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Characteristics of the Texas Higher Education System

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There are over 150 institutions of higher education in Texas, including a combination of two- and four-year, public and independent, upper- and lower-division, and technical and professional institutions. Texas ranks fourth nationally and third among the study states in terms of the number of colleges and universities. As Table 2 indicates, almost 90 percent of the enrollment in Texas higher education is in public institutions, the greatest percentage of any of the study states. Yet the state is about average among states in this study in enrollment in public institutions per 1,000 population.

Relative to other states, Texas has a fairly low-cost system of higher education. Texas ranks 29th in terms of state per-student appropriations, and 45th in total support (when appropriations, tuition, and fees are taken into account).

Table 2 System Characteristics for Texas Compared to Selected States (Numbers in Parentheses Represent Rank Among the Seven Study States)
System Characteristics	High (1-2)	Average (3-5)	Low (6-7)	U.S. Average
Total Degree-Granting Institutions (1994-95)		178 (3)
Public Four-Year Institutions (1994-95)	40 (2)
Public Two-Year Institutions (1994-95)	65 (2)
% of Enrollment in Public Institutions (1994)	88.3 (1)			78
FTE Students per 1,000 Population (Public Institutions Only) (1995-96)*		33.0 (3)		31.5
Participation Ratio: Public FTE Students per New High School Graduate (1995-96)*		3.45 (3)		3.28
% of High School Graduates Going on to Higher Education Anywhere (1994)?			50.4 (6)	57.3
State Appropriations plus Tuition Revenues per FTE Student (1995-96)*		$6,540 (4)		$7,020
Sources: Unless otherwise noted, data are drawn from Chronicle of Higher Education Almanac (September 1996), pp. 98-99. * Halstead, State Profiles: Trend Data (1996), pp. 85, 88. * Halstead, Higher Education Report Card 1995 (Washington D.C.: Research Associates of Washington, 1996), p. 37.

Public higher education in Texas includes a mix of large systems, smaller regional systems, free-standing campuses with individual boards, and independent colleges and universities, all of which fall under the purview the Texas Higher Education Coordinating Board (THECB). Table 3 lists the public universities and their enrollments.

Table 3 Public Universities and Enrollments (Fall 1996) (Does Not Include Health Sciences Institutions)
System/Institution	Enrollment	System/Institution	Enrollment
Texas A & M Univ. System		Univ. of Texas System
Prairie View A & M University	6,167	University of Texas, Arlington	20,544
Tarleton State University	6,369	University of Texas, Austin	48,008
Texas A & M International University	2,677	University of Texas, Brownsville	2,623
Texas A & M University*	38,630	University of Texas, Dallas	9,378
Texas A & M University, Galveston	1,202	University of Texas, El Paso	15,386
Texas A & M University, Commerce	7,457	University of Texas, Pan-American	12,682
Texas A & M University, Texarkana	1,145	University of Texas of the Permian Basin	2,193
Texas A & M University, Corpus Christi	5,671	University of Texas, San Antonio	17,547
Texas A & M University, Kingsville	6,113	University of Texas, Tyler	3,459
West Texas A & M University	6,481	Univ. of Houston System
Texas State Univ. System		University of Houston	30,774
Angelo State University	6,195	University of Houston, Clear Lake	6,968
Lamar University, Beaumont	8,417	University of Houston, Downtown	7,947
Lamar University, Orange	1,513	University of Houston, Victoria	1,795
Lamar University, Port Arthur	2,475	Other Institutions
Lamar University Institute of Technology	1,611	Midwestern State University	5,643
Sam Houston State University	12,564	Stephen F. Austin State Univ.	11,683
Southwest Texas State University	20,776	Texas Southern University	7,973
Sul Ross State University	2,518	Texas Tech University	24,717
Sul Ross State University, Rio Grande College	866	Texas Woman's University	9,747
		University of North Texas	24,957
* This refers to Texas A & M's flagship campus at College Station. Source: Texas Higher Education Coordinating Board, "Institutions of Higher Education in Texas," 1997 (www.thecb.state.tx.us), unpaginated.

