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January 17th, 2009
Texas State puts tuition revenue bonds in legislative priorities

Managing Editor

With the 2009 legislative session looming and an economy in rescission, Texas State University is looking to get as much financial support as it can from the legislature to start several new on-campus projects.

“Our legislative appropriations request includes tuition revenue bonds (TRB) among our top requirements,” Special Assistant to the President Dr. Robert Gratz said.

Tuition revenue bonds (TRBs) are issued by institutions and used to improve on-campus facilities. The institution borrows against anticipated future tuition.

TRBs have been used for almost 40 years as a way to complete construction projects, and even construct entirely new universities. The University of Texas at San Antonio and University of Houston-Clear Lake are two such schools.

“When the state authorizes institutions to issue (tuition revenue) bonds, the income stream that guarantees them is future tuition,” Gratz said. “They allow us to pledge future tuition.”

Traditionally the legislature will, through the normal appropriations process, set aside money from general revenue to pay the debt service on these bonds, so there is no financial impact to the students. However, this has not always been the case.

“(The) 2003 (session) was the only time the state didn’t come through,” said Bill Nance, Vice-President for Financial and Support Services, citing budget problems statewide at the time. “If we had any inkling they wouldn’t approve the debt, we’d pull them.”

University officials seem determined not to pass these costs along to the student body.

“The whole idea is the state will pick up and finance these construction projects, so there’s no impact to the students,” Nance said.

Other priorities for Texas State include a new recital hall and theater center, two health professions buildings at their Round Rock campus, a music building, and an appropriation for engineering and sciences. Other projects that are not named as priorities include a nanomaterials lab, river systems monitoring, border security geographic research and feed industry research and education.

“We see the first and second things on this list (tuition revenue bonds and the recital hall and theater center) as our main priority,” Gratz said.

Thomas Clark, Dean of the School of Music, sees the need for a new recital hall.

“We have a very strong interest in it,” Clark said. “The facilities are adequate, but barely. In particular, our (current) recital hall is too small and seats less than 150 people.”

Clark went on to say that the acoustics in the current recital hall could be much better and there are problems with entrance and egress from the building.

“Sound isolation is not good (for recording),” Clark said. “There’s a lot of interference. The recital hall opens into an atrium.”

Next week, university officials plan to sit down with representatives of student government and hold an orientation to talk about these priorities and get their input. No matter how persuasive the university is, however, it still must contend with other universities and institutions in tough economic times.

“I don’t know if any TRBs will be issued (this session),” Nance said. “It looked a lot more likely six months ago.”

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