(a) The governing board of an institution or component for which a fund is established under this subchapter may administer the fund of that institution. If a governing board elects not to administer the fund, the comptroller shall administer the fund. The administrator of a fund established under this subchapter shall invest the fund in a manner intended to preserve the purchasing power of the fund’s assets and the fund’s annual distributions. Annual distributions for any fund shall be determined by the investment and distribution policy adopted by the administrator of the fund for the fund’s assets. Expenses of managing the assets of a fund shall be paid from the fund. If a governing board administers a fund, the governing board may manage and invest the fund in the same manner as the board manages and invests other permanent endowments, and the board shall make distributions from the fund in a manner consistent with the board’s procedures for making distributions to other endowment beneficiaries. If the comptroller administers a fund, the comptroller may acquire, exchange, sell, supervise, manage, or retain, through procedures and subject to restrictions the comptroller considers appropriate, any kind of investment of the fund’s assets that prudent investors, exercising reasonable care, skill, and caution, would acquire or retain in light of the purposes, terms, distribution requirements, and other circumstances of the fund then prevailing, taking into consideration the investment of all the assets of the fund rather than a single investment.
(b) Except as provided by Subsections (c), (d), and (f), money in a fund established under this subchapter may not be used for any purpose.

(c) The amount available for distribution from each fund may be appropriated only for research and other programs that are conducted by the institution or components for which the fund is established and that benefit the public health. The comptroller or the governing board shall report to the legislature the amount of funds that are eligible for appropriation. An amount appropriated from the fund established for The University of Texas Health Science Center at San Antonio may be used to establish, maintain, and operate a children’s cancer center. An amount appropriated from the funds established for the component institutions of The University of Texas System may be used to maintain, operate, and conduct health education programs and other related work at the system’s multi-institution center in the city of Laredo. An amount appropriated from the funds established for the components of the Texas Tech University Health Sciences Center located in El Paso and for The University of Texas at El Paso may be used for the establishment and operation of an institute of public health in El Paso. An amount appropriated from the fund established for the components of the Texas Tech University Health Sciences Center at locations other than El Paso may be used for research and other programs that benefit the public health in areas outside El Paso. An amount appropriated from the fund established for The Texas A&M University Health Science Center may be used for the establishment and operation of the Coastal Bend Health Education Center in Corpus Christi.
(d) The comptroller or the governing board of an institution or component may solicit and accept gifts and grants to the institution’s or component’s fund. A gift or grant to the fund may be expended and used in the same manner as an amount distributed from the fund under Subsection (c), subject to any limitation or requirement placed on the gift or grant by the donor or granting entity.
(e) Sections 403.095 and 404.071, Government Code, do not apply to a fund established under this subchapter. § 404.094(d), Government Code, applies to the fund.
(f) An institution of higher education that has accepted a gift under Subchapter I, Chapter 51, that was conditioned on the receipt by the institution of state matching funds from the eminent scholars fund may use money the institution receives under this subchapter to provide the state matching funds, treating that amount as if it were a distribution to the institution from the eminent scholars fund for purposes of Subchapter I, Chapter 51.