Background

• San Antonio has one public university, The University of Texas at San Antonio (UTSA); one public health science center, The University of Texas Health Science Center at San Antonio; and four independent universities:  Our Lady of the Lake University, St. Mary's University, Trinity University, and the University of the Incarnate Word.  For mostly historical reasons related to the growth of the city, all of the independent universities are located in the central San Antonio area.  The University of Texas at San Antonio has two campuses: one in northwest San Antonio and one in downtown San Antonio. 
  
  
• The greater San Antonio area is also served by five community college campuses of the Alamo Community College District:  Northwest Vista College, Palo Alto College, San Antonio College, St. Philips College, and the Northeast Campus.  Total district enrollment for fall 2004 was 49,485 with 39 percent White, 7 percent Black and 51 percent Hispanic.  Palo Alto College, host college for Texas A&M University-Kingsville Center, had 7,960 students with 32 percent White, 2 percent Black and 65 percent Hispanic.
  
  
• The Texas A&M University-Kingsville System Center-San Antonio was established in January 2000 on the campus of Palo Alto College.  The System Center offers bachelor's degree programs in business administration-management, computer information systems, criminology, psychology, accounting, agribusiness, applied arts and sciences, child and family studies, inter-disciplinary studies, history, English, kinesiology, mathematics, and sociology.
  
  
• UTSA's enrollment in fall 2004 was 26,175, including students at the downtown campus.  The estimated headcount enrollment at the Texas A&M University-Kingsville System Center for fall 2004 was 960 (543 full-time-student-equivalents).  Fall 2004 headcount enrollments for the four independent universities were as follows:  St. Mary's, 3,931; Our Lady of the Lake, 3,025; Trinity, 2,639; Incarnate Word, 4,698, for a total headcount enrollment of 14,293.  The University of Texas Health Science Center at San Antonio had a headcount enrollment of 2,837 in fall 2004. 
  
  
• UTSA gets the vast majority of its local enrollments from north, northwest and central parts of San Antonio.

• UTSA’s downtown campus reports 6,100 headcount students (fall 2004), having grown from 1,900 students (fall 1997).  The downtown campus has added some property upon which a new building is planned that would increase enrollment capacity from 7,000 to 10,000 students.

• UTSA’s downtown campus has eight degree programs that are administered through the College of Public Policy, School of Architecture, and Department of Counseling and Adult and Higher Education (all with Deans who are located downtown).  Other degree programs that are located on the main campus are fully supported within the 500 courses offered at the downtown campus.
  
  
• Palo Alto College, the current location of the Texas A&M University-Kingsville System Center, is located southwest of central San Antonio (nine miles from the downtown campus of UTSA).  It gets most of its enrollment from central and northwest San Antonio, like UTSA, but it also gets a larger portion of its enrollment from more southern areas of San Antonio and Bexar County than does UTSA.
  
  

Demographics of South Texas and San Antonio

·        South Texas is identified by the Coordinating Board as one of the state's high growth regions.

·        By 2015, the population of South Texas is projected to increase by almost 1 million people (23 percent) to 5.1 million people.

·        The 15-to-34 Hispanic population in the region will total over 1.3 million by 2015.

·        Generally, educational attainment in the region is low.  The percentage of the population with at least a high school diploma is the second-lowest in the state at 68 percent; only the Upper Rio Grande at 65.6 percent has a lower percentage.

·        To increase educational attainment in the region, it will be necessary to increase the percentage of young adults completing high school college-ready.

Meeting Increasing Needs for Higher Education Services

            Even before Closing the Gaps, the Coordinating Board recognized that access to upper-level and graduate educational opportunities needed to be expanded to increase participation, especially of non-traditional students.  Off-campus educational units of existing public universities and systems helped provide additional access with flexibility.  The two primary types of off-campus educational units are multi-institution teaching centers (MITCs) and university system centers (USCs). 

            In July 1998, the Coordinating Board adopted the "Supply/Demand Pathway."  The Pathway ties the provision of instructional services to demonstrated enrollment thresholds and serves as a model to meet academic program needs in geographical areas not currently served by public universities, without over‑committing or under‑committing state resources.

            MITCs and USCs facilitate the transfer of course credits between institutions and potentially provide students a broader array of academic programs and support services than any one institution could provide at a particular location.  As originally envisioned, they:  (1) are funded through the regular formula process and are not eligible to request separate legislative funding; (2) are under the management of the parent institution(s); (3) focus on teaching, rather than research; (4) award course credit and degrees in the name of the providing institution; and (5) usually use locally provided facilities, often located on or near community college campuses.  MITCs and USCs emphasize upper-division and graduate-level instruction and are encouraged to develop campus‑specific articulation agreements and partnerships with local community and technical colleges and other universities.

