Rising out-of-state enrollments at Pennsylvania’s state-funded universities are symptomatic of the strains on higher education everywhere: rising costs and declining in-state enrollments are leading institutions to seek new sources of stability and, ultimately, growth. And that often means attracting out-of-state students to the commonwealth.

This isn’t a permanent solution to what ails the higher education system in Pennsylvania. That’s because it’s basically a pyramid scheme, and it depends on competing with other states for the scarce resource of college-bound students. At the same time, however, out-of-state students can be a way for the system to fulfill its purpose of strengthening the state’s workforce — if they are incentivized to stay in Pennsylvania.

Pennsylvania has two public college systems: the Pennsylvania State System of Higher Education (PASSHE), which encompasses 10 fully public schools including the new PennWest University, and the Commonwealth System of Higher Education (CSHE), which includes “state-related” schools like the University of Pittsburgh and Penn State. Together these systems represent more than 230,000 students.

PASSHE is a fully public system: It is funded and run by the state of Pennsylvania, and is meant to serve the overall public goals of the commonwealth. The system has its roots in what were called “normal schools,” which trained teachers, and to this day the system is meant, in a particular way, to train Pennsylvania students to join the Pennsylvania workforce.

CSHE schools, on the other hand, are neither fully public nor fully private. For tax purposes, for instance, they are treated as non-taxable public entities. They also receive state funding for the specific purpose of keeping tuition affordable for in-state students. But a 2017 audit found that it’s actually more difficult for in-state students to be accepted at Penn State’s University Park campus than out-of-state students.

Altogether, the purpose of funding these systems with Pennsylvania taxpayer dollars is to benefit Pennsylvania taxpayers. But this creates a perverse incentive for the schools themselves, to recruit more and more out-of-state students precisely because they pay higher tuition rates. At PennWest, for instance, out-of-state students pay $11,574 compared to $7,716 for Pennsylvania students. And at Pitt, it’s about $20,000 versus about $40,000.

None of these rates, by the way, include room and board.

This is not sustainable as a financial model, nor does it further the public purpose of these public (or quasi-public) institutions to education non-Pennsylvanians who go on to live, work and pay taxes outside Pennsylvania. While of course it is good for the state’s systems of higher learning to develop prestigious programs of study that naturally attract out-of-state students, the focus cannot shift toward them.

But there is a way to bring these institutions’ growing out-of-state enrollments — especially for the fully public PASSHE schools — in line with their Pennsylvania purpose. And that’s offering incentives for students to remain in Pennsylvania for a set period of time after graduation, especially in key areas of workforce need like healthcare and education. This could include anything from cash incentives to support for moving expenses or housing costs.

This allows the schools to continue to benefit from out-of-state tuition fees while the state benefits from well-trained workers ready to serve the commonwealth’s people and economy. Ultimately, Pennsylvania’s public universities will require broader reforms to respond to the challenges facing all institutions of higher learning. Part of that should be using them to draw talented people to the commonwealth — and then keep them here.

First Published: November 6, 2024, 10:30 a.m.
Updated: November 6, 2024, 5:34 p.m.