There are currently four primary university systems in the state: the University of Texas system (nine universities, four health science centers and the M. D. Anderson Cancer Treatment Center); the Texas A & M system (ten universities and one health science center); the University of Houston system (four universities); and the Texas State University system (five universities, one upper-level center, and three two-year, lower-division institutions). Each of these systems has a separate system office, headed by a chancellor. Each institution within the system is headed by a president. Of these four systems, only Houston is a regional system, with all four campuses in the greater Houston area. While the Texas State University system consists of similar institutions with similar missions, the other three primary systems include a flagship institution and then a variety of institutions with differing missions and capacities.

There are two additional smaller systems: Texas Tech University (one university and one health science center) and the University of North Texas (one university, one health science center). These systems do not have a separate system office. There are currently four institutions-Midwestern State University, Stephen F. Austin State University, Texas Southern University, and Texas Woman's University-that remain as free-standing institutions with their own individual boards of regents.

Each university system and free-standing institution is governed by a nine-member board of regents that is appointed by the Governor. Each regent serves a six-year term.

The public higher education system also includes 50 community college districts with over 70 campuses that enroll over 400,000 students. Each community college district has its own board of trustees, elected locally. There is no statewide board for community colleges. The Texas State Technical College system enrolls approximately 8,000 students and consists of three two-year campuses that have an emphasis on technical training.

The Texas higher education system also includes 40 independent colleges and universities and one independent medical school. Although these institutions must obtain a certificate of authority from the Coordinating Board to grant degrees in the state, their programs are not subject to review or approval by the board.

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System History

The governance structure has evolved substantially over the past century. The first "system" of institutions was the State Board of Normal Schools, established in 1911, which eventually became the Texas State University system. The composition of the individual systems, particularly of the University of Texas (UT) and Texas A & M University (A & M), is continually changing as increasing numbers of campuses are being incorporated into one of the two systems. Many of our respondents speculated that the free-standing campus with the individual board is becoming a "dinosaur" in Texas, and that increasingly Texas will move toward having only the two large systems. Free-standing institutions with individual governing boards, said one respondent, are "disappearing fast."

Organization and Structure

The higher education system in Texas is generally described as "not neat," "not rational," "ever-changing," and "unplanned." "We have an amoebic system," said one legislative staff member. The fact that the composition of the individual systems changes regularly contributes to this notion. No one could describe for us an educational rationale for the various systems and governance arrangements. Rather, the structures are believed to be the result of political influence and the political process. "It's a crazy way to do it, but it's grown up over time and it's hard to change," said one higher education official. Since Texans value local control and a weak central government, said one political staff member, chaos in the system will most likely continue. The result, one respondent argued, is a system that has needless duplication. Others believe that the two main systems have become too large and unwieldy.

While Texans like to laugh at the somewhat chaotic way in which their system of higher education is organized, they are not for the most part eager to change the current structure. In 1989, the Coordinating Board established a special committee on statewide governance of higher education to examine possible changes to the organization of higher education. Citing problems such as an inability to conduct statewide planning, insufficient regional coordination, insufficient buffering of institutions from the legislative process, and a continuing compromise in the quality of the flagship institutions in the state, the committee recommended a new structure for Texas higher education. This new structure would include only four systems, reorganized to include a smaller UT system, a smaller Texas A & M system, and two additional systems, one focused on undergraduate education, the other including a variety of types of institutions. One of the main problems with these recommendations was that their implementation would have upset the established balance of power. One respondent said that the people in Houston and Lubbock did not agree with the recommendations because they saw the change in structure as limiting their ability to develop a university of high prestige. Any set of recommendations that established some systems as more prestigious than others, or grouped institutions in such a way as to emphasize high versus low status would not be acceptable. Another respondent argued that the plan to regionalize some of the systems would have pitted one portion of the state against another, and this was not desirable. The report's recommendations, therefore, were never adopted.

Many of our respondents argued that although the system is not rational, it works pretty well. For example, one political staff member argued that while the system would be easier to understand if all institutions fit into nice organizational boxes, institutions have done a good job of trying to address statewide issues and needs. A former president suggested that the lack of logic to the structure could be problematic if there were a great deal of political competition among institutions as they vied for funds, but this has not been a problem in Texas because of the formula funding process.