            The Supply/Demand Pathway recommends matching state resources to demonstrated demand for higher education services.  As demand grows, additional state resources should be added.  It was conceived that a MITC or USC might eventually achieve enrollment levels that could justify the creation of a new, stand-alone university.  The Pathway specifies that the Coordinating Board should only consider converting a center to a free-standing, upper-level university when a significant, on-going demand has been demonstrated over a period of time.  Specifically, the Pathway calls for a center to have enrollments of 3,500 full-time student equivalents (FTSE) for four fall semesters before the Board reviews its status and considers recommending to the Legislature that it be re-classified as an upper-level university. 

            The threshold was set at 3,500 full-time equivalent students because that was the enrollment level deemed necessary for an institution to operate efficiently across a moderate range of degree programs and start seeing benefits of economies of scale.  Three thousand five hundred FTSE students is also the rough equivalent of 5,000 headcount students, the threshold that the Legislature has used in past years to identify less efficient institutions.  In past biennia, the Legislature has appropriated an additional $750,000 per institution per biennium to help these less efficient institutions meet their higher overhead costs. 

            In 2001, the Texas Legislature statutorily lowered the Coordinating Board’s Pathway Model threshold from 3,500 FTSE to 2,500 FTSE for the University of North Texas at Dallas. In 2003, the Legislature passed SB 800 which establishes Texas A&M University-San Antonio and Texas A&M University-Central Texas when the Coordinating Board certifies that enrollment at the Texas A&M University-Kingsville System Center and Tarleton State University System Center-Central Texas in Killeen reaches 2,500 FTSE for one semester. In 2003, the Legislature further reduced the FTSE threshold for the University of North Texas at Dallas to 1,000 FTSE.

Enrollment at System Centers and Teaching Centers

            Each of Texas' MITCs and USCs is unique and responsive to its local situation.  The first MITC, the Universities Center of Dallas, was established in 1994.  The table that follows summarizes information about the existing centers.

Reported Fall 2004 Upper-Division and Graduate Enrollment

at Higher Education Centers

* Unduplicated enrollments and full-time equivalents are significantly smaller numbers than headcounts.

** Full-time-student equivalents are determined from fall semester data as follows: undergraduate SCH-(semester credit hours) divided by 15; master's and special/professional SCH-divided by 12; doctoral SCH - divided by 9.

*** In some cases, the full-time-equivalent enrollments that would count toward the threshold may be somewhat higher than the numbers reported here. 

Texas A&M University System's Plans for Developing Texas A&M University-San Antonio

• Senate Bill 296 stipulates that in order for 1,000 full-time equivalent students to trigger the stand-alone status, the Texas Legislature would have to approve the issuance of $80 million in tuition revenue bonds.  Otherwise, 2,500 full-time equivalent students would remain the standard.
  
  
• Representatives of the Texas A&M University System believe that the proposed university would primarily serve southern Bexar County and neighboring counties.
  
  
• A commitment for 650 acres of land for the new campus has been made by a land owner in San Antonio.
  
  
• Development of the campus would be consistent with the city of San Antonio's Southside Development Initiative.
  
  
• The Texas A&M University System believes that given the growth rate of enrollments at the system center, the enrollment threshold of 2,500 FTE could be reached in three or four years.  Coordinating Board staff believes that a more realistic projection would be 1,000 FTE in three to four years (assuming a continued linear growth rate).
  
  
• Given the time required to reach the enrollment threshold and do the initial construction at a new campus, the entering class at Texas A&M University-San Antonio would not be likely before fall 2009 (under a 1,000 FTE scenario).

Efficiency and Cost Considerations

• Small, freestanding universities generally do not have sufficient enrollments to support a wide array of degree programs.  This is especially true of institutions with fewer than 2,500 full-time-equivalent students and even more so with 1,000 full-time equivalents.
  
  
• Small universities are also not able to operate as efficiently as larger universities.  A significantly higher percentage of state funds is expended on administrative costs rather than on teaching costs at such institutions.  In response to the diseconomies of scale of small institutions, the Legislature provides an additional $750,000 per biennium for institutions with fewer than 5,000 headcount students.
  
  
• The initial costs related to building a new university campus would probably start at about $40 million, which would be the cost to build the first teaching and administration building and provide a minimal amount of basic improvements.
  
  
• Planning for a new university is estimated to cost $250,000 for one biennium.
  
