"I am deeply disappointed to take this action," Napolitano said in a statement. "But Davis is a strong campus, nationally and internationally renowned in many academic disciplines. I'm confident of the campus' continued ability to thrive and serve California students and the Davis community."
Katehi, in a campus email earlier Wednesday, had said she was "100 percent committed" to remain as chancellor.
FOR THE RECORD
10:50 p.m.: A previous version of this article misspelled attorney Melinda Guzman's first name as Linda.
A statement from Katehi attorney Melinda Guzman called Napolitano's action "disappointing, unprecedented and, based on the facts, entirely unjustified."
A renowned scholar in electrical and computer engineering who became chancellor in 2009, Katehi has been widely criticized for questionable moonlighting activities and spending to cleanse the Internet of unfavorable publicity about the pepper-spraying of peaceful student protesters by campus police in 2011.
But Napolitano's letter to Katehi outlined several new issues that the president said would be examined by an independent outside investigator.
She said Katehi's daughter-in-law, who directly reports to one of the chancellor's staff members, had received promotions and pay increases of more than $50,000 over 2 1/2 years. During that same period, Napolitano said, Katehi approved a pay increase of more than 20% and a title change for her daughter-in-law's supervisor.
Napolitano also said that an academic program employing Katehi's son as a paid researcher was recently placed under the direct supervision of the chancellor's daughter-in-law.
"It does not appear that appropriate steps were taken to address, document or obtain approval for the fact that your son now reported to your daughter-in-law, who, in turn, was supervised by one of your direct reports," Napolitano wrote.
Katehi also may have made "material misstatements" when she told the UC president and the news media that she had no knowledge of contracts that UC Davis officials made with social media firms, according to Napolitano's letter.
The Sacramento Bee reported that Davis officials paid the firms at least $175,000 to improve the image of Katehi and the campus, in part by burying negative publicity about the 2011 pepper-spraying incident.
In fact, Napolitano wrote, documents indicate Katehi had "multiple interactions" with one vendor and efforts to set up meetings with others.
The investigator will also review complaints made under the campus whistleblower policy that student fee revenue was misused and specifically directed to "unapproved instructional purposes," Napolitano wrote. She provided no further details.
Earlier in the day, as rumors swirled that Napolitano had asked Katehi to resign, hundreds of UC Davis faculty members rallied behind the chancellor. As of Wednesday evening, more than 400 faculty members had signed a petition expressing strong opposition to any "preemptory action" by Napolitano to remove her without consulting campus administrators or the Academic Senate.
In another letter to Napolitano Sunday, faculty members said they believed Katehi was being singled out for criticism over her moonlighting because she is a woman.
"I am completely shocked [by the allegations]. … She has done a lot of good for the campus with respect to creating and funding programs for students and being transparent about the budget and decision-making such that this seems completely out of character," Linda Bisson, a faculty member, said in an email to The Times.
The chancellor, who earns an annual salary of $424,360, was criticized for accepting lucrative paid board positions with a textbook publisher and a for-profit college firm, DeVry Education Group, under federal and state investigations for misleading advertising.
Katehi took the board position with the college firm without obtaining Napolitano's approval, as UC policy requires, but stepped down and apologized. Napolitano seemed satisfied at the time.
But she told Katehi on Wednesday that the new issues could not be ignored.
"As I said when I defended you after you accepted the DeVry board position, another violation of University policy, you have done some great work for UC Davis," Napolitano wrote. "Given the accumulation of matters that require investigation, however, it is both necessary and appropriate to address these matters in a fair, independent, and transparent manner."
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