In addition to its use by startup firms, UC research has played a crucial role in the development of most of the state’s successful industries. For example, the modern biotechnology industry was born from the discovery of recombinant DNA technology by scientists at the San Francisco campus and Stanford University. Furthermore, UC faculty and alumni have founded one-third of the biotechnology companies in California, and the state is home to approximately one-fourth of the U.S. biotechnology industry. In 2011, the biotechnology industry employed 269,997 people in California and generated $114billionin revenue.1
For many decades, as a land-grant institution UC has also worked closely with California’s agricultural industry. In the late 1800s, UC researchers discovered how to remove salts from the soils of California’s Central Valley, turning what was once barren alkaline land into the most productive agricultural region in the world. Since then, UC has remained committed to supporting the agriculture industry by bringing to bear new technologies in crop management and pest control and helping it adapt to changing
regulations while remaining competitive. Additional information about UC’s Agricultural Experiment Stations appears later in this chapter.
RESEARCH ENTERPRISE FUNDING
Direct research expenditures (contrasted with awards as discussed in the next section) totaled $4.4 billion in 2012-13, a 2% decrease from the prior year.2 Federal,
State, and private sources are major providers of UC research funding. Federal agencies are the largest source of support for research, accounting for about half of all University research expenditures in 2012-13.3 Display VII-
3 shows direct research expenditures by fund source for 2012-13, and Display VII-4 shows growth over time among the major providers. Display VII-5 presents trend data about research expenditures in the various disciplines.
12013 California Biomedical Industry Report (http://
http://www.chi.org/industry-intelligence-and-analysis/)
2This rate of growth differs from the rate of growth in
extramural awards noted later, reflecting the multi-year nature of research grant awards.
3In addition, approximately 10% of UC’s research expenditures
from non-federal funds originated as federal awards to other institutions and come to UC as subawards.
Display VII-3: 2012-13 Direct Research Expenditures by Fund Source
Nearly 75% of research funding is derived from federal agencies and private sources.
Display VII-4: Trends in Research Expenditures by Source (Dollars in Millions)
UC federal and private research expenditures have doubled since 2000-01, while State expenditures have remained at almost the same level.
Display VII-5: Direct Research Expenditures by Discipline (Dollars in Millions)
Adjusting for inflation, expenditures for research in the medical fields have increased by 91% since 1998, compared to 47% for all other disciplines.
Federal Funds
UC is a leader among universities receiving research awards. The University was awarded $2.5 billion in federal research funding alone in 2012-13. Awards from the National Science Foundation (NSF) and National Institutes
State & UC
General Funds 11% Private Gifts & Grants 25% Endowment Earnings 4% Other 12% Federal Contracts & Grants 48% 0 500 1,000 1,500 2,000 2,500 2000-01 2012-13 State Federal Private
0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 1997-98 2011-12
Professional Arts and Humanities Social Science Other STEM and Medical Fields
Research
of Health (NIH) and other health and human services accounted for nearly 80% or $1.95 billion of the University’s federal research funding, with the Department of Defense (DOD), National Aeronautics and Space Administration (NASA), and Department of Energy (DOE) making up most of the rest. Historically, UC researchers competed successfully to win nearly 6% and 8% of the NIH and NSF R&D appropriations. Display VII-6 shows the distribution of federal research awards by agency.
Display VII-6: 2012-13 Federal Research Awards by Sponsor
Federal agency sources supply about 60% of all research awards. NSF and NIH and other health and human service agencies provide nearly 80% of federal research awards.
Federal funds are nearly all targeted at research in STEM (Science, Technology, Engineering and Mathematics) and medical fields (about 90% of the total each year during the past decade). This proportion masks research activity that also occurs in the social sciences, arts and humanities, and professional disciplines, which make important
contributions to scholarship, yet have relatively little access to external research funding.
Owing to the dominance of federal funds as a source of research funding, the outcome of the annual federal budget process has the largest impact on the University’s research budget. Fluctuations in UC’s funding from federal agencies closely parallel trends in the budgets of federal research- granting agencies. Display VII-7 provides a recent history of these funding fluctuations.
Although federal government funding for all university research decreased in 2008, an influx of American Recovery and Reinvestment Act (ARRA) funding temporarily reversed the downward trend. As of October 2013, UC researchers have been awarded $1.1 billion in ARRA contract and grant funding for research and research infrastructure. Consistent with overall federal
Display VII-7: History of Federal Funding for UC Research
1982-83 to
1991-92 Annual increases in federal support for UC averaged nearly 10%. 1992-93 to
1996-97 Focus on reducing the federal deficit resulted in much slower growth; federal support for UC rose 4% annually on average, with no increase in 1996-97. 1997-98 to
2001-02 Exceptionally strong growth in the national economy led to funding increases for federal research and development, including a bipartisan commitment to double the NIH budget over 5 years. UC support grew 7% to 9% each year. 2002-03 to
2003-04 After the 9/11 terrorist attacks, federal budgets contained record increases for federal R&D due in part to new spending on homeland security and defense. UC support grew by more than 10% each year. 2004-05 to
2008-09 The federal budget was constrained due to military commitments to Iraq and Afghanistan, and growth of entitlement programs such as Medicare. Growth in research funding for UC again slowed, with annual increases of less than 4%.
