Land of Opportunity

Solid Ground for Education

From the Comptroller:A Smart Bomb Against Fraud

High Tech Sleuths

QUEST for Results

200+ Millionaires and Counting

AG: Some Taxpayers Phone Numbers are Public Records

Factual Pursuit

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Land of Opportunity
Texas' public acreage is a key economic asset

Publicly owned lands have played a crucial role in Texas' economic development. From the grants made to early settlers and railroad companies, to the acres generating billions of dollars in oil and gas royalties for public schools, Texas' state-owned lands have been an economic asset that few states can match.

The State of Texas owns about 7.6 million surface acres or 4.5 percent of the state's total land area of 168.2 million acres. Another 1.4 percent--2.3 million acres--is owned by the federal government, a relatively low share that gives Texas a ranking of 43rd in the nation. The federal government owns more than one-quarter of all land in the entire U.S.

The Permanent University Fund endowment owns slightly more than 2.1 million acres of land. Another 2.6 million acres belong to special schools, such as those operated by the Texas Department of Mental Health and Mental Retardation (MHMR), and to other state agencies. The state owns 2.9 million acres in parks and forests, highway right-of-ways and riverbeds. Texas' public domain also includes 4 million acres of submerged coastal lands, mineral rights to 7.5 million acres and liens on 1.5 million acres held by the Veterans Land Board.

Gone to Texas: Under Spanish colonial and Mexican rule, about 26.3 million acres of lands that are now part of Texas were distributed in grants to promote citizenship and attract immigrants. Anxious to prevent French or British encroachment on their territories and to establish permanent civilian settlements, the Spanish commissioned Moses Austin to recruit American settlers for a colony on the Brazos River. The commission, granted in 1821, gave Austin the right to bring 300 families to Texas.

When Moses Austin fell ill and died, his son Stephen F. Austin took up the torch, renegotiating the terms of the settlement with the Mexican government after Spanish colonial rule was overthrown in 1821. By 1836, Austin had established five colonies to be settled by more than 2,000 families. Other empresarios joined him in recruiting settlers from the U.S., Mexico and Europe.

The settlers fought for and won independence from Mexico, resulting in the creation of the Republic of Texas in 1836. The republic included contiguous areas that are now part of New Mexico, Colorado, Kansas, Oklahoma and Wyoming--252 million acres of land that the new republic and its General Land Office were responsible for administering.

To build political and economic stability, Texas' early leaders attracted settlers by giving them free land. Any head of household living in Texas as of March 2, 1836, who had not already received land from Mexico was entitled to "a league and a labor" of land, 4,605 acres. These were dubbed "first-class headrights." Single men were entitled to one-third of a league, or 1,476 acres.

Other classes and types of headrights were defined for settlers who arrived later, for soldiers who had fought for Texas' independence and for the heirs of soldiers wounded or killed in certain battles. Between 1836 and 1845, the new nation granted almost 42 million acres to settlers and veterans and to pay off Texas' war debt and operating costs.

When Texas officials were negotiating terms of statehood with the federal government, a treaty was drafted requiring Texas to cede 175 million acres of its public land to the U.S. In exchange, the U.S. would assume $10 million of Texas' debts. Congress refused to accept the terms of the treaty, though, and in December 1845, Texas entered the Union land-rich but still very much in debt.

Public asset: By 1855, Texas had paid off its debt through the sale or transfer of public land and still had more than 98 million acres at its disposal. When the Texas Constitution was adopted in 1876, the state owned about 61.3 million acres of unappropriated lands, not including 20 million acres of school land.

As a state, Texas continued the homestead policy of its colonial and republican predecessors and granted another 4.8 million acres of land to settlers. The homestead policy remained in place until 1899, when the supply of unappropriated public land ran out.

The state sold or gave away much of the unappropriated land in large parcels to finance public capital improvement projects. Railroad companies received grants totaling about 32.2 million acres, an area the size of Alabama.

