MMA H.B. 1235 75(R)BILL ANALYSIS HIGHER EDUCATION C.S.H.B. 1235 By: Junell 2-26-97 Committee Report (Substituted) BACKGROUND Under Chapter 55, Education Code, institutions of higher education have the authority to issue revenue bonds for the purpose of providing funds to acquire or improve educational facilities. These bonds may be backed by future tuition revenues of the board including, any rentals, rates, charges, fees or other resources collected from students. Sections 55.171 through 55.173 provide the guidelines for the authority of an institution of higher education to issue revenue bonds that may be backed by revenue funds of the institution, including student tuition charges. PURPOSE C.S.H.B. 1235 grants authority to the board of regents of various institutions of higher education to finance capital improvements by the issuance of bonds in accordance with Subchapter B, Chapter 55, Education Code. The board may pledge to the payment of these bonds all or any part of the revenue funds of the institution, including student tuition charges. 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 55.17(e), Chapter 55, Education Code by adding Subdivision (4) which provides that in addition to authority already granted in Chapter 55, the board of regents of Texas Tech University and the Texas Tech University Health Sciences Center may issue bonds to finance items listed under Subdivision (1) in an additional aggregate principal amount for Texas Tech University not to exceed $66 million, and in an additional aggregate principal amount for the Texas Tech University Health Sciences Center not to exceed $51.2 million. The board may back these bonds with all or part of the revenue funds of the institution, including student tuition charges imposed on students enrolled at Texas Tech University or at the Texas Tech University Health Sciences Center. Contains standard provision that the amount pledged may not be reduced or revoked. SECTION 2. Amends Subchapter B, Chapter 55, Education Code, by adding the following Sections: Section 55.1721 THE TEXAS A&M UNIVERSITY SYSTEM. (a) Provides that in addition to authority already granted in Chapter 55, the board of regents of The Texas A&M University System may finance or build capital improvement projects for the following institutions by the issuance of bonds in accordance with a financing program adopted by the board in aggregate amounts not to exceed the following: (1) Prairie View A&M University, $15 million; (2) Tarleton State University, $15 million; (3) Texas A&M University--Commerce, $10 million; (4) Texas A&M University--Corpus Christi, $30 million; (5) Texas A&M International University, $70 million; (6) Texas A&M University--Kingsville, $17.5 million; (7) Texas A&M University--Texarkana, $5 million; (8) West Texas A&M University, $10 million. (b) The board may back these bonds with all or part of the revenue funds of the institution, including student tuition charges imposed on students enrolled at any component of The Texas A&M University System. Contains standard provision that the amount pledged may not be reduced or revoked. (c) If sufficient funds are not available to the board to meet its obligations under this section, the board may transfer funds among components of The Texas A&M University System to ensure the most equitable and efficient allocation of available resources. Section 55.1722 THE UNIVERSITY OF TEXAS SYSTEM. (a) Provides that in addition to authority already granted in Chapter 55, the board of regents of The University of Texas System may finance or build capital improvement projects for the following institutions by the issuance of bonds in accordance with a financing program in aggregate amounts not to exceed the following: (1) The University of Texas at Arlington, $40.7 million; (2) The University of Texas at Brownsville, $50 million; (3) The University of Texas at Dallas, $6.4 million; (4) The University of Texas at El Paso, $20 million; (5) The University of Texas--Pan American, $42.08 million; (6) The University of Texas of the Permian Basin, $37.2 million; (7) The University of Texas at San Antonio, $104.7 million; (8) The University of Texas at Tyler, $12.7 million. (b) The board may back these bonds with all or part of the revenue funds of the institution, including student tuition charges imposed on students enrolled at any component of The University of Texas System. Contains standard provision that the amount pledged may not be reduced or revoked. (c) If sufficient funds are not available to the board to meet its obligations under this section, the board may transfer funds among components of The University of Texas System to ensure the most equitable and efficient allocation of available resources. Section 55.1723 THE UNIVERSITY OF HOUSTON SYSTEM. (a) Provides that in addition to authority already granted in Chapter 55, the board of regents of the University of Houston System may finance or build capital improvement projects for the University of Houston--Downtown in accordance with a finance program adopted by the board in an aggregate amount not to exceed $8.2 million. (b) The board may back these bonds with all or part of the revenue funds of the institution, including student tuition charges imposed on students enrolled at any component of the University of Houston System. Contains standard provision that the amount pledged may not be reduced or revoked. (c) If sufficient funds are not available to the board to meet its obligations under this section, the board may transfer funds among components of the University of Houston System to ensure the most equitable and efficient allocation of available resources. Section 55.1724 TEXAS