FY22 financial report print.indd

Virginia Tech Financial Report 2021-2022

Tech’s sponsored research expenditures and awards increased 12 percent. Momentum continued on several major initiatives within the university’s four defined research frontiers: artificial intelligence, health systems, secu rity, and quantum technologies. Active collaborations with other universities, industry, foundations, and the federal government facilitated the sharing of expertise across disciplinary boundaries. In further collaboration with Amazon, Virginia Tech established the Amazon-Virginia Tech Initiative for Efficient and Robust Machine Learning to support development and implementation of innovative approaches to machine learning through research projects and doctoral student fellowships. In a partnership to advance transdisciplinary research and teaching in quantum information science and engineering, Northrup Grumman made a $12.5 million commitment to the Innovation Campus. The partnership will help establish the Center of Quantum Architecture and Software Development at the Innovation Campus with the goal of harnessing revo lutionary quantum technologies for both commercial and national security applications. Along the health frontier, the opening of the Fralin Biomedical Research Institute’s 139,000 square foot expansion in Roanoke will further accelerate growth in the region’s life sciences ecosystem, creating additional produc tive synergy between the Research Institute, Carilion Clinic, and industry. The Virginia Tech Carilion School of Medicine received a record number of applicants for the class of 2026, while the class of 2022 achieved a 100% match rate with residency programs across the country. The incoming class was both more diverse demographically and highly experienced in both clinical and research environments. The university’s medical school is positioned for growth to continue to address the shortfall of physicians in the commonwealth, especially in rural Virginia. Finally, groundbreaking work continued through the Virginia Tech-led Commonwealth Cyber Initiative (CCI), with significant investment in experiential learning projects across nine universities throughout Virginia. With implications for intellectual property and national security, an in ter-disciplinary team of researchers at Virginia Tech, in collaboration with the CCI’s Southwest node, continues to explore how to build and extend quantum networks, and in the process, enhance cybersecurity and enable broader access to quantum computation. While the pandemic’s lasting impact on higher education continues to be widely debated, enrollment pressures which began prior to the pandemic accelerated nationally. Fueled by unfavorable demographic trends and a labor shortage which has reduced educational requirements, many institu tions are projected to remain below pre-pandemic enrollment levels over the next several years. However, demand for a Virginia Tech education remains robust. A record number of 42,000 applications were received for fall 2021, only to be eclipsed in the fall 2022 enrollment cycle with a 7 percent increase or more than 45,000 applicants for the class of 2026. Continuous improvements to the university’s application process have contributed to more meaningful and lasting engagement with prospective students. The university’s efforts to remove barriers to access have also diversified the applicant pool with notable increases in interest from first generation and under-served populations. Virginia Tech’s strong and diverse academic programs continue to enhance the university’s reputation in an era of intensifying global competition for students. For fall 2021, Virginia Tech enrolled a class of 7,743 undergrad uate students, including 941 transfer students; Total undergraduate enroll ment was 29,760 students as of fall 2021 census. The university also made progress on several critical diversity benchmarks. Among the first-time in college and transfer student fall 2021 cohort, 39.1 percent were from

Economic Outlook As students, faculty, and staff returned to campus in the fall of 2021, resuming traditional in-person learning and activities, lingering appre hensions over COVID-19 gave way to the restored vibrancy of campus life and the familiar joys and anxieties of a typical semester. During fiscal year 2022, the university community collectively participated in Virginia Tech’s sesquicentennial celebration with a host of events that honored the univer sity’s rich history and promising future. Virginia Tech’s nimble response to the pandemic, its competitive market position, and state and federal funding support enabled the university to pursue its tripartite mission of discovery, learning, and engagement from a strong financial position. With a rapidly changing economic landscape, budget development for fis cal year 2022 proved especially challenging. Many sectors of the economy, including those heavily dependent on tourism, travel, and hospitality, con tinued to experience distress. Mounting concerns over supply chain dis ruptions, the potential emergence of new COVID variants, and projections of a labor shortage made an imminent economic recovery appear unlikely. Despite these gathering headwinds, Virginia’s economy emerged from the recessionary depths of the pandemic with rising consumer spending, real estate prices, and wages. With actual state revenue collections outpacing the revised revenue forecast, the commonwealth finished fiscal year 2021 with a $2.6 billion surplus. This unexpected surge in revenues allowed the commonwealth to further build its financial reserves, reduce long-term pension obligations, invest in strategic initiatives, and fund a state employ ee compensation increase. As part of its planning for fiscal year 2022, the university closely monitored the budget deliberations of the Virginia General Assembly. The common wealth allocated $337.2 million to Virginia Tech for fiscal year 2022 to support its academic division, research initiatives, student financial aid, cooperative extension and agricultural experiment station division, and its Corps of Cadets program. This represented an increase of $25.9 million in state support over the fiscal year 2021 budget. In addition, the university received $0.8 million in one-time Governor’s Emergency Education Relief pass through funds for need-based student financial aid. The General Assembly returned in August 2021 to consider allocation of more than $4.3 billion in federal pandemic relief funding, of which an additional $7.4 million of one-time American Rescue Plan (ARP) State and Local Recovery Funds was provided to Virginia Tech for need-based financial aid. These funds supplemented a $48.7 million one-time allocation to the university in the third installment of the Higher Education Emergency Relief Fund (HEERF) as part of the federal ARP program, with half dedicated to stu dent financial aid. During the transition to a post-pandemic environment, progress continued on a number of long-term initiatives designed to enhance the common wealth’s innovation and production capacity. In September 2021, con struction began on the Academic 1 Building at Virginia Tech’s Innovation Campus in Alexandria, the first of three planned buildings on the campus. With aspirations to become the most diverse graduate engineering school in the country, the Innovation Campus will play an integral role in the development of the region’s envisioned innovation ecosystem. In order to fulfill its multi-year commitment for degree production, the university implemented the Virginia Tech Talent Graduate Scholarship for students pursuing a graduate degree in eligible Computer Science and Comput er Engineering fields. This talent pipeline will accelerate growth in the region’s tech-savvy workforce and attract additional prominent, dynamic companies to the commonwealth. In addition to the Innovation Campus, the university contributed to the commonwealth’s economic diversification efforts with its focus on research, development, and commercialization. In fiscal year 2022, Virginia


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