Teresa A.

Sullivan
Joint Meeting of the Senate Finance Subcommittee on Education and the
House Appropriations Subcommittee on Higher Education
Friday, Aug. 26, 2016; approx. 10:00 am
Senate Room B, General Assembly Building
(as prepared)
Chairmen Norment, Hanger, Jones, and Cox; Vice Chairman Landes; and members of the subcommittees

UVA is a public flagship. Both of those words public and flagship are important to me, and
important to UVA.
UVAs role as a public university means we serve the Commonwealth by offering an affordable
education to citizens from all backgrounds, by advancing economic growth, and by offering excellent,
safe clinical care to patients from Virginia and beyond.
We are public by mission and by governance, not because of revenue sources. Every private college
receives federal student financial aid, tuition tax credits, tax deductions for donors, and maybe research
grants. Those funds do not make them public. UVA receives private philanthropy for which we are
grateful but that does not make UVA private.
UVA is also one of Virginias flagships, so the University must commit itself to excellence and quality in
educating our 23,000 students and in providing care in nearly one million patient visits a year.
UVAs dual roles as a public university and as a state flagship should never be contradictory or mutually
exclusive. UVA must be public and excellent; affordable and excellent; accessible to Virginians and
excellent.
Institutional excellence requires a commitment to prudent stewardship. I have served in leadership
positions in three highly-ranked universities with triple-A bond ratings Texas, Michigan, and UVA.
These universities earn their high ratings. UVA has a long-standing record of prudent financial leadership,
and that leadership together with strong investment earnings enabled us to create the Strategic
Investment Fund.
While were on the topic of credit ratings, I will mention that over the past 10 days, we have received
calls from Moodys and from Standard & Poors inquiring about the discussion taking place between
UVA and the state regarding the Fund. The calls were prompted by inquiries that they received from
reporters asking them to comment on our situation.
Additionally, Moodys intends to publish a report in the coming days commenting on the potential credit
impact to universities where turmoil and/or dysfunctional relationships exist among a board,
administration, and other stakeholders, including state government. They intend to mention UVA as one
of several examples of this turmoil. We anticipate the rating agencies will continue to monitor
developments on this front and possibly probe this topic further in conjunction with their ratings of a
planned refunding of University bonds some time in FY17.

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When we discuss the Strategic Investment Fund, we need to remember that UVA is a $3.2 billion
enterprise, and the Universitys Health System constitutes half of that enterprise. Our hospital was just
ranked the #1 hospital in Virginia by U.S. News and World Report.
For large, complex enterprises such as the University, having systems to ensure business continuity is
critically important. In the event of a cyber-attack, natural disaster, or just the breakdown of a critical
piece of equipment, we need to have financial reserves in place, and be prepared to use them.
We also use our financial reserves to enhance existing UVA programs in ways that include more
Virginians. For example, our Health System is investing up to $35 million to expand its transplant
programs, enabling us to perform all forms of organ transplants for Virginians both adults and
children who otherwise would have to go out-of-state for service. We are on track to go from 200 to
300 transplants a year. Recently, we have recruited two top bone-marrow transplant specialists to work
with us one from Massachusetts General and one from NIH.
Rector Goodwin mentioned the importance of affordability. UVA is consistently ranked as one of the best
values in higher education. We appreciate your recent increase in support.
In February, the Board of Visitors adopted a tuition schedule for the coming year that increased in-state
tuition by an average of 3% for continuing undergraduate students one of the lowest increases in recent
history.
As a result of your new funding in the state budget, the University reduced the previously-approved
tuition increase for continuing in-state students from 3% to 1.5% for the next academic year.
In the state budget, we were pleased to see funding for access and affordability and enrollment growth,
because this benefits many Virginians. This week, 2,467 first-year Virginia residents enrolled at the
University. We offered admission to another 1,745 Virginia residents, and offered another 1,021 Virginia
residents admission to UVA-Wise with guaranteed transfer to UVA in Charlottesville. This means that,
in all, 5,233 Virginians had a pathway to enroll at UVA. That is, 54% of Virginia applicants were offered
a way to earn a degree at UVA.
Virginia residents have many great options for higher education in the Commonwealth. A study1 of last
years admissions conducted by JMUs Office of Institutional Research showed that 95% of Virginia
residents who applied to William & Mary, JMU, Virginia Tech, and UVA that is, Virginians who
applied to all four schools got at least one offer of admission.
As of the end of this academic year, we will have already awarded undergraduate degrees to an additional
938 in-state students as a result of the growth plan that was extended in fall 2011. By 2019, we will be
awarding about an additional 385 degrees to in-state students every year due to the growth.
With the Strategic Investment Fund in place, investments of earnings will advance strategic priorities that
we have identified in our Academic Divisions Cornerstone Plan and the Medical Center Strategic Plan.
One priority is enhancing research.

Fall 2015 Admissions Study Virginia and Non-VA Resident Applications and Offers of Admissions to CWM,
JMU, UVA, VT, JMU Office of Institutional Research, 7/14/2016

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Among Science magazines top-10 finalists for the biggest research breakthrough of 2015, two were at
UVA.2 In one of the UVA breakthroughs, researchers Jonathan Kipnis and Antoine Louveau discovered
previously unknown vessels connecting the brain to the lymphatic system. The discovery could have
profound implications for a vast array of neurological diseases, from multiple sclerosis to Alzheimers
disease. I should also note that 10 UVA undergraduates and three graduate students work in the Kipnis
lab and what an experience for those students.
In 2016, we launched the new UVA Brain Institute, which will help our researchers develop more
effective treatments for stroke, Alzheimers, and other diseases, while helping us recruit top researchers
who can compete for national grants. This catalyzed the initiation of a $500,000 joint-pilot grant program
between UVA and Virginia Tech focused on brain research.
Yesterdays lead story in the New England Journal of Medicine was about the use of focused ultrasound
to cure essential tremor, using a technique pioneered and perfected by UVA neurosurgeons. It was the
product of a private-public partnership between the Commonwealth, The Focused Ultrasound Foundation,
and UVA.
Investments from the Strategic Investment Fund could help to support similar initiatives that hold great
promise for improving the lives of Virginians. These investments promote excellence at UVA without
passing along costs in the form of tuition increases or requests to the state for general fund appropriations.
We are making these investments because we share your commitment to ensure that UVA remains one of
the nations top universities in terms of quality, value, and excellence.
The Strategic Investment Fund will help us fulfill that commitment. Thank you.

Two UVA Findings in the Running for Years Biggest Scientific Breakthroughs, 12-3-2015
https://news.virginia.edu/content/two-uva-findings-running-years-biggest-scientific-breakthroughs
Runners Up for Scientific Breakthrough of 2015, Science Magazine,
http://science.sciencemag.org/content/350/6267/1458.full

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