WEANED FROM TSC, UTB, UTPA WILL NOW GET "PUF" MONIES: BUT WHAT'S GOING TO HAPPEN TO JULIET'S REDUNDANT UTB ADMINISTRATION WITH THE MERGER?

By Juan Montoya
The announcement by the UT Board of Regents unveiled an approved plan that will the University of Texas at Brownsville, UT Pan Am in Edinburg and the Regional Academic Health Center in Harlingen into a single institution in South Texas shows the wisdom of the Texas Southmost College board of trustees to wean UTB from the community college fiscal teat.
The kicker in the announcement, however, is not that there will suddenly be an over supply of administrators, but that the Regents have finally caved in and made the two predominantly Hispanic institutions (UT PanAm and UTB) participants in receiving their fair shar eof oil-and-gas reveneus from the UT Systems billionaire Permanent University Fund.
"The UT Regents and Chancellor Francisco Cigarroa have taken a giant step to give SOuth Texas what it truly deserves," said District 37 Texas State Representative Rene Oliveira. "The new legislation will provide a statutory framework to get it done."
Oliveira will carry the bill in the Texas House of Representatives.
Oliveira pointed to increasing Texas oil and gas revenues that will help to fund the new institution which is intended to have access to the Permanent University Fund, the wealthy energy-based revenue mechanism which provides funding for many of the state's universities.
In fact, what the Oliveira press release did not say was that all of the 15 other UT and A&M universities have had access to the state's richest educational kitty except for the UTB and Pan Am campuses.
When the UTB-TSC "partnership" agreement was reached in 1991, TSC was specifically prohibited from partaking in the PUF. Instead, the TSC district became the only UT System institution not to share in the oil-and-gar revenue apart from Pan Am. With the "approved" arrangement and the loss of an annual $50 million "transfer" from the community college to UTB, the funding became a necessity.
"They can blame TSC for all they want in relation to the separation," said a TSC supporter. "But UTB should be thankful we cut them off the community college transfer and the taxing district because now the UT System has to step to the plate and fund what they should have been funding from the start."
Oliveira's statement said as much.
"Further, given the ongoing separation of UTB and TSC, the plan should provide a faster infusion of potential funds for the development of the new UT Brownsville campus. The plan will eventually expand doctoral programs, enhance distance learning and international partnerships, and create new South Texas research opportunities."
The Permanent University’s board has announced in 2010 that it has completed a record-breaking oil and gas lease sale in West Texas that would bring $206 million to the fund.  Now, with shale oil deposits bearing even nmore riches, UTB's future looks even brighter.
The PUF is a state endowment contributing to the support of 18 institutions and 6 agencies associated with the University of Texas System and The Texas A&M University System. UTB-TSC and Texas Pan Am are part of that system. The PUF was established by the Texas Constitution in 1876 with land grants.
The PUF lease land holdings are composed of 2.1 million acres, primarily in West Texas. The PUF's strategy is to invest in a broadly diversified portfolio of fixed income and Article VII of the Texas Constitution assigns responsibility for managing the PUF Lands.
In the partnership negotiated by Sen. Eddie Lucio Jr. and Oliveira between Texas Southmost College and the UT System in 1991 TSC agreed that as a condition of becoming a part of the UT System, it would forgo participating in dividing up the PUF pie.
According to the PUF website, its portfolio includes private investments, marketable alternative investments, and various other specialized public market investments. The PUF is managed using universal endowment principals and dictates that distributions to the Available University Fund (AUF) are based on the total return of the PUF investments. The University of Texas System Board of Regents has established a distribution policy that provides stable, inflation adjusted annual distributions to the AUF to support the two university systems while preserving the real value of the PUF investments.
Now, with this announcement, the two entities will unite under one administration, share in the PUF as they should have done two decades ago, and the UT System will stop treating the TSC taxing district as its cash cow.
"It's a creative idea that pools our existing resources and makes us tronger as a region," Olicveira said. "As we face growing budget undertainties at the state and federal levels we have to crate greater efficiencies. This will achieve that goal."
And as the separation between UTB and TSC continues through 2015, there is that little matter of $12 million that the UT System owes in back rent to little TSC. And whatever is going to happen to poor Juliet Garcia and her cadre of overpaid, underachieving enforcers? Oh, well, we'll talk about that as we go down the road.