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California's stem cell agency may toss out grant applications seeking millions of dollars for researchers at UCSF and other prestigious universities because they included letters of support from deans who also sit on the citizens' board that governs the $3 billion program.

Sources close to the grant-making process said that staffers at the California Institute for Regenerative Medicine flagged the applications for conflict-of-interest violations, despite a requirement that each request contain a letter of support "signed by the Dean or Departmental Chair."

Among the institutions that have been notified their grant applications are in jeopardy, according to sources who spoke only on condition that they not be named, are UCSF, UCLA, the University of Southern California and UC San Diego.

At stake are grants in the first round of a new $85 million program to pay salaries of stem cell researchers. The initial awards are to be approved on Wednesday by the Independent Citizens' Advisory Committee - the state stem cell governing board, which will meet in Los Angeles.

The grants would create high-paying positions, and universities hoped to use...