When Fiscal Year 2020 started on July 1, 2019, few of us could imagine the challenge the University, the nation, and the world would encounter later that year. Midway through the spring 2020 semester, the University faced an unprecedented global coronavirus pandemic that disrupted many facets of our daily organization including the academic enterprise, the Medical Center, and the University’s operations. Recognizing that there was nohistorical experience to easily draw on, the team at UVA came together to partner in new ways, guided by three principles: maintain excellence in our core mission, support the most vulnerable, and be creative.
I was honored and privileged to join the University of Virginia as its fourth Executive Vice President and Chief Operating Officer on November 5, 2018. In the months since then, my respect and admiration for UVA has grown deeper as I am learning traditions and working closely with an incredible group of dedicated leaders who bring tremendous commitment to their work. We owe a debt of gratitude to our predecessors who created a strong financial foundation for the University to build upon as we plan for its future. Fiscal Year 2019 was a time of great transition at the University of Virginia. President Ryan took office on August 1, I joined his leadership team in early November, and Executive Vice President and Provost Liz Magill started in late spring. With each of these changes came new ideas about leading and managing the University. The leadership team shares a commitment to partnership and a deep sense of responsibility to steward our resources effectively and efficiently in support of the University’s academic, research, and service missions. Robert Durden completed his first full year as UVIMCO’s Chief Executive Officer and Chief Investment Officer during Fiscal Year 2019. Throughout these transitions, a continued focus on financial strength and stability enabled UVA to maintain its Triple A bond rating from all three major rating agencies for another year.
Fiscal year 2017-18 represents an important year of transition for the University of Virginia, with opportunities to reflect on the past, to make a difference in the present, and to honor the promise of the future at the beginning of the University’s third century. Once again, the University received recognition for providing a high quality educational experience at an excellent value. U.S. News & World Report most recently ranked UVA No. 3 in the nation for Best Public University and No. 2 for Best Value Public University. The Princeton Review rated UVA as the No. 1 Best-Value Public College. The University of Virginia consistently has been ranked near the top among all public universities and the top 25 of all universities in the nation since U.S. News began publishing its rankings more than three decades ago. We have held this position by, among other things, making strategic decisions to invest our resources to achieve and sustain educational excellence and to promote access and affordability for our students.
Fiscal year 2017 was another year of strong performance for the University of Virginia. Our financial and operational strength supports our mission of excellence in education, research, and patient care. The University has consistently earned a spot among the finest institutions in the country. Outstanding academic quality, affordability, excellent return-on-investment, and world-class patient care continue to be the hallmarks of the University of Virginia. U.S News & World Report most recently ranked UVA No. 3 in the nation for Best Public University and No. 2 for Best Value Public University. Kiplinger’s Personal Finance ranks UVA No. 2 for Best Value Among Public Institutions. These respected rankings are indicative of the quality of the University’s programs and our steadfast commitment to affordability. As of June 30, 2017, the University’s total assets were $11.2 billion.
Recent rankings recognize the University’s continued excellence and value throughout 2015-16. U.S. News & World Report ranked the University No. 2 best public national university; Kiplinger’s ranked us No. 3 best public college value; Money Magazine ranked us No. 3 best college value; and The Princeton Review put UVA at No. 7 among the Top 200 Colleges That Pay You Back. The University remains an excellent value for an excellent education. Additionally, the University has maintained its AAA bond rating since 2003 and is one of only four public institutions to earn top ratings from all three major rating agencies. UVA is now in a stronger nancial position than in its recent history with a growing endowment, a strong tradition of philanthropy, a diverse revenue base exceeding $2.5 billion annually, and increasingly efficient and effective operations. As of June 30, 2016, the University’s total assets were $10.5 billion.
Fiscal year 2014-15 represented another year of strong performance for the University. Through the careful stewardship of our resources over many years, UVA is widely known for its unique combination of academic excellence and financial strength. Innovative financial and operational management has enabled the University to make significant progress this year toward a number of goals called for in our academic and medical center strategic plans. The University initiated measures to capitalize on the strength of the balance sheet by completing a complex restructuring of our debt portfolio and we have developed a liquidity model that is designed to optimize investment opportunities while ensuring sufficient resources to address operational needs and strategic priorities. University leaders worked closely with the Board of Visitors Finance Subcommittee to develop Affordable Excellence, a multi-dimensional model that ensures access and affordability to an increasingly diverse student body while sustaining excellence across the Grounds. We continue to make progress on Organizational Excellence initiatives to increase quality, eliminate duplication, enhance effectiveness, and promote efficiency, entrepreneurialism, and innovation. The University of Virginia is positioned well to face future challenges and capitalize on opportunities, both those we know now and those that will emerge in the future.
The University experienced another strong year of performance in fiscal year 2013-14. Thanks to the skill and dedication of all of our people, we are better positioned than most universities to address the challenges facing public higher education. We have made significant strides in mobilizing the necessary resources to address the generational turnover of faculty and to pursue the strategic directions estab-lished in the Cornerstone Plan. We are focused on advancing the University’s distinctive qualities—an emphasis on close faculty-student interaction in an unparalleled setting, cutting-edge research, and affordable excellence—that continue to distinguish us in a highly competitive landscape and that enable us to deliver value to the citizens of the Commonwealth, the nation, and, increasingly, the world.
