CHICAGO — University of Illinois President Michael Hogan says scholarships are even more critical as tuition increases, in an era of diminished state funding.

So Hogan and his wife, Virginia, will announce their $100,000 donation Thursday in Chicago, to kick off Access Illinois: The Presidential Scholarship Initiative for all three campuses.

The three-year, $100 million campaign for student aid is a top priority for Hogan, who in his short tenure has seen two significant tuition increases while the state falls behind in funding.

"There is no higher priority to me than making sure that rising costs don't deny students the life-changing opportunities that a University of Illinois education provides," Hogan said Wednesday.

"College is a cornerstone of the American dream, and we are committed to preserving it for our students," he said.

UI spokesman Tom Hardy said state support accounts for 17 percent of the university's fiscal 2011 operating budget, compared to 48 percent in 1980.

For the first time last year, Hardy said, tuition dollars exceeded state appropriation support, with the state contributing 80 cents for every tuition dollar.

Don Kojich, an associate vice president for Marketing and Communications at the UI Foundation, said the campaign will rely heavily on private, corporate and foundation funding.

He said the new initiative, which starts July 1, comes at the tail end of the Brilliant Futures campaign, which is on track to meet its goal of $2.25 billion.

"We're close. Brilliant Futures ends in December, and we've raised $2.1 billion," he said.

Foundation president Sidney Micek said the goal of increasing scholarships as costs increase has something in common with efforts at elite private institutions.

"We need to raise support for our students and help them deal with the rising costs of college. We really have to crank up our scholarship support so the students who apply and are accepted can actually afford it," he said.

"Not just lower-income students, but middle-income students need and will get this assistance in this recession."

According to UI figures, state funding for public universities in Illinois has shrunk by more than 30 percent in the last decade.

The top reason students admitted to the Urbana campus give for choosing to enroll elsewhere is the cost and lack of financial aid.

Nevertheless, the UI will provide $51 million in fiscal 2012 in institutional financial aid for students across the three campuses, Hardy said.

Kojich said the $100 million is "very doable."

"We will focus on current use dollars — money we can use in a more immediate fashion — but we're not going to turn down deferred gifts," he said.

Kojich said the effort is not entirely new.

"Scholarships were part of the Brilliant Futures initiative," he said.

Hogan also announced that the UI has reallocated an additional $3 million to support its President’s Awards Program – the first funding increase in 25 years for the scholarship program, aimed at high-achieving, under-represented students.

The increase will increase funding for the program to $7.5 million, also effective July 1. Awards will increase to $5,000, up from about $1,000 to $3,000.