Chancellor Larry Vanderhoef announced Thursday that he will look to two experienced academic leaders from within UC Davis to serve as provost and executive vice chancellor during the next four years, rather than appoint an outside candidate to oversee campus resources during a period of deepening budget challenges.

In a letter to the campus community issued Thursday, Vanderhoef said he plans to extend the term of Interim Provost Barbara Horwitz through this December. And he announced his plans to appoint Enrique Lavernia, dean of the College of Engineering, to a three-year term as provost and executive vice chancellor beginning Jan. 1, 2009. Both moves will require approval from the UC president and UC Board of Regents.

"When we began our national search last fall, California's fiscal circumstance was dramatically different than it is today," Vanderhoef said of a state budget deficit that has grown from an estimated $6 billion to $16 billion. "The provost and executive vice chancellor, in consultation with the Academic Senate and our administrative team, will be responsible for ensuring that UC Davis continues to build upon its foundation of excellence while dealing with a very difficult budgetary circumstance. After considerable deliberation, I have concluded that this is not a situation into which we can bring a new person from outside the University of California."

Three finalists from across the country had traveled to UC Davis in February to meet with a recruitment committee, faculty members and other campus constituencies to explore the possibility of serving as the campus's second-in-command and chief financial officer, overseeing a budget of more than $2.6 billion.

"Our finalists were all distinguished scholars with impressive records of achievement," the chancellor wrote. "I know as well, from the evaluations by dozens of campus citizens, the recruitment advisory committee and the Council of Deans and Vice Chancellors, that each had strong advocates, so I particularly regret the circumstance that forces me to suspend our search."

Vanderhoef said that the role of provost, which he held himself for a decade before being named chancellor in 1994, "is arguably the most complex in the university." He noted that the provost is responsible for stewarding and allocating campus resources including money, faculty and staff positions, student enrollments, land, building space and construction funds on both the Davis and Sacramento campuses.

"Fortunately, we have two experienced campus administrators to draw upon until the time is more appropriate to resume our search for a permanent provost and executive vice chancellor," Vanderhoef said.

The campus has been seeking a successor to Provost Virginia Hinshaw, who left UC Davis last June to assume the chancellorship at the University of Hawaii, Manoa. Horwitz, a professor of physiology whose permanent administrative position is vice provost for academic personnel, has served as provost and executive vice chancellor since July.

As leader of the budget planning efforts, Horwitz last month advised all deans, vice provosts and vice chancellors to cut an average 2.6 percent from general fund budgets for academic units, and 7 percent from academic support and other administrative units, effective July 1, with exceptions for graduate student support from Graduate Studies, student mental health programs and externally purchased utilities. The governor has proposed a 10 percent cut to the UC system, $417 million below what the UC Regents proposed for 2008-09. UC Davis' situation is worsened by a campus energy deficit of $10 million.

"Barbara has done a remarkable job of leading an open, consultative budget planning process and in setting budget planning priorities as we enter a period of fiscal uncertainty," Vanderhoef said. "Her experience and leadership have helped us establish a solid framework and I am ... grateful for her willingness to continue to guide us through what will be a critical year of decision making for all of us."

To ensure "the smoothest transition possible," Vanderhoef has asked Lavernia to begin phasing into the position between July and December.

"Enrique is a longtime University of California citizen whose considerable administrative experience at both the Irvine and Davis campuses prepares him well for this term appointment," Vanderhoef said. "Under Enrique's leadership, the College of Engineering has experienced great growth and progress while also under resource constraints."

Lavernia has served as dean of the College of Engineering since September 2002, overseeing one of the nation's fastest-growing engineering schools with 15 undergraduate majors, more than 200 faculty and 4,200 undergraduate and graduate students. Prior to coming to UC Davis, Lavernia was chair of the Department of Chemical Engineering and Materials Science at UC Irvine. He has published 400 journal and 200 conference publications on topics ranging from nanomaterials to aluminum alloys.

Vanderhoef said that consultation will begin immediately with the College of Engineering regarding the appointment of an interim dean while Lavernia serves as provost and executive vice chancellor.

"I am grateful to both Barbara Horwitz and Enrique Lavernia for providing such sure and seasoned leadership at a time of unusual challenge for UC Davis," Vanderhoef wrote. "I know they will appreciate your support."