H.B. 3350 78(R)    BILL ANALYSIS

H.B. 3350
By: Davis, John
Higher Education
Committee Report (Unamended)


In June 2001, the University of Houston incurred approximately
$100,000,000 in damages to buildings and other infrastructures from
Tropical Storm Allison.  While insurance and funds from the Federal
Emergency Management Agency (FEMA) will cover approximately 78% of the
cost of recovery, the University has had to borrow approximately
$25,000,000 from Higher Education Assistance Funds and university reserves
dedicated to other institutional priorities in order to recover from the
storm.  House Bill 3350 would allow the University of Houston to issue
revenue bonds not to exceed $25,000,000 in order to cover all associated
recovery costs. 


It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency, or


HB 3350 amends Subchapter B, Chapter 55, Education Code, by adding Section
55.1743 to authorize the board of regents of the University of Houston
System to acquire, purchase, construct, improve, renovate, enlarge, or
equip property, buildings, structures, facilities, roads, or related
infrastructure for the University of Houston System, including the
individual campuses of the system, to be financed by the issuance of bonds
in accordance with this subchapter and in accordance with a system-wide
revenue financing program adopted by the board in an aggregate principal
amount not to exceed $25 million. 

HB 3350 provides that the board may pledge irrevocably to the payment of
those bonds all or any part of the revenue funds of an institution,
branch, or entity of the University of Houston System, including student
tuition charges.  The bill provides that the amount of a pledge made under
this subsection may not be reduced or abrogated while the bonds for which
the pledge is made, or bonds issued to refund those bonds, are

HB 3350 provides that if sufficient funds are not available to the board
to meet its obligations under this section, the board may transfer funds
among institutions, branches, and entities of the University of Houston
System to ensure the most equitable and efficient allocation of available
resources for each institution, branch, or entity to carry out its duties
and purposes. 


This Act takes effect immediately if it receives a vote of two-thirds of
all the members elected to each house, as provided by Section 39, Article
III, Texas Constitution.  If this Act does not receive the vote necessary
for immediate effect, this Act takes effect September 1, 2003.