The year began with the installation of a new chancellor, Robert C. Dynes, a physicist and former UC San Diego senior vice chancellor for academic affairs, replacing Richard C. Atkinson, who had been appointed president of the University of California the previous year.

In November 1996, Bruce B. Darling, UC San Diego vice chancellor for development and university relations, was appointed UC vice president for university and external relations. Winifred Cox, assistant vice chancellor for university communications, was appointed interim vice chancellor for development and university relations while a search was undertaken for a permanent replacement.

Marsha A. Chandler, a former dean of the faculty of arts and sciences at the University of Toronto and a scholar of comparative public policy, was appointed senior vice chancellor for academic affairs, replacing Richard Attiyeh, who had served as interim senior vice chancellor since Dynes was appointed chancellor. Attiyeh returned to his former position as vice chancellor for research and dean of graduate studies.

Edward A. Frieman retired from the position of director of UC San Diego’s Scripps Institute of Oceanography, vice chancellor for marine sciences, and dean of the graduate school of marine sciences on Oct. 31, 1996. Wolfgang H. Berger was appointed to take his place until a permanent director was appointed.

At UC San Diego, an intense debate over the feasibility of establishing a charter school on campus culminated last spring in a decision by the chancellor to appoint a task force to explore the wider question of preparing a greater number of disadvantaged students for higher education.

In September, the task force recommended that UC San Diego should expand its partnerships with public schools, increase student outreach and recruitment, and establish a model school on the La Jolla campus. These recommendations were reviewed by the San Diego Division of the Academic Senate during the fall quarter.

With this in mind, UC San Diego led a partnership—the National Partnership for Advanced Computational Infrastructure (NPACI)—whose plans to revolutionize high-performance computing and keep the United States ahead of its international competitors in all fields of science and engineering were approved by the National Science Foundation in fiscal 1997.

The approval of NPACI, which consists of thirty-eight of the nation’s leading academic and research institutions in eighteen states, ensures that the San Diego Supercomputer Center at UC San Diego will continue to operate as a major center for advanced computer research. Molecular science, neuroscience, earth-systems science, weather forecasting, and drug designing are among the research areas that are expected to benefit from the partnership initially.

High-profile partners include Caltech, UC Berkeley, the University of Texas at Austin, the University of Michigan at Ann Arbor, and the University of Virginia at Richmond. The approval enables NPACI to negotiate for research grants that could amount to as much as $170 million over the next five years.

Representatives of the University of California and the Boehringer Mannheim Corporation (BMC) signed an operating agreement to create a limited liability corporation, Molecular Medicine LLC, that will operate out of UC San Diego and produce vectors for gene and cell therapy and cellular and molecular diagnostic tests.

The production center will be located at the UCSD School of Medicine and expand upon the activities of the already existing Clinical Applications Laboratory of UC San Diego’s Program in Human Gene Therapy. As a consequence of this agreement, discoveries in the field of molecular biology will be more speedily transferred to clinical practice.

The Indianapolis-based BMC is the U.S. regional headquarters of the worldwide Boehringer Mannheim Group, a German pharmaceutical company and world leader in the development and sales of diagnostic tests, biochemicals, and pharmaceutical products.

UC San Diego Chancellor Robert C. Dynes paid tribute to the donors, expressing his gratitude for their generosity, and underlining the importance of private support to the campus. “That $58.1 million is an astounding amount of money for our donors to give in support of the teaching, research and service functions of UC San Diego,” the chancellor said. “Since the state provides only 20 percent of the total campus budget, the need for private support is crucial.”

Of the $58.1 million total, $20.1 million came from foundations, $15.6 million came from corporations, and $11.7 million was given by individuals. The largest amount of the donations, $35.3 million, was given for research.

Among the major gifts, $1.9 million was donated by the Madge Elaine Lawhead Trust of Coronado, California, to establish the Madge Elaine Lawhead Endowed Scholarship for undergraduate students; $1.1 million was donated by the E. Turner Biddle Trust and Lois B. Biddle Trust of Palm Springs, California, to the Keck Foundation Center for Ocean Atmosphere Research at UC San Diego’s Scripps Institution of Oceanography; and Chugai Pharmaceuticals of San Diego donated $1 million to establish the Chugai Pharmaceutical Chair in Cancer.

Sixty-three chairs have now been endowed at UC San Diego.

Extramural funding is a significant source of support for university activities. Twenty-nine percent of UC San Diego’s total current-funds expenditures for fiscal 1997 came from extramural sources.

During the past financial year, 2,125 contracts and grants totaling $351.4 million were awarded to UC San Diego for research and development to be conducted in current and subsequent years, and gifts totaling $20.1 million were pledged or made directly to UC San Diego. An additional $17.8 million in gifts was received from the UC San Diego Foundation.

As of June 30, 1997, UC San Diego had approximately 7,000 active gifts, grants, and contracts from private and federal sources.

As a direct result of the licensing activity, nine research awards were received in the amount of $1.8 million as compared to three totaling $819,000 in fiscal 1996.

The office had a total income of $600,000, an increase of 79 percent over 1996.

Among the major construction projects completed or under way during fiscal 1997 were: a Science and Engineering Research Facility, an Ocean Atmosphere Research Facility, and a new Dance Studio Facility.

The UC San Diego Office of Facilities Design and Construction is anticipating four major projects to be undertaken on campus this year: a new Natural Sciences Interdisciplinary Laboratory Building; the Eleanor Roosevelt College North Campus Housing; two new on-campus parking structures; and a new Bioengineering Building.