The fiscal year ending June 30, 2013, was one of transition, reassessment, and renewed energy at the University of Virginia. Among other accomplishments, we completed "Financing Academic Excellence," a framework for the University's long-term financial plan; set a course to restore faculty and staff compensation to more competitive levels; completed a successful bond refunding; and, importantly, positioned AccessUVa, our financial aid program, on a fiscally sustainable path for continued growth and excellence. In addition, the $3 billion Campaign for the University of Virginia concluded successfully, thanks to the generosity of many alumni, parents, and friends. We made substantial progress in developing a new internal financial model for the University and also reached a number of milestones in the Health System's strategic plan. Our overriding goal throughout these efforts has been to preserve the academic excellence and efficient management of resources that distinguish the University of Virginia.
This discussion and analysis provides an overview of the financial position and results of activities of the University of Virginia for the fiscal year ended June 30, 2012. Comparative information for the fiscal year ended June 30, 2011, has been provided where applicable. This discussion has been prepared by management and should be read in conjunction with the financial statements and the footnotes that follow this section.
The University of Virginia is an agency of the Commonwealth of Virginia and is governed by the University's Board of Visitors. The Commonwealth prepares a separate financial report that incorporates all agencies, boards, commissions, and authorities over which the Commonwealth exercises or has the ability to exercise oversight authority. The University, consisting of three major divisions, is a component unit of the Commonwealth of Virginia and is included in the basic financial statements of the Commonwealth. The University of Virginia's three divisions are its Academic Division, Medical Center, and the College at Wise.
It is a critical time in our nation's history, where some are questioning the public value of University-based research, the cost of undergraduate degrees, and the outcomes of our investments in health care. The University of Virginia is not alone in facing financial challenges ahead. With the headwinds in the global and national economies and the political stalemate in Washington, we must expect pressure on the key revenue sources that support our mission. That said, the stakes are in many ways higher in a public institution because the public investment and all else is much more transparent and therefore more highly accountable, as it should be. The key for us is putting our best foot forward and making clear our record of serving the public with effective and efficient use of resources to deliver high-quality education, patient care, and research that leverages that investment with great returns to our society.
2009-2010 Financial Report
The global economic crisis made this an extraordinary year for the University of Virginia and institutions of higher education everywhere. But even as University leaders took steps to understand and manage the downturn, we recognized that real advantages can be gained in times of financial crisis. Focusing on core missions provides an occasion to assess the University's areas of strength and emerge from the recession a stronger and smarter institution.
This University has several advantages that have helped us through this period. U.Va. has tended to be more conservative in its business practices than many of its peers and, as a result, is able to be more resourceful and flexible during lean times. We successfully reduced expenditures this year but did so in ways designed to protect students and patients—our ultimate customers—from the impact of the cutbacks.
2008-2009 Financial Report
The past year was a challenging one for the University as we managed the consequences of the historic meltdown in the U.S. economy while also contending with repeated rounds of reductions in state support. At the time of this writing in October 2009, the governor has announced a $19 million cut in state support for the University (but with federal stimulus funds offsetting part of the reduction — the actual cut will be $10.3 million). This comes on top of $32 million in cuts during the last three years. Our endowment suffered losses during the past year, as other major endowments did. During the twelve-month period that ended June 30, 2009, the Long-Term Pool, which includes the endowment and foundation assets, was down 21 percent — though recent positive returns have restored some of these losses. The recession and its various effects now promise to be the University's most serious financial setback of modern times, indeed perhaps of all times. Our mission and functions are larger and more complex than they were in 1929. Despite these daunting realities, and against all reasonable expectations, the University continues to thrive in most measurable ways. In the past year, we have seen a new generation of deans settle into leadership positions and begin building new strengths for their schools; new academic programs come into existence; new buildings take shape across the Grounds; and — perhaps most extraordinary, given the state of the economy — continued success in our capital campaign. This report includes details on these issues as well as a full report on the achievements of our students, faculty members, and staff.
2007-2008 Financial Report
The past year was productive for the University in most measurable ways. It brought smooth successions in key academic leadership positions; completion of several major building projects, with others commencing; unconditional reaffirmation of the University's accreditation by the Southern Association of Colleges and Schools; and improvements in the University's financial condition because of implementation of Virginia's 2005 and 2006 restructuring bills, prudent endowment investments, and continued success in our capital campaign. In recent weeks, the financial outlook here and everywhere has dimmed; what is now a global economic crisis began to take shape toward the end of fiscal year 2008. This report includes details on these issues and also a full account of the considerable achievements of our students, faculty members, and staff.
2006-2007 Financial Report
Thomas Jefferson believed that knowledge should be useful. In an 1813 letter to John Adams, he described the University he was planning to build as a place "where all the useful sciences should be taught." His insistence on the practical aspects of learning was grounded in a pressing necessity: the American Republic urgently needed educated young people who could apply their new knowledge to the governance of the nation.
