My answer:
If you go to a car dealership and make a deal to pre-purchase a vehicle with certain options, colors, etc., you expect them to give you an exact price. If you pay that price, you expect to pick up the car on delivery at that price. If the dealership raises the price after the car is delivered, changes the options, or tries to give you a different vehicle for the same price, you would be understandably upset. You would expect the dealership to provide you the vehicle you ordered at the price you PREPAID.
Since the original contracts contained language to "GUARANTEE" a certain number of credit hours at a fixed, QUOTED price, those who purchased the original contracts are also understandably upset. The original contracts were sold as "Prepaid College Tuition," not sold as a 529 investing in mutual funds at the direction of the investor. They contained the seal of the State of Alabama, signatures of officers of the State, and other indications of Alabama. The purchasers, not investors in 529's, were actually "purchasing" "prepaid" tuition.
If you had a contract with the State to furnish office supplies for a specified dollar amount, would you expect the State to pay after you delivered those supplies? Or, would you expect them to change the terms of the agreement to that which would benefit them the most? Would it be proper for them to say to the store owner that the economy is bad and their investments lost money, so they can't pay the full amount? Would the office supply store be "bailed out" by the State when they were only asking to be paid what was originally promised?
Since there was an original agreement to pay the tuition, a bailout is not an appropriate term to use in fulfilling a contract.
Some of the students are already attending or planning to attend this fall under the program and had signed for leases and dorm leases for next year prior to even being notified that there was a problem. Should the PACT guarantee broken leases since they would be their cause of a default if they don't pay the tuition which was used in the parent's and student's budgets including employment, student loans, scholarships, etc. when considering college attendance and costs?
How many students will not even be able to attend or finish? Do you really want to tell your children that Alabama can't keep promises and will not honor contracts? How is that a bailout? Besides, yes, the governor and the legislature did make the deals, otherwise there would be no laws establishing the program in the first place!
