Amend CSHB 1839 by striking all below the enacting clause and
substituting the following:
SECTION 1. Chapter 62, Education Code, is amended by adding
Subchapter C to read as follows:
SUBCHAPTER C. TEXAS EXCELLENCE FUND
Sec. 62.051. PURPOSE. The Texas excellence fund is
established to provide funding to promote increased research
capacity and to develop institutional excellence at eligible
general academic teaching institutions in order to ensure that
Texas and its workforce remain at the forefront of scientific and
technological innovation.
Sec. 62.052. DEFINITIONS. In this subchapter:
(1) "Eligible comprehensive research university" means
an eligible general academic teaching institution that in each of
the two most recent state fiscal years, as verified by the
coordinating board:
(A) offered a full range of baccalaureate
programs and a wide variety of graduate programs;
(B) awarded 45 or more doctor of philosophy
degrees in the fields of science, agricultural science,
engineering, and clinical and experimental psychology; and
(C) expended at least $15 million in restricted
research funds as reported in the institution's annual financial
report for the applicable year.
(2) "Eligible general academic teaching institution"
means a general academic teaching institution, as defined by
Section 61.003, that is eligible to participate in the funding
provided by Section 17, Article VII, Texas Constitution.
Sec. 62.053. ADMINISTRATION. (a) The Texas excellence fund
is a fund outside the state treasury in the custody of the
comptroller.
(b) The comptroller shall administer and invest the Texas
excellence fund.
Sec. 62.054. FUNDING. (a) The legislature may appropriate
or provide for the transfer of any available money to the credit of
the Texas excellence fund.
(b) The comptroller shall deposit all interest, dividends,
and other income earned from investment of the Texas excellence
fund to the credit of the fund.
(c) The comptroller may accept gifts or grants from any
public or private source for the Texas excellence fund.
(d) An institution may use money appropriated from the Texas
excellence fund only for the support and maintenance of educational
and general activities, including research and student services,
that promote increased research capacity and develop institutional
excellence at the institution.
Sec. 62.055. APPROPRIATION AND ALLOCATION OF FUND TO
ELIGIBLE INSTITUTIONS. (a) In each state fiscal year, the
comptroller shall distribute the total amount of all assets in the
Texas excellence fund to eligible comprehensive research
universities and other eligible general academic teaching
institutions as follows:
(1) 80 percent of the amount distributed from the fund
shall be distributed to the eligible comprehensive research
universities and be allocated among those institutions in
accordance with an equitable allocation formula based on the amount
of restricted research funds expended by each institution as
reported in each institution's annual financial report; and
(2) the remaining amount distributed from the fund
shall be distributed to the eligible general academic teaching
institutions, other than the eligible comprehensive research
universities, and be allocated among those institutions in
accordance with an equitable allocation formula based on the amount
of restricted research funds expended by each institution as
reported in each institution's annual financial report.
(b) Subsection (a) does not apply to the distribution of
money from the Texas excellence fund for the state fiscal biennium
ending August 31, 2003. Notwithstanding any other provision of
this subchapter, for each fiscal year of the state fiscal biennium
ending August 31, 2003, the comptroller shall distribute the money
in the fund among the following general academic teaching
institutions as follows:
FY2002 FY2003
University of Houston $5,533,185 $6,651,584
Texas Tech University $4,769,654 $5,733,723
University of North Texas $1,966,761 $2,364,293
University of Houston-Clear Lake $633,661 $761,740
Southwest Texas State University $710,519 $854,133
Texas A&M University--Kingsville $379,568 $456,288
Texas Southern University $245,801 $295,484
Stephen F. Austin State University $189,169 $227,405
Sam Houston State University $139,113 $167,231
Texas Woman's University $178,415 $214,477
Texas A&M University--Corpus Christi $163,492 $196,538
Lamar University $85,502 $102,784
University of Texas--Pan American $98,993 $119,002
University of Houston--Downtown $49,445 $59,439
Sul Ross State University $36,382 $43,735
Texas A&M University--Commerce $24,646 $29,627
Texas A&M International University $28,867 $34,702
Angelo State University $43,511 $52,306
West Texas A&M University $23,609 $28,381
University of Texas at Brownsville $28,654 $34,445
Midwestern State University $8,054 $9,682
(c) For purposes of Subsection (b), "FY2002" means the state
fiscal year ending August 31, 2002, and "FY2003" means the state
fiscal year ending August 31, 2003. Subsection (b) and this
subsection expire January 1, 2004.
(d) This section expires August 31, 2005.
Sec. 62.056. VERIFICATION OF ALLOCATION FACTORS. (a) For
purposes of this subchapter, the coordinating board shall establish
standards and accounting methods for determining the amount of
restricted research funds expended by an eligible general academic
teaching institution in a state fiscal year.