In 1882, the Texas Legislature initially appropriated 3 million acres of public land in the High Plains to a private contractor to finance the construction of the State Capitol. Spread over 10 counties in the Panhandle, this land, called the XIT Ranch, was used to raise cattle from 1885 to 1912. The capitol was completed in 1888 at a cost of $3.7 million.

From 1876 to 1901, the state government fought to retain the right to minerals on public land while preserving the flexibility to sell the land to private owners. It did not take long for conflicts to arise over privately owned lands for which the state owned the mineral rights. The 1919 Relinquishment Act sought to minimize or eliminate conflicts by allowing surface owners of land to be agents of the state. They could lease lands for mineral development and partake in the bonuses, rentals and royalty income from the land.

Oil billions: In 1921, oil was discovered in West Texas, and state-owned lands became an asset worth billions. The most valuable lands were in the Permian Basin. Among the most famous oil fields generating revenue for the state were Santa Rita in Reagan County, discovered in 1923, and Yates in Pecos County, discovered in 1926. The latter still provides a major source of Permanent School Fund revenue. In the 1930s, oil was found on state-owned lands in East Texas, starting with the Daisy Bradford No. 3 well near Kilgore.

The new-found wealth in Texas' public lands brought not only oil and gas revenues, but also fights between the state and federal government for control of those revenues.

As a republic, Texas had proclaimed that its coastal boundaries extended into the Gulf of Mexico for three marine leagues (10.4 miles), the traditional marker under international law. When Texas joined the U.S., the new state's boundaries were not immediately challenged by the federal government, which recognized a three-mile boundary for other coastal states. In 1948, however, the U.S. Attorney General filed suit to claim offshore lands more than three miles but less than three marine leagues from Texas' shoreline.

Texas fought to keep its tidelands, which had become a valuable source of oil and gas, for almost two decades. In 1953, Congress finally recognized Texas' ownership of the tidelands, which was upheld by a U.S. Supreme Court decision in 1960.

Land management: Various state agencies and boards oversee public lands and income from natural resources. The General Land Commissioner chairs the School Land Board, which approves leases on state-owned lands, except for properties belonging to state universities. The University Board for Lease oversees leasing on 2.1 million acres dedicated to the Permanent University Fund. Other state agencies that own land have their own leasing boards, consisting of the Land Commissioner, the agency's chairman and a gubernatorial appointee.

Leases of state lands for oil, gas and mineral development are put up for bid twice a year, in April and October. Private energy companies nominate tracts of state land that they want included in the lease sales, at $100 per tract.

Created by a 1986 law, the Asset Management Division of the General Land Office (GLO) inventories and evaluates state land and determines its best use by state agencies or the private sector. Through the Capital Trust Fund, another legislative initiative, GLO buys and sells land on behalf of other state agencies.

As of December 1994, according to GLO, the state owned almost 25,000 acres of underused land, worth an estimated $208 million, that could bring the state higher returns if sold or leased to commercial users or used by other state agencies.

In recent years, Texas and other states have sought to improve the financial return on state-owned land by selling or leasing certain tracts to developers who can put them to better use.

For example, in 1991, the state leased 38.5 acres in central Austin, formerly part of the Austin State Hospital campus, for development of high-end retail and apartment properties. The Central Park lease will yield the state $10 million in the first 10 years. In another project, MHMR has agreed to sell 200 acres and more than 50 buildings east of Austin to a nonprofit firm for construction of an intergenerational housing complex.

In January 1996, Governor George Bush approved the sale of almost 1,720 acres owned by the state, as recommended by GLO and community representatives. Properties up for bid this year include the Travis State School and Anson Jones State Office Building in Austin; the Leander Rehabilitation Center in Williamson County and the Dallas Northside Maintenance Site, both owned by the Texas Department of Transportation (TxDOT); and the San Antonio State Hospital.

The original list of properties proposed for sale included the Texas National Guard's Camp Mabry in Austin, valued at $32.8 million. Community and state officials' sentiments ran strongly against selling Camp Mabry, however, and Governor Bush left the installation off the final list of properties to be sold, along with several smaller properties.

