Given its ambition, money was tight on the original series, but it wasn't a "cheapie" by any means. The first season's average budget of $190,635 was comparable to other one-hour dramas of the time. However, it didn't help that the series' budget was slashed each season while simultaneously incurring annual contractual pay raises.
This is probably the biggest reason that the series declined going forward. If the budget had at least stayed at the season 1 level, it would have made things better.
That isn't to say, though, that season 3 was terrible. While there were certainly clunkers in there, it also gave us many gems that I really enjoy because the stories hold up exceedingly well.