The issue of funding higher education in our nation is no mere academic argument. The stakes are huge for the next generation of students, for businesses and markets that rely on new knowledge and trained workers, for our nation's industrial competitiveness, and, indeed, for our quality of life. For too many years, Americans have benefited from the investments of previous generations. Today, our nation appears reluctant to reinvest in various public goods, whether it be public infrastructure, transportation, the environment, or education. In the Commonwealth of Virginia, we have been unable to find the balance between public needs and the ability or desire to assess ourselves. As a result, we continue to underfund such public responsibilities as higher education.

Recognizing the political difficulties within Virginia and the unlikelihood that we will see restoration of lost funding anytime soon, three universities have proposed a novel solution: If the state cannot fund us, we ask for the flexibility to manage ourselves.

To counter the impact of budget cuts and address chronic underfunding--both of which have resulted in fewer teachers, larger classes, and fewer course offerings--Virginia Tech, the University of Virginia, and the College of William and Mary put forth the University Restructuring Initiative during the 2004 Virginia General Assembly legislative session. The initiative proposes that each institution be given increased authority and management flexibility for operations, including the capacity to set tuition rates that are reflective of the state-determined "cost to educate" and the market of peer universities.