The last decade has seen the University of Virginia emerge as one of the leaders in higher education. The student body is more diverse and accomplished than ever. Faculty are engaged in groundbreaking research. And the University itself has taken the lead in addressing a number of issues that affect the well-being of the state and nation.

At a time when institutions of all sorts, both public and private, are struggling to maintain their momentum and direction, the University has benefited immeasurably from Thomas Jefferson's sustaining vision. Jefferson established a republic based squarely on individual freedom, but he understood that if this new nation was to flourish, its citizens must be equipped to use their freedom wisely. They must be prepared, as Jefferson himself was, to weigh the requirements of the present against the orthodoxies of the past.

During the last decade, the University has worked to advance the core values built into the curriculum, the scheme of student self-government, and indeed the buildings and grounds. We have sought to preserve and enhance the vitality of our academical village. New residential colleges, new seminars for first-year students staffed exclusively by our most experienced scholars, and new computer networks to enable students and faculty to exchange ideas outside the classroom are products of this effort.

Jefferson's achievement has inspired generations of faculty, students, administrators, and alumni to move beyond theorizing and accept the risks of creation. They have contributed their talent, energy, and resources to the University, devising new programs, erecting new buildings, and serving the members of the commonwealth.

Managing the Transition 

Private support has never been more critical than in this era. State funding for higher education will not return to levels of the 1980s at any time in the near future, and we have faced this fact squarely. The Commonwealth of Virginia funded only 13.6 percent of the University's budget this fiscal year, down from 27.1 percent just five years ago. In fact, state financing of the University's general budget has fallen behind the support we receive from either sponsored research or tuition.

While making the shift from state support to state assistance, we have cut administrative costs by 8.5 percent between 1990 and 1993. Numerous senior administrative positions have been eliminated, saving more than $800,000 each year. Overall, the University has seventy-four fewer administrative posts now than in 1989.

In addition, staff have found innovative and creative methods to produce greater efficiencies over the long term. We will shortly invest $425,000 in equipment and software for financial and administrative reporting that will save $865,000 over three years and $180,000 each year thereafter. Other savings will result from coordination of computing on Grounds. With funds from the National Library of Medicine and the National Institutes of Health, the Health Sciences Center is designing an Integrated Advanced Information Management System.

The goal of this system is to develop, support, and use information to make informed decisions for patient care, research, education, and administration. A major reorganization in the Health Sciences Center has already created savings of $1.25 million a month. These savings resulted from eliminating 599 full-time positions through attrition and retraining over the past year.

Similar reengineering is underway all across Grounds. The College proposes reallocating $1 million from its annual budget, not by leaving faculty positions vacant as it has done in the past, but by reexamining its basic assumptions. The College has already revamped its administrative structure. The positions of the Dean of the College and Dean of the Graduate School of Arts and Sciences are being consolidated with the Dean of the Faculty in July 1995.

One result of the College's work has been the closing of the Rhetoric and Communications Department, a small three-person department with seventy-five majors. Its faculty members are being absorbed by other departments, and current majors are being allowed to complete their requirements.

Targeting Excellence Additional savings will come as the University streamlines its administrative relationship with the state. In the 1994-95 state budget, the Virginia General Assembly established a pilot decentralization program. The University of Virginia submitted proposals for a "full measure of authority" to handle its own human resources and purchasing needs, as well as financial and accounting operations. Annual savings of $500,000 will result from these changes, once approval is granted.

Responding to another legislative mandate, the University submitted a report detailing an "explicit program of improvement, efficiency, and responsiveness" to lower the cost of generating a bachelor's degree. Titled "Targeting Excellence," the report calls for a number of improvements. These include:

• reducing certain graduate enrollments to permit reallocation of resources to undergraduate education;
• redefining faculty workloads;
• using existing classrooms and laboratories efficiently by scheduling classes throughout the normal workday and workweek; and
• continuing to streamline the administration and merging duplicative services.

Total savings projected in the report amount to $11 million annually, roughly half academic and half medical.