Citing years of falling enrollment, the system that oversees Pennsylvania’s 14 state universities will use a new state law to conduct a financial review that ultimately could result in fewer schools.

The board of governors of the Pennsylvania State System of Higher Education on Thursday agreed to allow the chancellor’s administration to study the financial implications of integrating three pairs of universities in the western and north-central areas of the state: California and Clarion, Edinboro and Slippery Rock, and Lock Haven and Mansfield. Other options also will be explored.

The integration could leave the system with 11 universities, but even if approved, the implementation is at least two years away.

The decision comes as financial challenges mount for the state universities amid a pandemic that has only exacerbated the problem. The schools are expected to use about $260 million of their $724 million in reserves to balance their budgets by 2022. Four universities would be left with less than $10 million each and five others with about $20 million, said Daniel Greenstein, system chancellor.

The 95,000-student system has seen a 20% enrollment decline in the last decade and forecasts another drop this fall, with a further dip in high school population coming.

“The market in Pennsylvania for traditional residential education is shrinking,” Greenstein said during an interview this week. “It has been for years, and it’s going to shrink more. How many of our institutions can that market sustain? That’s the question we are trying to address.”

The system’s exploration could be a harbinger for other colleges struggling with enrollment declines and financial strain.

Greenstein said the system has to act to continue providing a quality, affordable education for students. A decade ago, he said, the system’s annual tuition and room and board cost was about $7,000 cheaper than some competitors; now, at more than $21,000 annually, it’s only about $1,500 less, he said. The system has frozen tuition the last two years.

“The time is now,” he said. “This can has been kicked down the road for a long time. The road ended a while back.”

For years, system leaders have resisted any suggestion of closing a university, and they are not closing one now, Greenstein emphasized. In fact, the law that took effect this month does not allow the system to close a university, but rather gives the power for affiliating or consolidating schools.

Under the proposal to be studied, the affected pairs of schools would integrate in some fashion, Greenstein said. The model proposed would have them using the same staff and faculty and working under one budget and leadership team. Whether they would retain both names or assume a new one and just how each of their campuses would be used are among the topics the review will explore, Greenstein said. The goal, said Dave Pidgeon, a system spokesperson, would be to make sure academic programming remains available in all regions.

Greenstein also said he did not have an estimate of how much money schools would save through integration, noting that would come through the review.

Board members said they understood the need to move forward with the review.

“There’s really no other path that would lead us to sustainability,” said David Maser, vice chair.

Some had concerns.

“It’s important if we’re going to move forward with this that we do work with faculty, staff, with students in making sure they are included in developing the plans for integration,” said Alex Fefolt, a student at Indiana University of Pennsylvania and the student member of the board. “There are a lot of … details, I think, that we tend to miss at this level.”

Neil Weaver, another board member, also said communication is key.

“I’m getting text messages right now from staff who are asking what does this mean,” he said.

Jamie Martin, president of the statewide faculty union, said she wants to see what the plan actually will look like and how it will affect members at the six universities.

The process is sure to draw attention and questions from alumni, students, and communities about potentially losing a university name or identity that has been in place for more than a century.

“As we are looking at these integrations, those kinds of considerations are absolutely critical,” Greenstein said.

The intent, Greenstein said, would be for the schools to expand their market or grow into adjacent ones. Clarion and California have a strong online presence and could do more with that, he said. Lock Haven and Mansfield serve communities with a need for nondegree credentials to meet workforce needs, he said, and combining Edinboro with Slippery Rock — the strongest and largest of the six with 8,806 students — could put them in a better market position.

With the exception of Slippery Rock, the schools are the ones “we have the greatest concerns about” and were also selected because of their proximity to each other, Greenstein said. Mansfield has the smallest enrollment, 1,683 as of last fall. The others are: Lock Haven, 3,162; Edinboro, 4,636; Clarion, 4,703; and California, 6,842.

As the review continues, other state universities could be included for integration, he said. West Chester, the system’s largest with more than 17,000 students, and Indiana are the only two exempt from consolidation under the law. Cheyney, a historically Black university that has struggled in the past but projects a strong enrollment gain for the fall amid new partnerships with businesses, is not expected to be considered for consolidation, Greenstein said.

Greenstein said he likely will come back to the board in October with recommendations and if the board decides to pursue integration, it would take about six months to develop plans. If those plans are approved, it would start a 60-day public comment period, with a final decision next summer and implementation for fall 2022.

“Change is hard,” he said, “but the cause is right.”