South Texas Initiative

The biggest changes to the structure and composition of the higher education systems in the state came as a result of what is known as the South Texas Initiative. In the mid-1980s, a group of institutions in the southern part of the state, a section of the state with a significant Hispanic population, were concerned that they did not provide sufficient program offerings or enrollment opportunities. A lawsuit was filed in 1987 by the Mexican American Legal Defense Fund (MALDEF) on behalf of the League of United Latin American Citizens (LULAC), claiming that there were inequities of opportunity for higher education in the South Texas region. The lawsuit accused the state of discriminating against Mexican Americans, citing low spending on higher education and the limited number of graduate programs (less than one percent of the state's doctoral programs) in the region.

A lower court found in favor of MALDEF, but this decision was overturned by the state Supreme Court. The Supreme Court found that the state had not intentionally discriminated against Mexican Americans.

While the Supreme Court ultimately found in favor of the state in this lawsuit, the Legislature took an active role in trying to address some of the concerns brought about by the South Texas institutions. The Legislature called upon the University of Texas and Texas A & M systems to bring some of the South Texas institutions into their systems in order to build up those campuses. As a result, two institutions were incorporated into the UT system, and three into the A & M system.

The incorporation of institutions into the two large systems was seen as one way of upgrading these institutions by giving them more political clout. In addition, significant funds were appropriated by the Legislature to South Texas/Border Initiative schools to allow for new buildings, new faculty, and new programs. In 1993, for example, the Legislature approved a $460 million package for the nine colleges and universities in the Texas border region, which has resulted in the introduction of nearly 100 new academic programs, hundreds of additional faculty members, new buildings, and renovations. This included $96.4 million to improve and expand undergraduate, graduate and doctoral programs, compared with $35.2 million for new programs in the 1991-1993 biennial, and $13 million in the 1989-1991 biennial. According to one administrator, for a time it seemed that a geographic test was used for approval of doctoral programs, and only those in the southern part of the state would be approved. He thinks that there now appears to be a greater feeling of equity of opportunity for higher education in the southern region. The Coordinating Board says that no such test was ever employed.

The infusion of money and expansion of program offerings into the South Texas region has resulted in enrollment surges at many of the South Texas institutions. Texas A & M International saw a 57 percent increase in enrollment from fall 1993 to fall 1996. Enrollment at the University of Texas, Brownsville, and Texas A & M, Corpus Christi, increased 37 percent and 26 percent, respectively, during the same period.

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Texas Higher Education Coordinating Board

The board advises the Legislature on higher education issues. It is responsible for preparing a master plan for higher education and for preparing funding formulas for use by the Legislature. In addition, the board is responsible for approving new degree programs and some construction processes. According to one staff member, the Coordinating Board should be seen as an impartial and objective source of information, which can be provided with or without recommendations.

There are approximately 270 employees at the Coordinating Board. At least 90 of those are part of the student loan program, which is self-supporting, and another 50 or so are paid through special grants, primarily from federal dollars. About 130 board employees, therefore, are supported by the state budget.

The Coordinating Board is made up of 18 members appointed by the Governor to six-year terms. The Governor also appoints the chair and the vice chair of the board. Typically, according to the commissioner of higher education, when a new Governor comes into office, the chair will step aside or be replaced.

The commissioner of higher education is appointed by and serves at the pleasure of the board. There have been some attempts to have this position appointed by and accountable to the Governor, but these attempts have not been successful. The current commissioner has been in this position for 20 years. Each Governor, with the exception of Ann Richards and George W. Bush, has come into office with the intention of firing the commissioner, but to no avail. One staff member attributed this in part to the way that board appointments are managed, and to the independence of the board. Another respondent said that the commissioner has done a marvelous job of balancing institutional aspirations against the overall needs of the state, and the board has been smart enough to realize that. A former institutional president suggested that the commissioner is "brilliant" and is able to win "through logic and argument" rather than relying on personal relationships or lobbying.

A number of our respondents said that the Coordinating Board plays an important and needed role in Texas. To one former member, the Coordinating Board limits the proliferation of graduate degrees, and plays an integral role in the formula-funding process. A former regent of the UT system said that the primary role of the board is to avoid unnecessary duplication in the state, and he believes that they do quite well in this regard. The Coordinating Board members, he argued, are strong advocates of the public purposes and functions of higher education in the state, and serve to encourage greater public commitment to the enterprise.

There is generally a "love-hate" relationship between the Coordinating Board and the institutions and between the board and the Legislature, according to one political staff member. Institutions and the Legislature appreciate the Coordinating Board for some of their actions and services, but they are also quick to blame and criticize the board for others.