2005-2006 Financial Report
The University's founder was both visionary and pragmatic. With great confidence and ambition, Mr. Jefferson described the institution he created as "the future bulwark of the human mind in this hemisphere." At the same time, he grounded the curriculum in what he called the "useful sciences." He believed in teaching practical knowledge that ordinary citizens could use to organize and govern a Republic.
2004-2005 Financial Report
In 1825, when classes were first held in the Rotunda and the Pavilions, Mr. Jefferson (nearly 82 years old at the time, and embarked on the last great adventure of his life) expressed the hope that his new University would prove "a blessing to my own state, and not unuseful perhaps to some others." In the past year, his University has proved a blessing not only to Virginia, but to the world.
2003-2004 Financial Report
This has been a productive year. Every member of this community- students and parents, faculty and staff, alumni and friends - can take pride in all the University of Virginia has achieved. The Board of Visitors and the management team worked effectively to launch groundbreaking initiatives that will provide for immediate needs and reap long-term benefits for the institution. Together we designed bold and innovative plans to meet the University's objectives in major areas, including financial aid, compensation, and research support. The institution, under the leadership and strong encouragement of its board, has moved decisively to focus its resources in ways that bode well for the future of the University.
2002-2003 Financial Report
The 2002-2003 fiscal year was a testament to the fundamental strength and resilience of the University of Virginia. We began the year in a difficult environment, facing sharp cuts in state funding. By the end of the year, we emerged as one of only two public institutions with the top rating from all three major bond-rating agencies, we achieved a return on our endowment second only to Harvard’s, and we recaptured our position as the nation’s top public institution as ranked by U.S. News & World Report. These exceptional results speak to the hard work of our staff and faculty, the effectiveness of the Board of Visitors and the management team, and the underlying fiscal stability and soundness of the institution.
2001-2002 Financial Report
These are difficult times for the Commonwealth of Virginia, which provide the University with a period of challenge and opportunity. Facing an accumulated budget deficit initially projected to be $3.8 billion by 2004, our elected officials have had no choice but to make substantial cuts in funding to state agencies, including the University of Virginia. We are dealing with reductions in state support of historic proportion.
2000-2001 Financial Report
At no time in its history has the University of Virginia been better prepared to fulfill the aspirations of its founder. The success of the recent campaign, the strength of our endowment in a volatile market, the support we attract for cutting-edge research, the effective management structures now in place, and the extraordinary community of students and faculty assembled on the Grounds--these and many other positive factors have enabled us to pursue ambitious goals even in difficult times.
1999-2000 Financial Report
The University of Virginia concluded fiscal year 2000 in an exceptionally strong operational and financial position. The endowment grew significantly. We ended the year with good reserves. University operations were not only efficient, but also effective. The level of professionalism, innovation, and commitment on the part of our employees rivaled that found at the most dynamic corporations. Most important, our academic and health care enterprises flourished.
1998-99 Financial Report
Over the last decade, the University of Virginia has successfully entered the ranks of the nation's premier educational institutions. We have been able to outpace many of our peers because of the generosity of alumni and friends combined with support from the state. The success of our students, the commitment and creativity of our faculty, and the dedication and professionalism of our staff have contributed to our standing among the very best universities.
1997-98 Financial Report
As we approach the twenty-first century, faculty and staff are engaged actively in formulating initiatives needed to ensure that the University of Virginia continues to offer the citizens of the Commonwealth the finest academic and health care programs of any in the nation. Over the past decade, the University has cultivated the means and specialized expertise needed to respond to new challenges and steward resources.
1996-97 Financial Report
The University of Virginia is now established firmly as one of the premier universities in the nation and the world. It is widely recognized as an exceptional place to both learn and teach, a fact that lends stability to our academic enterprise and provides a basis for further excellence. The faculty here is one of the most distinguished groups ever assembled anywhere, and each successive class of students is brighter and more talented than the one that preceded it.
1995-96 Financial Report
At a time when public resources available for higher education are limited, we have forged a unique alliance of alumni, faculty, legislators, business leaders, and administrators that has enabled us to achieve ever higher standards of quality. We have been successful in building a financial base that is supported by a broad range of reliable revenues.
1994-95 Financial Report
The 1990s have seen a remarkable resurgence of American Business, as it successfully restructured and repositioned itself for eminence. The University of Virginia has been committed to these same practices consistent with its academic mission, and the results, we believe, have been similar. Creating a system of streamlined excellence has been a matter of continuous, collaborative, and synergistic improvement promoted by every division of this institution.
1993-94 Financial Report
At the University of Virginia, we are finding new ways to serve more students while preserving the qualities that distinguish our academic programs. We must, first and foremost, teach well. We must quickly apply the discoveries of our laboratories to society's needs. Our Health Sciences Center must change the way it delivers health care. We are being asked, quite simply, to do more -- and do it superbly -- without the prospect of significant increases in resources.