UNDERSTANDING
PUF LANDS MANAGER
CONSTITUTION STATE OF TEXAS
2.1 million acres that produce two income streams: mineral income, which comes mainly from oil and gas bonuses, rentals and royalties, and surface income such as income from grazing leases, easements and wind power generation.
PERMANENT UNIVERSITY FUND
UTSYSTEM.EDU/PUF
A constitutional permanent endowment that supports excellence in the The University of Texas and Texas A&M University Systems.
Established in the Texas Constitution of 1876 through the appropriation of land.
KEY FACTS Constitution gives management to UT System Board of Regents; Grows from oil and gas production and investment income; Supports construction and capital expenses at institutions of UT and TAMU Systems; Corpus is not spent except for expenses of managing the land and the investment assets; Constitution allows UT Austin and UT System to bene t from AUF for operational expenses.
The constitution permits the UT System and Texas A&M University System to each sell a limited amount of bonds (a type of borrowing) to fund construction and other capital expenses at system institutions. The bonds are secured by the AUF, which gives the systems the lowest interest rates available, saving the state money. Bond proceeds may not be used for operational expenses.
MINERAL INCOME
SURFACE INCOME
AUF
The Available University Fund is PUF surface income plus an annual distribution from the total return on PUF investments, constitutionally allocated 2/3 to UT System and 1/3 to Texas A&M University System.
PUF income and investment assets are managed by UTIMCO, a nonpro t corporation operating under the authority of the UT System Board of Regents.
TEXAS A&M UNIVERSITY SYSTEM
THE UNIVERSITY OF TEXAS SYSTEM
The Texas A&M University System has similar constitutional restrictions on use of AUF. Some Texas A&M institutions are not eligible for PUF bonds.
CONSTITUTIONAL USES OF AUF:
31
Support and maintenance of UT System Administration
Support and maintenance of UT Austin
Payment of principal and interest on PUF bonds
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