1-1 AN ACT
1-2 relating to research and excellence funding at certain institutions
1-3 of higher education.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Chapter 62, Education Code, is amended by adding
1-6 Subchapter C to read as follows:
1-7 SUBCHAPTER C. TEXAS EXCELLENCE FUND
1-8 Sec. 62.051. PURPOSE. The Texas excellence fund is
1-9 established to provide funding to promote increased research
1-10 capacity and to develop institutional excellence at eligible
1-11 general academic teaching institutions in order to ensure that
1-12 Texas and its workforce remain at the forefront of scientific and
1-13 technological innovation.
1-14 Sec. 62.052. DEFINITIONS. In this subchapter:
1-15 (1) "Eligible comprehensive research university" means
1-16 an eligible general academic teaching institution that in each of
1-17 the two most recent state fiscal years, as verified by the
1-18 coordinating board:
1-19 (A) offered a full range of baccalaureate
1-20 programs and a wide variety of graduate programs;
1-21 (B) awarded 45 or more doctor of philosophy
1-22 degrees in the fields of science, agricultural science,
1-23 engineering, and clinical and experimental psychology; and
1-24 (C) expended at least $15 million in restricted
2-1 research funds as reported in the institution's annual financial
2-2 report for the applicable year.
2-3 (2) "Eligible general academic teaching institution"
2-4 means a general academic teaching institution, as defined by
2-5 Section 61.003, that is eligible to participate in the funding
2-6 provided by Section 17, Article VII, Texas Constitution.
2-7 Sec. 62.053. ADMINISTRATION. (a) The Texas excellence fund
2-8 is a fund outside the state treasury in the custody of the
2-9 comptroller.
2-10 (b) The comptroller shall administer and invest the Texas
2-11 excellence fund.
2-12 Sec. 62.054. FUNDING. (a) The legislature may appropriate
2-13 or provide for the transfer of any available money to the credit of
2-14 the Texas excellence fund.
2-15 (b) The comptroller shall deposit all interest, dividends,
2-16 and other income earned from investment of the Texas excellence
2-17 fund to the credit of the fund.
2-18 (c) The comptroller may accept gifts or grants from any
2-19 public or private source for the Texas excellence fund.
2-20 (d) An institution may use money appropriated from the Texas
2-21 excellence fund only for the support and maintenance of educational
2-22 and general activities, including research and student services,
2-23 that promote increased research capacity and develop institutional
2-24 excellence at the institution.
2-25 Sec. 62.055. APPROPRIATION AND ALLOCATION OF FUND TO
2-26 ELIGIBLE INSTITUTIONS. (a) In each state fiscal year, the
2-27 comptroller shall distribute the total amount of all assets in the
3-1 Texas excellence fund to eligible comprehensive research
3-2 universities and other eligible general academic teaching
3-3 institutions as follows:
3-4 (1) 80 percent of the amount distributed from the fund
3-5 shall be distributed to the eligible comprehensive research
3-6 universities and be allocated among those institutions in
3-7 accordance with an equitable allocation formula based on the amount
3-8 of restricted research funds expended by each institution as
3-9 reported in each institution's annual financial report; and
3-10 (2) the remaining amount distributed from the fund
3-11 shall be distributed to the eligible general academic teaching
3-12 institutions, other than the eligible comprehensive research
3-13 universities, and be allocated among those institutions in
3-14 accordance with an equitable allocation formula based on the amount
3-15 of restricted research funds expended by each institution as
3-16 reported in each institution's annual financial report.
