Can a Former Gates Grantmaker Save Public Colleges in Pennsylvania?

Daniel Greenstein has a question for the group of well-scrubbed student leaders at East Stroudsburg University who have gathered in a conference room to meet him, their new system chancellor.

“It’s the zombie apocalypse,” he says. “You can have two people with you on your team. Who are they?”

This is how Greenstein has started most of the meetings on his listening tour of the 14 public universities of the Pennsylvania State System of Higher Education, known as Passhe. He hasn’t always asked about zombies, but everyone in the room must answer an icebreaker question.

The students around the table smile and begin reeling off pairs of names — superheroes and family members are popular choices — until the question works its way back around to Greenstein. He cheats a bit in his answer: the Dead & Company, the ever-touring remnants of the Grateful Dead, and Spider-Man.

But the answer is less important to Greenstein than the fact that the students will now know him as more than the system chancellor; he’s also Dan the Deadhead. After the icebreaker, the students become a little more at ease, ready to share their takes on their institution and to bring up real concerns, like faculty and staff diversity and student advising. He’s gotten them talking. That’s his plan. Greenstein has great faith in the power of dialogue to bring people together and to solve problems.

East Stroudsburg marks the last stop after more than 2,400 miles in a system van, crisscrossing the commonwealth, sometimes visiting four campuses a week. It has been a grueling schedule, but Greenstein is here to do hard things.

Passhe is a collection of former normal schools turned regional comprehensive universities, in locations like Edinboro, Slippery Rock, and West Chester, that operate separately from the state’s flagship and its satellite campuses. Passhe faces an imposing set of challenges, which resemble those of many public-university systems in the Northeast and Midwest. State support has dropped to about 28 percent of the annual operating budget, leaving it dependent on tuition revenue (though the state has increased the system’s budget for each of the past three years). At the same time, Pennsylvania has been producing fewer high-school graduates for years, and the trend is projected to continue.

The total number of students in the system has dipped below 100,000 for the first time in more than 10 years — a drop of 18 percent since 2010. Enrollment at Passhe institutions over all was down 4 percent this fall, with some institutions seeing double-digit percentage enrollment drops since last year.

The decline in enrollment has led to widespread budget difficulties. A recent report on the system from the National Center for Higher Education Management Systems, known as Nchems, warned that “if current trends continue, it is just a matter of time before all of the universities become financially unsustainable.”

Greenstein represents an unorthodox choice to take over the system. A historian by training, he spent the past six years in Seattle as director of postsecondary success at the Bill & Melinda Gates Foundation, helping disburse about $600 million in grants and guiding policies aimed at shaping how higher education works nationwide. He has served as a tenured faculty member in Scotland and as a vice provost in the University of California system, but he has never run a university, much less a system of 14 of them.

Now this self-described “erstwhile postsecondary technocrat” must turn around a collection of public universities that have been linked as a system for only 35 years, and that still compete fiercely with one another, as well as with an overcrowded field of semipublic institutions, in a state where he has only tenuous connections. He must do so with — or, possibly, in spite of — forces beyond his control: a powerful faculty union and a state government whose stewardship of its public colleges in recent years has been laissez-faire at best.

But this is what Greenstein signed up for. When he left Gates this year, he says during an interview at his office in Harrisburg, he saw two paths ahead. One led to “commercial opportunities” in and around higher education. The other led to a traditional college-leadership role. Greenstein says that a conversation with a colleague at Gates about his work in increasing student success among lower-income and first-generation students helped him decide: “He said, ‘How would you feel if you spent six years really working on this and really investing in it, and you never had a chance to know whether or not it works?’ "

He chose Passhe specifically because it offers advantages and challenges. He sees potential here, promoting worthy institutions and good faculty members, and enthusing over the system’s data warehouse as only a technocrat can. The system also offers an attractive chance to help some of the students who need it most: about a quarter of the students are first-generation, and about a third of the undergraduates are eligible for Pell Grants. But he knows that the system faces formidable structural problems. The job “has all of the key ingredients” he was looking for, he says, then adds with a wry smile, “in doses that are a little high.”

Greenstein’s nascent tenure at Passhe is, in essence, a critical experiment in rethinking public higher education for a 21st century that is brutalizing it in many states. If he can reverse Passhe’s downward trajectory with his data- and discourse-driven approach, the system could become a model for other states to emulate.

