This report responds to the 1992 Virginia legislative direction and offers suggestions on how the state's colleges and universities should change their resource allocations to extend the reach of teaching faculty and develop new and creative approaches to the work of teaching, research, and service. Restructuring in the areas of staffing productivity and curricular change is urged. Recommendations are offered in the context of the expectation that at least 65,000 additional students will seek higher education by the year 2001 and the approval by voters, in 1992, of $472 million in bonds which will allow accommodation of about 40,000 more students. The report urges that the following specific tasks be completed by 1996: efforts toward de-bureaucratization and decentralization of both state government and the colleges and universities; state enrollment planning to restructure at a reasonable pace; increased institutional planning; Council of Higher Education advocacy of faculty salaries and development; construction, renovation, and maintenance of instructional and research space; procurement of superior instructional and research equipment; funding for library materials; and provision of adequate student financial aid. The report suggests that funding increases should be targeted toward improving salaries and providing incentives to help institutions extend the reach of current faculty. Tasks to be completed by century's end include changing to a competency model rather than the current "credit-for-contact" model of educational delivery and effective use of technology in classrooms and laboratories. (JB)