The structure of higher education in Texas contributes to the adversarial relationship established between the systems, the Legislature, and the Coordinating Board. There is very little filtering coordination that takes place at the system level, and therefore difficult decisions are passed along to the Coordinating Board. That is, the systems typically do not want to deny campus requests for new programs, and therefore they leave this responsibility to the Coordinating Board. The board then tries to serve as a countervailing force to some of higher education's parochial interests, acting as the guardian of the interests of higher education as a whole. This often leads to conflict, pitting the board against the wishes of the system and the institutions. "This is the best show in town," said one Coordinating Board staff member. "We have terrible shoot-outs here and an incredible amount of political pressure over such things as programs and budgets." A legislator suggested that the board serves as the "scapegoat" when the systems need to have someone to blame. A former president said that the conflict is "inevitable" because the system board must play the role of advocate for its institutions while the Coordinating Board has the task of referee.

To some, the problem is that the Coordinating Board does not spend its time wisely. One university administrator argued that the Coordinating Board spends time on minor issues, or issues of procedural accountability, rather than issues of importance to the state as a whole. Another argued that the board's excessive reliance on regulations prevents it from enhancing the quality of the system. A third suggested that the board spends an inordinate amount of time on such issues as examining whether a small proprietary school should be authorized to award a certain degree-something that is inconsequential to most of Texas higher education.

The antagonistic relationship extends to the Legislature as well. One respondent suggested that the Legislature often "uses" the Coordinating Board. When the Legislature faces a problem that should be settled legislatively but is too hot politically, it will assign the matter to the Coordinating Board. There are disagreements among legislators as to the appropriate role of the board. For example, a former politician argued that the Legislature-not the Coordinating Board-should perform the functions of centralized planning since the Legislature is responsible for the distribution of dollars. In contrast, the Senate Education Committee recently proposed that the Coordinating Board take on a stronger and more centralized approach to planning. A faculty member argued that allowing the Legislature to handle planning would result in chaos, and create a situation where an institution's future would depend too much on the political skills of its president.

A political staff member argued that one of the biggest weaknesses of the Coordinating Board is the fact that its enabling legislation does not guarantee limits to legislative intrusion on the processes and procedures assigned to the board. He cited what he called the "fiasco" with the South Texas Initiative as a good example of this. The Legislature took it upon itself, he said, to mandate specific degree programs at specific campuses, assuming the powers assigned to the Coordinating Board. A former board member agreed, saying that the board loses out when political leaders will not let the system work the way it was set up to work. A faculty member argued, however, that while it is true that the Legislature occasionally preempts the Coordinating Board, there is no way to avoid this short of giving the board total autonomy, which would, in his view, be undesirable.

Both the Coordinating Board and the Legislature have made attempts to improve their relationship with each other. The Coordinating Board, most agree, has always been weak in legislative relations, but it is now recognizing the need to do more in the political arena. In June 1995, the Governor, Lieutenant Governor, and Speaker of the House issued a statement saying that in the future no changes in system structure could be made without some approval or review by the Coordinating Board. There is not a great deal of optimism, however, about the extent to which that directive will hold.

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Community and Technical Colleges

According to one Coordinating Board staff member, however, the structure of higher education in the state and the status of the universities mean that community colleges do not get the attention or support they deserve. Not all districts have a community college, and therefore there are communities that are underserved. Another staff member described the historical relationship between the board and community colleges as "benign neglect," but said it is much improved now. The increase in the amount of federal money coming to the state through the Perkins Act, combined with a greater emphasis throughout the state on technical education and work-force preparation, have created a more integral relationship between the board and community colleges. A former president suggested that it is not benign neglect but simply a matter of responsibility; previously, federal and state funds for vocational and technical education were administered out of the Texas Education Agency, while the Coordinating Board was responsible for academic programs. Now, the Coordinating Board has responsibility for vocational, technical and academic programs, leading to much greater involvement.

Community colleges get about 46 percent of their budget from the state, with the rest coming from local funds. As recently as 1985, 61 percent of community college funding came from state funds. State funding for the colleges is formula driven-on a basis of dollars per contact hour. This is problematic, said one respondent, because the emphasis is on contact time rather than educational quality; institutions tend to stretch out contact hours, creating longer degree programs in order to increase funding.

