by Charles E. McMahen
vice chairman of Compass Bank and
chairman of the University of Houston System Board of Regents
The economic future of Houston and Texas depends, as never before, on our ability to remain at the forefront of scientific and technological innovation. Texas is already a hub for many important high-tech industries, while Houston, the energy capital of the world, is home to important technology- and research-related industries and organizations, such as the National Aeronautics and Space Administration, the Texas Medical Center and Compaq Computer Corp., among others. Both the city and the state are well positioned to excel in the next century. There is some question, however, as to whether we are on the right track to maintain our leadership position.
The Texas Science and Technology Council estimates that more than 130,000 new high-tech positions will need to be filled by the year 2000. At the same time, student performance and interest in math and science - areas critical to the development of a high-tech work force - are stagnant or on the decline. To meet industry demand, Texas universities need to triple the number of these graduates over the next decade.
Also critical to the state's high-tech future is scientific discovery. Texas and Houston companies will lead in national and world markets only if there is a research base through which Texans can capitalize on the latest innovations. Texas and Houston universities must play a major part in this economic growth. Through university research, new technologies are developed and commercialized, and spin-off companies formed, bringing considerable economic benefits.
Texas, however, falls short among leading high-tech states in terms of its number of "tier one" research universities. California has 10, New York has eight, Massachusetts five and Illinois four. Texas has only two - the University of Texas at Austin and Texas A&M University at College Station. While these two universities have served the state well, there is a demonstrated need to increase the number of "tier ones" to provide both the highly skilled, high-tech work force the state needs and to promulgate greater scientific innovation and commercialization of technology.
Already a Carnegie Research II institution, the University of Houston main campus is primed for expansion. Through greater financial support from the state, UH will be able to enhance the quality of student education, attract and retain more high-quality faculty, use state appropriations as leverage for greater federal research support, increase technology transfer to the private sector, attract new companies and industries to the Houston area and produce spin-off companies.
Investments in research and development yield a 20 percent to 30 percent rate of return. The University of Texas at Austin provides an eloquent example of the importance of research universities to the economy. Through its technology commercialization center, the ICB2 Institute, UT-Austin has been instrumental in developing 42 companies that generate nearly $100 million in annual sales. Just think of the benefits that "tier one" status for the University of Houston main campus could bring to Houston and the region.
Historically, the state has made a commitment to UT-Austin and Texas A&M to provide not only capital and operations funding, but excellence funding as well, allowing these universities to become two of the nation's finest research institutions. For the past few years, UT-Austin has received approximately $75 million in excellence funding, while Texas A&M has received approximately $58 million.
Two bills calling for the creation of a research university excellence fund are now before the Texas Legislature. HB2865 was introduced in the House by State Rep. Jessica Farrar, D-Houston, and SB1493 was introduced in the Senate by State Sen. Robert Duncan, R-Lubbock.
Originally conceived by the Texas Higher Education Coalition, composed of the state's public university and community college systems, the bills ask for an appropriation of not less than $50 million every fiscal year to enhance research activities at eligible public research universities in Texas. While the bills do not designate specific institutions, all public research institutions in the state stand to gain.
The state currently has two institutions - Texas Tech University and the University of Houston main campus - ranked as Carnegie Research II. They both would immediately benefit from this new fund that would help elevate them to "tier one" status. In addition, the University of Texas at Arlington, now ranked Doctoral I, will shortly reach Carnegie Research II status and benefit as well.
Funding resulting from the research university excellence initiative would enable UH main campus, Texas Tech and eventually UT-Arlington to establish the infrastructure they need - including equipment and support personnel - to enter the upper echelon of research universities, and to produce the high-tech work force, scientific innovation and the resultant economic development that Texas, and particularly its urban centers of Houston and Dallas, will require in the next century.
Elevating the University of Houston main campus to "tier one" status will reap economic and educational benefits for Houston and the region for generations to come.