On a languorous Sunday in June, low season on the campus of the University of Virginia, Prof. Larry Sabato opened a perplexing e-mail. “My instant reaction,” he said, “was that I thought we’d been hacked.” The message, sent to the entire university, announced the resignation of the university’s president, Teresa Sullivan, obliquely citing a “philosophical difference of opinion” with the institution’s governing board. Sullivan had held the job for just two years, without any scandal, and Sabato couldn’t believe she had been pushed aside with so little evident justification. “I said that if this was true,” he recalled, “this was going to be a P.R. disaster of national proportions.” Sabato is accustomed to offering predictions — a prodigiously quotable political scientist, he maintains a Web site called Sabato’s Crystal Ball. And his opinions carry serious weight around UVA, an institution he has been immersed in since his undergraduate days in the 1970s, when he served as president of the Student Council. Sabato called around and discovered that the school’s deans had learned of the resignation just that morning at a meeting in which Helen Dragas, the real estate developer who led UVA’s board, warned that the university faced an “existential threat.” The professional educators who ran UVA were well aware that public universities everywhere were enduring a crisis. State governments have been slashing funding, driving per-student spending to historic lows, forcing schools to raise tuition, while controlling costs through salary freezes and other austerity measures. Founded and designed by Thomas Jefferson and renowned as one of the country’s finest state institutions, the University of Virginia is better off than most of its counterparts: it fears mediocrity, not insolvency. But along with other elite public universities, it is struggling to figure out how to continue providing a premium education with less government support. If anyone appeared equipped to manage the situation, it was Sullivan: she had come to Virginia after excelling in administrative positions at the University of Texas and the University of Michigan. “Everybody had the same reaction,” Sabato told me. “First, shock, and then a sneaking suspicion that there had to be something else.” That afternoon, in the 90-degree heat, Sabato looked on as Dragas gave an outdoor news conference. She promised to replace Sullivan with “a bold, strategic, visionary leader” but refused to answer when asked for the reasons behind Sullivan’s departure.