The Coordinating Board recently adopted a quality review initiative, called institutional effectiveness, to address issues of access, labor market demand, placement, and quality in community college programs. Every four years, the board looks at a college to see if they are performing the mission established by the Legislature. They use an accreditation model to determine program effectiveness, with a focus on providing a developmental or formative evaluation. This model, according to one board staff member, has tied the board and community colleges more closely together.

The board does not approve construction and/or capital costs at the community colleges, leaving these decisions to the local boards. This results from the historical relationship between the state and the community colleges. The state, through its appropriations, provides support for instruction at the colleges, while the local community, through its tax base, provides for the physical plant and administration of the colleges.

The Texas State Technical College System includes three colleges and four extension centers offering two-year, technical degree and certificate programs. All colleges in the system are governed by a single board of regents. These institutions do not have a local tax base. The state uses the same formula for administrative and instructional activities at the technical colleges as for the community colleges.

There is tension in Texas between the community colleges and the Texas Technical College system. The technical colleges have a statewide mission, and thus receive the bulk (over 63 percent) of their funding through state appropriations, while community colleges receive about 46 percent of their funding from the state. In addition, technical colleges are not supposed to duplicate what community colleges do, but over time, the missions of the two have become blurred. The duplication in programs, as well as the fact that the technical colleges receive substantially more state support than community colleges, has led to animosity between the two systems.

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Public Universities

The 1995 legislative session provides examples of how institutions are moved from system to system through the legislative process in Texas.

The Lamar University system was created by a powerful state senator who felt his district would be best served with a system that included its own Board of Regents. During the past several years enrollment at the university declined, and the current president became involved in a contentious relationship with the Lamar Board over what some have described as the board's micromanaging tendencies. When the senator who created the system was voted out of office in 1994, the state representative from the area stepped in. This representative felt that it was in the district's best interest to be part of a larger system, and came to the conclusion that the Texas State University system would provide the best match. The move appeared beneficial for both parties: the system would gain a set of institutions from an area with a great deal of political clout, while the institutions would remove a board that was at cross purposes with its president. Those we spoke with suggested that despite these benefits, this shift-which took place in 1995-would not have occurred without political involvement.

During the same legislative session, the senator from Laredo attempted to move the Texas A & M International University to the UT system. The legislation was introduced by the senator as a "local bill," meaning that as a matter of courtesy it was virtually guaranteed passage in the Senate. According to one university president, this bill came as a surprise to the institution. The House Higher Education Committee, while affording the bill a lengthy hearing, decided not to report the bill from committee. The representative from Laredo made certain that the bill did not get out of committee in the House. Attempts by the senator to amend the provision to other higher education bills failed, and the institution remains a part of the A & M system. As a result of the political battle that developed in this proposed shift, one university administrator predicted that the hand of the Coordinating Board will be strengthened, giving them more say about which systems should absorb which institutions.

The University of Texas System

The University of Texas (UT) system, with 14 institutions and approximately 145,000 students, is the largest university system in the state. The system is governed by a nine-member Board of Regents, considered to be the most prestigious gubernatorial appointment in Texas.

The system is coordinated by a chancellor's office, which focuses primarily on governmental relations. The system office coordinates systemwide activities and represents the institutions in the state Legislature and in Washington, D.C. In addition, the system office develops rules and guidelines (such as uniform systems of accounting) and transmits communications between the institution and the Regents. The chancellor said that it is through such areas as legal systems, asset management and governmental relations that a system provides scale economies, allowing smaller campuses to have a higher quality of service while all campuses benefit from economies of scale. One campus president agreed, saying that the value of the system is that it provides services in a more efficient manner than the campus could on its own.

The UT system is comprised of a set of very diverse campuses. From the flagship campus at UT Austin with over 47,000 students to small campuses with enrollments of less than 2,000, there is enormous variation in the system. UT Austin is a research institution with a full array of doctoral and professional programs. UT Arlington, El Paso and Dallas offer several doctoral programs, while UT Pan American and San Antonio offer only a small number of doctorates. The remaining institutions offer primarily baccalaureate degrees, with some master's programs. There is some disagreement about the extent to which there is mission creep within the system; some respondents said that once a campus joins the UT system, the campus staff and faculty want to add graduate programs and become increasingly like UT Austin; others argued that this is not the case and that each campus enjoys its unique mission. One president said that the institutions may differ in quality, but they are similar in their hope and their visions. He did not see this as problematic because of the size of the state; there is no need to worry about duplication when programs are so spread out, he said.