(b) The coordinating board, as soon as practicable in each
state fiscal year, shall provide the comptroller with verified
information relating to the amounts of restricted research funds
expended and degrees awarded by eligible general academic teaching
institutions as necessary to determine the allocations under this
subchapter for that fiscal year.
(c) The coordinating board may audit the appropriate records
of an eligible general academic teaching institution to verify
information for purposes of this subchapter.
Sec. 62.057. ANNUAL REPORT. Each institution of higher
education that receives money under this subchapter in a state
fiscal year shall prepare a report at the end of that fiscal year
describing the manner in which the institution used the money. The
institution shall include in the report information regarding the
use of money spent in that fiscal year that was received under this
subchapter in a preceding fiscal year. The institution shall
deliver a copy of the report to the coordinating board and the
Legislative Budget Board not later than December 1 after the end of
the fiscal year. The Legislative Budget Board may establish
requirements for the form and content of the report.
SECTION 2. Section 62.025, Education Code, is amended by
amending Subsections (a) and (c) and adding Subsection (d) to read
as follows:
(a) Not later than November 1 of each state fiscal year, the
comptroller shall deposit the first $50 million that comes to the
state at the beginning of each state fiscal year and that is not
dedicated by other law as follows:
(1) except as provided by Subsections (d) and (e), an
amount equal to the portion of the total return on all investment
assets of the higher education fund in the preceding state fiscal
year computed by multiplying that total return by the percentage of
the total return on all investment assets of the permanent fund for
tobacco education and enforcement that constitutes available
earnings as determined by the comptroller under Section 403.1068,
Government Code, in that year must be deposited to the credit of
the Texas excellence fund established under Subchapter C; and
(2) the remaining amount must be deposited to the
credit of the higher education fund.
(c) The deposit required by this section to the higher
education fund expires on September 1 after the date the
comptroller certifies that the value of the higher education fund
is $2 billion. In each state fiscal year that begins on or after
that date, the comptroller shall deposit to the credit of the Texas
excellence fund established under Subchapter C from the first money
that comes to the state at the beginning of that fiscal year an
amount, not to exceed $50 million, equal to the portion of the
total return on all investment assets of the higher education fund
in the preceding state fiscal year computed by multiplying that
total return by the percentage of the total return on all
investment assets of the permanent fund for tobacco education and
enforcement that constitutes available earnings as determined by
the comptroller under Section 403.1068, Government Code.
(d) In any state fiscal year for which the legislature has
made an appropriation specifically for the purposes of the Texas
excellence fund in an amount equal to or greater than the amount
provided by Subsection (a)(1) or (c), as applicable to that state
fiscal year, the deposit to the Texas excellence fund under
Subsection (a)(1) or Subsection (c) may not be made.
(e) An amount may not be deposited to the Texas excellence
fund under this section if Subchapter C expires or is repealed or
if the Texas excellence fund is abolished.
(f) Notwithstanding S.B. No. 1, Acts of the 77th
Legislature, Regular Session, 2001 (General Appropriations Act), in
each year of the biennium, the comptroller shall reallocate a
portion of the appropriation under S.B. No. 1 to be deposited to
the credit of the higher education fund in the amount required by
Subsection (a)(1) to be deposited to the credit of the Texas
excellence fund in each fiscal year. This subsection expires
September 1, 2003.
SECTION 3. Sections 62.026(b) and (d), Education Code, are
amended to read as follows:
(b) The fund consists of the amount <$50 million> deposited
in the fund each state fiscal year under Section 62.025 <of this
code> and interest, dividends, and other income earned from the
investment of the fund.
(d) The comptroller shall administer and invest the fund.
In investing the fund, the comptroller has the same investment
authority as that provided under Sections 11a and 11b, Article VII,
Texas Constitution, or other law to the board of regents of The
University of Texas System with respect to the investment of the
permanent university fund. The investment authority granted to the
comptroller under this subsection is in addition to that provided
by Section 404.024, Government Code, or other law. The
comptroller, in consultation with the presiding officers of the
governing boards of the institutions eligible to benefit from the
investment of the fund under Section 17, Article VII, Texas
Constitution, shall invest the fund in a manner that maximizes the
total return of the fund.
SECTION 4. Chapter 62, Education Code, is amended by adding
Subchapter D to read as follows:
SUBCHAPTER D. UNIVERSITY RESEARCH FUND FOR CERTAIN
PERMANENT UNIVERSITY FUND INSTITUTIONS
Sec. 62.071. PURPOSE. The university research fund is
established to provide funding to promote increased research
capacity and to develop institutional excellence at eligible
general academic teaching institutions.
