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Think of the flagships in the Lone Star State -- the University of Texas at Austin and Texas A&M University at College Station -- and images of great wealth spring to mind. The details are fuzzy, but they have something do with extensive land holdings and oil wells, producing an endowment of Ivy League proportions.
Today, the Permanent University Fund for the University of Texas and Texas A&M Systems is worth more than $7-billion, which seems like the kind of money that can make money no object.
The provost at the Austin campus works in an office so large it echoes -- the wood paneling and 20-foot ceilings give it the feel of a library reading room, which it once was. The recreational athletics complex at Texas A&M sprawls over nearly 17 acres, has a weight room the size of a small supermarket, and cost $30-million to build.
"It looks like we must be filthy rich," says Ray Bowen, College Station's president. "You need to see all of that and look through it."
A deeper look reveals that the two institutions are downright poor compared with other elite public and private institutions. The permanent fund is now split so many ways -- 17 campuses in the University of Texas and Texas A&M Systems get a cut -- that it produces for Austin and College Station less than a tenth of the income, on a per-student basis, that Rice University's endowment generates.
But many state legislators continue to think the fund has made College Station and Austin rich, and that's just one of several factors that have left the two institutions wanting for state funds. They are also being hurt by the biennial free-for-all at the Capitol, where there is no comprehensive higher-education plan to ensure that their costly form of education receives special consideration; by the perception that their students are wealthy and don't adequately reflect the racial diversity of the state; and by having no room on their cramped campuses to accommodate the state's expected surge in college enrollment over the next 15 years. Appropriations to the Texas flagships during the 1990s -- a decade when the economy boomed -- lagged behind other colleges in the state and declined on an inflation-adjusted basis,...