New directions: While it disposes of some public land, Texas increases its holdings in other areas. In January 1996, the Richard King Mellon Foundation donated a 40,000-acre tract of ranch land in West Texas--the largest gift of land ever made to the state--to the Texas Parks and Wildlife Department.

Mesquite Ranch, covering 62 square miles in Presidio County, will be the second largest state park, but size is not the only distinguishing feature of the donation. Accompanying the land are funds to maintain the property and offset $7,600 in tax losses to local governments.

Such endowments have been created in the past for established parks but are largely unheard of in the case of newly public land. They will probably become more common as states and localities shy away from ownership of land for public purposes because of high operating costs and lost tax revenue.

The Illinois Department of Natural Resources, for example, declined the Forest Park Foundation's offer to donate a 2,000-acre wildlife preserve worth $19 million. State officials cited the preserve's $300,000 annual deficit in operating costs as the main reason they could not accept the donation. Federal and local government officials turned down the offer for the same reason.

Texas is taking steps to develop new sources of revenue for the Permanent School Fund to replace the oil and gas income that will eventually dry up. GLO, the Lower Colorado River Authority and Kenetech, a private firm, are partners in the Texas Wind Power Project on state-owned land in Culberson County.

This and several other "windfarm" projects in West Texas eventually will generate between $3 million and $4 million a year for the school fund, according to GLO.

Contributing to this article:
Eva DeLuna-Castro

Solid Ground for Education

In 1876, Article VII of the Texas Constitution created the Permanent University Fund (PUF) and the Permanent School Fund (PSF). Through these endowments, the state uses income from publicly owned land and minerals to provide a perpetual source of support for state universities and public schools.

The PUF, an endowment for public higher education institutions affiliated with the University of Texas and Texas A&M University, was created to support a "university of the first class." Administered by the UT System, the PUF consists of 2.1 million acres of land in West Texas, royalties and proceeds from land sales. The principal of the PUF may not be spent; mineral income remains a part of the fund, while surface, dividend and interest income is available for UT and A&M system spending.

In fiscal 1995, PUF revenue included $36.4 million in oil royalties, $14.8 million in gas royalties and a $49.7 million gain from the disposal of government and corporate investments, obligations and securities. PUF investments at the end of fiscal 1995 totaled $4.3 billion, up from the previous year's $4.1 billion.

The PUF supports UT and Texas A&M in two crucial ways. First, it is used to guarantee bonds issued for capital improvement projects. UT may issue PUF bonds for up to 20 percent of the fund's book value, while A&M may issue bonds for up to 10 percent of book value. Money flowing to the two systems through the Available University Fund (AUF) must first be used to service PUF bond debt, including principal and interest.

Second, AUF money remaining after debt service is spent on excellence programs at UT-Austin, Texas A&M's College Station campus and Prairie View A&M. These programs support fellowships and scholarships for graduate and minority students and National Merit scholars, purchases to improve campus libraries and upgrading of science and engineering labs and equipment.

The Permanent School Fund, which supports public schools, is available only for investment. Originally endowed with more than 44 million acres of public domain, the PSF now consists of 13.3 million acres of land, proceeds from the sale of PSF land, royalty earnings from oil and gas and fees for surface damages.

Dividends from PSF investments and other income are deposited in theAvailable School Fund, which also receives one-fourth of the revenue generated by state motor fuels taxes. This fund provides revenue to local school districts based on their average daily attendance. In the 1994-95 school year, PSF income from investments came to $711 million, about $193 per Texas school child.

Investments for the PSF at the close of fiscal 1995 totaled $9.4 billion on a book value basis, up from $9.0 billion a year earlier, or $12.3 billion on a market value basis, up from $11.3 billion a year earlier.

Of the state's four major investment funds--the PSF, PUF and funds managed by the Employees Retirement System (ERS) and the Teacher Retirement System (TRS)--the PSF has had the highest comparative yield since 1987. In fiscal 1994, the PSF had a comparative yield of 8.5 percent, compared to 6.1 percent for the PUF, 5.9 percent for ERS and 6.7 percent for TRS.

