1. Higher Education May 3, 2016

2. Higher Education More than 1.3 million students attend one of the state’s universities, colleges, community college districts, health-related campuses, and technical colleges. As the table to the right shows, more students attend community colleges than attend universities. 50 community & junior colleges— 693,791 38 universities, including law schools—603,598 11 health-related institutions— 23,035 Texas State Technical College System—11,642 Three Lamar State Colleges— 7,045 Fall 2014 Enrollment

3. Size Matters Texas A&M has 59,000 students UT Austin has 51,000 students University of Houston has 41,000 students Texas State University has 37,000 students Lone Star Community College has 75,000 students Dallas Community College has 71,000 students Alamo Community College has 58,000 students Tarrant County Community College has 58,000 students

4. State Funding Per Credit Hour In 2003, the legislature, facing a budget shortfall, cut higher ed funding, but it allowed universities to raise tuition to make up the difference. More and more, the cost of education is born by students.

5. Tough times for higher ed funding all over.

6. State Money Down, Tuition and Fees Up Colleges and universities have filled the gap caused by declining state funding by raising tuition and fees and going into debt.

8. Compared with Other States

11. Permanent University Fund (PUF) The University of Texas (UT) at Austin and Texas A&M University at College Station benefit from the Permanent University Fund (PUF), which is used to guarantee bonds for capital improvements at schools in the UT and A&M University Systems. The PUF cannot be spent. Income generated by the land is invested. Investment returns fund the Available University Fund (AUF), which supports the 21 institutions in the UT and A&M systems.

12. Today the PUF contains 2.1 million acres located in 19 counties primarily in West Texas. On December 31, 2014 the market value of the PUF was $17.5 billion.

13. How the PUF Works PUF land generates income Land income of $17.5 billion is invested, not spent Investment earnings comprise the AUF AUF supports UT and A&M system institutions The UT Board of Regents manages the PUF

14. The AUF is used for three primary purposes: 1) to pay interest and principal due on PUF bonds that are issued to provide construction dollars at 21 institutions of the UT and A&M Systems; 2) to provide support for a wide range of programs intended to develop excellence at The University of Texas at Austin, Texas A&M University, and Prairie View A&M University; and 3) to provide for the expenses of the two respective System administrations.

15. UT, A&M, and PUF Because of the PUF, the state funds UT and Texas A&M more generously than other state universities. In 2014, the state sent $296.4 million to UT-Austin and $176.3 million to Texas A&M. In contrast, it sent UH main campus $68.9 million.

16. Tier One A Tier One university is measured by the amount of research it conducts and by membership in the prestigious Association of American Universities (AAU). Tier One universities attract the best students and the most research money. Three Texas Universities are members of the AAU—Rice, Texas, and Texas A&M.

17. U.S. News Ranking Universities across the country compete to be ranked highly by the U.S. News & World Report. In 2016, the top 10 national universities were Princeton, Harvard, Yale, Columbia, Stanford, Chicago, MIT, Duke, Penn, and Cal Tech. The highest ranking Texas schools were Rice at 18, UT at 52, SMU at 61, Texas A&M at 70, Baylor at 72, TCU at 82, UT Dallas at 140, Texas Tech at 168, and UH at 187.

18. Race for Tier One In 2009, the legislature and the voters approved measures to provide funding aimed at increasing the number of Tier One universities in Texas.

19. Moving Toward Tier One: National Research University Fund The legislature set aside more than half a billion dollars in a National Research University Fund to provide incentive grants that eight state universities can draw upon as they move toward Tier One status. The institutions are the University of Houston, Texas State University, Texas Tech University, University of Texas at Dallas, University of Texas at San Antonio, University of Texas at Arlington, University of Texas El Paso, and the University of North Texas. To qualify for the money, a university has to have at least $45 million in research expenditures in each of the two previous years. In 2012, both UH and Texas Tech met eligibility thresholds and began receiving distributions from the fund. None of the other institutions have yet to meet the criteria. UT Dallas is close.

20. Eligibility for National University Research Fund Grants Eligibility of funds is based on an institution meeting benchmarks in the following categories, as identified in the legislation. The institution: must be designated as an emerging research university in the Coordinating Board's accountability system; must have expenditures of at least $45 million in restricted research; and must comply with four of the following: A. $400 million endowment annually; B. 200 PhD degrees awarded annually; C. freshmen class with high academic achievement; D. membership in Association of Research Libraries, Phi Beta Kappa or equivalent national recognition; E. high quality faculty; F. commitment to high quality graduate education.

21. Research Spending 2014 UT and A&M are considered Tier One. TX A&M$854 m. UT Austin$585 m. TX Tech$159 m. UH$141 m. UT Dallas$100 m. UT Arlington$89 m. UTEP$80 m. UT North TX$44 m. TX State$39 m.

22. Ph. Ds Awarded

23. We Have Our Priorities in Texas Who are the two highest paid state employees in Texas?

24. Hint: They are Both Black Guys Kevin Sumlin, A&M Football CoachCharlie Strong, UT Football Coach $3.1 million a year$5 million a year

25. Money Lost on Athletics 2008- 2014 University of Houston --- $106.23 million University of Texas at El Paso --- $47.09 million Texas State University --- $38.61 million University of North Texas --- $16.97 million Texas A&M University --- $14.77 million Texas Tech University --- $14.62 million University of Texas at San Antonio --- $12.95 m. University of Texas at Austin $0

26. What You Have Learned How has state funding for higher education changed over the last decade? How have student costs changed over the last decade? Why has state funding for higher education not kept up with enrollment? What is Tier One? What Texas institutions are Tier One? What is the state doing to increase the number of Tier One institutions?