University lands: resource utilization for higher education, 1838-1996
Houck, Michael L Todd
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The 2.1 million-acre land reserve of the University of Texas and Texas A&M University, called "university lands," played a significant role in the financial history of both institutions. This dissertation traces the history of the university lands from 1838 to 1996. President Mirabeau B. Lamar in 1838 announced plans to set aside a fifty-league land reserve for the establishment and maintenance of a university. In 1876, the Constitution called for the establishment of a University of Texas, the Permanent University Fund (PUF), the Available University Fund (AUF), and a grant of one million acres of land, known as the "constitutional million." An additional land grant in 1883 represented the so-called "legislative million" and completed the present-day university lands. The study examines the development, use, and management of the university lands. Following the establishment of the University of Texas in 1881, the University of Texas Board of Regents began lobbying for exclusive control over the sale and lease of university lands. Following two decades of such efforts, lawmakers granted the regents' request in 1895. The year 1896 marked a watershed in the history of university lands. The regents hired an agent to lease and sell university lands on their behalf Income increased almost immediately and surface use diversified in the following years, but, more importantly, oil was discovered on university lands in 1923. The year 1929 was also important in the history of university lands. That year the legislature established the University Lands Surface Office and University Lands Geology Office. Lawmakers also set up the Board for Lease of University Lands to handle mineral lease sales and the University Lands Survey Office to re-survey the entire 2.1 million-acre university lands. Surface leasing provided considerable income for the AUF throughout the twentieth century, but oil revenues proved to be the real windfall. Through sound policies, university lands management organization helped make the PUF the largest endowment of a public institution of higher learning in the United States. By the 1990s, oil revenues began to decline and the regents looked to investment management to continue sustained growth of the PUF. In 1996 the regents established the University of Texas Investment Management Company (UTIMCO) to manage PUF investments. They also placed the three management organizations. University Lands Surface, Mineral Interests, and Accounting, under a single director and designated the combined organizations as University Lands West Texas Operations (WTO).