As the University plans a new capital campaign, public universities all over the country are seeking greater private funding as a result of state budget problems.
States around the country are having trouble balancing their budgets, leading to cuts in higher education funding like those experienced by the University.
The University of Michigan, one of the U.Va.'s peer institutions, is an example of a school facing similar challenges.
The University's share of funds that comes from the state has dropped drastically since 1990, and Joel Seguine, a spokesperson for the University of Michigan, said in recent years Michigan has experienced a similar trend.
State funding accounted for 19 percent of Michigan's budget in fiscal year 2001 and that figure had dropped to 17.6 percent in 2003, Sequine said.
The state government further cut the appropriations to Michigan for 2003 in the middle of the year, he said.
Sequine added that the state's budget problems have worsened for 2004.
"It's going to mean an even greater cut," he said. "The current budget result is going to put pressure on all the state universities."
The problems at Michigan are particularly striking given that the state government has a long history of supporting higher education and that other schools such as the University of Iowa and University of Wisconsin are in greater financial trouble, Sequine said.
"Michigan has traditionally held firm with higher education," he said. "It's not going to be able to hold firm any longer."
Faced with decreasing state funding, schools nationally are faced with a choice between two alternatives to maintain their expenditures: either raise tuition or increase private funding.
Though many schools and state governments have chosen to raise tuition, this decision risks alienating students.
Last year, hundreds of University of Wisconsin students protested at the state capitol after legislators proposed a budget with cuts in higher education funding and tuition increases of 8 and 23 percent for in-state and out-of-state students respectively.
Though raising tuition may be an unpopular solution to funding shortfalls, raising private funding is not necessarily an easy alternative for universities given the country's lukewarm economy.
Schools such as the University have chosen a combination of increased private fundraising and higher tuition in order to raise the money they need.
Sequine said Michigan also is seeking more private funds to compensate for decreases in state funding.
"The fundraising machine keeps rolling," he said.
Though many of the budget problems colleges and universities have faced nationally are due to state budget gaps, private schools, which do not take money from states, also are hurting financially.
Top private schools such as Stanford University and Duke University have experienced financial troubles in recent months, showing the difficulty of private fundraising in the current economic climate.
Stanford announced a hiring freeze last year, while an internal report at Duke said the school faced a budget deficit of $1.7 million for fiscal year 2004.
"We've been affected like everyone else," Stanford spokesman Jack Hubbard said. "I don't think anyone is immune."
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