The State Board of Education (SBOE), which oversees PSF investments, is implementing a long-term asset allocation strategic plan, designed to improve the fund's income-generating capacity. A key element of the plan is to invest more of the PSF in stocks rather than fixed-income securities--a move which the board believes will increase long-term PSF income, although it will cause short-term losses.

The Comptroller's Biennial Revenue Estimate projects that the new investment strategy will yield almost $1.3 billion in earnings for Texas' public schools during the 1996-97 biennium, $172 million less than the school fund would have received if the portfolio mix had remained unchanged. The SBOE has designated Citibank to manage the PSF for an annual fee of $1.1 million. A separate contract with Citibank authorizes it to oversee lending of PSF securities.

Renewed oil and gas exploration in offshore and coastal bay areas--a part of the PSF since 1941--accounts for most of the recent upswing in PSF leasing activity. A November 1995 School Land Board meeting produced $19.7 million in bonus money for the PSF, the highest for a regular lease sale in 10 years. November 1995 also saw the most tracts leased (242) and the most acres leased (72,384) since October 1984. Coal, lignite and uranium leases also generate money for the PSF.

From the Comptroller:
A Smart Bomb Against Fraud

The problem of fraud in government assistance programs has festered for so long that it has undermined public support for those programs. As taxpayers watch the system being defrauded again and again, they gradually lose faith in it.

Take food stamps. The public is all for feeding poor children, but after reading and hearing about repeated abuses of the federal food stamp program, taxpayers begin to question whether this program deserves their support.

Texas' electronic benefits transfer program--first proposed by my Texas Performance Review--has already taken a big bite out of food stamp fraud. Now, we've joined forces with a team of experts to develop new computer software that will "learn" how to detect waste, fraud and abuse in Texas' massive Medicaid system.

Each year, Texas spends $10 billion of state and federal money on Medicaid to provide health care for poor and elderly Texans. While this program underwrites vital services for thousands of deserving clients, as much as $1 billion per year in Medicaid outlays may go to pay fraudulent claims.

The "neural network" technology I'm developing will help investigators target suspicious patterns in Medicaid disbursements to reveal rip-offs in progress. We call it the "smart bomb" for Medicaid fraud. The article beginning on page 3 describes this and other smart computer applications.

A working prototype of the new system should be in place by September 1996.

Ultimately, this technology will save taxpayers hundreds of millions of dollars. It will set the standard for using limited resources to deal with a growing public assistance caseload. And it will provide a dramatic boost for Texas' efforts to make sure Medicaid dollars are spent for their intended purpose--caring for people who are truly in need.

-John Sharp

High-Tech Sleuths
Government and businesses find new uses for smart computers

One of the most enduring memories of the 1991 Gulf War is the hazy video image of crosshairs rapidly zeroing in on the chimney of an Iraqi factory. When the screen went blank, the military spokesman describing the image declared the enemy target destroyed--another successful mission by America's newest class of weapons, the so-called "smart bombs."

The names of these weapons are familiar--Tomahawk, Lantirn and so on--but the technology behind their success has remained relatively obscure. Most people still do not realize that smart bombs were developed from some of the most advanced computer technologies available.

Smart bombs earned their name because they can adapt their targeting systems to changing conditions and environments. The targeting and guidance systems of these missiles use intelligent computer systems that can "learn" like humans, processing new information and reacting to unexpected situations--but at the speed of a computer. Now, this technology is beginning to prove its worth in nonmilitary applications.

In 1993, Comptroller John Sharp's Texas Performance Review identified one of the most promising governmental uses for smart computer technology: detecting fraud in public assistance programs. Sharp's office has taken the lead in developing a new application that is expected to save Texas taxpayers hundreds of millions of dollars in fraudulent Medicaid claims. Private businesses already use this technology for a variety of purposes, and the public sector will find additional uses to help government save money and "work smarter."

