81R22134 KSD-D

By: Branch, McCall, Coleman, Madden, et al. H.B. No. 51

Substitute the following for H.B. No. 51:

By: Branch C.S.H.B. No. 51

A BILL TO BE ENTITLED

AN ACT

relating to funding and incentives to support emerging public research universities in developing and maintaining programs of the highest tier.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Chapter 61, Education Code, is amended by adding Subchapters FF, GG, and HH to read as follows:

SUBCHAPTER FF. RESEARCH UNIVERSITY DEVELOPMENT FUND

Sec. 61.9771. DEFINITIONS. In this subchapter:

(1) "Eligible institution" means an emerging research university.

(2) "Emerging research university" means an institution of higher education that the board determines:

(A) is a research university as that term is commonly used in classifying or ranking institutions of higher education; and

(B) has demonstrated a commitment to developing and maintaining degree and research programs that support the mission of the institution and the institution's efforts to improve its ranking among research universities.

Sec. 61.9772. PURPOSE. The purpose of this subchapter is to provide funding to eligible institutions for the enhancement of research productivity to enable those institutions to achieve national prominence as major research universities.

Sec. 61.9773. FUNDING. (a) For each state fiscal year, the board shall distribute any funds appropriated by the legislature for the purposes of this subchapter, and any other funds made available for the purposes of this subchapter, among eligible institutions in proportion to the total amount of restricted research funds expended by each institution in the two most recent state fiscal years.

(b) For purposes of Subsection (a), the amount of restricted research funds expended by an eligible institution in a state fiscal year is the amount of those funds as reported to the board by the institution for that year, subject to any adjustment by the board in accordance with the standards and accounting methods the board prescribes for purposes of this section.

Sec. 61.9774. USE OF ALLOCATED AMOUNTS. An eligible institution may use money received under this subchapter only for the support and maintenance of educational and general activities that promote increased research capacity at the institution.

Sec. 61.9775. RULES. The board shall adopt rules for the administration of this subchapter, including rules requiring eligible institutions to report necessary information to the board.

SUBCHAPTER GG. TEXAS RESEARCH INCENTIVE PROGRAM (TRIP)

Sec. 61.9791. DEFINITIONS. In this subchapter:

(1) "Eligible institution" means an emerging research university.

(2) "Emerging research university" means an institution of higher education that the board determines:

(A) is a research university as that term is commonly used in classifying or ranking institutions of higher education; and

(B) has demonstrated a commitment to developing and maintaining degree and research programs that support the mission of the institution and the institution's efforts to improve its ranking among research universities.

(3) "Program" means the Texas Research Incentive Program (TRIP) established under this subchapter.

Sec. 61.9792. PROGRAM ADMINISTRATION. The board shall administer the Texas Research Incentive Program (TRIP) in accordance with this subchapter to provide matching funds to assist eligible institutions in leveraging private gifts for the enhancement of research productivity and faculty recruitment.

Sec. 61.9793. MATCHING GRANTS. (a) An eligible institution that receives cash gifts from private sources in a state fiscal year for the purpose of enhancing research activities at the institution, including gifts for endowments or endowed chairs or professorships, research or academic facilities, equipment, program costs, or graduate stipends or fellowships, is entitled to receive, out of funds appropriated for the purposes of the program for that fiscal year, a matching grant in an amount determined according to the following rates:

(1) 50 percent of the total amount of the gifts received, if the total amount of those gifts is $100,000 or more but not more than $999,999;

(2) 75 percent of the total amount of the gifts received, if the total amount of those gifts is $1 million or more but not more than $1,999,999; or

(3) 100 percent of the total amount of the gifts received, if the total amount of those gifts is $2 million or more.

(b) An eligible institution is not entitled to matching funds under the program for:

(1) an in-kind gift;

(2) a gift that has been pledged but has not been received by the institution;

(3) a gift for undergraduate scholarships, grants, or other financial aid; or

(4) any portion of gifts received by the institution from a single source in a state fiscal year in excess of $10 million.

(c) The board shall establish procedures for the certification by the board of an eligible institution's receipt of a qualifying gift. A gift must be certified as of the date the gift was deposited by the institution in a depository bank or invested by the institution as authorized by law.

(d) If the funds appropriated for the program for a state fiscal year are insufficient to provide matching grants in the amounts specified by this section for all qualifying private gifts received by eligible institutions during that fiscal year, the board shall provide matching grants for those gifts in order of their certification dates under Subsection (c) and shall provide matching grants for any remaining unmatched gifts in the following fiscal year. Unmatched gifts carried forward from a preceding fiscal year under this subsection shall be given priority over gifts received in the current fiscal year, and shall be provided matching grants under this section in order of their certification dates. An unmatched gift shall continue to be carried forward to subsequent fiscal years until a matching grant is awarded for the gift.

(e) Matching grants received by an eligible institution under this section may not be considered as a basis to reduce, directly or indirectly, the amount of money otherwise appropriated or allocated to the institution under any other law.

