The University emerges from challenging times with renewed strength and confidence.

The first years of the twenty-first century have been a test of the Universityâs mettle. As state revenue shortfalls threatened to erode its financial foundation, the University found ways to cultivate other funding sources and to increase its efficiency without retreating from its core purposes and without diminishing its stature as a top-twenty-five institution. It never veered from its commitment to strengthen its academic programs, to increase the diversity of its community, to improve its facilities, and to stay true to its long-range vision.

Having thrived in both lean and prosperous years, we now have the confidence to think even more boldly about the future and to ask new questions. How can we, as a public institution, take our place among the finest universities in the nation, public and private? And how can we best live up to our Jeffersonian mandate to serve the people, to harness the vast store of human and intellectual capital on these Grounds to address the problems besetting our society and the world at large?

These are daunting but inspiring challenges, and we are prepared to accept them. As a starting point, we can look to our Virginia 2020 initiatives, to the goals emerging from the Envision planning process undertaken by individual schools and programs, and to the new recommendations of the Presidentâs Commission on Diversity and Equity. As we strive to meet these challenges, we will benefit from the talents of several new academic leaders.
• Biomedical engineering professor J. Milton Adams is the new vice provost for academic programs. A former associate dean for academic programs in the School of Engineering and Applied Science, he is playing a pivotal role in realizing the Virginia 2020 goals.

• Chemical engineering professor Roseanne Ford assumed the post of associate vice president for research and graduate studies. As the University endeavors to strengthen its graduate programs, Prof. Ford will ensure that it continues to attract qualified and diverse graduate students.
• As the new vice provost for faculty advancement, anthropology professor Gertrude Fraser oversees the Universityâs efforts to increase the diversity of the faculty and to provide faculty with opportunities for professional development and leadership training.
• Dr. Leigh Grossman, chief of pediatric infectious diseases and now vice provost for international affairs, is piloting the Universityâs efforts to add a global dimension to the academic experience.

PROGRESS TOWARD VIRGINIA 2020
These administrators join a dedicated team that is committed to advancing the University on a number of fronts, as is evident in our continued progress toward meeting the Virginia 2020 goals.

The Fine and Performing Arts. To lay the groundwork for superb programs in the arts, the University is moving forward with the first projects envisioned in the Arts Grounds master plan. In the coming year, we will break ground for Ruffin Hall, the new studio art building. The long-awaited renovation of Fayerweather Hall is well under way and will provide a new home for the art history program. We are developing a visionary but eminently achievable plan for placing a new performing arts center and a new building for the University Art Museum on adjoining sites with a shared lobby, caf�, and support facilities. This arrangement will foster collaborative ventures across artistic disciplines and build a vibrant new crossroads of University and community life. The process of planning itself has energized our arts programs and has awakened the creativity of our students and faculty.

"This institution is committed to effecting cultural change. Let me assure you that you have the full commitment of this board÷both in terms of financial resources and moral leadership. We are united in our commitment to see change." Gordon F. Rainey, Jr., Rector of the University, in response to the Diversity Commission's report

Science and Engineering. Of the several groundbreaking decisions by the Board of Visitors this past year, one of the most far-reaching was the commitment of $60 million to expand the Universityâs research capabilities in science, biomedicine, and engineering. This investment, combined with other resources, will build on emerging strengths. Our research in nanotechnology is pointing the way to improved electronic devices and novel materials with extraordinary properties.Our studies in cell biology are opening doors to new cancer treatments and advances in regenerative medicine.Our computer scientists are finding ways to process data faster and more efficiently.Our investigations of cognitive impairment are anticipating the needs of an aging population. Our environmental research is identifying climate patterns affecting wide areas of the globe.

Public Service and Outreach. In our multifaceted public service and outreach endeavors, we are helping to strengthen Kö12 education with programs such as Teachers for a New Era, a research-based collaboration of the College of Arts and Sciences and the Curry School of Education to identify best practices for training and retaining effective teachers. Equally important are capable school administrators. The new Curry-Darden Partnership for Leaders in Education has focused its attention on turnaround specialists who can save failing schools. This work has won the backing of Governor Mark Warner and a $3 million grant from Microsoft Corporation.