Smart technology: To some, the concept of computer systems that can learn may sound like science fiction--like the cyborg Arnold Schwarzenegger played in The Terminator, with its neural-net brain. But in this case, fantasy is not far removed from fact.

Over the past few decades, scientists around the world have been developing computer systems that mimic human thinking patterns. Although the human brain is still the most powerful computing machine ever created--witness the defeat of Big Blue, IBM's chess-playing computer, at the hands of Grand Master Garry Kasparov--computer programs have begun to close the gap.

The technology, traditionally called artificial intelligence, has evolved into two distinct categories called either "expert systems" or "computational intelligence." The latter group, considered true learning systems, include neural networks and other technologies.

Modeled after human nervous systems, neural networks comprise a series of independent processing units working together. Much in the same way we think, these systems learn to recognize that some patterns are more important than others. With enough experience, they can even discover new patterns that might have been overlooked before.

Because they combine many simple, individual elements that process information simultaneously, neural networks can process huge amounts of data much faster than traditional computing methods. By adding weight, or increasing the importance of certain connections, one can teach these smart systems what types of things to find. The system then begins to "understand" and process the information, often finding other connections that humans and conventional computer systems never detected.

Genetic algorithms, another form of computational intelligence, are based on the biological model of chromosomes, allowing data processing operations essentially to evolve and join, even mutate. Information coded in this way can use the power of natural selection to find a near-perfect solution to a problem.

Fuzzy logic began in the mid-1960s as an attempt to mimic the human propensity for characterizing things in intermittent steps. For instance, rather than just saying that it is hot outside, we often say it is "really hot" or "pretty warm." In this way, we assign different values to the temperature to help others understand more clearly what to expect. Just as we can state the temperature more precisely in degrees Fahrenheit, we can use mathematical representations to assign more precise descriptions of data for computing.

Because computational intelligence systems make no assumptions about data, they can solve a whole class of problems that traditional statistical methods cannot address.

Targeting fraud: Comptroller Sharp's office is moving ahead with a project to develop neural network technology that will help detect fraud in state-operated public assistance programs. In November 1995, Sharp contracted with Austin-based Berkom USA--whose staff played a key role in developing the smart bomb--to create a system that will pinpoint fraud and abuse in Texas' Medicaid program. This project marks the first time any state government has used the technology for this purpose.

Texas now spends about $10 billion annually on Medicaid--almost one-quarter of the entire state budget--and processes more than 28.6 million claims a year. With estimates of fraud and abuse ranging from 3 percent to 10 percent, Texas could save hundreds of millions of dollars by applying smart technology to its Medicaid claims data.

Sharp's office and Berkom will work with the Texas Health and Human Services Commission, the Texas Department of Health, the Attorney General's fraud control unit and other agencies to develop a working prototype of the Medicaid fraud detection system by September 1996. Berkom will develop the prototype at cost--about $300,000--and then market the technology to other state governments if, as expected, the project succeeds in Texas.

In Texas' electronic benefits transfer program, neural networks may help detect counterfeit Lone Star cards and other fraud. Other areas where neural networks may prove helpful in detecting fraud and abuse include public assistance and tax collections.

The Center for Cybernetic Studies (CCS) at the University of Texas at Austin has won international recognition for its study of complex, interactive systems, including some using computational intelligence. CCS used neural networks to identify patterns of consumer fraud and noncompliance with automobile insurance laws in Massachusetts and to predict the risk of insolvency of insurance companies operating in Texas. In the Massachusetts study, smart computer systems proved more successful than insurance investigators and claims adjusters in identifying suspicious claims of bodily injury.

Private sector uses: Although computational intelligence has been around since 1949, it has become practical for nonmilitary uses only in the past five years. Many businesses are excited about the possibilities.

The private sector already uses these systems for financial, economic and sales forecasting, market research, biomedical instrumentation, speech and language pattern recognition, securities trading and resource allocation. Some direct-mail marketing firms have used neural networks to profile their customer base, helping them target their mailings better. Political campaigns have used this technology to profile voters.

