BLACKSBURG -- Virginia Tech President Charles Steger warned of the effects of impending state budget cuts while praising increases in other revenue sources at Monday's quarterly meeting of the board of visitors.

Steger said Provost Mark McNamee and Dwight Shelton, vice president for finance and chief financial officer, are putting together plans for further budget reductions. Steger said the university is "down to the core" after dealing with state budget cuts last year, and managing further cuts will be difficult.

Steger's warning came a week after Gov. Tim Kaine announced his administration will impose another round of budget cuts because of weaker-than-expected growth in tax revenues. Some lawmakers expect the shortfall to reach $1 billion.

Steger said specifics on what the cuts will mean are expected to come out in October.

"We view these things always with some cautious optimism," he said. "But a billion dollars is very real."

Offsetting news of state budget cuts was an announcement that Tech jumped 12 spots in the latest National Science Foundation rankings, from No. 54 to No. 42. The rankings measure the amount of money institutions spend on research and development. Funding for the research comes from federal agencies such as NSF, private foundations, industry and the institutions themselves.

The ranking, based on 2007 fiscal year numbers, is the best for Tech in several years. R&D expenditures increased from $321.7 million in 2006 to $366.9 million in 2007.

Steger also praised donors who have given $690 million as of the end of July toward the university's capital campaign. The campaign, which kicked off its public outreach in October with a $1 billion goal, is ahead of schedule.

"It's a real test to the enthusiasm and commitment and support of the university," Steger said.

In other news from the meeting:

n A student lounge in Litton-Reaves Hall will be named after Emily Hilscher, one of the first two victims in the April 16, 2007, campus shootings. The board approved a resolution renaming the lounge after Hilscher, a student in animal and poultry sciences at Tech, at the request of the Dixie Egg Co. The company established the Emily Jane Hilscher Memorial Classroom Renovation Fund to renovate space in Litton-Reaves, Tech's animal science building.

n The board approved a proposal for a Master of Fine Arts degree in creative technologies. The program will focus on interactive new media and design and digital fabrication and imaging. If approved by the State Council of Higher Education for Virginia, the program will begin in fall 2009.

n The board approved a request to move forward with plans on a $2.3 million indoor batting practice facility. The facility, to be funded by private donations, will be adjacent to English Field and feature three indoor batting cages and two throwing lanes as well as training and storage space.