Key Provisions of The Texas Constitution, Article 7 Education, Section 17
HEAF may be used for the purpose of:
- Acquiring land either with or without permanent improvements;
- Constructing and equipping buildings or other permanent improvements;
- Major repair or rehabilitation of buildings or other permanent improvements;
- Acquisition of capital equipment, library books and library materials;
- Paying for acquiring, constructing or equipping or for major repair or rehabilitation of buildings, facilities, other permanent improvements, or capital equipment used jointly for educational and general activities and for auxiliary enterprises to the extent of their use for educational and general activities.
HEAF may not be used for the purpose of constructing, equipping, repairing, or rehabilitating buildings or other permanent improvements that are to be used only for student housing, intercollegiate athletics, or auxiliary enterprises.
Purchase Order (PO) required. No procurement card, employee reimbursements, IDT's or transfers.
These items cannot be purchased or paid with HEAF:
- Routine maintenance & repairs
- Extended warranties
- Additional parts not purchased with eligible HEAF asset
- Consumable supplies
- Advance payments (except for library books and periodicals)
A fixed or moveable tangible asset with an extended life of more than one year can be purchased or paid with HEAF. Asset does not necessarily have to be controlled or capitalized.
Items that can be purchased or paid with HEAF in association with the purchase of an asset are:
- Applicable freight or shipping charges
- Site preparation
- Maintenance agreement or warranty purchased as part of the original purchase
Equipment must be for E&G purposes only.
Equipment parts used to construct or upgrade an existing E&G equipment is allowable; however, the PO must reference the Texas State inventory number, the equipment serial number and the parent equipment's original PO number.
Major Repair and Renovations
This includes the following categories for building or other improvements:
These improvements are normally expected to:
- Extend the useful life in excess of one year
- Improve operating efficiencies
- Eliminate health and safety hazards
- Correct structural or mechanical defects
- Upgrade the quality of existing facilities
- Convert these assets to more useful functions
HEAF may be used to purchase hardware and builiding supplies for use on "major" construction or renovation projects. Qualifying HEAF projects must have a total cost exceeding $5,000.
Appropriated HEAF funds may be used for the proportional share of renovations, construction and improvements for facilities used jointly for E&G and auxiliary purposes.
Maintenance, minor repairs and operating expenses cannot be paid with HEAF.
The Education Code, Chapter 61 defines "educational and general buildings and facilities" as:
"[B]uildings and facilities essential to or commonly associated with teaching, research, or the preservation of knowledge, including the proportional share used for those activitgies in any building or facility used jointly with auxiliary enterprises. Excluded are auxiliary enterprise buildings and facilities, including but not limited to dormitories, cafeterias, student union buildings, stadiums, and alumni centers, used solely for those purposes."
The Education Code, Chapter 62 defines the following requirements:
- funds distributed on presentation of a claim and issuance of a warrant in accordance with Section 403.071, Government Code;
- funds may not be issued before the delivery of goods or services eligible for HEAF except for a payment for a book or other published library materials as authorized by Section 2155.386, Government Code;
- funds may not be issued before the delivery of goods or services eligible for HEAF except for the payment of principal or interest on bond or notes;
- funds appropriated, but not expended during the fiscal year of appropriation, can be carried forward and reappropriated for each of the succeeding fiscal years until expended for the purposes described in Article VII, Section 17;
- new construction, major repair and rehabilitation projects and land acquisition projects may not be expended without the prior approval of the legislature or the approval, review or endorsement, as applicable, of the Texas Higher Education Coordinating Board,
- review and approval of major repair and rehabilitiation applies only to projects in excess of $600,000.