UC Davis' bid for a proposed biolab suffered a crushing setback Thursday when federal officials denied the university funding for a critical research consortium that would have operated out of its proposed facility.

Officials with the U.S. Department of Health and Human Services named eight institutions that will receive five-year grants to operate Regional Centers of Excellence (RCE) where scientists would study infectious diseases and defenses against bioterrorist attacks. University of California, Davis, was not among the grant recipients.

"We're pretty stunned," said Lynne Chronister, associate vice chancellor for research administration.

She and other campus officials had envisioned the $59 million federal grant as a key component in the operation of the university's proposed National Biocontainment Laboratory (NBL).

If the National Institutes of Health were to fund the biolab, the research consortium would have been headquartered within it, providing a large share of the lab's ongoing research money.

Chronister said that if the university were still to receive funding for a biolab, officials would need to establish a collaboration with another institution that was awarded one of Thursday's grants. The only institution on the West Coast awarded funding was the University of Washington.

"We would definitely need to seek other sources of research support, and we would have to work with one of the existing RCEs," she said.

UC Davis' application said it would be working with scientists from throughout the West -- including from Stanford University; the University of California, Los Angeles; Lawrence Livermore lab; and the California Department of Health Services. They would have conducted research for the regional center at various locations in the state. They also would have used the proposed biolab to test dangerous pathogens that require biosafety level 4 security.

The Regional Centers of Excellence are envisioned by federal officials as a national research network to bolster the country's defenses against diseases, whether they are naturally occurring or the result of bioterrorism. The Department of Health and Human Services announced $350 million Thursday for the five-year grants.

Officials from institutions that received the Regional Centers of Excellence grants said they believed that an applicant for a biolab must have an existing collaboration with an RCE in order to remain in the running for biolab funding.

"If we hadn't gotten an RCE, we wouldn't be in contention (for a biolab)," said Tom Curtis, a spokesman for the University of Texas Medical Branch at Galveston.

"The RCE designation is a prerequisite for institutions to be considered," John D. Soto, president of UTMB, said in a prepared statement announcing the university's award.

NIH officials declined to comment on what impact the loss of an RCE grant would have on an application for a biolab, saying the final decisions on the biolab funding have not been made.

UC Davis is vying with at least five other institutions in the nation for $140 million to build a 285,000-square-foot national biocontainment laboratory. In the lab, scientists would study some of the world's most dangerous pathogens, including Ebola, plague and anthrax.

The NIH is expected to announce the funding grants for two such labs later this month.

Of the six known institutions vying for the lab, three received funding for Regional Centers of Excellence: They are the New York State Department of Health, UTMB and the University of Illinois at Chicago, which applied for an RCE in conjunction with the University of Chicago and other local institutions.

The biolab proposal has sparked significant controversy in the city of Davis where more than 150 opponents have packed City Hall for briefings on the issue on several occasions.

Most opponents say they fear the lab could become the target of terrorists and could spread dangerous pathogens through the community through accidents or safety breaches. Marches and silent protests also have been staged to oppose the project.

In February, the Davis City Council voted unanimously to oppose the lab, saying it was too divisive.

A handful of the lab's backers also have spoken at public meetings, and about 25 proponents held a rally in support of the project when officials from the NIH visited the campus in July.

Dick Bakker, a Davis resident who supports the lab, said he was disappointed but hoped UC Davis could still move forward with its biolab proposal.

"I'm certain that UCD is able to handle the lab and all the intricacies of the lab," Bakker said. "They already have ongoing research up to biosafety level 3 on campus."

Don Mooney, an attorney for the group Stop UCD Bio Lab Now, said he has read the NIH's request for proposals for the National Biocontainment Laboratory thoroughly and he believes UC Davis' loss of the Regional Center of Excellence "should be the end" of the biolab proposal. Davis City Councilman Mike Harrington agreed.

"There was funding for the tenant and funding for the facility, and they've lost the funding for the tenant," Harrington said. "UCD should do the right thing and pull their application now to demonstrate their good will to the community."

Other institutions that were awarded RCE grants are: Duke University; Harvard Medical School; Univeristy of Maryland, Baltimore; and Washington University in St. Louis. The University of Iowa and the University of Minnesota received planning grants that could lead to the establishment of regional research centers.