Given the situation at Passhe, that’s a big if.

If Greenstein feels any pressure, it doesn’t show through an aura of laid-back bonhomie redolent of his years living in the San Francisco Bay Area and Seattle. He lugs a backpack across the East Stroudsburg campus, not a briefcase. He favors shirtsleeves and rarely wears a tie.

Greenstein acquired his West Coast vibe relatively late in life. He grew up in Rochester, N.Y., the son of a lawyer and a journalist. He got his bachelor’s degree in history at the University of Pennsylvania, where one of his two children now studies, and moved on to the London School of Economics. He earned a doctorate in social studies from the University of Oxford.

While he was serving as a senior lecturer at the University of Glasgow in the early ’90s, his interests began to shift toward internet technology and what would come to be known as digital humanities. He returned to the United States in 1999 and eventually went to work for the University of California president’s office, first on UC’s digital libraries and later as vice provost handling academic planning, programs, and coordination for the system.

After joining Gates in 2012, Greenstein got a look into how higher education works — or doesn’t — all across the country, in all types of settings and institutions. He also learned the importance of using data as a way to make tough calls palatable. “Someone at Gates told me early on, ‘Dan, you have to make sure that grantmaking decisions are analytically driven,” he says, “because otherwise they’re political and perceived as being arbitrary.’ "

When Greenstein arrived at Gates, the foundation had “hundreds of grant programs that were experimental and innovative but disconnected,” says Jason Palmer, a general partner at New Markets Venture Partners, a venture-capital firm, and a former deputy director of postsecondary success for Gates. “He pulled together a unified strategy.”

Greenstein narrowed the focus of Gates’s efforts in higher education to a handful of strategies related to increasing degree attainment for first-generation and low-income students, through tools like predictive analytics in student advising, and he pushed back when the agenda started to sprawl again. By clarifying Gates’s higher-education mission, Greenstein won more money for the postsecondary team’s budget, a scenario that “could be very similar in Pennsylvania,” Palmer says.

The Gates Foundation has earned a reputation among some in higher education for using its money and influence to impose its will, but Greenstein’s approach at Passhe so far throws no weight around. He preaches discussion, and listening. He is learning a large and complex organization, but he is also, bit by bit, laying the groundwork for consensus.

Some college leaders might begin a daylong series of campus meetings with muffins and coffee in a conference room. Greenstein brought along one of his bicycles, a light-blue Salsa Vaya, in the system van and began many of his listening-tour visits with a long ride through the area around the campus, accompanied by whomever wanted to come along. (The morning ride in East Stroudsburg was one of a few canceled by bad weather.)

The rides allowed him to see some beautiful countryside, but they also gave him another way to get people talking. “Higher education is a very hierarchical place,” he says. “It actually can get in the way of real conversation. And if you jump on a bike with six or a dozen other people, you’re no longer in your uniform.” Sometimes his fellow riders chatted about cycling, accidents, and injuries. Sometimes they opened up about their institution.

The bike rides, like his relaxed, welcoming demeanor, seem to represent who he is, but they also aid him in his work. Take the tie thing. He rarely wears one, in part because that’s what he got used to on the West Coast. But it also puts people more at ease, he says, and helps break down the hierarchy of chancellor and student, or chancellor and president or faculty member. Or take the icebreaker questions. He’s not exactly an icebreaker-question kind of person, he says, but for his tour, he cribbed some from a list he found online called “The Only List of Icebreaker Questions You’ll Ever Need.”

The open collar and the icebreakers, like his blog, his new Instagram account (@chancellor_dan), and his responses to faculty emails, are “about positioning myself so I can listen and hear,” he says. “I don’t know how you can do a job like this without being available for that conversation.”

Greenstein mostly listens at East Stroudsburg, but he does give one brief speech, at an open forum in an auditorium. He tells the scattered crowd of professors and staff members that they have an opportunity to reimagine public higher education in America. He notes that Passhe institutions are struggling to fulfill their missions using instructional and business models that date from the 1950s. He says that Passhe and its institutions must change their culture, must overcome mistrust between management and staff, and between the universities and the system, and have “open, inclusive, honest, transparent, civil, data-informed conversations about the issues we need to nail down and align around in order to move forward.”

