Late Sunday, the Texas House of Representatives approved legislation that authorized the issuance of about $3.2 billion for projects to be financed through the use of what are known as Tuition Revenue Bonds (TRBs) for higher education institutions around the state.
Texas Gov. Greg Abbott announced the addition of the issue “to improve higher education in Texas” as a part of the ongoing special session agenda last Friday, enabling a scramble of quick deliberations in both legislative chambers. A few days prior, Lt. Gov. Dan Patrick requested Abbott add it to the agenda.
As the House was deliberating the legislation, Republican State Rep. Matt Schaefer (Tyler) proposed an amendment that would have lessened the amount of money given to the higher education institution by the same rate in which they increase tuition.
Schaefer himself is a member of the House Appropriations Committee and has consistently raised concerns over the skyrocketing tuition costs and fees to students at universities and colleges around the state, as well as the exponentially growing debt burden placed upon those students after graduation.
Schaefer authored legislation in both the regular session, which took place earlier this year, and the ongoing special session to specifically address limiting the increase of higher education institutions’ tuition and fees. Though the legislation was scheduled for a public hearing in the House Higher Education Committee in May, it was never voted on. The same legislation was never considered during the ongoing special session.
When introducing his amendment, Schaefer highlighted the rising cost of tuition:
The cost of higher education for our students has been skyrocketing year after year. This year we poured billions of dollars of additional federal money into our higher education universities, and many of them are going to raise tuition and fees. I would argue most of them are, we’ve had that testimony already in Appropriations [committee] from the Higher Education Coordinating Board. The amount of student loan debt that many of our staff persons have, that many in the younger generation have is extraordinary. They essentially have a mortgage and no house.
Schaefer continued his introduction by explaining how higher education is funded in Texas:
There are two sides to that equation: one is the amount of aid that we provide, through tax dollars, through grants, through scholarships, through Pell Grants, through all of the money we appropriate down here. But for our four-year universities, there is another side, and that is the price they charge in tuition and fees, which has gone up and up and up and up and up. And unlike our community colleges, which have an elected official over them, there is no elected official involved in these decisions, only appointed officials in the board of regents and the trustees for these universities.
As he introduced the amendment, multiple lawmakers took to the back microphone to question whether it belonged on the overall legislation they were debating.
“Our universities are flush with cash,” Schaefer responded. “Between the federal COVID dollars, between the dollars that have been appropriated in the general appropriations fund, this is not going to harm any school.”
Republican State Rep. Mayes Middleton (Galveston), a fellow Texas Freedom Caucus member of Schaefer’s, asked questions as well, causing Schaefer to explain the impetus for his amendment in another way:
When you look at the cost of higher education relative to other things that we pay for in life (technology, goods and services, automotive, food), it has gone straight up with nothing to control it. At what point are we going to say that tuition deregulation ultimately is a failure in the State of Texas and begin to do little things? I’m trying to do a very small thing in this bill, which is to force a conversation at our universities, force a conversation here on the House floor to say, “What are we going to do?” The experiment has proved to be a failure. Our students are in more debt than ever, and what are we doing?
In 2003, the Texas Legislature chose to take itself out of the process of setting tuition rates at public universities and colleges through a process known as tuition deregulation, which many claim is a misnomer.
Instead, members of each institution’s board of regents are charged with setting the tuition rates; they have no accountability other than to the governor, who appoints them.
Over the better part of the last two decades, several attempts have been made to end this practice and allow lawmakers to again set tuition rates, but those attempts were unsuccessful.
Schaefer continued:
This amendment is a signal that we’re paying attention, we’re listening, and at some point we’re going to get serious in the Higher Education Committee and in the appropriations process to what is happening to students and their debt.
The amendment ultimately failed by a vote of 34-98.
The overall legislation went on to pass the House with only eight lawmakers voting in opposition, including Schaefer.
Brief History
In 2019, the House passed legislation that would have authorized $3.8 billion in TRBs, but it was never considered in the Senate.
In 2015, the Legislature authorized the largest allocation of TRBs in Texas history by passing legislation that cost $3.109 billion in principal and an additional $2.24 billion in interest. For comparison, the Legislature has previously only authorized $2.6 billion total between 1971 and 2014 to retire TRB debt, which speaks to the exponential cost that higher education institutions have imposed on Texas taxpayers.
Next Steps
On Monday, the Texas Senate refused to concur with amendments that were adopted by the House and instead appointed a conference committee. When the House convenes late Monday afternoon, they will have to decide to also appoint conferees to the conference committee to reconcile the differences between versions of the legislation. Assuming they do, they will produce a conference committee report, and each chamber will have to successfully adopt that report for the legislation to be finally approved and sent to Abbott for his consideration.
The special session will reach its forced conclusion on Tuesday, October 19.