Priorities are set at the system level, according to the chancellor, but implementation is left to the campuses. For example, the system has said that salaries should be a priority in this coming year, but they are not likely to tell any campus how much of a salary increase to offer.

Smaller campuses have been drawn to the UT system for several reasons. First, the political clout of UT is enormous, much more than a small institution could ever hope to gain on its own. Second, the prestige that goes along with the UT name is something that many institutions seek. A former board member suggested that the system tries to improve the quality of all institutions in the system. An administrator at UT Austin, however, said that the system needs to do much more in terms of institution building at the small campuses.

The benefits of the system are less evident to some at UT Austin. "We're part of the system for bureaucratic and funding purposes," said one administrator, "but we don't really think of ourselves as part of UT." Austin generally sees itself as a national university, with a very different scope and mission than the rest of the system.

Texas A & M University System

There are 11 institutions in the Texas A & M University system, including a health science center, serving about 76,000 students. Three institutions were added to the system in September 1996, including one formerly private institution. The flagship institution, Texas A & M University, enrolls almost 40,000 students in an array of baccalaureate, master's and doctoral programs; enrollment at the rest of the institutions ranges from 1,200 to 10,000. Most of the institutions in the A & M system offer baccalaureate and master's degrees only, though three of the institutions offer a limited number of doctorates (one or two programs each). The Texas A & M system has made great efforts to strengthen its system in recent years through the addition of new institutions. An administrator in the A & M system justified adding smaller institutions to the larger system because it "solidifies our political base." In addition, the administrator continued, joining the A & M system helps those institutions both politically and educationally because of the added support they receive.

The A & M system expects to see about a 28 percent increase in students over the next decade. Accommodating this demand will be difficult, said one administrator, because the system will need to expand physical facilities.

Texas State University System

The Texas State University System (TSUS) consists of five four-year institutions, with the fifth, Lamar University, recently added. There are also three lower-division institutions and one upper-level center. The four-year institutions have similar missions, and most have developed out of teacher's colleges. Approximately 57,000 students are enrolled in the system.

The system office, which is located in Austin, has a small staff funded by the Legislature. There is no flagship campus, so the political power that institutions in the UT and A & M systems gain by association with their flagships does not exist in this system. Presidents in the Texas State University System do most of their own lobbying, and although there is a system chancellor, the presidents report directly to the Board of Regents, which is divided into local committees to deal with specific institutional needs. The Board of Regents is responsible for policy setting, organization, and management of the institutions.

According to one president within the system, success in this system depends on the amount of special-item funding a president is able to obtain, and the amount of growth in his or her institution.

The University of Houston System

The University of Houston (UH) system, with almost 50,000 students and four institutions, is small by comparison to the two primary systems. The chair of the UH Board of Regents, however, does not think that the system is disadvantaged by the smaller size. As a regional system, the University of Houston can focus on the issues and needs of a defined area. Because the Houston economy is so important to Texas as a whole, it is important for the state to pay attention to and support the system.

In the spring of 1995, the Houston system had a major shakeup in its top-level administration. The chancellor, presidents of two of the four institutions, as well as several other top administrators resigned, under threat of removal by the Board of Regents. The system had been losing favor with the Legislature in recent years, and there was concern among faculty and others that the administration was not doing its job.

The Board of Regents has expressed interest in studying the governance of the system, in particular whether the system would not be better served by eliminating the separate system office and transferring those duties to the administration at the "flagship" University of Houston campus. Rather than making these changes right away, however, the Board appointed interim administrators to help turn the system around. The most notable of these appointments was the interim chancellor, William P. Hobby, the former Lieutenant Governor of the state. Hobby is well connected, is respected politically, and was brought in to stem what the Regents recognized as an increasing threat of reduced funding by the Legislature.

