Portland State is part of a larger phenomenon.
Sports reporting used to be local. In that environment grew Mouse Davis. At the tail end of that environment, Pokey Allen thrived here... and he knew how to corral that.
Sports reporting is no longer local. The major networks and ESPN (who is a major network thanks to Disney/ABC, frankly) simply drew away sports fans. Everyone else is now pissed at where their cable TV payments are going (NFL, MLB, even NBA, maybe the Big 10 and SEC) and want blood.
(That's one thing right there. Local media has compensated by turning attention away from sports altogether, and not just in Portland. Whole leagues used to be able to pay their way on the backs of casual fans. Those casual fans are disappearing.)
The rise of the Oregon program makes it look like it took away any thunder Portland State had. The truth is that it hit the big time at JUST the right time; just when people who were sports fans stopped watching the local news and started watching the national sports reports. Portland State probably sensed the need to push up (hence the bleachers on the east side that one season), but that was probably a year too late. I think, BTW, it would be trifling to blame PSU administrators for lack of foresight... these trends are always hard to see.
Besides, Portland had a major youth influx from out of state, driving up the cost of living, and that's become a problem.
On that national front:
You have Nick Saban complaining that Alabama students aren't going to games. The top schools fear for their future. Hence they will try to distance themselves from everyone else. If the Big 12 Conference is successfully shuttered (it's run like crap, Texas and Oklahoma are thought to want out, and the other conferences MIGHT see the 4-team playoff and a 4-power-conference structure as the ultimate), look out.
Schools like Fresno State are reporting crowds of 31,000 and 23,000 and probably not actually drawing any more than what Portland State is reporting. Memphis, the Florida directional, most G5 schools have sucky attendance in everything but what's reported in the box score. Ticket prices are the primary issue, television quality is so good that it no longer pays to attend (and pay inflated ticket prices at that) to be out in questionable weather.
The Pac-12 isn't getting a significant part of the money the new contract promised because the dishes won't put them on.
College sports are rapidly becoming a wreck. Why should Portland State be any different?