In 1993, Visa International began using a neural net system called the Cardholder Risk Identification System (CRIS) to identify suspicious credit card transactions. As a result, Visa's counterfeit-fraud losses are down 18 percent. Since January 1995, CRIS has saved Visa's member financial institutions $100 million.

In medicine, neural networks have been used to identify Alzheimer's patients. In one study, 95 percent of the patients were correctly classified, compared to 33 percent by using traditional analytical models. A study in Denmark successfully predicted the survival rates for patients with cirrhosis of the liver. New research at Carnegie Mellon's Interactive Systems Laboratories is looking at ways to help people with certain disabilities to communicate. Once the computer has an image of the face, it can use neural networks to perceive emotional expressions and to lip-read.

Banks are using this technology to analyze credit risks. Other finance-related uses include building stock portfolios and forecasting commodity prices. Insurance companies can identify traits shared by successful insurance underwriters to develop training and evaluation tools.

The military is experimenting with various neural network applications, including a new flight control system being tested in McDonnell Douglas F-15 Eagles, which would allow pilots to fly damaged planes. By setting the computer controls to learn from top pilots as they deal with simulated problems such as a damaged wing, the neural net-based system can develop internal methods to compensate for the damage and allow the pilot to maintain control of the airplane.

In Texas, neural network technology is helping to authenticate bank account holders' identities (NBIB), monitor pollution emissions (Pavilion Technologies), predict propane futures prices (Texas Eastman) and determine the potential amount of oil available at various depths of an oil well (Schlumberger). Austin-based Pavilion Technologies has developed a neural-based software system to maximize production at petroleum and chemical refining plants. In Houston, the National Aeronautics and Space Administration uses this technology in its space vehicle docking procedures.

Public sector promise: Just as neural networks have been used in market forecasting, they may prove useful in estimating public assistance caseloads. These estimates guide the Texas Legislature in determining how much money agencies should receive to serve Medicaid and other public assistance clients.

Also, educators could potentially use this technology to help reduce dropout rates in Texas schools by analyzing student patterns of academic and other behavior.

Neural network technology has proved its value in other public settings. Using a new neural-based system, the U.S. Postal Service plans to speed up the processing of the 15 percent of letters that are still hand-addressed. A neural net-based system can locate the various components in an address, such as the zip code, and then determine what the numbers are most likely to be.

Despite the relative newness of this technology, the number of computational intelligence applications in the private sector is already large. Undoubtedly, some of the most innovative uses have yet to be developed. Opportunities for the public sector to benefit from smart computer systems are only beginning to be recognized.

Contributing to this article:
Robin Herskowitz, Emmett Coleman, Andy Liebler and Veronica Briseno

QUEST for Results

Project QUEST, an innovative job training program in San Antonio, is winning statewide and national attention as a model for local work force development efforts. Since January 1993, Project QUEST (Quality Employment through Skills Training) has met the needs of San Antonio area businesses by training local residents who would otherwise be out of work or on public assistance.

Winner of a 1995 Innovations Award from the Ford Foundation and the Kennedy School of Government at Harvard University, Project QUEST stands out among job training programs because of its ties to community-based organizations and businesses, especially in the banking and health care industries.

Origins: Project QUEST began as the initiative of two local organizations, Communities Organized for Public Service (COPS) and Metro Alliance. In 1990, spurred by job losses resulting from the closing of a Levi Strauss plant on San Antonio's South Side, COPS and Metro Alliance identified job training needs that were not being addressed by existing programs.

The two organizations worked with Tom Frost of Frost National Bank to convene a July 1991 meeting with major San Antonio employers such as auto dealer B.J. "Red" McCombs, Callie Smith of Baptist Hospital and Dr. John P. Howe III of the University of Texas Health Science Center. Another early participant was Charles Cheever, senior board chairman of Broadway National Bank and former chairman of the Greater San Antonio Chamber of Commerce. Cheever now serves as board chairman of Project QUEST.