He asserts, as he often does, that he is an optimist. He delivers a line he will repeat later in an interview: “We do not have the luxury of time.”

During a Q&A session after the speech, a few questioners remind him that higher education is about more than hard numbers and a return on the dollar. As Peter E. Pruim, a professor of philosophy, tells him, “It’s not always easy to find data that says this person’s soul has changed.” The audience applauds.

Greenstein reminds the audience several times that he, too, is a product of the liberal arts. “I graduated from Oxford, for Christ’s sake,” he says at one point. But when answering Pruim, he pivots quickly to the realities of running a public-college system in 2018.

“I think of legislators as investors,” he says. “What do investors look at when they want to make an investment? They look at ROI, and they look at leadership.” In other words, they don’t look at intangibles. “We can no longer have conversations about how student success is about saving souls,” he says. Student success must be judged by tangible measures so that it can be planned for, budgeted, and evaluated.

What the system should do to fix itself has already been the subject of much study. Last year, after commissioning the Nchems report, the State Senate asked the RAND Corporation to write its own report evaluating the system and making suggestions on how to fix it. The two reports often agree. For example, both note that the system will need to negotiate some flexibility with its unions to enact some reforms. But each take offers slightly different solutions. For example, the RAND report recommends merging universities, as Georgia has done with many of its institutions.

Greenstein argues that the two reports both say basically the same thing: The system can’t continue in its current form, with 14 universities operating completely independently and competing with one another for scarce resources and a dwindling number of traditional-age students.

Asked what short-term strategies East Stroudsburg is using to build up its enrollment, Marcia G. Welsh, the president, pauses. “How can I answer that?” she says. “We may be a system, but we compete.” She says she would like to add more night classes, to better serve older, nontraditional students as well as traditional-age students who now often attend classes while working full time. Asked if she thinks the competition among Passhe institutions should change, she says, “I don’t think it will change. I don’t think it can change.”

Fewer universities is a nonstarter. Closing campuses would slash access to higher education in parts of the state, and is political poison besides. According to Ronald R. Cowell, president of the Education Policy and Leadership Center in Harrisburg and a former Pennsylvania state representative, “the legislature has never been responsive to proposals to completely close institutions, and I doubt that has changed a whole lot.”

Mergers may be impractical. In Georgia, many of the merged institutions were relatively close to each other, Greenstein says, and several of the mergers involved putting together four-year and two-year institutions. The four-year Passhe universities are scattered across a large state, by East Coast standards.

Greenstein is attracted to the concept of “the sharing university,” as articulated in a recent paper by Georgia Tech and Deloitte Insights, a consulting firm. Under this model, which resembles the “One University” concept that the higher-education system in Maine is exploring, individual Passhe campuses would maintain their identities but share as many services and as much infrastructure as possible, along with programs, courses, and possibly students. The universities could save money, and students could find it easier to get the classes they need. The sharing university “captures that concept that I see emerging out of each of these reports,” Greenstein says.

But he doesn’t have any idea what the system will look like in five years — not yet, he doesn’t. He is only a few months on the job, and he’s still learning. He chairs a task force that is evaluating possible system models, and the system’s Board of Governors will hear the initial report at its January meeting. But he has emphasized the importance of discussion, consensus, and a unified front. Deciding Passhe’s course is “going to require some pretty challenging conversations,” he says.

Cynthia D. Shapira, chair of the Board of Governors, says that building consensus is vital if Greenstein, and Passhe, are to succeed. The culture of the system at every level has been “one of divisiveness, and this one has something and that one doesn’t have it,” she says. The new chancellor has to establish a vision and a plan to execute it, as well as to rebuild relationships across the system. “Otherwise we’ll have the same problem that we’ve always had,” she says, “which is something that is dictated from Harrisburg, and most people are angry about it.”

During an interview in his office, Greenstein’s answers to questions about specific ways the system might address its immediate problems are a mix of ideas and best practices, all of them speculative.

West Chester University, he says, is doing great things with experiential learning, which shows promise as a tool for freshman retention. But West Chester is an outlier — the one Passhe university that has consistently gained enrollment over the past decade. Most of the campuses are having trouble getting students in the door. Some are adjusting their selectivity to admit fewer students who will be likely to drop out, and thus may “get smaller to grow.”

