U.T. System Welcomes Legislative Decisions
please note this file is extremely large (68.9 MB) and may require
a long time to download
The University of Texas System appreciates the confidence in
higher education expressed by the leadership of Texas during the
78th session of the Legislature. Now it is our duty to perform
up to their high expectations.
Without the leadership of Governor Perry, Lieutenant Governor
Dewhurst, Speaker Craddick, Chairman Shapiro, Chairman Morrison,
and many others, institutions of higher education would have suffered
a severe setback during these tough economic times in our state.
Thanks to their vision and hard work, we now have an opportunity
to build and strengthen academic and health institutions to meet
the growing needs of our state for an educated workforce.
During exceedingly difficult economic conditions, the Legislature
has made fundamental decisions about state appropriations that
help protect the state's colleges and universities from the level
of budget cuts that had been foreseen earlier in the session.
At one time, it appeared that cuts of up to 12.5 percent in General
Revenue appropriations might be applied within higher education.
However, the final appropriations bill provides for cuts across
the U.T. System averaging about 3 percent in General Revenue.
Some of our institutions do face significant budget cuts, and
these reductions will present difficulties, but we are grateful
that the cuts have been minimized as much as possible, and we
will be working diligently with all available resources to do
the best job possible on behalf of the people of Texas.
The Legislature's decisions to end the state tax on research,
revise financial aid programs, free campuses from burdensome regulations,
approval new tuition revenue bonds, revise research development
appropriations, and grant governing boards the authority to set
tuition and fees, are welcome, positive moves and good public
policy for the state.
The Legislature's decision to allow general academic universities
to retain 100 percent of the indirect cost reimbursements on research
grants will have far-reaching benefits for the entire state. Institutions
will now be rewarded, rather than penalized, for attracting external
research grants, and the indirect cost reimbursements can be reinvested
in the research enterprise to help attract still further external
support for research.
The change in treatment of indirect costs will provide Texas
public universities with an estimated $86.4 million in additional
funds for the new biennium. Within the U.T. System, the total
will be an estimated $54 million. The largest impact will be at
U.T. Austin, which will receive an additional $39 million during
the biennium.
The Legislature approved a "Be on Time" program that
provides zero-percent loans and loan forgiveness for students
who graduate within a proscribed period of time. The appropriations
bill also allocates an additional $10 million for work-study programs.
Passage of legislation to end a series of onerous state regulations
will help make Texas higher education more efficient and cost-effective.
With greater freedom to manage our own affairs, the U.T. System
will be able to reduce bureaucratic expenses and streamline operations
still further. We pledge to merit the trust placed in us by the
Legislature and to operate a university system that is efficient,
transparent, and accountable.
Among the changes in the regulatory environment are these: Hiring
outside legal counsel for technology issues will no longer require
approval of the attorney general; employee-leave management will
be delegated to governing boards; postdoctoral fellows who are
paid through federal grants will be able to receive health benefits;
and the rule-making process of the state Department of Information
Resources will be modified for higher education institutions.
Also, duplicate or overlapping reports will be reduced. Examples
are the following: Elimination of requirement to file intellectual
property policy with higher education commissioner because it
is posted on an institution's website; elimination of requirement
to report twice a year to the LBB on purchases from non-resident
bidders; elimination of recycled products reporting; and elimination
of biennial reports to the Building and Procurement Commission
regarding a higher education's construction projects.
The Legislature granted authority for several institutions to
finance vitally needed construction and renovation projects through
tuition revenue bonds. U.T. System institutions covered by this
bill are U.T. Health Science Center at Houston -- $64.9 million;
U.T. Southwestern Medical Center - Dallas -- $56 million; and
U.T. M. D. Anderson Cancer Center - Houston -- $20 million.
The Legislature also abolished two special research funds created
by the 77th Legislature and combined all eligible universities
into one research fund. Distributions from the new Research Development
Fund will be based on each institution's three-year average expenditure
of restricted research funds. All universities except U.T. Austin,
Texas A&M at College Station, and Prairie View A&M are
eligible. (Those three institutions receive academic enhancement
funds from the constitutionally mandated Permanent University
Fund.)
Giving governing boards authority to set tuition allows university
presidents, in broad consultation with their campuses, to recommend
flexible rates of tuition as a means to achieve many strategic
goals, including assuring the critical needs of the state for
access and affordability of higher education and meeting the state's
goals for "Closing the Gaps."
Other goals that will be significantly enhanced by this legislation
include assuring quality of instruction, recruiting and retaining
high-quality faculty, reducing student-faculty ratios, improving
graduation rates, making better use of facilities, improving academic
programs, ensuring financial assistance to those in need, and
attracting more research dollars.
We share the public's concern about keeping higher education
affordable for middle-income and lower-income families. Our goal
is to make sure that no student is denied educational opportunity
because of financial needs.
The tuition deregulation bill provides for a minimum 20 percent
set aside from any increase in designated tuition for resident
undergraduates for financial aid programs. For graduate and professional
students, the set aside is 15 percent.
Deregulation of tuition makes sense not only as a partial response
to cushioning the impact of the state's current economic crisis,
but also as sound public policy for the future. Legislators have
helped to assure adequate and sustainable support for institutions
of higher education while providing for the broad access and affordability
of colleges and universities, and accountability for results,
that Texas needs in order to remain competitive in the future.
Tuition decisions in the U.T. System will be made through a broad
process of consultation with students, faculty, and administrators.
Each campus president will conduct such consultations as part
of the process of developing tuition proposals to be brought to
the U.T. System Administration and the Board of Regents. The U.T.
System also will form a System-wide commission on tuition and
fees, including student representation, to help coordinate policy
and facilitate an exchange of ideas and information. We also will
form a tuition working group to conduct a continuing assessment
of best practices and strategic uses of tuition.
To assure accountability for its decisions, the Board of Regents
will closely monitor and report on the impact of tuition increases.
