UC San Diego is in far deeper financial trouble than it had previously disclosed and could face half a billion dollars in annual budget cuts, it says in a new forecast. Chancellor Pradeep Khosla revealed the situation in a public statement issued late Tuesday, adding that UC San Diego might have to slash its $9 billion budget by as much as 12.5%. Reductions on that scale would seriously hurt teaching and research and threaten jobs at the county’s second-largest employer, and could bring to an end one of the longest and biggest university expansions in the nation. Khosla had already said in February that UC San Diego expected to lose $150 million in funding that it had expected to receive from the NIH to help pay overhead costs in research, plus face a $50 million state budget cut. But the size of the worst-case financial hit more than doubled in the risk analysis the university finished this week. As a result, UC San Diego has indefinitely postponed construction of two big planned research buildings, one on the main campus in La Jolla and the other at its hospital in Hillcrest. Their joint cost: about $565 million. The university will keep building the Triton Center, a $428 million, four-building complex that will become the new social hub of UC San Diego, the school said in a separate statement. Khosla also said a number of workers could lose their jobs due to the combination of budget cuts, canceled grants and cuts to Medicaid funding. The school didn’t indicate whether significant numbers of people have already been let go. “The budget modeling includes potential cuts to UC San Diego Health, including Medicaid/Medicare reimbursements,” UC San Diego said in a separate statement late Wednesday to The San Diego Union-Tribune. A school spokesperson said Khosla was not available for an interview. It was the fifth such request the Union-Tribune has made since early February. In his Tuesday statement, Khosla noted that the university had been notified of disruptions to about 50 research grants over the past month but didn’t elaborate. Several faculty told the Union-Tribune that the National Institutes of Health has been stopping and limiting many clinical studies, largely in health and medicine, and especially in infectious disease research. The Trump administration has directed the NIH to go beyond cutting overhead costs to surgically canceling research contracts at schools nationwide. Khosla blended these issues into his risk analysis, determining that the university could lose anywhere from $75 million to more than $500 million a year in various types of funding. “In a landscape of escalating financial pressures, increased scrutiny, shifting policies, rising costs and exceptional uncertainty about future funding for research universities nationwide, it is essential that we remain nimble and proactive,” he said in the statement. He told his staff to model budget cuts ranging from 2.5% to 12.5%, cuts that could deeply affect university hospitals and medical clinics. Khosla also said that grant cuts could lead to temporary layoffs. He also did not go into detail how how cuts could affect UC San Diego’s more than 44,000 students, who worry the cuts will mean larger classes, shorter library hours and fewer teaching assistants, particularly in popular engineering programs. And last month, the university said it would no longer guarantee full funding for the first-year graduate students who enroll this fall. “At this time, we do not expect an impact on undergraduate enrollment, and no letters of graduate admission have been withdrawn or added to the waitlist,” UC San Diego told the Union-Tribune late Wednesday. Potential congressional cuts to Medicaid have emerged as a major area of concern. The program, jointly funded by states and the federal government, provides health coverage to low-income people and people with disabilities. “If we end up losing $100 million a year of (Medicaid) reimbursement, you know, we have to shift some of our strategy,” Patty Maysent, chief executive officer of UC San Diego Health, said last month. “If we didn’t have the level of demand that we currently have, maybe I would be less aggressive — but because we do, we need to continue finding ways to service the patients.” Staff writer Paul Sisson contributed to this report. ...read more read less