3-17 (b) Subsection (a) does not apply to the distribution of
3-18 money from the Texas excellence fund for the state fiscal biennium
3-19 ending August 31, 2003. Notwithstanding any other provision of
3-20 this subchapter, for each fiscal year of the state fiscal biennium
3-21 ending August 31, 2003, the comptroller shall distribute the money
3-22 in the fund among the following general academic teaching
3-23 institutions as follows:
3-24 FY2002 FY2003
3-25 University of Houston $5,533,185 $6,651,584
3-26 Texas Tech University $4,769,654 $5,733,723
3-27 University of North Texas $1,966,761 $2,364,293
4-1 University of Houston-Clear Lake $633,661 $761,740
4-2 Southwest Texas State University $710,519 $854,133
4-3 Texas A&M University--Kingsville $379,568 $456,288
4-4 Texas Southern University $245,801 $295,484
4-5 Stephen F. Austin State University $189,169 $227,405
4-6 Sam Houston State University $139,113 $167,231
4-7 Texas Woman's University $178,415 $214,477
4-8 Texas A&M University--Corpus Christi $163,492 $196,538
4-9 Lamar University $85,502 $102,784
4-10 University of Texas--Pan American $98,993 $119,002
4-11 University of Houston--Downtown $49,445 $59,439
4-12 Sul Ross State University $36,382 $43,735
4-13 Texas A&M University--Commerce $24,646 $29,627
4-14 Texas A&M International University $28,867 $34,702
4-15 Angelo State University $43,511 $52,306
4-16 West Texas A&M University $23,609 $28,381
4-17 University of Texas at Brownsville $28,654 $34,445
4-18 Midwestern State University $8,054 $9,682
4-19 (c) For purposes of Subsection (b), "FY2002" means the state
4-20 fiscal year ending August 31, 2002, and "FY2003" means the state
4-21 fiscal year ending August 31, 2003. Subsection (b) and this
4-22 subsection expire January 1, 2004.
4-23 (d) This section expires August 31, 2005.
4-24 Sec. 62.056. VERIFICATION OF ALLOCATION FACTORS. (a) For
4-25 purposes of this subchapter, the coordinating board shall establish
4-26 standards and accounting methods for determining the amount of
4-27 restricted research funds expended by an eligible general academic
5-1 teaching institution in a state fiscal year.
5-2 (b) The coordinating board, as soon as practicable in each
5-3 state fiscal year, shall provide the comptroller with verified
5-4 information relating to the amounts of restricted research funds
5-5 expended and degrees awarded by eligible general academic teaching
5-6 institutions as necessary to determine the allocations under this
5-7 subchapter for that fiscal year.
5-8 (c) The coordinating board may audit the appropriate records
5-9 of an eligible general academic teaching institution to verify
5-10 information for purposes of this subchapter.
5-11 Sec. 62.057. ANNUAL REPORT. Each institution of higher
5-12 education that receives money under this subchapter in a state
5-13 fiscal year shall prepare a report at the end of that fiscal year
5-14 describing the manner in which the institution used the money. The
5-15 institution shall include in the report information regarding the
5-16 use of money spent in that fiscal year that was received under this
5-17 subchapter in a preceding fiscal year. The institution shall
5-18 deliver a copy of the report to the coordinating board and the
5-19 Legislative Budget Board not later than December 1 after the end of
5-20 the fiscal year. The Legislative Budget Board may establish
5-21 requirements for the form and content of the report.
5-22 SECTION 2. Section 62.025, Education Code, is amended by
5-23 amending Subsections (a) and (c) and adding Subsections (d)-(f) to
5-24 read as follows:
5-25 (a) Not later than November 1 of each state fiscal year, the
5-26 comptroller shall deposit the first $50 million that comes to the
5-27 state at the beginning of each state fiscal year and that is not
6-1 dedicated by other law as follows:
6-2 (1) except as provided by Subsections (d) and (e), an
6-3 amount equal to the portion of the total return on all investment
6-4 assets of the higher education fund in the preceding state fiscal
6-5 year computed by multiplying that total return by the percentage of
6-6 the total return on all investment assets of the permanent fund for
6-7 tobacco education and enforcement that constitutes available
6-8 earnings as determined by the comptroller under Section 403.1068,
6-9 Government Code, in that year must be deposited to the credit of
6-10 the Texas excellence fund established under Subchapter C; and
6-11 (2) the remaining amount must be deposited to the
6-12 credit of the higher education fund.
