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By David Dziekanski, CBC NewsIt was a big fall for a Virginia college that once boasted a $3.5 million budget for the coming academic year.

The University of Virginia’s annual report to the state Department of Education on Wednesday said the university has raised its projected tuition and fees by an average of 6.7 per cent, but added it had no additional financial aid available.

The university reported the annual deficit was $1.9 million, about a quarter of what the Department of Public Safety estimated it would have been had it been operating at full capacity.

The school’s report also noted it had about $9.8 million in debt.

“We’ve done some tough decisions in the past couple of years and we’ve made some big decisions in recent years,” said university president Teresa Sullivan, who said she and her staff have taken steps to improve its financial position.

“The big thing for me has been that we have a lot of work to do and a lot more that we still need to do.”

The university said it expects to raise its annual operating budget by at least $300 million over the next decade.

Sullivan said the school’s $9 billion budget will be enough to pay the university’s operating costs for the next two years and keep it on track to meet the University of North Carolina’s goal of raising its tuition by 30 per cent over the following decade.

The $3 billion figure is the lowest it has been since 2011.

Sullivan acknowledged that the state’s student debt is “a big problem” for the university, which has a $2.3 billion loan from the federal government to help cover its operating costs.

The state of Virginia has had trouble finding enough borrowers willing to pay their loans back, said Mike Stiles, an attorney for the state Public Service Commission.

He said some of the more than 100,000 people who signed up for Stafford loans in Virginia between 2010 and 2016 could be affected by the budget shortfall.

He also said the college’s financial aid programs are not well-suited to students with student debt.

Stiles said the state needs to work to ensure all students have access to financial aid.

“It’s a very tough problem,” he said.

“And there are a lot, a lot different parts of it.”

The department of public safety has been trying to help Virginia’s colleges and universities since the late 1990s, when a new state law passed requiring the state to provide financial aid to students who could not pay back loans in the previous year.

Sullivan has said she is hopeful the department will be able to find the funding to cover the tuition gap in the coming year.

“I hope we can get the funding, but we also want to be sure that the universities and colleges that we serve have access so they don’t feel they’re on the hook for any additional expenses,” she said.

“But also, we want to make sure that they’re able to compete and continue to have that kind of support.”

The school reported $935,000 in financial aid in the 2018-2019 academic year, but Stiles said that was down from $1 billion in the years leading up to the recession.

The tuition increase comes as the number of Virginia students enrolled in degree-granting programs has fallen.

The number of students enrolled this academic year was the lowest in more than 20 years, the Virginia Higher Education Coordinating Council reported last month.

The council’s chief economist, Mike McAndrews, said that is a result of students who dropped out of school and had to take on debt to complete their degrees, including $6 billion in student loan debt in 2017.

“That is a lot,” McAndrew’s report said.

McAndrews said that in order for Virginia’s universities to remain competitive in the future, they will need to be able keep up with the demand for graduates.

“What they’re really struggling with is that there’s a tremendous demand for people with a bachelor’s degree in the workforce,” he told CBC News.

“And what we’ve seen is a huge number of people graduating with student loans and then going on to pursue post-secondary education, and then having to pay off those loans.”

Sullivan said students need to work harder to pay back their loans, and that the university is committed to helping students.

“For us, it’s a little bit more challenging than it might be to make a big jump in enrollment, but it’s really the responsibility of the universities to make their financial aid work,” she told CBC.

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