Sec. 61.9794. USE OF MATCHING GRANTS. An eligible institution may use matching grant money received under this subchapter for the same purpose as that for which the matched gift was received or for the support and maintenance of educational and general activities that promote increased research capacity at the institution.

Sec. 61.9795. RULES. The board shall adopt rules for the administration of this subchapter, including rules requiring eligible institutions to report necessary information to the board.

SUBCHAPTER HH. NATIONAL RESEARCH UNIVERSITY BENCHMARK FUND

Sec. 61.9801. DEFINITIONS. In this subchapter:

(1) "Eligible institution" means an emerging research university.

(2) "Emerging research university" means an institution of higher education that the board determines:

(A) is a research university as that term is commonly used in classifying or ranking institutions of higher education; and

(B) has demonstrated a commitment to developing and maintaining degree and research programs that support the mission of the institution and the institution's efforts to improve its ranking among research universities.

Sec. 61.9802. PURPOSE. The purpose of this subchapter is to provide funding to incentivize the enhancement of emerging research universities by rewarding those universities that meet critical benchmarks toward achieving national prominence as major research universities.

Sec. 61.9803. FUNDING. (a) Except as provided by Subsection (b), for each state fiscal year, the board shall distribute any funds appropriated by the legislature for the purposes of this subchapter, and any other funds made available for the purposes of this subchapter, among eligible institutions in proportion to the total number of points assigned to each institution for that fiscal year under Subsection (c).

(b) If the allocations for eligible institutions calculated under Subsection (a) would result in the three eligible institutions to which the highest total number of points are assigned under Subsection (c) receiving a total amount that is less than 80 percent of the total amount available for distribution to all eligible institutions under Subsection (a), the total amount of funds available for distribution under that subsection for that state fiscal year shall be distributed as follows:

(1) 80 percent shall be distributed among the three eligible institutions receiving the highest total number of points for that fiscal year under Subsection (c) in proportion to the total number of points assigned to each of those institutions; and

(2) the remainder of those funds shall be distributed among the remaining eligible institutions in proportion to the total number of points assigned to each of those institutions for that fiscal year under Subsection (c).

(c) The following points are assigned to each eligible institution for a fiscal year based on information submitted to the board by each institution for each of the two state fiscal years immediately preceding the state fiscal year for which the funds are distributed:

(1) one point if the institution's library was a member of the Association of Research Libraries in each of those years;

(2) one point if the institution had a chapter of Phi Beta Kappa in each of those years;

(3) one point if the institution employed at least three but fewer than eight tenured faculty members or full-time employees who are Nobel Prize Laureates or who have been elected to a national academy in each of those years;

(4) two points if the institution employed at least eight tenured faculty members or full-time equivalent employees who are Nobel Prize Laureates or who have been elected to a national academy in each of those years;

(5) one point if the institution awarded at least 200 but fewer than 300 doctor of philosophy degrees in each of those years;

(6) two points if the institution awarded at least 300 doctor of philosophy degrees in each of those years;

(7) one point if the institution expended at least $45 million but less than $75 million in restricted research funds in each of those years;

(8) two points if the institution expended $75 million or more in restricted research funds in each of those years;

(9) one point if the total amount of the institution's restricted research expenditures in each of those years divided by the total number of full-time tenured and tenure-track faculty members employed by the institution in the same year is at least $75,000 but less than $125,000;

(10) two points if the total amount of the institution's restricted research expenditures in each of those years divided by the total number of full-time tenured and tenure-track faculty members employed by the institution in the same year is $125,000 or more;

(11) one point if:

(A) the average score on the Scholastic Assessment Test (SAT) of entering freshman students at the institution for each of those years is at least 95 percent of the average SAT score of entering freshman students at Texas A&M University and The University of Texas at Austin for the same year; or

(B) at least 35 percent of entering freshman students at the institution in each of those years graduated in the top 10 percent of the student's high school graduating class; and

(12) one point if the aggregate value of the institution's endowment funds for educational and general use is at least $500 million for each of those years.

(d) For purposes of Subsections (c)(3) and (4), a faculty member or other employee may be counted only once for a particular year.

(e) For purposes of Subsections (c)(9) and (10), the amount of restricted research funds expended by an eligible institution in a state fiscal year is the amount of those funds as reported to the board by the institution for that year, subject to any adjustment by the board in accordance with the standards and accounting methods the board prescribes for purposes of this section.

(f) For purposes of Subsection (c)(12), an eligible institution that receives benefits from the permanent university fund shall be assigned, as part of the aggregate value of the institution's endowment funds for educational and general use, an amount equal to the total amount of expenditures made on behalf of the institution from the available university fund for the preceding 10 state fiscal years.

Sec. 61.9804. RULES. The board shall adopt rules for the administration of this subchapter, including rules requiring eligible institutions to report necessary information to the board.

SECTION 2. The Texas Higher Education Coordinating Board shall adopt rules relating to the administration of Subchapters FF, GG, and HH, Chapter 61, Education Code, as added by this Act, as soon as practicable after the effective date of this Act.

SECTION 3. This Act takes effect September 1, 2009.