Fightingscot82]

Cal is on track to run out of money by 2023. Their problem is the same as Edinboro, albatross debt payments combined with steady decreases in tuition revenue.

Passive governance at all levels. Benign neglect from the legislature.