At the initial meeting, the QUEST staff identified occupations that were in demand in San Antonio, such as sheet metal workers and health care workers, and persuaded businesses they would benefit from the program by getting skilled employees who would not be available to employers in other cities. A meeting in November 1991, attended by health care executives, focused on a chronic shortage of nursing and allied health care professionals. QUEST later targeted these jobs in designing its training programs.

COPS and Metro Alliance secured $4.5 million in funding from state, local and nonprofit sources. Finally, in August 1992, the two groups incorporated Project QUEST.

Employer-driven: Business input and leadership have played a major role in shaping the program from the beginning. Today, more than 60 community, corporate and educational institutions make up the QUEST network, including the Alamo Community College District and the Greater San Antonio Chamber of Commerce.

Project QUEST negotiates partnerships with local companies to get up-front commitments to hire QUEST graduates. The number of businesses pledging to hire QUEST trainees has risen from 12 in 1992 to more than 60 in 1995.

Occupational advisory committees allow employers themselves to decide what QUEST participants will learn. Employers work with QUEST staff and educators to establish certification requirements, achievement standards and curriculum design. This approach ensures that QUEST graduates are fully prepared to accept jobs with participating companies.

The top five occupations for which QUEST has trained participants are medical technician (28 percent of enrollees), licensed vocational nurse (20 percent), office systems technician (7 percent), registered nurse (7 percent) and financial services (6 percent). Because of the high skills required in the targeted occupations--ideally, jobs paying at least $7.50 per hour plus benefits--90 percent of students have had to take remedial English or math classes or both.

From 1993 through 1995, the project had 825 clients averaging 30 years of age; about two-thirds were women. To participate, clients must have at least a high school diploma or General Educational Development certificate, must meet income guidelines and must have barriers to employment such as lack of job skills or child care.

The time required for trainees to complete their programs--up to two years--and the total expense per client ($10,000) are higher than in traditional publicly funded job training programs that average two or three months in length and $2,000 to $3,000 per client. But studies by the Massachusetts Institute of Technology's Sloan School of Management and other researchers indicate that QUEST shows better and longer-term results than other programs that are cheaper and faster. For instance, three months after graduating, QUEST clients who had formerly been on welfare were earning an average $9.55 per hour, compared to $5.50-per-hour earnings for graduates of San Antonio's other publicly funded job training programs.

Model program: The Project QUEST model has been used to design similar programs in Dallas, Fort Worth, Houston and the Rio Grande Valley. The Dallas program, called Workpaths, has gained the endorsement and involvement of the Greater Dallas Chamber of Commerce, PepsiCo, Texas Instruments and Parkland Hospital.

Project QUEST is proving to be a valuable economic development tool that local officials and businesses can use to meet their work force needs, along with customized training, career and technology programs in public schools and community colleges and more traditional higher education offerings.

Contributing to this article:
Eva DeLuna-Castro

200 + Millionaires and Counting
Lottery enriches lucky Texans, state coffers

The Texas Lottery celebrates its fourth birthday in May 1996, and for more than 200 Texans who have hit the jackpot since its inception, it's bound to be a happy birthday. The state will celebrate too: the Texas Lottery was the nation's best selling in fiscal 1993 and 1994 and has pumped more than $3 billion into the state's General Revenue Fund since May 29, 1992.

That first day, retailers sold 23 million Lone Star Millions scratch-off tickets; during the first week of operation, they sold 102.4 million tickets. Both sales totals were records for any state lottery. Comptroller John Sharp oversaw the lottery startup, which occurred 47 days ahead of schedule.

According to the Texas Lottery Commission, which assumed full responsibility for operating the lottery in December 1993, cumulative sales have now surpassed $10 billion.

Big state, big winners: Texas began creating millionaires almost every week when Lotto Texas, the twice-weekly jackpot drawing, hit retail stores on November 7, 1992. The first winner, a 65-year-old woman from Schulenburg, won $21.7 million.

