Laura Schweitzer, president of Union Graduate College, and Anthony G. Collins, president of Clarkson University, take pains to emphasize that their two institutions are strong. Both are running in the black, the presidents say, and both could continue to do what they do for some years into the future.
But both leaders concede that their colleges would be better prepared for that future together. This week Clarkson and Union Graduate College, separated by 200 miles in the Adirondack region of upstate New York, announced their intention to merge.
If all goes as the two institutions plan, Union will be absorbed by Clarkson early next year. Clarkson would get graduate programs near a major city to strengthen its offerings—hoping to increase its graduate population to 2,000 students over the next five years—and the tiny Union Graduate College would get the infrastructure it needs to keep going. What’s more, the presidents emphasize, the colleges would not reduce staff members after the merger.
Ms. Schweitzer said the change would help her institution face its challenges: It has just 700 students, and operating costs for such a small college—without the benefits of economies of scale—can be daunting. But she already knows the wisdom of pursuing efficiencies: As part of a nonprofit institute she runs, Ms. Schweitzer has been encouraging small charities to merge to save money on back-office operations and infrastructure. For Union Graduate College, she said, “it was time for us to walk the walk.”
Mergers are nothing new in higher education—in fact, some ascending institutions are products of mergers. Take Case Western Reserve University, which came out of a merger between the Case Institute of Technology and Western Reserve University in the 1960s.
But given the financial pressures that colleges are under these days, many people have expected to see a wave of mergers passing through higher education, particularly in regions with declining numbers of high-school graduates, like the Northeast and the Midwest. In its reports on the higher-education marketplace, Moody’s Investors Service has repeatedly pointed out the need for mergers and collaborations among vulnerable colleges. Virginia’s Sweet Briar College, for instance, said this week it had considered a merger before deciding to shut its doors.
But whether those foreseen mergers are still coming remains unclear. “There is certainly not an explosion of mergers and alliances happening,” said Rick Staisloff, a financial consultant who advised Hilbert College and St. Bonaventure University as the Roman Catholic institutions examined a possible merger. “However, we are certainly seeing more activity around mergers, consolidations, alliances, and consortiums. These are questions and initiatives that really would not have come up, at least with any regularity, as recently as five years ago.”
“We are seeing increased activity, and it’s driven by the fact that these smaller institutions are having challenges,” said Aaron D. Lacey, a partner at the law firm Thompson Coburn LLP who specializes in higher education. Distance and differences between two institutions can pose barriers, but not necessarily: His firm is now working with a small religious college in the northern Midwest that may soon be absorbed by a seminary in the South.
“The seminary infused some cash and took on the debt,” Mr. Lacey said. He declined to name the institutions.
Sensitive Questions
Indeed, one reason it’s hard to gauge the growing interest in potential mergers is that colleges remain quiet about them, given the sensitivities involved. Faculty and staff members at the colleges may face the prospect of reductions, and alumni may chafe at the notion that their institution will be consumed by another.
A merger raises other thorny questions: Will the institutions’ missions change? Who will represent the merged colleges on a new Board of Trustees? Will a duplicative program be discontinued?
Those questions have bedeviled administrators at Hilbert and St. Bonaventure since they began discussing their potential merger, in 2013. Even the language of the talks has been fraught.
“I will not use the word ‘absorbed,’” said Cynthia Zane, Hilbert’s president, when describing what would happen to her institution if it merged with the larger and more prominent St. Bonaventure. “I would say that we are going in as a strategic alliance. We believe that we can go into this and emerge stronger than either one of us would be independently.”
For now, both institutions in the Buffalo, N.Y., area are on fairly solid ground financially. But, Ms. Zane pointed out, just look out on the horizon of the higher-education landscape: High-school graduation rates will decline over the next several years, in a region dotted with Franciscan colleges like Hilbert and St. Bonaventure.
The boards of the two colleges are to vote this month on whether to go forward with the merger; if they approve, Hilbert will eventually cease to exist as a separate entity (although the Hilbert name might be preserved in some way).
Asked if she was saddened at the prospect of presiding over a college that might cease to exist, Ms. Zane said she would be more troubled by presiding over a college that, years down the road, might be doomed. She takes inspiration from the University of Detroit Mercy, where she spent part of her career as dean of health professions and nursing. In 1990 that university formed from a merger of the University of Detroit and Mercy College of Detroit. Had the merger never happened, she said, “I don’t think either of them would be around today.”
In Buffalo, locals often speculate about a merger between Canisius College and Medaille College, which ran a $2.2-million deficit in 2013 and had to close a satellite campus in Amherst, N.Y. Richard T. Jurasek, Medaille’s president, appeared on a Buffalo radio show recently, and batted away questions about a merger with Canisius, which sits across the street from Medaille. In an interview, he said that an outright merger was not on the table but that Medaille may someday pursue back-office collaborations with other institutions—including Canisius—to reduce costs.
Potential Pitfalls
Mergers can help some struggling colleges, but experts say that everything depends on which institutions are coming together and what they do to strengthen themselves.
Michael B. Goldstein, a lawyer specializing in higher education for the firm Cooley LLP, said some college mergers were like a Sears-Kmart partnership. “You take two struggling organizations, you put them together, and you get a somewhat larger struggling organization, but you haven’t cured anything,” he said. Consolidation can help reduce costs, improve productivity, or improve revenues, but none of that is automatic. “If all you are doing is changing two names to one name, and everything else stays the same, you haven’t accomplished anything.”
The other pitfall, Mr. Goldstein said, lies in a reluctance to give up things to the other institution, an unwillingness to consolidate. “The mergers that have worked the best are where each institution has agreed where their areas of strength are, and where they are not, and have acted accordingly,” he said. If that doesn’t happen, “they don’t get anywhere near the economies they expected.”
Such transitions can be difficult, even when a financially well-off institution offers a lifeline to a weaker one. Last year the University of New Haven took over the struggling Lyme Academy College of Fine Arts. Steven H. Kaplan, president of New Haven, took pains to assure faculty members that the art college would remain devoted to fine arts—not be acquired just for real estate or some other asset.
“Politically, the most important thing is to convince the board and faculty that you are going to leave them as they are, that you are not going to change the mission,” Mr. Kaplan said.
Faculty members at Lyme were skeptical at first, he said, but eventually came to understand the benefits of merging with a larger institution. Now they are talking about potential collaborations with engineering and other disciplines on the campus. But for a while there, Mr. Kaplan said, a merger seemed worse than death.
“People are unrealistic,” he said. “I got the sense from a senior faculty member that they would rather go under trying it on their own than take the risk that we would absorb them and change them.”
Scott Carlson is a senior writer who covers the cost and value of college. Email him at scott.carlson@chronicle.com.