6-13 (c) The deposit required by this section to the higher
6-14 education fund expires on September 1 after the date the
6-15 comptroller certifies that the value of the higher education fund
6-16 is $2 billion. In each state fiscal year that begins on or after
6-17 that date, the comptroller shall deposit to the credit of the Texas
6-18 excellence fund established under Subchapter C from the first money
6-19 that comes to the state at the beginning of that fiscal year an
6-20 amount, not to exceed $50 million, equal to the portion of the
6-21 total return on all investment assets of the higher education fund
6-22 in the preceding state fiscal year computed by multiplying that
6-23 total return by the percentage of the total return on all
6-24 investment assets of the permanent fund for tobacco education and
6-25 enforcement that constitutes available earnings as determined by
6-26 the comptroller under Section 403.1068, Government Code.
6-27 (d) In any state fiscal year for which the legislature has
7-1 made an appropriation specifically for the purposes of the Texas
7-2 excellence fund in an amount equal to or greater than the amount
7-3 provided by Subsection (a)(1) or (c), as applicable to that state
7-4 fiscal year, the deposit to the Texas excellence fund under
7-5 Subsection (a)(1) or Subsection (c) may not be made.
7-6 (e) An amount may not be deposited to the Texas excellence
7-7 fund under this section if Subchapter C expires or is repealed or
7-8 if the Texas excellence fund is abolished.
7-9 (f) Notwithstanding S.B. No. 1, Acts of the 77th
7-10 Legislature, Regular Session, 2001 (General Appropriations Act), in
7-11 each year of the biennium, the comptroller shall reallocate a
7-12 portion of the appropriation under S.B. No. 1 to be deposited to
7-13 the credit of the higher education fund in the amount required by
7-14 Subsection (a)(1) to be deposited to the credit of the Texas
7-15 excellence fund in each fiscal year. This subsection expires
7-16 September 1, 2003.
7-17 SECTION 3. Sections 62.026(b) and (d), Education Code, are
7-18 amended to read as follows:
7-19 (b) The fund consists of the amount [$50 million] deposited
7-20 in the fund each state fiscal year under Section 62.025 [of this
7-21 code] and interest, dividends, and other income earned from the
7-22 investment of the fund.
7-23 (d) The comptroller shall administer and invest the fund.
7-24 In investing the fund, the comptroller has the same investment
7-25 authority as that provided under Sections 11a and 11b, Article VII,
7-26 Texas Constitution, or other law to the board of regents of The
7-27 University of Texas System with respect to the investment of the
8-1 permanent university fund. The investment authority granted to the
8-2 comptroller under this subsection is in addition to that provided
8-3 by Section 404.024, Government Code, or other law. The
8-4 comptroller, in consultation with the presiding officers of the
8-5 governing boards of the institutions eligible to benefit from the
8-6 investment of the fund under Section 17, Article VII, Texas
8-7 Constitution, shall invest the fund in a manner that maximizes the
8-8 total return of the fund.
8-9 SECTION 4. Chapter 62, Education Code, is amended by adding
8-10 Subchapter D to read as follows:
8-11 SUBCHAPTER D. UNIVERSITY RESEARCH FUND FOR CERTAIN
8-12 PERMANENT UNIVERSITY FUND INSTITUTIONS
8-13 Sec. 62.071. PURPOSE. The university research fund is
8-14 established to provide funding to promote increased research
8-15 capacity and to develop institutional excellence at eligible
8-16 general academic teaching institutions.