In addition to setting up task forces to study questions of governance and structure for the system, the board has done some strategic planning, and has identified six priority areas it will address. The first is expanding access and diversity, which focuses on what the chair has referred to as the "new Houston." A second priority is working with the public schools to address the problem of under-prepared college students. Other priorities include: creativity and application of scholarship; globalism and international competitiveness; interactive distance learning; and accountability and public support. The chair of Houston's Board of Regents said that the board knows that the money to address these issues will not all come from the state, so the Regents have looked for other ways of raising resources. The Regents have raised over $300 million in endowment money to help address these problems.

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Tuition

There is some discussion now about using tuition increases in order to pay for projected enrollment growth, but there is not general agreement that tuition increases are the answer. A former politician, for example, said that any increase in tuition would be part of the problem, not part of the solution. "Low tuition is good public policy," he argued. A university board member argued that while there is a need for some tuition increases, these cannot be great because the major influx of new students will be minority and low-income students, and will not be able to pay if the price is raised too high. A legislative staff member said that tuition can play an important role in accommodating future demands, and that tuition must go up significantly. A former Coordinating Board member also said that increased tuition is necessary, arguing that low tuition is a subsidy of the rich.

Tuition is set by the Legislature for all four-year institutions. Every student pays the same tuition, regardless of the institution they attend. Tuition has been increasing at an incremental rate of $2 per credit hour per year since 1985, and will continue to increase at that rate until 2000-01. Until 1995-96, institutions were not allowed to keep the tuition increase. However, they are now appropriated the increase.

The Legislature must appropriate tuition revenues for each public institution, based on an estimate of what the institution will raise in the coming year. The institutions cannot spend tuition revenues unless these have been appropriated by the Legislature. According to one university administrator, there is considerable debate and negotiation about the amount of tuition revenues that should be appropriated each year.

Institutions do have the ability to charge higher tuition at the graduate and professional level. In addition, institutions can propose certain general use fees at their campuses. These fees have increased significantly faster than tuition over the past few years. Recently, the Legislature passed a bill introduced on behalf of the UT system that allowed the governing boards to raise the general use fee to the same level as tuition ($32 per unit for fall 1996). Some critics argue that this fee increase really represents a tuition increase.

The Legislature sets the minimum tuition rates for community colleges and the Texas State Technical College system. However, the individual governing boards set the actual tuition rates for their in-district and out-of-district students.

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Independent Higher Education

There are different viewpoints on the role of independent higher education in the state. One administrator commented, "Texas doesn't worry about private higher education." Others described the privates as "big players" who are active in the political sphere.

The state supports students at independent institutions through the tuition equalization grant (see section on Financial Aid in this case study). In addition, the state provides a direct appropriation of $33.8 million annually to the Baylor College of Medicine. In 1995, the Legislature appropriated $2.5 million to establish centers for teacher education at predominately minority, private, general academic institutions.

A private university president suggested that the role of private colleges and universities in Texas has developed by accident. The state has no formal policy or framework for the independent sector. According to a representative of the private colleges, the independent sector is regulated very little by the Coordinating Board. Institutions must obtain a certificate of authority from the Coordinating Board in order to grant degrees in the state, but the board has no program review or approval authority over the independent colleges and universities. A representative of the Coordinating Board argued that the private institutions support a strong role for the Coordinating Board, perhaps because they see little direct impact on themselves.

Most of our respondents agreed that there is unused capacity in the private sector, and these institutions could be better utilized to address the projected enrollment growth. One public university administrator suggested that private institutions will be expected to accommodate approximately 20 percent of the growth. Other respondents do not think this is a real possibility. According to one private institution president, the biggest barrier to fully utilizing private colleges and universities is that Texas is a low-tuition state and it is difficult for students to justify the cost of independent institutions. He said that the state will have to do more with the Tuition Equalization Grant if the privates are to be expected to absorb much of the growth in enrollment.

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Financial Aid

In addition to the Tuition Equalization Grant, financial aid in Texas includes the Texas Public Education Grant, a need-based grant for undergraduate and graduate students. By law, 20 percent of public tuition revenue is used to assist students who need aid; these funds are distributed through the Texas Public Education Grants. The average award in 1993-94 for this program was $704, with approximately 71,000 awards given. Other state grants include the student incentive grant (average award of $323), and several targeted scholarship programs for nursing and accounting students. The Coordinating Board administers these programs, as well as the Federal Stafford Loan programs (called the Hinson-Hazlewood College Student Loan Program in Texas).

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