WASHINGTON -- The University of California shrugged off scandal and congressional skepticism Thursday and won another chance to manage Los Alamos National Laboratory.

Winning the seven-year, multimillion-dollar contract keeps the university in the nuclear weapons business it first entered during World War II. But in hopes of getting past some rocky times, the university will now join with San Francisco-based engineering giant Bechtel in overseeing Los Alamos.

"I cannot stress enough that this is a new contract, with a new team, marking a new approach to management at Los Alamos," Energy Secretary Samuel Bodman said in announcing the decision. "It is not a continuation of the previous contract."

The University of California and Bechtel, linked with smaller partners, beat out a partnership of the University of Texas and Lockheed Martin. This was the first time the University of California faced competition for the contract it has held, in one form or another, for the past six decades.

Good performance, moreover, could earn the University of California team contract extensions stretching out for the next 20 years.

"If the new team lives up to our expectations, as I fully expect, we have set Los Alamos on a course for continued excellence for a generation," Bodman said.

Originally dubbed Project Y when scientists began designing the first atomic bomb in 1943, the Los Alamos lab now employs 13,300 employees and contractors. Its sister facility in the Livermore Valley, Lawrence Livermore National Laboratory, is also managed by the University of California.

Michael Anastasio, a bearded nuclear physicist who directed the Lawrence Livermore lab for the past three years, is now slated to take over as the Los Alamos manager.

"Mike provided excellent leadership at Livermore," said Antioch Democrat Ellen Tauscher, whose district includes the Lawrence Livermore facility.

The Lawrence Livermore lab contract expires on Sept. 30, 2007, and will likewise be put out for competitive bidding, although the University of California has not yet made the formal decision whether it will apply.

The new Los Alamos lab team, which includes some New Mexico public universities and is called Los Alamos National Security LLC, will be able to earn as much as $512 million in management fees over seven years, depending on performance. The new contract kicks in next June 1.

But university officials, and the California lawmakers who have been their strongest advocates, have always insisted that money is not their paramount concern. With three-quarters of the lab's $2.2 billion annual budget devoted to weapons and defense-related research, officials cast the contract as a matter of patriotism and prestige.

"Today," Gov. Arnold Schwarzenegger declared, "is a great day for California."

University of California President Robert C. Dynes added that the university "believed we could make a vital contribution to the country by applying scientific excellence to national security."

Even so, the contract award represents a determined comeback by the University of California. The university has faced serious criticism in recent years for assorted Los Alamos mishaps that ranged from security leaks and missing laptop computers to expensive meals and improper travel.

"Given the length of time (the university) operated without the threat of competition, it appears that it had been lulled into a state of irresponsible complacency," Pennsylvania Republican James Greenwood warned in a 2003 investigative hearing.

Earlier this year, while recognizing improvements, Energy Department Inspector General Gregory Friedman cautioned that the highly sensitive Los Alamos site was still vulnerable to "weaknesses in the protection of the department's critical resources and infrastructure."

The problems, the watchdog group Project on Government Oversight declared, have been sufficient that "it is hard to see how UC could possibly have been given a vote of confidence."

Tauscher and the rest of California's congressional delegation conceded in a letter last month that "there have been management lapses," but stressed that "few question the quality of the science" conducted.

The University of California's other two partners are the Virginia-based BWX Technologies, which operates several Energy Department nuclear facilities, and the Idaho-based Washington Group International, a contracting firm whose nuclear power work goes back to the days of the Manhattan Project in World War II.