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November 21, 2012

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JA

I actually don't think your biggest fear is that big of a deal. In fact, I think my school would be much better off if it took its worst law students and its worse faculty members and opened another school with them. That law school may fail, but that could be a good thing. If not, it could opperate to subsidize our "main" law school. I don't have a problem with that, as long as the primarily "for-profit" school is open and honest about its placement stats (which, again, may cause it to fail).

anon

Carlisle is not a cash cow. Relaxing admission standards is necessary for that campus to break even.

CBR

Given the way that the current lending program distorts the market, I'd be more afraid of the "better" school failing if the school is divided on the basis of credentials. Right now, students with lesser credentials are heavily subsidizing the tuition of those with higher credentials. Split the law school in two in the way that you are talking about, and you lose that ability to cross-subsidize tuition. The "for profit"/lesser-credentialed school is likely to do just fine, with students paying the same tuition as before (fueled by loans and relying on IBR to repay those loans after law school). In theory, if the lesser-credentialed students were no longer subsidizing scholarships for the higher-credentialed students, tuition could even decrease at the school--but perhaps it is more likely that the leftover revenue would be spent on educational programming. The "elite" or "main" law school is going to have a hard time attracting highly credentialed students without being able to offer substantial scholarships funded by the tuition payments of the lesser-credentialed students. If the school cannot attract the highly credentialed students it had relied on in the past, it would likely suffer significant financial distress--which may be ameliorated only by reducing the credentials of its own class, leading to two mediocre law schools in the place of one better one.

Dan Filler

JA - I think that the Carlisle folks would worry that "main" law school in your scenario is College Park.

Anon - That is precisely the fear for the Carlisle folks.

CBR - Given that PSU is a large university system, I imagine that cross-subsidies are very possible.

The bottom line is that this year's entering class at PSU Law was 164 students. I would be very surprised if the university thinks it can run two separate schools on that total. If you want to increase student size, you might choose to divert the students with lower predictors to the less favored campus - rather than having the LSAT hit and thus the reputational hit - fall equally on both campuses.

CBR

It's problematic enough for a law school to be a cash cow for the central university--but to be a cash cow specifically for a more prestigious law school within the same university system? No one in their right mind would take that deanship, and I think students would also resist being "diverted" to the less favored campus. I think it's a bad idea to separate the two schools, but if they do it, I think they have to make an effort to treat them equally within the system.

anon

This seems like an obvious attempt to shunt down the Carlisle campus, no?

anon

It's hard to feel bad for PSU here. When they acquired Dickinson Law, the latter was on a path to dissolution. Admissions standards had plummeted, and it was extremely difficult to attract good students to a small independent law school (it was not formally tied to Dicksinson University, a small liberal arts school also in Carlisle) in the middle of nowhere that primarily sent its grads to work in the not-so-vibrant central PA economy. PSU swooped in not out of altruism, but to save itself the time, hassle, and *money* of building up its own accredited law school from scratch. It was a "rational" and calculated decision, and the politics were immediately obvious. In fact, the politics were written into PSU's agreement to buy Dicksinson. PSU promised to keep the Carlisle campus open for an extended period of time. This was necessary to get state approval of the deal given Dicksinson's history of producing lawyers who later entered into state government. And then of course, virtually as soon as the new State College campus was opened, the law school's leadership figured out--surprise!!--that a two-campus operation was wasteful and inefficient. Thus a decade-long struggle to close down Carlisle and consolidate in State College (a struggle that, I imagine, has not been great for faculty morale). Maybe, given "unforeseen events"--the force majeure?? of a collapsing market for law students--the original "deal" should be adjusted on an equitable basis. But it was PSU that drove this deal in the first place. It turns out to have been a bad deal. But PSU knew or should have known, at the time the deal was made, that the deal was risky. So yes, the new "two independent law schools" plan is idiotic, and so are Pa. legislators, but the fact that a risk materialized does not make me feel particularly sorry for the parties--many of whom were sophisticated lawyers--who designed, negotiated, and agreed to the deal in the first place. After so many years of (not) dealing with the two-campus problem very effectively, I would bet a change of leadership is not too far away. This "solution" seems too obviously like a parting "f*** you" to the powers that be in Harrisburg.

Anono

The people who cut the original deal for Penn State with Carlisle are long gone from Penn State. They got totally out-negotiated by the Dickinson folks (once again, trying to run a major institution without a general counsel's office had demonstrable consequences). The current dean actually had a pretty creative plan to keep Carlisle full with non-traditional students, but the local politicos and the Governor closed the door on that. In 2025, Penn State will be free to shut Carlisle down. My prediction is that they will do so, if efforts before that deadline to return Carlisle to its alumni and independent status fail (to date, the alumni and former board love to complain about Penn State, but every offer to unwind the deal has been rejected). I don't think current faculty are too demoralized (most will be retired long before 2025 and the focus has been on University Park for years), but even in the current market hiring good new faculty will be a challenge.

Anono

A couple of more points. The dean who pushed to open in University Park had nothing to do with the acquisition of Dickinson. He took the job, and figured out pretty quickly that the synergies of having a law school within a major research university didn't really work out if the law school was a long way away. He's also not pushed to close the Carlisle campus. He found donors to do a pretty gorgeous rehab of the Dickinson physical plant, and put a lot of effort and money into integrating the two campuses electronically. What happened, I am guessing, is that when the governor (an opportunist and an idiot) weighed in against some pretty interesting ideas that would have made the Carlisle campus viable, he decided he had had enough fighting the Carlisle crowd. In my opinion, while there are some things he's done I wouldn't have done, overall he's done a pretty defensible and strategically sound job under very tough circumstances.

At this stage, I wouldn't expect them to do anything systematic to drain Carlisle of resources. The reality is, they won't need to in order to make that a difficult campus to sustain absent a new vision. By an overwhelming percentage, the students want to be in State College, where the other students are. It's going to be much tougher to draw students to Carlisle as an alternate Penn State. Carlisle had some advantages in recruiting faculty, as it is almost comfortably commutable from DC and Philly, but with young faculty that probably will be overshadowed by the lack of clarity about what happens after 2025. If they just let each school be self sustaining, Carlisle will have lower ranked students and lower ranked faculty based on the fundamentals of the situation. The University Park campus will be free to seek its own level, which should end up being a bit higher in the Big 10 range. Carlisle will also be free to seek its own level, which absent some creativity could be closer to Widener.

Despite that, I actually think that the right dean could do interesting things in Carlisle. It's not going to be Yale or Harvard, or even Indiana Bloomington, but if you wanted to explore a Tamanaha style approach to doing things differently, you've got a fairly good location close to Harrisburg, DC and Philly, some good legacy faculty, and a gorgeous building. The trick would be to figure a value proposition in Carlisle that is distinctive for students and faculty.

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