Through its Energy Management Program, the department achieved savings in purchased utilities of over $800,000 last year. These savings were instrumental in UC San Diego being honored by the Association of Energy Managers as “Energy Manager of the Year.”

Despite aggressive efforts by the maintenance staff, however, the backlog of deferred maintenance continues to grow, and now stands at over $60 million. Last year the campus spent over $2.5 million on deferred maintenance, a rate at which, if continued, the backlog would take almost twenty-five years to elimnate, disregarding the millions of dollars more in additional work that, inevitably, becomes necessary as facilities age.

During 1996-97, the department led the way in the campus recycling effort. Approximately 3,600 tons of materials were diverted from the landfill, resulting in a cost avoidance of $275,000 and a diversion rate of over 40 percent. Those efforts were publicly recognized when the city of San Diego presented the campus with a “Recycler of the Year” award.

The department continues to set standards of excellence for physical-plant- and facility-management organizations. During the year, over 200 personnel from other college and university physical plants visited the campus to observe and learn. A major area of interest has been the department’s utilization of self-directed work teams.

The promulgation and dissemination of the new universitywide Human Resources Staff Policies and the UCSD Implementing Procedures were completed early in fiscal 1997. The completion of this two-year process, which included the movement to a single personnel program, established current and progressive practices to govern UC San Diego’s conditions of employment.

The Diversity Education Program, dedicated to expanding cultural awareness among members of the UCSD work force in order to ensure a climate of respect and fairness, was expanded to all employees. More than 600 managers and supervisors received training under the program last year.

The planning and development of an electronic job applicant management system that combines state-of-the-art applicant retrieval and interactive voice response technologies with the World Wide Web was undertaken last year. The system, currently in a pilot phase, is being used to match applicants to job vacancy criteria.

To a large extent, UCSD Healthcare remained focused on implementing the fiscal 1996 UCSD Healthcare Performance Improvement Initiative and the final recommendations of the Hunter Group, the experts in health-care systems organization who were retained as consultants in 1996.

One of the principal goals of the reorganization was that costs should be brought down, and this has been achieved. The UCSD Medical Center set 2 to 3 percent of revenues as a comfortable operating margin, and it had an 8 percent excess of income over expenditures at the end of fiscal 1997. This margin will enable the UCSD health-care enterprise to continue to make investments for the future and to maintain programs and facilities at the cutting edge.

To further improve operating efficiencies, all health-care activities, including faculty practices, hospitals, and managed-care operations, have been consolidated under a single administration. Kent Sherwood was recruited as chief executive officer of UCSD Healthcare, and David Sakai was recruited as chief financial officer to manage all health-care finances. Both of these are new positions.

The significance of these appointments is that UCSD Healthcare is now structured to move ahead as a fully integrated health-care enterprise, able to provide services, conduct appropriate strategic analyses, monitor operations, and marshal resources in an integrated fashion across the entire health-sciences enterprise (School of Medicine, hospitals, faculty group practices, and communitywide affiliated practices).

The UCSD Healthcare Network remains dedicated to fostering relationships with community physicians, and it is being reorganized to enable the network to serve patients in a financially responsible fashion.

Aware of the fact that academic health-care centers are not always as sensitive to patient service as they might be, UCSD Healthcare has initiated a program, PROJECT ACCESS, to identify problems where they exist and find solutions for them.

Following a nationwide competition conducted by Medicare, UCSD Healthcare has been awarded the Medicare Demonstration Project, the purpose of which is to see if a Medicare-HMO program can be designed to eliminate the gatekeeper and make specialists more readily available to patients.

The general picture of health care in San Diego is still in flux. Each large health-care system in the region is in the midst of a fundamental internal review and reorganization with a view to redefining its own strategic direction. Although UCSD Healthcare is not currently seeking to merge with another major health-care system, the university recognizes the need for consolidation of high-cost specialist programs with others in the community and continues to pursue opportunities for strategic partnerships.

The store, which operates as an academic resource to the university, had total revenues that exceeded $23 million. Computers and related sales accounted for $8.3 million; textbook sales $5.5 million; supplies and general merchandise $5.2 million; and nonrequired books $4.1 million.

With a database of 200,000 titles and products, the store’s Web site provides customers with the opportunity to virtually visit any department in the store, browse through the stock, and place orders for books, clothing, and gifts. In the first six months of 1997 the number of Web site orders per month increased by over 92 percent.

To reduce the risk of obsolescence and lower costs, the store reduced its inventory by nearly $500,000, just 4.8 percent of the total. Activity Based Costing and Management programs have been implemented to more objectively and efficiently measure business costs and to set goals to improve productivity.

A new project, “Textbooks ’96,” was developed in response to answers received on student surveys. Steps were taken to reduce prices, have inventory on hand at the beginning of each quarter, revise the refund policy, and make buy-back easier in the textbook department. As a result of these efforts, students saved $144,000 on the price of their textbooks.

Regular book signings by authors took place at the campus store and at the downtown center throughout the year. Guest authors included child movie star Diana Sera Cary, San Diego architect Rob Quigley, former senator Bill Bradley, and La Jolla Playhouse director Michael Greif.

The UCSD Bookstore remains dedicated to serving the reading needs of all its customers, whether they be members of the campus community, the wider San Diego community, or the thousands of virtual browsers who visit its Web site.