MONEY TREE: Bills Seek To Rescue Ala. Prepaid Tuition Program
MONTGOMERY, Ala. (AP) — A settlement aimed at saving Alabama’s financially troubled prepaid college tuition plan could be restored under bills introduced by two legislative budget chairmen.
State Treasurer Young Boozer, who oversees the Prepaid Affordable College Tuition plan, said the bills would address issues raised by the Alabama Supreme Court when it struck the settlement down.
The settlement called for the Prepaid Affordable College Tuition plan to pay tuition rates at fall 2010 levels instead of current levels, with participants making up the difference. It was designed to keep the financially troubled program operating rather than shutting down and refunding the money paid by participants.
Some participants challenged the settlement, and the state Supreme Court struck it down. The court said the settlement violated a law the Legislature passed in 2010 to provide extra funding to PACT. That law provided for the program to be 100 percent funded.
The state treasurer said he worked with Sen. Trip Pittman, R-Daphne, and Rep. Jay Love, R-Montgomery, on the bills they introduced. The bills would rewrite the 2010 law to remove the part that says “100 percent fully funded.”
“Hopefully, it will become a law as quickly as possible,” Boozer said.
In the meantime, he said the PACT board is asking the Supreme Court to reconsider its decision.
Patti Lambert, co-founder of Save Alabama PACT and a member of the PACT board, said restoring the settlement appears to be the only way to keep PACT from shutting down.
“I feel like I have to be for these bills because I see all the numbers from the PACT board and know that this is the only way we will not be a Ponzi,” she said.
House Minority Leader Craig Ford, D-Gadsden, said the Legislature created the PACT plan, and it should make sure participants get the full tuition they expected when they signed up, rather than a reduced rate.
“This bill doesn’t just break the state’s promise to the PACT families; it also undermines the public’s faith in our state government,” he said.