AUSTIN, Texas 

A Mexican-American pediatric surgeon is the nation's first Hispanic to preside over a major university system when Dr. Francisco Cigarroa takes the helm at the University of Texas System, which faces financial woes and complaints about diversity.

Cigarroa, a 51-year-old pediatric transplant surgeon from Laredo, looks at his new job as the system's new chancellor as an opportunity to exceed expectations.

"Challenges really don't dissuade me from pursuing important opportunities," said Cigarroa, who started his new job on Monday. "If you're an optimist, you see opportunities, and that's the way I've been brought up."

Cigarroa, as the chief executive officer of the UT System, will help administer an $11.5 billion operating budget and preside over 15 campuses with more than 194,000 students.

He faces complaints about soaring tuition costs, a growing battle over admissions policies and a hurricane-ravaged medical school and health center in Galveston.

To address those issues, the outgoing president of the UT Health Sciences Center in San Antonio will have to enter an arena far dicier than medicine: politics. The state Legislature granted school officials the power to raise tuition rates in 2003, but has been pressuring the school system to stop increases.

Cigarroa has refused to specify his views on tuition restraints but said school  officials and legislators have to work together to resolve the issue.

He's more passionate about the prospect of changing admissions policies, which currently dictate automatic entry to state universities for students who graduate in the top 10 percent of their high school class.

UT wants the policy relaxed so it can have more say about who gets in the door. At UT-Austin, more than 80 percent of the Texas freshmen gained admission though the top 10 percent provision.

Cigarroa said the system could keep or even increase diversity in the student body even if the top 10 percent law is modified or eliminated.