  

Potential Benefits

·        Texas A&M University-San Antonio would increase the availability of higher education services to the growing population of southern Bexar County.

·        College-going rates in the southern half of San Antonio are lower than in other areas of the city. In this context, enrollment growth at Palo Alto College while steady has been 19 percent compared to St. Philip’s College (22.3 percent) and Northwest Vista College (235.8 percent). The enrollment growth at the Texas A&M University-Kingsville System Center in San Antonio has gone from 163 FTSE in 2001 to 543 FTSE in 2004. An expanded higher education presence in the area could enhance efforts to improve public education in the area and increase the college going rates and degree completion rates of area residents.  In doing this, Texas A&M University-San Antonio could contribute to Closing the Gaps in higher education participation and success.

·        If institutions in the region meet the enrollment targets they set for the Closing the Gaps by 2015 plan, the region will have the largest university enrollment growth of any region (an increase of 36,292 students).

·        Population growth and meeting the goals of Closing the Gaps should result in a significant increase in demand for higher education services in San Antonio.  Existing institutions in San Antonio are growing significantly and require substantial resources to keep up with enrollment growth.  When The University of Texas at San Antonio reaches an enrollment level of around 35,000, some determination may need to be made regarding size.  Supporting existing facilities could be more cost efficient than starting new ones.  However, access remains an important issue.

·        An institution of higher education would promote economic development in the southern half of San Antonio and help provide skilled workers for the Toyota plant that is being built.

Other Considerations

• The Coordinating Board's Higher Education Supply/Demand Pathway recommends that state resources should be provided to meet the actual demand for higher education services.  Demand at the Texas A&M University-Kingsville System Center-San Antonio is unlikely to reach the Board-recommended threshold of 3,500 FTE students for four fall semesters or the threshold in the bill of 2,500 FTE students for one semester within the next two biennia.  And even 1,000 FTE students would probably take three to four years.
  
  
• The Coordinating Board's Pathway model recommends considering the conversion of an upper-level system center to an upper-level university once enrollment thresholds have been met.  The proposed bill creates a general academic teaching university that is not restricted to the upper-level.  This would result in a duplication of lower-division offerings in the area served by the new university.

• UTSA is planning to expand enrollment at the downtown campus from 6,000 to 10,000 over the next 5 years. The downtown campus is approximately 10 miles away from south San Antonio and southern Bexar County.
  
  
• The provision in the bill that requires the Texas Legislature to approve revenue bonds of up to $80 million would lower the FTE from an existing 2,500 to 1,000.  If the revenue bonds are not approved, the FTE would remain at 2,500.

A number of factors are likely to affect the emergence of additional demand for higher educational services in San Antonio.  They include:

- the continuation of demographic trends that are resulting in rapid population growth in San Antonio;

- the success of efforts to increase graduation rates in San Antonio and area high schools;

- the success of the Closing the Gaps plan in increasing college-going rates among the state's Hispanic students;

- the continuation and size of the UT-Austin program that sends students who are not admitted to the Austin campus to another system institution campus for the first two years of the bachelor's degree; 

- whether UTSA decides to limit its size to 30,000 to 40,000 students; and

- whether the independent universities in San Antonio have the capacity to continue to grow significantly, and students have the resources to attend them.

Recommendations

            The Board recognizes that San Antonio in the long term will likely be able to support two general academic teaching institutions.  However, the Coordinating Board strongly endorses the Pathway model as the most effective and efficient means of establishing new stand-alone campuses.  Of particular concern is whether the one-time threshold of 1,000 full-time students provides sufficient demonstration of the continuing demand necessary to support the provision of the broad range of high quality programs and services generally assumed to be offered by a full university and do so with economies of scale.  And because the Pathway thresholds were based on conversion of an upper-level center to an upper-level institution, the Legislature should consider the point that conversion to a full four-year institution would likely require greater resources and would duplicate opportunities already available at local community colleges.

            In addition, an existing institution, The University of Texas at San Antonio (including its downtown campus), has continuing crucial needs to be supported as it increases its enrollments across a large range of academic programs.  For the immediate future, it would be more cost efficient to meet the needs of the region and state in expanding UTSA, including the downtown campus.  As previously noted, the downtown campus is ten miles from south San Antonio and southern Bexar County. 

            Texas A&M University-Kingsville System Center needs to continue to grow in order to be considered as a general academic teaching institution.  Expanding the outreach efforts that Texas A&M University has initiated could greatly enhance growth patterns for the System Center.  The Coordinating Board recommends not lowering the FTE threshold to 1,000 students to establish Texas A&M-San Antonio.