We also are doing our part to improve security in this country and abroad. The School of Continuing and Professional Studies oversees the curriculum for the FBIâs National Academy in Quantico, Virginia, which provided instruction to nearly 1,000 members of the law enforcement community this past year. The school is working with the FBI to restructure the academy to meet new antiterrorism objectives. The school also provided curricular support for the International Law Enforcement Academy in Budapest, which promotes cross-border cooperation in combating such crimes as nuclear materials smuggling, money laundering, and drug trafficking.

International Activities. Over the past three years, enrollment in study-abroad programs has doubled, with approximately 1,400 students participating in educational activities overseas. Opportunities for foreign study include five one-semester programs for full University credit, nine summer programs for full credit, four programs for transfer credit, and sixty-four exchange programs. Many of these are offered through Universitas 21, a global consortium of institutions that promotes scholarly and educational exchanges and provides distance-learning opportunities across national borders. International initiatives on Grounds include a new diplomat-in-residence program. Leonard Robinson, former deputy assistant secretary of state for African affairs and president and CEO of the Africa Society, came to the University as the first visiting scholar-diplomat.

ENVISIONING A DIVERSE AND OPEN COMMUNITY
For the University to take its place among the nationâs very best institutions of higher learning, all members of this community ÷administrators, faculty, staff, and students÷must each ensure that this is a welcoming environment in which all persons have the opportunity to succeed. The

Presidentâs Commission on Diversity and Equity, which presented its report to the Board of Visitors in October 2004, has offered a pragmatic plan for fulfilling this vision. Formed in the wake of troubling racial incidents in 2002ö2003, the commission has called for establishing a chief officer for diversity and equity. It also made recommendations for building a more diverse faculty and student body (at both the graduate and undergraduate levels), for improving the climate for diversity on Grounds, for weaving diversity into the curriculum, and for addressing incidents of harassment and disrespect in decisive ways.

Even before the report was released, the commissionâs work was making an impact. The Inter-Fraternity Council unanimously passed a resolution creating a diversity outreach chair to increase minority recruitment in fraternities; the University opened a new multicultural center in Newcomb Hall, the Kaleidoscope Center for Cultural Fluency; and the College of Arts and Sciences reported that its hiring of women and minorities is up significantly over previous years. For the full report and an overview of the commissionâs work, visit www.virginia.edu/uvadiversity/.

SEEKING GREATER AUTONOMY
For a decade and a half, the Commonwealth of Virginia has struggled to provide adequate funding for its system of higher education. The University is among three institutions leading the way to address this problem by forging a new relationship with the state. Under proposed legislation known as the Commonwealth Chartered Universities and Colleges initiative, the University of Virginia, the College of William and Mary, and Virginia Tech would obtain greater autonomy from the state while increasing their reliance on non-state revenues. A plan also has been proposed that would allow all of Virginiaâs public colleges and universities to participate in the charter initiative and to gain more flexibility in their day-to-day management.

Under the charter legislation, the Board of Visitors would be fully responsible for setting tuition, issuing bonds, and approving building projects, a change that alone could speed the completion of capital projects by as much as 25 percent. Tuition and fees would increase according to a cost-of-education formula, but without endangering affordability for all qualified students. AccessUVA, the bold financialaid program described in greater detail in the next section of this report, will keep the doors open. For more details on the charter proposal, visit www.virginia.edu/chartereduniversities/.

FINDING NEW RESOURCES TO SUSTAIN EXCELLENCE
The support provided by alumni, parents, friends, corporations, and foundations has helped us weather the vagaries of state financing. Such generosity will be even more critical to our future success as we enter the early phase of an eight-year fund-raising campaign. Aimed at sustaining the people, places, and programs that make this an institution like no other, the campaign will seek the resources needed to prepare students for leadership in the twenty-first century; to expand the Universityâs capacity to make groundbreaking discoveries; to provide facilities for superb teaching, research, and patient care; and to marshal the Universityâs intellectual resources to serve the common good. We are continuing to fine-tune our goals, which at present total some $3 billion. A campaign of this magnitude will rank as one of the most ambitious undertaken by any university, public or private. The official kickoff is expected to be in fall 2006. For information on current fund-raising initiatives, visit www.virginia.edu/supportuva/.