The possibilities become jumbled, and when Greenstein is reminded that his questioner is just trying to understand how the system might work in the future, he says quietly, “Yeah, you and me both.”

Two of the biggest challenges that Greenstein faces are beyond his control as chancellor. His ability to transform the system is limited by the contracts with the unions that represent the system’s employees. He needs the legislature and Gov. Tom Wolf, a Democrat, to support big changes, but lawmakers have shown little inclination to get involved.

A long history of antagonism defines the relationship between Passhe leaders and the Association of Pennsylvania State College and University Faculties, known as Apscuf. Union contracts have raised faculty pay and protected professors from losing their jobs. System presidents say that union-won faculty pay raises approved by the board without additional state support to pay for them have worsened budget challenges, and that the terms of the collective-bargaining agreement prevent institutions from making necessary changes to academic programs. The faculty contract is “incredibly difficult to manage,” says Welsh, president of East Stroudsburg, “and it does put restrictions on us that at times make it hard to be innovative, period.” She declined to give specific examples.

Greenstein is trying a different approach to dealing with Apscuf: He wants to talk.

“Sure, there are issues that we need to resolve” with the collective-bargaining agreement, which is up for renegotiation next spring, he says. But starting the process with “an attack on the CBA or the union doesn’t seem to me to be a very sensible approach.”

Past chancellors have appointed negotiators. Greenstein plans to sit down at the table himself, along with Shapira, the board chair. Instead of each side coming to the negotiating table with a position staked out and arms folded, Greenstein has proposed using an interest-based bargaining strategy, which looks for mutually beneficial solutions.

“The intent is to come in instead with more of a problem-solving attitude of how can we reach consensus on things that either side thinks are important,” says Kenneth M. Mash, president of Apscuf. After some initial conversations, he says, he’s “cautiously optimistic.”

Greenstein is also responding to another union complaint: that there’s been no solid basis for some of the system’s negotiating positions on raises. Mash accuses the system of “drawing conclusions without any support, which is totally the opposite of what an academic institution should be doing.” Now Greenstein is opening up the system’s data to the unions, including its financial data. “Let’s have at it, let’s figure it out,” he says.

He has also invited union officials to be part of the board-level workshops on the future of the system. “Who are they going to turn to to get the academic point of view? Me?” says Greenstein, who hasn’t been a tenured professor for more than 20 years. “You might want to ask a member of the faculty what he thinks.”

Timothy Connolly, a professor of philosophy and religious studies at East Stroudsburg, would like to see an end to the antagonism between the union and the system leaders. “It’s an overall bad,” he says. “It’s something that doesn’t help the students any. It doesn’t help the universities any.”

At the same time, he says, the union has helped insulate Passhe institutions and their faculties from leaders with a “corporate mentality” who, he worries, make decisions based on the bottom line alone. “I think if I didn’t have the union to protect me, they would have fired me,” Connolly says. “They would have cut philosophy.” He is encouraged by Greenstein’s academic background, and his emphasis on listening.

And then there is the commonwealth, which, through lack of political will, has allowed its public higher-education system to drift into disarray.

Pennsylvania, like many other states, slashed state support for public higher education after the recession. While it has begun increasing its annual support again over the past few years, Pennsylvania still ranked 48th among states in higher-education support per capita in the 2018 fiscal year, and 49th among states in higher-education support per $1,000 in personal income, according to data compiled by the Grapevine survey.

Through a lack of government oversight of higher education, the commonwealth has also worsened the competition for students and state resources. The 14 Passhe institutions don’t compete only with one another. They also draw from the same shrinking pool of in-state students as Pennsylvania’s three semipublic universities: Temple University, the University of Pittsburgh, and Pennsylvania State University, as well as three Temple branch campuses, four Pitt branch campuses, and 23 Penn State branch campuses, spread across the state.

That’s 47 publicly funded four-year campuses in Pennsylvania, for a state of less than 13 million citizens. By contrast, Illinois has 12 public four-year universities for a population of similar size.