8-17 Sec. 62.072. DEFINITIONS. In this subchapter:
8-18 (1) "Eligible general academic teaching institution"
8-19 means a general academic teaching institution, as defined by
8-20 Section 61.003, that:
8-21 (A) is a component institution of The University
8-22 of Texas System or The Texas A&M University System, other than The
8-23 University of Texas at Austin, Texas A&M University, or Prairie
8-24 View A&M University; and
8-25 (B) is eligible to participate in the funding
8-26 provided by Section 18, Article VII, Texas Constitution.
8-27 (2) "Eligible doctoral and research university" means
9-1 an eligible general academic teaching institution that:
9-2 (A) in each of the two preceding state fiscal
9-3 years, as verified by the coordinating board:
9-4 (i) offered a full range of baccalaureate
9-5 programs and a wide variety of graduate programs; and
9-6 (ii) awarded 50 or more doctor of
9-7 philosophy degrees; and
9-8 (B) in the three preceding state fiscal years,
9-9 as verified by the coordinating board, expended an average of at
9-10 least $5 million per year in restricted research funds as reported
9-11 in the institution's annual financial reports for the applicable
9-12 years.
9-13 (3) "Eligible emerging doctoral and research
9-14 university" means an eligible general academic teaching institution
9-15 other than an eligible doctoral and research university that:
9-16 (A) in each of the two preceding state fiscal
9-17 years, as verified by the coordinating board:
9-18 (i) offered a full range of baccalaureate
9-19 programs and a wide variety of graduate programs; and
9-20 (ii) awarded one or more doctor of
9-21 philosophy degrees; and
9-22 (B) in the three preceding state fiscal years,
9-23 as verified by the coordinating board, expended an average of at
9-24 least $5 million per year in restricted research funds as reported
9-25 in the institution's annual financial reports for the applicable
9-26 years.
9-27 Sec. 62.073. ADMINISTRATION. (a) The university research
10-1 fund is a fund outside the state treasury in the custody of the
10-2 comptroller.
10-3 (b) The comptroller shall administer and invest the
10-4 university research fund.
10-5 Sec. 62.074. FUNDING. (a) In each state fiscal year, the
10-6 legislature shall appropriate or provide for the transfer to the
10-7 credit of the university research fund of an amount equal to the
10-8 amount deposited to the credit of the Texas excellence fund under
10-9 Section 62.025 or 62.054 in that fiscal year. The comptroller may
10-10 not deposit money to the credit of the Texas excellence fund under
10-11 Section 62.025 or 62.054 and the legislature may not appropriate
10-12 money specifically for the purposes of the Texas excellence fund
10-13 under Section 62.025(d) unless an equal amount is deposited at the
10-14 same time to the credit of the university research fund.
10-15 (b) The comptroller shall deposit all interest, dividends,
10-16 and other income earned from investment of the university research
10-17 fund to the credit of the fund.
10-18 (c) The comptroller may accept gifts or grants from any
10-19 public or private source for the university research fund.
10-20 (d) In each state fiscal year, the comptroller shall
10-21 distribute all assets in the university research fund as soon as
10-22 practicable to eligible institutions in accordance with this
10-23 subchapter.
10-24 (e) All assets received by an institution under this
10-25 subchapter may be used only for the support and maintenance of
10-26 educational and general activities, including research and student
10-27 services, that promote increased research capacity and develop
11-1 institutional excellence at that institution.
11-2 (f) As soon as practicable in each fiscal year of the state
11-3 fiscal biennium ending August 31, 2003, the comptroller shall
11-4 transfer one-half of the $33,774,000 appropriated by S.B. No. 1,
11-5 Acts of the 77th Legislature, Regular Session, 2001 (General
11-6 Appropriations Act) in the Contingency Appropriation for HB 1839 to
11-7 the credit of the university research fund. This subsection
11-8 expires September 1, 2003.
