I went to a small liberal arts school where the IT department recruited CS students under work study to build the systems. It’s a good learning experience for students to be involved in constructing and maintaining the infrastructure that keeps the university running. I don’t mean this entirely as in cost savings, but because I like the idea of a university being self maintained.

You don’t need to roll your own LMS—you can self-host Canvas: https://github.com/instructure/canvas-lms/wiki/Production-St...