During the Session
The General Appropriations Bill
The general appropriations bill is divided into articles that group agencies by functional areas. Education is funded in Article III.
Article IX contains provisions proscribing how agencies spend money, including travel reimbursements levels, restrictions on publishing and disseminating reports, and prohibitions on lobbying expenditures. Some of its provisions, commonly called riders, can reduce an institution's state funding below the amount it seems slated to receive in Article III.
In addition to the funds appropriated to institutions by name in Article III, the bill appropriates other funds that support higher education, including:
- Health benefits through the Employees Retirement System appropriation.
- Retirement benefits through the Teacher Retirement System appropriation.
- Competitive research grants distributed by the Coordinating Board.
- Higher Education Assistance Fund (HEAF) money for construction and equipment.
- Scholarship funding through the Texas Grant program
Higher Education Fund
Higher Education Fund (HEF) money can be spent on the acquisition and improvement of land; on the construction, maintenance, improvement, and furnishing of buildings; on capital equipment such as computers and research instruments; and on library acquisitions.
HEF was established in 1985 by amendment to the Texas Constitution as a source of money parallel to the Permanent University Fund, which only benefits University of Texas at Austin, Texas A&M at College Station, and Prairie View A&M. (and other schools within the UT and A&M systems). The constitutional language [Article 7 17(a)] creates 10-year cycles, during which the Legislature can authorize the increase of appropriations to HEF once and their reallocation twice. The original appropriation was for $100 million annually. It was increased to $175 million in 2003. In 2005, the Legislature voted to increase the annual appropriation to $262.5 beginning in 2007.
How a Budget Bill becomes a Law
The Senate Finance Committee and House Appropriations Committee work concurrently on similar general appropriations bills, meeting daily and often nightly. They may authorize subcommittees to conduct public hearings and leave debate of the details to the full committee. Agency hearings begin as soon as committees are appointed by the Speaker and Lieutenant Governor in January or early February. At this time, the committees or their higher education subcommittees ask institutions to testify on provisions of the bill that concern them and answer questions.
Both the House and Senate committees try to complete mark-up on their respective bills by early April and pass a bill by late April. Differences between the two versions are worked out in conference committee with a target date in mid-May. Generally, final consideration of the appropriations bill by both houses is delayed until the waning days of the session. The Comptroller must certify that revenues will be available to support the appropriations. Then the bill is sent to the governor, who has line item veto authority.
When the legislature is not in session, the Governor and the LBB have authority-through a process called budget execution-to transfer appropriations from one state agency to another or within a single agency.
For more information, please see the chart on how a bill is passed (PDF).