Higher Education Chairman Optimistic About Campus Construction Funding

Originally published on ConstructionCitizen.com.

State funding for college campus construction projects has been described by many around Texas as “long overdue.” Leaders in the Legislature have agreed on the fundamentals in recent years but have been unable to come to a consensus on the details of a solution.

This year, various construction associations, educators, and others are pushing lawmakers to approve as much as $3.6 billion in new buildings at multiple college campuses. Leaders in higher education say public universities are quickly falling behind in classroom space and other facilities as they struggle to accommodate growing demand. In many cases, the buildings on college campuses are decades out of date.

Most of these projects could be funded by something called “tuition revenue bonds,” which are floated by tuition and fees. As structured, the TRB’s can only be used for financing educational space like labs and classrooms. No legislation to approve tuition revenue bonds has been approved by the Texas Legislature in almost a decade. These bonds would have to get the green light from lawmakers before the debt can be issued. In the past, the state covered the debt payments with general revenue.

Some lawmakers say universities should come up with at least some of the funding on their own. Some schools have already made commitments to do so. Gov. Greg Abbott and Lt. Gov. Dan Patrick have said there should be a school-by-school review before they would be willing to go along with more money for construction on college campuses.

In 2013, the Legislature came very close to approving about 60 college campus construction projects at a cost of about $2.7 billion. The effort fell apart, though, when the House and Senate could not hammer out the details. Many fights at the Legislature are not Republicans vs Democrats. They are House vs Senate.

Sen. Kel Seliger, R-Amarillo, is once again the chairman of the Senate's Higher Education Committee and has already filed campus construction legislation. When asked about the failure of similar legislation two years ago, he said, "It's the only time I've seen a bill that everybody was in favor of fail.”

Seliger said he has high hopes this time around.

"I think it's going to do much better this time,” he said, and added that those tuition revenue bonds may not be the method of financing. In fact, he would prefer it if they weren’t.

“When the opportunity comes to prepare for the future, I think that's a prudent thing to do," Seliger said. The projects could be paid for with general revenue, money from the state's Rainy Day Fund, or bonded indebtedness, Seliger said. "If we take on debt, we're incurring expenses for the next 20 to 30 years," Seliger said. "These are one-time projects so it makes sense to address them with one-time funding."

Sen. Seliger’s Senate Bill 150 would spend about $2.9 billion on 64 projects. The largest of those would be $90 million for a health and biomedical sciences center at the University of Houston. There is also Senate Bill 21, which would spend as much as 5.3 billion for 84 projects across Texas. That bill by Sen. Judith Zaffirini, D-Laredo, includes a $190 million science and engineering building at UT Arlington.


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