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The budget shall also include estimated institutional funds.

The budget shall be prepared within the limits of legislatively appropriated general revenue and estimated educational and general funds.

An institution of higher education that has adopted a pay-for-performance program that is in effect when an across-the-board salary increase for state employees made by an appropriation act of the legislature takes effect is entitled to receive any appropriation made for purposes of the across-the-board salary increase, and may use the amount appropriated for an across-the-board salary increase or for increases in compensation under the institution's pay-for-performance program. Section 403.094(h), Government Code, does not apply to funds described in this section.(h) Tuition revenues and revenue collected under Section 34.017, Natural Resources Code, that are deposited in the treasury pursuant to this section, and the interest earned on those revenues, shall be treated as designated funds in the general revenue fund.

These funds may be only used for the support, maintenance, and operation of the institution as provided for by law.

If a colonia does not have a classification number, the institution of higher education may contact the secretary of state or the secretary of state's representative to obtain the classification number.

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(a) Separate accounts shall be kept on the books of the institution showing the sources of all sums collected and the purposes for which disbursements are made.(b) All trust funds, including gifts, grants, and bequests received, establishing or adding to endowment funds, loan and scholarship funds, and funds for other current restricted purposes, shall be credited to separate accounts and shall not be commingled with other local or institutional funds.(c) If the governing board so elects, deposits of all funds not specifically required to be deposited to special accounts may be deposited in a single bank account if the records of the institution clearly reflect the balances attributable to general funds and various categories of trust funds.(d) Interest received from depository banks for funds on deposit may be credited to an appropriate account in either general funds or trust funds in relation to the sources of temporary investments in time deposits, if the disposition of the earnings was not specified by the grantor. If bids are taken orally, the bids shall be tabulated by the person taking the bids and made a part of the permanent records of the institution.(b) The funds shall either be deposited in the depository bank or banks or invested as authorized by Chapter 2256, Government Code (Public Funds Investment Act). Depositories shall be selected on the basis of competitive bids. Every day in excess of the number of days hereinabove provided for that any sum of money belonging to any of the funds enumerated in this subchapter, whether depositable in special depositories or whether those that should be deposited in the state treasury, shall be withheld from deposit at its proper place of deposit, shall constitute a separate offense and each day of such withholding shall subject the officer, agent, employee, or person so withholding said sum to the penalties herein provided for. For the purpose of facilitating the transferring of such institutional receipts to the state treasury, each institution shall open in a local depository bank a clearing account to which it shall deposit daily all such receipts, and shall, not less often than every seven days, make remittances therefrom to the comptroller of all except 0 of the total balance in said clearing account, such remittances to be in the form of checks drawn on the clearing account by the duly authorized officers of the institution, and no disbursements other than remittances to the state treasury shall be made from such clearing account. Failure to print and furnish to the officers above named, the reports above specified, shall subject all of the members of the governing board of the institutions above mentioned to the penalties provided for in this section. The comptroller is directed to credit such receipts deposited by each such institution to a separate fund account for the institution depositing the receipts, but he shall not be required to keep separate accounts of types of funds deposited by each institution. The foreign bank must:(1) be licensed and supervised by a central bank;(2) be audited annually by an accounting firm that follows international financial reporting standards; and(3) maintain a capital to total assets ratio that is not less than the greater of four percent or the minimum tier 1 capital to total assets ratio required for depository institutions insured by the Federal Deposit Insurance Corporation. Venue for a suit to recover an amount claimed by the state to be due on a surety bond is in Travis County.(f) Notwithstanding any other provision of this section, the governing board of each institution may maintain unsecured deposits in a foreign bank as necessary to support the institution's academic and research operations in the foreign country in which the bank is located, provided that no appropriated or tuition funds other than those collected from students enrolled in the affected programs are deposited. No part of any of the funds listed in Section 51.002 of this code shall ever be used to increase any salary beyond the sum fixed by the legislature in the general appropriations act; provided, however, that the use of such funds by an institution for this purpose may be specifically authorized by the legislature in general law or the general appropriations act. Notwithstanding a pledge of those revenues made or to be made in the proceedings approved by the governing board of an institution of higher education authorizing the issuance or incurrence of bonds, the deposit of those revenues in the treasury to the credit of an account in the general revenue fund does not:(1) affect in any manner the pledge of the revenues or the governing board's ability to pledge the revenues to secure and pay bonds issued or incurred by the governing board in accordance with law;(2) cause the bonds to constitute a debt of the state or be payable from the full faith and credit of the state;(3) change the character of the revenues as separate revenue of the institution collecting the revenue; or(4) cause the revenue to be considered general revenue for purposes of Sections 17 and 18, Article VII, Texas Constitution. Additional copies shall be delivered to the Texas Higher Education Coordinating Board as required. Copies of each such budget shall be furnished to the Texas Higher Education Coordinating Board for distribution to the Governor's Budget and Planning Office, Legislative Budget Board, and Legislative Reference Library.

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