2009-10 Due to an influx of funding from the American Recovery and Reinvestment Act (ARRA), federal contracts and grants funding to UC increased by 9%. 2010-11 With the end of ARRA funding, the fiscal
year award total declined 3%. However, non-ARRA funding from both federal and private sources showed a modest increase, mitigating somewhat the ARRA fall-off. 2011-12 The federal funding base remained
essentially unchanged from 2010-11. The most striking increase was a 29% increase in funding provided by corporate sponsors for a total of $464 million in 2011-12. This reflected the slowly improving economic climate and suggested reinvestment in academic research and development. 2012-13 The sequester cuts about $3.5 billion in
federal academic research support nationwide, a reduction of about 7%. This translates to an approximate $175 million decline in federal research funding for UC and an additional decline of $25 million in non-research contracts and grants. This decline will be further compounded as the deadline for spending ARRA funding was September 2013.
National Aeronautics & Space Administration 2% Department of Defense 9% National Science Foundation 16% National Institutes of Health & other Health and Human Service Agencies 63% Other 7% Department of Energy 3%
Research
research funding, the largest amounts of ARRA funding awarded came from NIH and NSF. Many awards were multi-year, but all ARRA funds were required to be expended by September 2013.
In the most recent fiscal year, the sequestration of the federal budget has produced a sharp downturn in support for research at UC, strongly accelerating the problems caused by the absence of ARRA funds. Federal research at UC is down by $346 million or about 12% for the year. This very pronounced drop in funding has an immediate effect on UC’s ability to support graduate students and post-doctoral scholars, as well as pay for facilities that were developed under the assumption of continued federal support from contracts and grants.
Private Funds
Research investment in UC by private organizations has kept pace with federal funds as an important source of research funding. From 2000-01 to 2012-13, private support for research doubled. Private foundations, industry, and partnerships with faculty at other institutions contributed 25% of total research expenditures in 2012-13. The global economic recession caused a decline in new corporate awards, as shown in Display VII-8, but corporate support increased again during 2011-12, decreasing slightly in 2012-13, showing that the business community is reinvesting in UC research. Non-profit research sponsorship has been increasing since 2010-11, with a 26% increase for 2012-13. Among the largest non- profit awards came from the Bill and Melinda Gates
Display VII-8: Private Research Awards by Type of Sponsor (Dollars in Millions)
Corporate and non-profit sources account for nearly a quarter of all UC research awards. Corporate and non- profit awards are above pre-recession levels.
Foundation ($13 million), the Gordon and Betty Moore Foundation ($15 million), the Simons Foundation ($33 million), and Microelectronics Advanced Research Corporation ($33 million).
State Funds
In 2012-13, State funds spent directly for research constituted about 11% of total research funding, including State General Funds, State Special Funds to support coordinated statewide programs, and State agency agreements. For many UC research programs, State funds provide the base support to attract extramural funds by providing seed money for research projects vital to California, whether the subject is earthquake engineering or improved crop varieties.
In 2013-14, State and UC General Funds are providing $338.1 million for direct research, including:
the California Institutes of Science and Innovation; Proof of Concept funds to stimulate greater development
of products and new companies from UC research;
organized research units on individual campuses; multi-campus research programs and initiatives (MRPIs); systemwide programs to support research on AIDS,
geriatrics, and collaborative research with industry; and
agricultural research through the Agriculture Experiment
Stations.
State Special Funds appropriated from restricted State fund sources are providing more than $25 million in funding for a range of research initiatives, including a coordinated statewide program of tobacco-related disease research administered by the University ($11.2 million for 2013-14), but available to researchers from other institutions on a competitive basis. Part of the State’s tobacco tax supports the Breast Cancer Research Program ($11.1 million). The State personal income tax check-off also supports the California Breast Cancer Research Fund ($618,000) and the California Cancer Research Program ($425,000). California State agencies also provide contracts and grants to the University for research similar to federal awards. In 2012-13, expenditures from State agency sources were $185 million. Major providers of State agency agreements are the departments of health care services, social services, transportation, food and agriculture, and education. 0 100 200 300 400 500 2000-01 2004-05 2008-09 2012-13 Corporate Non-profit
Research
Department of Energy National Laboratories
UC oversees three Department of Energy (DOE)
laboratories: the Lawrence Berkeley National Laboratory and two national security laboratories, Lawrence Livermore and Los Alamos National Laboratories. UC receives fees to manage the two national security laboratories and uses them to fund collaborative projects between UC and DOE laboratory researchers. The Lab Fees Research Program supports projects on a range of issues, including
bioterrorism, nuclear nonproliferation, energy efficiency, and new energy resources. Collaborative research between UC and the DOE laboratories gives UC faculty and students access to premier researchers in fields of strategic importance to the nation, as well as unique research facilities that are generally not found at other universities. UC has managed the DOE laboratories since their creation during and immediately after World War II, and it maintains close intellectual ties to the DOE laboratories through this program. The DOE laboratories are discussed in more detail in the Department of Energy
Laboratory Management chapter of this document.