Sec. 62.072. DEFINITIONS. In this subchapter:
(1) "Eligible general academic teaching institution"
means a general academic teaching institution, as defined by
Section 61.003, that:
(A) is a component institution of The University
of Texas System or The Texas A&M University System, other than The
University of Texas at Austin, Texas A&M University, or Prairie
View A&M University; and
(B) is eligible to participate in the funding
provided by Section 18, Article VII, Texas Constitution.
(2) "Eligible doctoral and research university" means
an eligible general academic teaching institution that:
(A) in each of the two preceding state fiscal
years, as verified by the coordinating board:
(i) offered a full range of baccalaureate
programs and a wide variety of graduate programs; and
(ii) awarded 50 or more doctor of
philosophy degrees; and
(B) in the three preceding state fiscal years,
as verified by the coordinating board, expended an average of at
least $5 million per year in restricted research funds as reported
in the institution's annual financial reports for the applicable
years.
(3) "Eligible emerging doctoral and research
university" means an eligible general academic teaching institution
other than an eligible doctoral and research university that:
(A) in each of the two preceding state fiscal
years, as verified by the coordinating board:
(i) offered a full range of baccalaureate
programs and a wide variety of graduate programs; and
(ii) awarded one or more doctor of
philosophy degrees; and
(B) in the three preceding state fiscal years,
as verified by the coordinating board, expended an average of at
least $5 million per year in restricted research funds as reported
in the institution's annual financial reports for the applicable
years.
Sec. 62.073. ADMINISTRATION. (a) The university research
fund is a fund outside the state treasury in the custody of the
comptroller.
(b) The comptroller shall administer and invest the
university research fund.
Sec. 62.074. FUNDING. (a) In each state fiscal year, the
legislature shall appropriate or provide for the transfer to the
credit of the university research fund of an amount equal to the
amount deposited to the credit of the Texas excellence fund under
Section 62.025 or 62.054 in that fiscal year. The comptroller may
not deposit money to the credit of the Texas excellence fund under
Section 62.025 or 62.054 and the legislature may not appropriate
money specifically for the purposes of the Texas excellence fund
under Section 62.025(d) unless an equal amount is deposited at the
same time to the credit of the university research fund.
(b) The comptroller shall deposit all interest, dividends,
and other income earned from investment of the university research
fund to the credit of the fund.
(c) The comptroller may accept gifts or grants from any
public or private source for the university research fund.
(d) In each state fiscal year, the comptroller shall
distribute all assets in the university research fund as soon as
practicable to eligible institutions in accordance with this
subchapter.
(e) All assets received by an institution under this
subchapter may be used only for the support and maintenance of
educational and general activities, including research and student
services, that promote increased research capacity and develop
institutional excellence at that institution.
(f) As soon as practicable in each fiscal year of the state
fiscal biennium ending August 31, 2003, the comptroller shall
transfer one-half of the $33,774,000 appropriated by S.B. No. 1,
Acts of the 77th Legislature, Regular Session, 2001 (General
Appropriations Act) in the Contingency Appropriation for HB 1839 to
the credit of the university research fund. This subsection
expires September 1, 2003.
Sec. 62.075. ALLOCATION TO ELIGIBLE INSTITUTIONS. In each
state fiscal year, the comptroller shall distribute the total
amount of all assets in the university research fund as follows:
(1) $1 million shall be distributed to the eligible
general academic teaching institutions, other than the eligible
doctoral and research universities and eligible emerging doctoral
and research universities, and allocated among those institutions
in equal amounts; and
(2) the total amount to be distributed less the amount
required to be distributed under Subdivision (1) shall be
distributed to the eligible doctoral and research universities and
eligible emerging doctoral and research universities as follows:
(A) 50 percent shall be apportioned among those
institutions based on the average amount of restricted research
funds expended per year by each institution in the three preceding
state fiscal years as reported in each institution's applicable
annual financial reports; and
(B) the remaining 50 percent shall be
apportioned among those institutions as follows:
(i) 75 percent based on the number of
doctor of philosophy degrees awarded by each institution in the
preceding state fiscal year; and
(ii) the remaining 25 percent based on the
number of master's degrees awarded by each institution in the
preceding state fiscal year.
(3) This section expires August 31, 2005.
