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Amend SB 34 by adding the following new SECTIONS, 
appropriately numbered, and renumbering subsequent SECTIONS of the 
bill accordingly:
	SECTION __. Subchapter M, Chapter 56, Education Code, is 
amended by adding Section 56.3012 to read as follows:
	Sec. 56.3012. PILOT PROJECT TO PROVIDE INCENTIVES FOR 
ATTENDANCE AT UNDERUTILIZED PUBLIC INSTITUTIONS.  (a) In addition 
to incentives described by Section 54.0065, the coordinating board 
shall establish a tuition grant incentive pilot project as provided 
by this section to encourage students to attend eligible public 
institutions of higher education that offer extensive 
baccalaureate degree program options and that have sufficient 
facilities, administrative infrastructure, and faculty to serve 
additional students in order to reduce the need for this state to 
construct additional facilities or hire additional faculty at other 
institutions of higher education.
	(b)  From money available under Section 56.310 for purposes 
of this subchapter and money available under Section 54.464 for 
purposes of Subchapter Q, the coordinating board shall set aside 
sufficient money to provide tuition grant incentives, including 
TEXAS grants for the 2005-2006 and 2006-2007 academic years to 
students who are initially eligible for a grant under Section 
56.304 or 56.3041 in either of those years as follows:
		(1)  for not more than 400 additional students in excess 
of the total of fall 2004 awards at Angelo State University; and
		(2)  for not more than 200 additional students in excess 
of the total of fall 2004 awards at Sul Ross State University
	(c)  To the extent money set aside under Subsection (b) is 
available for the purpose, a person awarded a grant as provided by 
Subsection (b) who continues to be eligible for a grant under 
Section 56.305 may receive a grant from the money set aside. If 
money set aside under Subsection (b) is not available to pay for a 
grant for a person awarded a grant as provided by Subsection (b) who 
continues to be eligible for a grant under Section 56.305, the 
person may receive a grant from the money available under Section 
56.310 on the same basis as other Texas grant applicants.
	(d)  The coordinating board shall reallocate for grants under 
this subchapter or for loans under Subchapter Q, as applicable , any 
money set aside for purposes of the TEXAS grant pilot project that 
is not used in the academic year for which the money is set aside. 
Money reallocated under this subsection may be used at any eligible 
institution under this subchapter or Subchapter Q.
	(e)  Except as otherwise specifically provided by this 
section, this subchapter applies to a TEXAS grant awarded under 
this section.
	(f)  The coordinating board shall develop criteria for 
evaluating the pilot project and, based on that evaluation, not 
later than January 1, 2007, shall report to the 80th Legislature the 
coordinating board's recommendations concerning whether to 
continue, expand to other underutilized eligible public 
institutions of higher education, or discontinue the pilot project.
	SECTION __.  The Texas Higher Education Coordinating Board 
shall adopt rules to administer Section 56.3012, Education Code, as 
added by this Act, as soon as practicable after the date this Act 
takes effect. For that purpose, the board may adopt the initial 
rules in the manner provided by law for adoption of emergency rules.