BILL ANALYSIS H.B. 2462 By: Junell April 18, 1995 Committee Report (Unamended) BACKGROUND The Higher Education Assistance Fund (HEAF) was created in 1984 in Article VII, Section 17, of the Constitution. The fund provides aid to Texas public universities that are outside the University of Texas and Texas A&M University systems. Until 1984 UT and A&M system schools alone had a constitutionally dedicated source of funding for capital needs: the Permanent University Fund (PUF). The HEAF was created to provide a similar constitutional fund for all other state universities. An Advisory Committee, consisting of representatives from all institutions and systems that are eligible to receive HEAF revenues, was created in 1983. The Advisory Committee recommends the formula used to distribute the HEAF funds to the Commissioner and the Coordinating Board. The annual appropriation originally set at $100 million will be raised to $175 million in September 1995 with an annual dedication of $50 million toward establishment of a $2 billion dollar higher education fund to serve as an endowment for future capital expenditures. The Texas State Technical College System will also be added to the HEAF in September of 1995. HEAF funds are used for capital projects and equipment used jointly for educational and general activities and for auxiliary enterprises to the extent of their use for educational and general activities. PURPOSE This bill sets out the allotments of the HEAF fund adding the Texas State Technical College System and an additional set-aside for Texas Southern University. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 62.003, Education Code, by defining "Coordinating Board." SECTION 2. Amends Section 62.021(a) and (b), Education Code, by setting out the HEAF allotments as follows: (a) $5,572,558 East Texas State University at Texarkana $9,468,548 Lamar University including LU at Orange and LU at Port Arthur $2,862,203 Midwestern State University $20,217,740 University of North Texas $10,174,500 UT--PanAm and UT--Brownsville $6,468,273 Stephen F. Austin State University $3,640,000 University of North Texas HSC at Ft. Worth $23,181,556 Texas State University System $8,199,288 Texas Southern University (includes $1,000,000 for compliance with Texas Desegregation Plan) $16,887,085 Texas Tech University $7,735,000 Texas Tech University HSC $6,849,160 Texas Woman's University $37,726,969 University of Houston System $12,167,120 TAMU--Corpus Christi, TAM International U, TAMU-- Kingsville, West Texas AMU $3,850,000 Texas State Technical College System (excluding extension centers or programs) (b) Removes the requirement that land acquisition projects proposed for coordinating board endorsement within three months of the legislative session be automatically referred to the legislature for consideration. Makes conforming changes. SECTION 3. Amends Section 62.022, Education Code, to require only the coordinating board, rather than the coordinating board and the Texas Colleges and University System, conduct a study of the five-year period adjustment of the formulas and present findings to the legislature. Authorizes the coordinating board to study the educational and general building quality, if the legislature appropriates money to fund the survey. Requires the Coordinating Board rather than the Coordinating Board and the Texas Colleges and University System to conduct a study of the ten-year period allocation beginning in 2005 and present the findings to the LBB and House and Senate Standing Committees having cognizance over legislation related to the HEAF prior to the Legislative Session in 2005. Makes conforming changes throughout the Section. SECTION 4. Subchapter B, Chapter 62, Education Code, is amended by adding Section 62.027 as follows: Sec. 62.027. EFFECT OF LEGISLATION. (a) The constitutional amendment proposed by HJR 13, 73rd Legislature and ratified by voters on November 2, 1993, authorized the legislature by a two-thirds vote of the membership of each house to increase the amount of the appropriation made under Section 17(a), Article VII, Texas Constitution for each five-year period. (b) Chapter 537, Acts of the 73rd Legislature, Regular Session, 1993, added Section 62.024 to this subchapter in order to increase the amount of the appropriation made under Section 17(a), Article VII, Texas Constitution. (c) The increase provided by Section 62.024 in the amount of the appropriation made under Section 17(a), Article VII, Texas Constitution, is valid and effective beginning September 1, 1995. SECTION 5. The amounts allocated under Section 62.021, Education Code, as amended by this Act, apply to each state fiscal year beginning with the state fiscal year beginning September 1, 1995. SECTION 6. Emergency clause. SUMMARY OF COMMITTEE ACTION H.B. 2462 was taken up in a public hearing on April 5, 1995. The bill was laid out by Representative Junell. The Chair recognized Bill Beckham and Don Brown with the Texas Higher Education Coordinating Board to testify on the bill. The bill was left pending in Committee. H.B. 2462 was taken up in a public hearing on April 12, 1995. No witnesses testified on the bill. Representative Kubiak moved H.B. 2462 be sent to the Committee on Calendars with the recommendation it do pass. The motion prevailed with a record vote of 17 ayes, 0 nays, 0 p-n-v, and 10 absent.