Sec. 62.0751. ALLOCATION TO ELIGIBLE INSTITUTIONS FOR
2002-2003 FISCAL BIENNIUM. (a) Section 62.075 does not apply to
the distribution of the total amount of all assets in the
university research fund in the state fiscal biennium ending August
31, 2003. In each state fiscal year of that biennium, the
comptroller shall distribute the total amount of all assets in the
university research fund as soon as practicable as follows:
(1) $1 million shall be distributed to the eligible
general academic teaching institutions, other than the eligible
doctoral and research universities and eligible emerging doctoral
and research universities, and apportioned among those institutions
in equal amounts;
(2) $500,000 shall be distributed to the eligible
doctoral and research universities and apportioned among those
institutions in equal amounts;
(3) $500,000 shall be distributed to the eligible
emerging doctoral and research universities and apportioned among
those institutions in equal amounts; and
(4) the total amount to be distributed less the
amounts required to be distributed under Subdivisions (1), (2), and
(3) shall be distributed to the eligible doctoral and research
universities and eligible emerging doctoral and research
universities as follows:
(A) 50 percent shall be apportioned among those
institutions based on the amount of restricted research funds
expended by each institution in the preceding state fiscal year as
reported in each institution's financial report for the applicable
year; and
(B) the remaining 50 percent shall be
apportioned among those institutions as follows:
(i) 75 percent based on the number of
doctor of philosophy degrees awarded by each institution in the
preceding state fiscal year; and
(ii) the remaining 25 percent based on the
number of master's degrees awarded by each institution in the
preceding state fiscal year.
(b) This section expires August 31, 2003.
Sec. 62.076. VERIFICATION OF ALLOCATION FACTORS. (a) For
purposes of this subchapter, the coordinating board shall establish
standards and accounting methods for determining the amount of
restricted research funds expended by an eligible general academic
teaching institution in a state fiscal year.
(b) The coordinating board, as soon as practicable in each
state fiscal year, shall provide the comptroller with verified
information relating to the amounts of restricted research funds
expended and degrees awarded by eligible general academic teaching
institutions as necessary to determine the allocations under this
subchapter for that fiscal year.
(c) The coordinating board may audit the appropriate records
of an eligible general academic teaching institution to verify
information for purposes of this subchapter.
Sec. 62.077. ANNUAL REPORT. Each institution of higher
education that receives money under this subchapter in a state
fiscal year shall prepare a report at the end of that fiscal year
describing the manner in which the institution used the money. The
institution shall include in the report information regarding the
use of money spent in that fiscal year that was received under this
subchapter in a preceding fiscal year. The institution shall
deliver a copy of the report to the coordinating board and the
Legislative Budget Board not later than December 1 after the end of
the fiscal year. The Legislative Budget Board may establish
requirements for the form and content of the report.
SECTION 5. (a) The lieutenant governor and speaker of the
house of representatives shall appoint a joint committee composed
of:
(1) five members of the senate appointed by the
lieutenant governor; and
(2) five members of the house of representatives
appointed by the speaker.
(b) The speaker and lieutenant governor shall jointly select
a presiding officer or co-presiding officers of the committee from
among the committee members. The committee may designate other
officers as the committee considers appropriate.
(c) The committee shall conduct a study to (i) examine the
feasibility of creating a single research enhancement fund to
provide funding for institutions of higher education that have a
proven research history, (ii) examine how institutions have
historically utilized "excellence funds", and (iii) consider
whether a portion of the annual distribution from the permanent
university fund to the available university fund appropriated to
The University of Texas System under Section 18(f), Article VII,
Texas Constitution, should be appropriated or made available for
appropriation for the support and maintenance of institutions of
higher education in The University of Texas System other than The
University of Texas at Austin. The committee shall consider the
institutions or types of institutions that should be eligible to
receive a portion, if any, of that appropriation to The University
of Texas System, the methods by which any amount should be
allocated among those institutions, and the purposes for which that
amount should be used in the best interests of this state and The
University of Texas System. The lieutenant governor and speaker
may direct the committee to consider other matters related to the
committee's charge under this subsection.
(d) The committee shall conduct any study or inquiry and
make any findings or recommendations the committee considers
appropriate regarding the matters within the committee's charge.
(e) The Legislative Budget Board shall provide staffing and
other assistance to the committee on request. The committee may
request information from the comptroller, the Texas Higher
Education Coordinating Board, or any public institution of higher
education in this state. The comptroller, coordinating board, and
each public institution of higher education shall provide the
requested information to the extent practicable.
(f) The expenses of the committee may be paid from any
appropriate funds of the house of representatives, the senate, or a
legislative agency.
(g) The committee shall file a report of the committee's
activities, findings, and recommendations with the governor, the
lieutenant governor, and the speaker of the house of
representatives not later than December 1, 2002. The report shall
include any recommendations for legislative or administrative
action the committee considers appropriate.
(h) The committee is abolished and this section expires
January 1, 2003.
SECTION 6. This Act takes effect September 1, 2001.