STATE UNIVERSITY SYSTEM. (a) Provides that in addition to authority already granted in Chapter 55, the board of regents of the Texas State University System may finance or build capital improvement projects for the following institutions by the issuance of bonds in accordance with a financing program adopted by the board in aggregate amounts not to exceed the following: (1) Angelo State University, $22.06 million; (2) Lamar University--Beaumont, $8.4 million; (3) Lamar University Institute of Technology, $2.75 million; (4) Lamar University--Orange, $4.6 million; (5) Lamar University--Port Arthur, $3.16 million; (6) Sam Houston State University, $8.97 million; (7) Southwest Texas State University, $21.7 million; (8) Sul Ross State University, $6.69 million; (b) The board may back these bonds with all or part of the revenue funds of the institution, including student tuition charges imposed on students enrolled at components of the Texas State University System. Contains standard provision that the amount pledged may not be reduced or revoked. (c) If sufficient funds are not available to the board to meet its obligations under this section, the board may transfer funds among components of the Texas State University System to ensure the most equitable and efficient allocation of available resources. Section 55.1725 UNIVERSITY OF NORTH TEXAS AND UNIVERSITY OF NORTH TEXAS HEALTH SCIENCE CENTER AT FORT WORTH. (a) Provides that the board of regents of the University of North Texas may finance or build capital improvement projects for the University of North Texas or the University of North Texas Health Science Center at Fort Worth by the issuance of bonds in aggregate amounts not to exceed $24 million for the University of North Texas and $23 million for the University of North Texas Health Science Center at Fort Worth. (b) The board may back these bonds with all or part of the revenue funds of the institution, including student tuition charges imposed on students enrolled at the University of North Texas or the University of North Texas Health Science Center at Fort Worth. Contains standard provision that the amount pledged may not be reduced or revoked. (c) If sufficient funds are not available to the board to meet its obligations under this section, the board may transfer funds between the University of North Texas and the University of North Texas Health Science Center at Fort Worth to ensure the most equitable and efficient allocation of available resources. Section 55.1726 TEXAS WOMAN'S UNIVERSITY. (a) Provides that Texas Woman's University board of regents may finance or build capital improvement projects for Texas Woman's University by the issuance of bonds in aggregate amounts not to exceed $10.1 million. (b) The board may back these bonds with all or part of the revenue funds of the institution, including student tuition charges imposed on students enrolled at Texas Woman's University. Contains standard provision that the amount pledged may not be reduced or revoked. Section 55.1727 MIDWESTERN STATE UNIVERSITY. (a) Provides that Midwestern State University board of regents may finance or build capital improvement projects for Midwestern State University by the issuance of bonds in aggregate amounts not to exceed $15 million. (b) The board may back these bonds with all or part of the revenue funds of the institution, including student tuition charges imposed on students enrolled at Midwestern State University. Contains standard provision that the amount pledged may not be reduced or revoked. Section 55.1728 STEPHEN F. AUSTIN STATE UNIVERSITY. (a) Provides that Stephen F. Austin State University board of regents may finance or build capital improvement projects for Stephen F. Austin State University by the issuance of bonds in aggregate amounts not to exceed $10 million. (a) The board may back these bonds with all or part of the revenue funds of the institution, including student tuition charges imposed on students enrolled at Stephen F. Austin State University. Contains standard provision that the amount pledged may not be reduced or revoked. SECTION 3. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE HB 1235, as filed, gave additional authority to issue revenue bonds to Texas A&M University System for Texas A&M International University. The C.S.H.B. 1235 increases the amount for Texas A&M International University to $70 million from $5 million and gives the following institutions authority to issue revenue bonds for designated amounts to finance capital improvement projects: Texas Tech University Texas Tech University Health Sciences Center Texas A&M University System: Prairie View A&M University Tarleton State University Texas A&M University--Commerce Texas A&M University--Corpus Christi Texas A&M University--Kingsville Texas A&M University--Texarkana West Texas A&M University The University of Texas System The University of Texas at Arlington The University of Texas at Brownsville The University of Texas at Dallas The University of Texas at El Paso The University of Texas--Pan American The University of Texas of the Permian Basin The University of Texas at San Antonio The University of Texas at Tyler The University of Houston System University of Houston--Downtown Texas State University System Angelo State University Lamar University--Beaumont Lamar University Institute of Technology Lamar University--Orange Lamar University--Port Arthur Sam Houston State University Southwest Texas State University Sul Ross State University University of North Texas and University of North Texas Health Science Center at Fort Worth Texas Woman's University Midwestern State University Stephen F. Austin State University