MINUTES 
          
             SENATE INTERIM COMMITTEE ON FUNDING ISSUES IN EDUCATION 
                            Wednesday, April 8, 1998 
                                    8:30 a.m. 
                         Capitol Extension, Room E1.036 
          
                                      ***** 
          
         Pursuant to a notice posted in accordance with Senate Rule  
         11.11, a public hearing of the Senate Interim Committee on  
         Funding Issues in Education was held on Wednesday, April 8,  
         1998 in the Capitol Extension, Room E1.036, at Austin, Texas.   
          
                                      ***** 
          
         MEMBERS PRESENT:                        MEMBERS ABSENT: 
         Senator Teel Bivins                      
         Senator Bill Ratliff 
         Senator Robert Duncan 
         Senator David Sibley 
         Senator Judith Zaffirini 
                                      ***** 
          
         [Co-Chairmen Bivins and Ratliff decided that Senator Ratliff  
         would Chair this hearing.  Hereinafter "Chair" refers to  
         Senator Ratliff, or to whomever he has handed the gavel.] 
          
         The Chair called the meeting to order at 8:30 a.m.  There  
         being a quorum present, the following business was transacted.   
          
         The following members arrived after the roll was called:   
         Senator Gregory Luna 
         Senator Royce West 
          
         The Chair called on the following witnesses to testify before  
         the committee on the committee charges and agenda topics  
         indicated: 
          
         Charge #3 - Management, Investment and Distribution of the  
         Permanent School Fund, Available School Fund, Permanent  
         University Fund, Available University Fund and Higher  
         Education Fund 
          
              Management and Investment of the Permanent University  
              Fund 
          
                   William H. Cunningham, representing The University  
                   of  Texas System, provided oral and written  
                   testimony. 
          
                   Thomas Ricks, representing The University of Texas  
                   Investment Management Company, provided oral  
                   testimony. 
          
         Available University Fund and Permanent University Fund Bond  
         Proceeds 
          
                   William H. Cunningham, representing The University  
                   of Texas System, provided oral and written testimony 
          
                   Tom Scott, representing The University of Texas  
                   System, provided oral testimony. 
          
                   Barry B. Thompson, representing Texas A&M University  
                   System, provided oral testimony. 
          
                   Richard Lindsay, representing Texas A&M University  
                   System, provided oral testimony. 
          
              Higher Education Fund Formula and Allocation Process 
          
                   Don W. Brown, representing the Texas Higher  
                   Education Coordinating Board, provided oral and  
                   written testimony. 
          
                   Roger W. Elliott, representing the Texas Higher  
                   Education Coordinating Board, provided oral  
                   testimony. 
          
              Capital Allocation Comparison 
          
                   Deborah Beck, representing the Legislative Budget  
                   Board provided oral testimony. 
          
                   Dean Murray, representing the Permanent School Fund,  
                   provided oral testimony. 
          
              Distribution of the Available School Fund 
          
                   Ursula Parks, representing the Legislative Budget  
                   Board, provided oral testimony. 
          
         Charge #5 - Allocation of Funds for Special Items, Medical  
         Schools and Texas A&M Service Agencies 
          
              Special Item Review 
          
                   Nancy Frank, representing the Senate Finance  
                   Committee, provided oral testimony. 
          
              Formulas for Health Science Centers 
          
                   Tom Scott, representing The University of Texas  
                   System, provided oral testimony on behalf of the  
           
                   Health Science Center Funding Working Group. 
          
              Overview of Formula Funding for Texas A&M Service and  
              Research Agencies 
          
                   Eric Wright, representing the Senate Finance  
                   Committee, provided oral testimony. 
          
                   Stanton C. Calvert, representing the Texas A&M  
                   University System, provided oral testimony. 
          
              Infrastructure Formula 
          
                   Roger W. Elliott, representing the Texas Higher  
                   Education Coordinating Board, provided oral  
                   testimony. 
          
              Research Formula 
          
                   Stanton C. Calvert, representing the Texas A&M  
                   University System, provided oral testimony. 
          
                   James G. Butler, representing Texas A&M University  
                   System, provided oral testimony. 
          
         Charge #1 - Status of Student Financial Aid and Tuition  
         Exemption/Waiver Programs 
          
              Recommended Changes to Student Financial Aid Policies,  
              Including Consolidation of Programs, Report on Tuition  
              Exemption/Waiver Statutes, and Cost of Scholarships to  
              Students Completing the Recommended High School Program 
          
                   Don W. Brown, representing the Texas Higher  
                   Education Coordinating Board, provided oral  
                   testimony and a written report. 
          
                   Sharon Cobb, representing the Texas Higher Education  
                   Coordinating Board, provided oral testimony. 
          
         Charge #6 - Costs of Textbooks and Use of Computers and Other  
         Technological Resources as Alternatives to Textbooks 
          
              Costs of Textbooks and Electronic Textbook Pilot Program 
          
                   Ann Smisko, representing the Texas Education Agency,  
                   provided oral testimony. 
          
                   Robert Leos, representing the Texas Education  
                   Agency, provided oral testimony. 
          
         Other Business 
          
              Recommendations of Formula Advisory Committee Regarding  
              University Funding Formulas 
          
                   Don W. Brown, representing the Texas Higher  
                   Education Coordinating Board provided oral  
                   testimony. 
          
         Closing remarks were given by the Chair and committee members. 
          
         There being no further business, at 1:45 p.m. Senator Bivins  
         moved that the Committee stand recessed subject to the call of  
         the Chair.  Without objection, it was so ordered.   
          
         ______________________ 
         Senator Bill Ratliff, Chair 
          
         ______________________ 
         Patricia Hicks, Clerk