The largest jackpot awarded so far was $77.1 million, split among five winners who bought tickets in different locations in March 1995. The largest individual prize went to a Mansfield man, who claimed $54 million in November 1994. Through April 15, 1996, the state had awarded 227 Lotto Texas jackpots worth more than $2 billion.

One $12.4 million prize from a ticket sold in Flower Mound in October 1994 was left unclaimed, and one $10.5 million prize was denied. That jackpot--still contested--was claimed by a New Jersey police officer who bought the ticket from a Pennsylvania lottery dealer not licensed to sell Lotto Texas tickets. The ticket matched the winning numbers drawn on November 23, 1994, and had originally been sold by a Houston retailer.

Sharing the pot: In fiscal 1995, combined sales of all lottery games in Texas totaled roughly $3 billion. Of that, $1.7 billion went to lottery winners, nearly $900 million went to the state's General Revenue Fund, $151 million went to lottery retailers who sold tickets and the rest went to pay administrative and production costs.

According to the Legislative Budget Board, about 60 percent of the state's general revenue-related funds are spent on public and higher education. The lottery now contributes about 4.4 percent of general revenue-related funds. The state has recouped additional money from some lottery winners.

According to the Lottery Commission, through January 1996, the state had withheld more than $1.7 million from prize winners to pay delinquent taxes, student loans or child support some winners owed. Student loan repayments to the Texas Guaranteed Student Loan Corporation and the Texas Higher Education Coordinating Board made up about half of such withholdings, nearly $900,000.

Who's playing: An October 1994 survey by the College of Communication at the University of Texas at Austin showed that seven out of 10 adult Texans played the lottery at least once during the year preceding the survey. Lotto Texas was the most popular game; two-thirds of those surveyed said they had played it at least once in the past year. About 57 percent had played scratch-off games, and about 20 percent had played Pick 3, a daily (except Sunday) jackpot game.

The survey found that most lottery players were between 25 and 54 years old, with those over 65 playing the least. Texans with some college education were most likely to play; two-thirds of that group bought tickets in fiscal 1994, compared to about 59 percent of Texans with less than a high school education.

Of all Texans earning more than $10,000 a year, roughly three-quarters played the lottery. Among those earning less than $10,000, about 60 percent played the lottery. Ethnic background and gender made little difference in determining who played, according to the study.

Contributing to this article:
Greg Mt.Joy

AG: Some Taxpayers' Phone Numbers Are Public Records

In February 1996, the Texas Attorney General's Office issued a decision (OR96-0263) stating that in some cases, a taxpayer's telephone number--like a mailing address--is public information that must be released if requested under the Open Records Law.

Taxpayers provide phone numbers to the Comptroller of Public Accounts on certain franchise and sales tax forms. According to the AG's decision, the Comptroller must now make those phone numbers available upon request, along with the taxpayer's address and identification number. Tax payment information remains confidential.

The ruling applies only to the franchise and sales tax records addressed in the decision, and does not apply to requests for other types of tax records held by the Comptroller's Office.

Previously, the Comptroller had a policy of not releasing phone numbers supplied on sales and franchise tax forms, believing that these numbers were exempt from disclosure under sections of the Government and Tax Codes. OR96-0263 reverses that policy.

Factual Pursuit

Want to know the projected population for the Big Spring area? Looking for the per-capita income of Jefferson County? Need to know how many vehicles are registered in El Paso County?

Texas Area Facts, published by the Comptroller's Office, answers these questions and thousands more. The 600-page 1995-96 edition is available to the public free of charge.

First published in 1994, Texas Area Facts has been popular with universities, businesses, local governments and economic development groups. This year, new county-by-county categories were added: average educational attainment as well as total square miles of land and water. Other categories range from the availability of health services to gross sales of selected industries.

To obtain a copy of Texas Area Facts, call 1-800-531-5441, ext. 3-4900, or write to Comptroller of Public Accounts, Research Division, P.O. Box 13528, Capitol Station, Austin, TX 78711-3528.