Monday, March 24, 2014

History Lesson: Dan Branch's slush fund for Bill Powers


"May the Lord cut off all flattering lips,
And the tongue that speaks proud things,"
Psalm 12:3

In 2012, under the 'leadership' of Bill Powers, the University of Texas was embroiled in a $215 million accounting scandal.

How did the Texas House committee on Higher Education, under the 'leadership' of Dan Branch, respond?!?

Was there an investigation?!? Nope.

Was there any attempt to hold the UT administration accountable?!?  Negative.

Instead, Branch focused on helping the University issue new debt:
The Texas House appropriations committee gave tentative approval to House Bill 5 on Thursday, which authorizes and appropriates millions of dollars for construction and maintenance projects at public colleges across Texas.

Appropriations chair Jim Pitts thanked his fellow legislators for their support of the measure, a near-duplicate of which was passed by the House in the regular session. That version died when the House and Senate failed to make an eleventh-hour deal. House higher education chair Dan Branch (R-Dallas), the bill’s author, outlined the measure before it was passed and referred to the calendars committee, which schedules bills to be considered by the full House.

The mechanism for funding these projects, tuition revenue bonds (TRBs), provide debt service for the costs incurred by new construction or maintenance. The current legislation would partially fund 62 projects around the state, including funding 100 percent of projects at three brand new universities.

....

Legislators like Pitts and Branch hope to convince Perry that the bonds, not passed since 2006, will keep Texas competitive both economically and academically. He points to the EERC as an example of a project that will not only keep talented students in Texas, but attract students and faculty to Texas. Branch says he has spoken to Perry on the topic, and worked closly with the governor’s senior staff.

“My sense is that he’s heard from a lot of people around the state,” Branch says, “and so I think he’s paying attention.”

[Sidenote: Because Jim Pitts' relationship with the University of Texas is soooooooooooooooooooooooooooooooooooo distinguished!!!]
And what exactly are "Tuition Revenue Bonds"?!?
Tuition Revenue Bonds (TRBs) are issued under the RFS program and are secured by the same pledge of all legally available revenues of the System; however, the expectation is that the State will reimburse TRB debt service with general revenue. Despite the name, TRB debt service is not necessarily paid from tuition and fees. In fact, an institution is not required to have tuition in order to be eligible for TRB debt proceeds. Tuition Revenue Bond debt is specifically authorized by the Legislature under Ch. 55 of the Education Code. Please see Ch. 55 of the Education Code for further detail regarding this topic.  [Emphasis Added.]
Translated into English: Taxpayer-backed slush fund.

In 2012, Bill Powers lied on the University of Texas' financial statement to the tune of $215 million.  In 2013, Dan Branch attempted to reward Powers with an additional $310 million in taxpayer backed bonding authority.  What could possibly go wrong?!?

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