11-9 Sec. 62.075. ALLOCATION TO ELIGIBLE INSTITUTIONS. In each
11-10 state fiscal year, the comptroller shall distribute the total
11-11 amount of all assets in the university research fund as follows:
11-12 (1) $1 million shall be distributed to the eligible
11-13 general academic teaching institutions, other than the eligible
11-14 doctoral and research universities and eligible emerging doctoral
11-15 and research universities, and allocated among those institutions
11-16 in equal amounts; and
11-17 (2) the total amount to be distributed less the amount
11-18 required to be distributed under Subdivision (1) shall be
11-19 distributed to the eligible doctoral and research universities and
11-20 eligible emerging doctoral and research universities as follows:
11-21 (A) 50 percent shall be apportioned among those
11-22 institutions based on the average amount of restricted research
11-23 funds expended per year by each institution in the three preceding
11-24 state fiscal years as reported in each institution's applicable
11-25 annual financial reports; and
11-26 (B) the remaining 50 percent shall be
11-27 apportioned among those institutions as follows:
12-1 (i) 75 percent based on the number of
12-2 doctor of philosophy degrees awarded by each institution in the
12-3 preceding state fiscal year; and
12-4 (ii) the remaining 25 percent based on the
12-5 number of master's degrees awarded by each institution in the
12-6 preceding state fiscal year.
12-7 (3) This section expires August 31, 2005.
12-8 Sec. 62.0751. ALLOCATION TO ELIGIBLE INSTITUTIONS FOR
12-9 2002-2003 FISCAL BIENNIUM. (a) Section 62.075 does not apply to
12-10 the distribution of the total amount of all assets in the
12-11 university research fund in the state fiscal biennium ending August
12-12 31, 2003. In each state fiscal year of that biennium, the
12-13 comptroller shall distribute the total amount of all assets in the
12-14 university research fund as soon as practicable as follows:
12-15 (1) $1 million shall be distributed to the eligible
12-16 general academic teaching institutions, other than the eligible
12-17 doctoral and research universities and eligible emerging doctoral
12-18 and research universities, and apportioned among those institutions
12-19 in equal amounts;
12-20 (2) $500,000 shall be distributed to the eligible
12-21 doctoral and research universities and apportioned among those
12-22 institutions in equal amounts;
12-23 (3) $500,000 shall be distributed to the eligible
12-24 emerging doctoral and research universities and apportioned among
12-25 those institutions in equal amounts; and
12-26 (4) the total amount to be distributed less the
12-27 amounts required to be distributed under Subdivisions (1), (2), and
13-1 (3) shall be distributed to the eligible doctoral and research
13-2 universities and eligible emerging doctoral and research
13-3 universities as follows:
13-4 (A) 50 percent shall be apportioned among those
13-5 institutions based on the amount of restricted research funds
13-6 expended by each institution in the preceding state fiscal year as
13-7 reported in each institution's financial report for the applicable
13-8 year; and
13-9 (B) the remaining 50 percent shall be
13-10 apportioned among those institutions as follows:
13-11 (i) 75 percent based on the number of
13-12 doctor of philosophy degrees awarded by each institution in the
13-13 preceding state fiscal year; and
13-14 (ii) the remaining 25 percent based on
13-15 the number of master's degrees awarded by each institution in the
13-16 preceding state fiscal year.
13-17 (b) This section expires August 31, 2003.
13-18 Sec. 62.076. VERIFICATION OF ALLOCATION FACTORS. (a) For
13-19 purposes of this subchapter, the coordinating board shall establish
13-20 standards and accounting methods for determining the amount of
13-21 restricted research funds expended by an eligible general academic
13-22 teaching institution in a state fiscal year.
13-23 (b) The coordinating board, as soon as practicable in each
13-24 state fiscal year, shall provide the comptroller with verified
13-25 information relating to the amounts of restricted research funds
13-26 expended and degrees awarded by eligible general academic teaching
13-27 institutions as necessary to determine the allocations under this
14-1 subchapter for that fiscal year.
14-2 (c) The coordinating board may audit the appropriate records
14-3 of an eligible general academic teaching institution to verify
14-4 information for purposes of this subchapter.
