It was October. University Provost Steven E. Hyman stood before the board of directors of the Boston Redevelopment Authority, pleading his case for the approval of Harvard’s first project in its 50-year expansion into Allston.

“The state of California has a $3 billion bond issue and they are daily trying to attract away our scientists,” he said, referring to the 2004 bond that funds embryonic stem cell research in that state. “If we can’t move ahead in a timely fashion, I think we will lose many of our leading scientists to other areas.”

“Keeping this dream team together is absolutely critical,” he added.

Harvard bills the new science complex as part of a strategy to maintain its position at the head of research, but it will be expensive. Over two million square feet will be devoted to science laboratories which will, University officials promise, set the stage for breakthroughs in diabetes, Parkinson’s disease and other chronic maladies.

But keeping Harvard at the head of national scientific research comes at a hefty price.

As the University pours its money into new research facilities in Allston, officials are hoping that the future social benefits will outweigh the current financial costs.

MONEY IN THE BANK

The complex, which ultimately received unanimous approval from the city, comes with a projected price tag of $1 billion. Add in the cost of pacifying community members outraged by the University’s encroachment and the total increases by another $21.5 million.

To fund Allston development, former President Neil L. Rudenstine established a 0.5 percent levy on the endowment that sets aside money for a strategic infrastructure fund devoted to the expansion.

In fiscal year 2006, the Faculty of Arts and Sciences (FAS) contributed $57.8 million of its $13.2 billion endowment to the fund. If the money had remained in the endowment, it would have earned an additional $2.6 million in income. Between fiscal years 2002 and 2006, the cumulative lost growth in income of its endowment was $9.4 million.

FAS has a projected deficit for the 2008-2009 school year.

Still, Harvard administrators maintain that sinking University dollars into cement should be viewed as an investment for the entire University and not a depletion of funds.

“Put it this way, even though money is tight right now, I still want to put money away in my savings account to do the things that I know are important in the future,” FAS Dean Michael D. Smith said in an interview in December. “Allston is absolutely important for FAS in the future. That just needs to be balanced against all the other initiatives that we have on campus.”

“There are always more things to do than we have money for,” he said.

The first project, a 589,000-square-foot science complex set for completion in 2011, will house Harvard’s Stem Cell Institute, the Institute of Bio-Inspired Engineering, the Initiative in Systems Biology, the Chemical Biology program, and the Initiative in Innovative Computing. Allston will also serve as a new home for the School of Public Health, which is currently housed in dozens of disconnected and aging facilities.

“The best science is often done at the interface of disciplines,” said Stephanie Shore, a senior lecturer in physiology at the school, who said that nearly half of her colleagues work over three miles away at the Landmark Center. “You often make progress in science not so much by staying in your own laboratory, in doing what you always do, but by talking to other people who know different things than you do.”

The University has paid close attention to how its newest building will visually symbolize its commitment to cutting-edge technology.

Stefan Behnisch, the architect selected for the project, specializes in environmentally friendly design. The plans call for winter gardens and heat extraction methods to keep the complex’s greenhouse gas emissions capped at 50 percent below the national standard. Glass sky bridges will connect the four buildings in an attempt to aid interdisciplinary collaboration.

“It will certainly send a very strong signal, both regionally and nationally, that Harvard is committed to reinvigorating research in the sciences,” said Alex Krieger, an urban design professor who has been involved with Allston planning in the past.

But others have questioned whether developing land is the best way to revamp Harvard sciences.

Co-discoverer of DNA and former Harvard researcher James D. Watson has been an outspoken critic of Allston expansion.

“To get stars, you need to offer star salaries...The creation or restoration of a great scientific institution is not a matter of real estate development,” Watson wrote in his recently released autobiography entitled “Avoid Boring People: Lessons from a Life in Science.”

But Watson acknowledged that boosting salaries would require Harvard to reconsider how it spends its funds.

“Paying top salaries is well within the means of the largest university endowment on earth—provided that the almost Soviet-style fantasy of the Allston expansion, at present envisioned to cover the area of 25 football fields, is abandoned,” he wrote.

With construction breaking ground this spring on the science complex, officials must wait to see whether University development in Allston will result in scientific breakthroughs that will compensate for current spending.

—Samuel P. Jacobs contributed to the reporting of this story.

—Staff writer Laura A. Moore can be reached at lamoore@fas.harvard.edu.

For recent research, faculty profiles, and a look at the issues facing Harvard scientists, check out The Crimson's science page.