By: POLLY ROSS HUGHES
Houston Chronicle Austin Bureau
April 03, 2003, Thursday

AUSTIN - Performance records for high-risk investments from Texas' higher education trust fund must be released for public inspection, Attorney General Greg Abbott ruled Wednesday.

Abbott rejected arguments from fund managers for the private equity investments that the information is exempt from the Texas Public Information Act for competitive reasons.

University of Texas Investment Management Co. President Bob Boldt, however, said he believes Abbott's ruling does not necessarily apply to future requests for the same information.

"The part we expected was the attorney general found this is information that can and must be disclosed," Boldt said. "The part we're disappointed about is, the attorney general refused to accept our request to give us a ruling we could rely on in the future."

Wording in Abbott's ruling and a direct statement from the attorney general's office contradict Boldt's assertion, however.

"So long as the elements of law, fact, and circumstances do not change so as to no longer support the findings set forth above, UTIMCO need not ask for a decision from this office again with respect to these types of information requested of UTIMCO," the ruling states.

The decision does apply to future open-records requests for the material in question, the attorney general's office said when asked about Boldt's interpretation.

"That was put in there to say, 'Don't keep coming back to us and asking the same questions over and over again, because this information is public,' " said Abbott spokeswoman Angela Hale.

The Houston Chronicle had sought the records while following up a 1999 story concerning possible cronyism in the way investment managers are chosen by UTIMCO's board of directors. Regents of the University of Texas and Texas A&M University and private investment advisers make up the board.

Still, Boldt predicted the openness issue could become a quarterly affair involving more legal briefs and rulings from the attorney general's office. The issue is likely to come up again, especially if investments continue to take a battering during tough economic times.

Some of the 42 fund managers of the Permanent University Fund, particularly three who manage venture capital funds of risky start-up companies, have contended that the public disclosures reveal too many trade secrets and undermine their competitiveness. Abbott's ruling rejected that argument.

This is the second time a state attorney general has ruled that the records are public. Yet Boldt said he still fears potential lawsuits from fund managers, and UTIMCO still feels compelled to seek express legal approval for releasing the records concerning $855 million in the PUF investments.

The PUF, which is used for capital construction projects in the University of Texas and Texas A&M systems, has taken a beating during the national recession. It is expected to produce $15 million less this year than last year.