Teresa Sullivan, president of the University of Virginia, poses for a portrait in front of a statue of Thomas Jefferson last year in Charlottesville, Va. (Norm Shafer/For The Washington Post)

A University of Virginia panel has proposed that the institution break many of its ties with the state government and operate more like a private school.

Such an arrangement — which would need state lawmakers’ approval and likely would meet opposition — would allow Virginia’s flagship public school the freedom to more easily increase tuition and accept more top-tier students from across the country and the world. Although it could increase U-Va.’s prestige and shore up its finances, such a move could also make it more difficult for in-state students to win admission and could significantly raise their tuition.

Preliminary recommendations from the Public University Working Group, released this week, make clear that U-Va. would remain a public university. University officials said that the discussions are part of a brainstorming exercise as President Teresa A. Sullivan develops a strategy for the university and that there are no plans to make such a move. In its report, the group acknowledges that such a dramatic change at U-Va. would be “complex and challenging.”

Already, the preliminary proposal has drawn criticism and questions from the university community and state lawmakers, who said moving U-Va. toward a private model could be contrary to the public mission Thomas Jefferson laid out when he founded the university nearly two centuries ago. U-Va. is among the nation’s top public universities, and about 70 percent of its undergraduates are state residents.

The 11-page draft report says that change is needed at the university because of “significant, sustained, and permanent decreases in federal and state funding.” Under the proposal, U-Va. would give up much of its state funding, which totaled more than $154 million in 2012-13, or about 6 percent of its $2.6 billion budget. U-Va. would then shift from being a “state supported” or “state controlled” university to being affiliated or associated with the state, giving administrators more power. Members of the group found that the autonomy gained from separation could be beneficial for the university and the state.


Read the University of Virginia planning group report.

“Now is the moment for bold, decisive, and transformative action,” the report states.

U-Va. spokesman McGregor McCance said the working group — which Sullivan organized but did not sit on — has not finalized its report.

“President Sullivan has no intention or interest in attempting to make U.Va. a private institution,” McCance wrote in an e-mail Wednesday. “She strongly believes and has consistently stated that the University of Virginia has a unique and important mission as a public university and that it embraces this mission and the responsibility of serving the Commonwealth and the nation through that role.”

Sullivan’s definition of “public” appears to align with many of the working group’s preliminary ideas, according to a memo she sent to members of a strategic planning committee on Sept. 1. Sullivan included a list of seven public university principles, one of which stated that “being a public university in the 21st century is no longer what it was in the 19th and 20th centuries.” State support has dwindled, and the federal government has become a major supporter through tax credits, deductions, financial aid, grants and contracts, according to the document, and greater autonomy does not make universities any less public.

U-Va. “embraces its status, which was also foreseen by its Founder, as a national university,” according to the principles Sullivan shared. “It is important to recognize that the University’s public mission includes the public beyond the boundaries of the Commonwealth.”

Although Virginia’s public universities have negotiated some freedoms in the past decade, many politicians have been on guard against any attempts to privatize — or quasi-privatize — the state’s premier school.

“We have to make sure, as public policymakers, that U-Va. is a public school and stays a public school,” said state Sen. R. Creigh Deeds (D-Bath), who represents the Charlottesville area and ran for governor in 2009. “The whole reason you have a system of public higher education is to lift people up, to give them the American dream.”

Tucker Martin, a spokesman for Gov. Robert F. McDonnell (R), said that because the draft report has yet to be acted upon by Sullivan or the Board of Visitors, “it would be premature for this office to make any specific comments at this time.”

Given U-Va.’s small size, rich undergraduate experience and multibillion-dollar endowment, it already often feels and functions more like a private university than a state flagship. Sullivan and her team want to compete with the nation’s elite private schools — and surpass them — and stay ahead of international universities that are quickly growing with substantial government investment.

At an August meeting of the Board of Visitors, Sullivan ticked off the schools U-Va. loses faculty members to and those that compete for its students, a list that included the University of Chicago, Harvard, Duke, Stanford, NYU, Northwestern, and the universities of Texas, Michigan, California and North Carolina.

But lawmakers most often compare U-Va. to the state’s other public universities, which compete for Virginia’s students.

“To some extent, that is true. We do compete for students with William and Mary and Virginia Tech,” Sullivan said at the board meeting. “But if you asked our faculty and our alumni if that was our aspiration, I think they would say, ‘You’re shooting way too low.’ ”

U-Va. Student Council President Eric McDaniel said he worries about U-Va. being too much of a national university and not enough of a local one.

“We’re the University of Virginia,” McDaniel said. “We’re not a Harvard, we’re not a Yale, we’re not an expensive private, and that was on purpose. . . . And we should continue to stand for that.”

Louise Epstein of Fairfax County, a longtime advocate for gifted education, said that many Northern Virginia parents are already concerned about how difficult it is for students to get into the state’s flagship school and that they would be concerned about any changes that might make it even more so.

“Do we want to be a state where we have some of the top public universities in the country?” she said. “Or do we want to . . . end up in a situation where our state university system that was once so lauded has become a little less shiny?”

This discussion is largely at the heart of a campus identity crisis, with Sullivan advocating vast, new investment and competition at the national level while several board members have demanded major cost cutting and accessibility. In the past year, the board rejected a proposal to increase tuition for juniors and seniors and approved scaling back financial aid for low-income students.

“This university is very efficient,” Sullivan said at the board meeting, promising to continue looking for places to cut. “But at some point, you begin to compromise quality, and that’s the point we can’t cross, because otherwise we will have lost the heritage that has been passed on to us of being that nationally and internationally competitive institution.”

U-Va. officials and supporters have long debated the idea of privatization. Similar conversations are happening at other state institutions, especially those where state funding makes up less than 10 percent of the overall budget, according to Richard Vedder of the Center for College Affordability and Productivity, who teaches at Ohio University and researches privatization.

Vedder said the proposal makes clear that U-Va. would still serve a public mission but that it would be freed of many restrictions.

“It’s a declaration of independence,” Vedder said. “It’s the right thing at the right time at the right university.”

Hunter R. Rawlings III, president of the Association of American Universities, has said public university leaders need to stop talking about privatization and instead push their state lawmakers to see higher education as a public good, not a private interest.

During a speech to U-Va. faculty last year, Rawlings said: “There’s no possibility, as far as I can see, that any state will ever relinquish its ownership and governance of its public universities, much less of its flagship research university, no matter how minute its financial support becomes.”

Michael Alison Chandler contributed to this report.