The purpose of this study is to provide research on the funding of state senior higher education in Texas. The focus of this work is on the pressure group-policy process. At the beginning of the study, several questions were raised to assist in establishing boundaries for the research, the collection of data, and the construction of a heuristic model to conceptualize the policy process. The historical and legal factors which affect the funding of higher education were then examined. Attention was focused on the constitutional and statutory provisions which pertain to general appropriations and capital outlays for public higher education. Formula and non-formula items were examined as well as the sources of capital funds.