<p>For quite a number of years, UVA has only received about 8% of its total budget from the state, though the money it does get is valuable because it is un-earmarked and can be used for basic operating expenses. In a recession in the early 1990s, when state funding fell sharply, the upper administration realized that the university could not rely on that source alone and started bolstering the endowment in a big way, with two giant fundraising campaigns. As a result UVA is now a semi-public, semi-private institution, and is better situated than many other state schools, esp. those in California. At the same time, when the stock market tumbled the size of UVA’s endowment tumbled too, so there have necessarily been some cuts. There’s been a two-year hiring freeze, and faculty and staff salaries have been frozen at 2007 levels. There have not been firings or furloughs so far. </p>
<p>Departments have been trying very hard to minimize the effect of budget cuts on instruction. For instance, the English Dept, where I teach, has saved a lot of money on office supplies by switching aggressively to email for all departmental correspondence, lecture advertisements, and so on. Other departments have made other cuts depending on their priorities; for instance, the Music Dept. cut out the department contribution to professional travel expenses for faculty, and trimmed the budget for visiting artists and lecturers. Arguably these cuts make the educational environment less rich but I doubt many undergraduate students notice a huge change.</p>
<p>Universities public and private are having similar issues; the public schools are getting less tax revenue, while the privates have to deal with shrunken endowments. I suspect that super-rich schools, like HYP, have more fat to cut than UVA or other state schools have but on the other hand, I gather from what I read that there investment strategies were more exotic and riskier so they may have suffered greater losses.</p>