The proliferation of competing public campuses “is a failure of public-policy leadership,” says Joni E. Finney, director of the Institute for Research on Higher Education at the University of Pennsylvania. “This wasn’t just Passhe’s own problem, or the other systems’. This is really a failure of the state to provide for higher education and to make sure there is some kind of reasonable plan for developing higher education in the future.”

Greenstein will need the Statehouse if he is to transform Passhe. For example, he will need legislative support to alter the structure of the system’s governance. But if there’s political will to tackle the system’s problems, Finney says, “I haven’t seen it yet.”

Greenstein speaks several times, in his meetings in East Stroudsburg and back in his office in Harrisburg, about rebuilding the system’s brand in the eyes of the state. Passhe needs a credible plan to stop the financial bleeding and designate a path forward that makes sense for the system and the commonwealth. “It’s basically about being able to go to the legislature and say, ‘OK, we’ve got this,’ " Greenstein says. “We’re being responsive to what you’re saying, and we are positioning ourselves as an investable partner.”

David G. Argall, a Republican state senator who serves on the Senate Appropriations Committee, says that so far he’s been impressed by Greenstein’s style. “He’s not trying to hide the problems,” Argall says, “but it’s not gloom and doom.”

He adds that the legislature isn’t interested in micromanaging Passhe, though then again some management is needed. Argall encourages Passhe, the state-related universities, and the community colleges to propose a solution that lawmakers can get behind.

Cowell, the former state representative, says it’s unlikely that the legislature will take up the cause of Passhe on its own. “Stuff like that happens in Pennsylvania only with very substantial executive leadership,” he says. If it’s not on the governor’s agenda, “I don’t think it’s going to happen.”

Governor Wolf’s office did not respond to requests for comment.

By the time Greenstein arrives at the last event of the last campus visit of his listening tour, he’s clearly tired. As a large group of students, staff members, professors, and administrators find their seats in a small classroom for what’s being called a focus group, the chancellor grabs a cookie from a tray of refreshments. As the participants settle, he pulls out his smartphone and snaps a photo of the fall foliage outside the window to send to his family back in Seattle, where everything is evergreen.

After another icebreaker — What’s the best advice anyone’s ever given you? (His answer: “Love isn’t about finding someone you can live with, it’s about finding someone you can’t live without”) — he begins an exercise called the five whys. He asks the 10 or so small groups to answer the question “Why is East Stroudsburg University important?” After some animated conversation, the groups deliver disparate answers — because it provides access to education, because it puts students first. Next he asks, “Why is that important?” Then he asks it again. After five rounds of questions and conversation, the groups arrive at a remarkably consistent answer: The university is important because it aids personal growth for students who then aid society.

The outcome of the focus group may not play any part in the redesign and reform of Passhe. But Greenstein got people talking, and on the same page.

Across the state, the one thing that almost everyone agrees on regarding Passhe is that its current troubles, especially the enrollment crises at some of its institutions, have gotten so bad that they might finally spark some action.

Passhe, like many established institutions, has been operating on “a hopefulness that you can ride out a bad storm, versus having to navigate a completely different path,” says Karen M. Whitney, a former president of Clarion University and interim chancellor of the system for a year before Greenstein came on board. The new chancellor may be able to use the severity, and the obviousness, of the system’s problems to his advantage. “We — big ‘we,’ all of us — have major issues,” she says. “Quite frankly, I think if the challenges were less, you’d have a harder time galvanizing a coalition of the enthusiastic.”

If nothing else, Greenstein’s pragmatic optimism has sparked something some Passhe campuses haven’t seen much of lately: hope. As Michael A. Driscoll, president of Indiana University of Pennsylvania, says, “That’s the first thing I hear out of most people’s mouths” in the wake of the chancellor’s visit. “They feel optimistic about the future for the first time in a long time.”

For all his optimism, Greenstein knows that he faces a difficult task. But that’s why he came to Passhe. “If there is a path, which I believe there is, it’s a narrow, tricky path,” he says. “But the cost of not trying to find it, to me, it’s too high to even consider.”

Clarification (11/26/2018, 10:55 a.m.): This article has been updated to reflect that the paper on the sharing university was sponsored by Georgia Tech, as well as Deloitte Insights.

Lee Gardner writes about the management of colleges and universities, higher-education marketing, and other topics. Follow him on Twitter @_lee_g, or email him at lee.gardner@chronicle.com.