14-5 Sec. 62.077. ANNUAL REPORT. Each institution of higher
14-6 education that receives money under this subchapter in a state
14-7 fiscal year shall prepare a report at the end of that fiscal year
14-8 describing the manner in which the institution used the money. The
14-9 institution shall include in the report information regarding the
14-10 use of money spent in that fiscal year that was received under this
14-11 subchapter in a preceding fiscal year. The institution shall
14-12 deliver a copy of the report to the coordinating board and the
14-13 Legislative Budget Board not later than December 1 after the end of
14-14 the fiscal year. The Legislative Budget Board may establish
14-15 requirements for the form and content of the report.
14-16 SECTION 5. (a) The lieutenant governor and speaker of the
14-17 house of representatives shall appoint a joint committee composed
14-18 of:
14-19 (1) five members of the senate appointed by the
14-20 lieutenant governor; and
14-21 (2) five members of the house of representatives
14-22 appointed by the speaker.
14-23 (b) The speaker and lieutenant governor shall jointly select
14-24 a presiding officer or co-presiding officers of the committee from
14-25 among the committee members. The committee may designate other
14-26 officers as the committee considers appropriate.
14-27 (c) The committee shall conduct a study to (i) examine the
15-1 feasibility of creating a single research enhancement fund to
15-2 provide funding for institutions of higher education that have a
15-3 proven research history, (ii) examine how institutions have
15-4 historically utilized "excellence funds," and (iii) consider
15-5 whether a portion of the annual distribution from the permanent
15-6 university fund to the available university fund appropriated to
15-7 The University of Texas System under Section 18(f), Article VII,
15-8 Texas Constitution, should be appropriated or made available for
15-9 appropriation for the support and maintenance of institutions of
15-10 higher education in The University of Texas System other than The
15-11 University of Texas at Austin. The committee shall consider the
15-12 institutions or types of institutions that should be eligible to
15-13 receive a portion, if any, of that appropriation to The University
15-14 of Texas System, the methods by which any amount should be
15-15 allocated among those institutions, and the purposes for which that
15-16 amount should be used in the best interests of this state and The
15-17 University of Texas System. The lieutenant governor and speaker may
15-18 direct the committee to consider other matters related to the
15-19 committee's charge under this subsection.
15-20 (d) The committee shall conduct any study or inquiry and
15-21 make any findings or recommendations the committee considers
15-22 appropriate regarding the matters within the committee's charge.
15-23 (e) The Legislative Budget Board shall provide staffing and
15-24 other assistance to the committee on request. The committee may
15-25 request information from the comptroller, the Texas Higher
15-26 Education Coordinating Board, or any public institution of higher
15-27 education in this state. The comptroller, coordinating board, and
16-1 each public institution of higher education shall provide the
16-2 requested information to the extent practicable.
16-3 (f) The expenses of the committee may be paid from any
16-4 appropriate funds of the house of representatives, the senate, or a
16-5 legislative agency.
16-6 (g) The committee shall file a report of the committee's
16-7 activities, findings, and recommendations with the governor, the
16-8 lieutenant governor, and the speaker of the house of
16-9 representatives not later than December 1, 2002. The report shall
16-10 include any recommendations for legislative or administrative
16-11 action the committee considers appropriate.
16-12 (h) The committee is abolished and this section expires
16-13 January 1, 2003.
16-14 SECTION 6. This Act takes effect September 1, 2001.
_______________________________ _______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 1839 was passed by the House on
May 3, 2001, by a non-record vote; and that the House concurred in
Senate amendments to H.B. No. 1839 on May 27, 2001, by a non-record
vote.
_______________________________
Chief Clerk of the House
I certify that H.B. No. 1839 was passed by the Senate, with
amendments, on May 22, 2001, by a viva-voce vote.
_______________________________
Secretary of the Senate
APPROVED: __________________________
Date
__________________________
Governor