Mary, you make some very good points...I would strongly reccommend that you and others, as I did, call the persons listed on the University Legislative Update and ask them the same questions. They are strongly against SB581 in any form that contains any tuition freezes for any period of time. I personally feel the tuition freezes to help PACT get back on its feet should be voluntarily agreed to by AU and U of A, because of the reasons you mentioned above, but they didn't seem to see it that way when Patti and I both spoke with them looking for a compromise.

Power is in numbers....call um and tell um your story!

Dave Wilcox,

Try the link on the front home page now, it should work fine.

The document can also be found under our DOCUMENTS tab.

Check it out!

The ammended SB581 is getting close.  Ammend it once more, and remove any mixing of the PACT with the 529 Plan and eliminate the breaks for students living out of State.  The bill can not allow re-wording of any contracts.  Allowing the PACT children a college education will likely result in addtional future taxation revenues for the State. Its win win.

Auburn shouldn't have any problem with tuition freezes for PACT members. My daughter's tuition is already frozen. When they had their last tuition increase they froze the tuition at the current rate for students already attending. Plus they get a great deal when they don't allow the students in the classes they need for graduation and so they end up taking random classes they don't need (and paid by PACT) just so they can be considered full-time. That has happened to my daughter all but two semesters. In the fall they were only going to allow her THREE hours that she needed and the dept. head finally agreed to let her in two more classes but she still had to take an unneeded class to be full-time. It's important for her to be a full-time student so she can remain under our insurance for several medical issues. Because of the unavailability of classes she will be at Auburn two extra semesters. So there should be many PACT participants who already have their tuition froze.

I wrote my representative again (Jim McClendon). Nice guy and he felt something would be done.  I wanted to make sure he knew there was a difference between the State sponsored PACT and the State sponsored 529 plan.   Also I compared the PACT contract to a purchase and payment agreement as an analogy.  If someone bought a car would if be OK not to pay if the stock market went down?

No word today. Appears Paul Hubbert of AEA may be opposed to the bill.

FYI From ALISON

IN THE LEGISLATURE OF THE STATE OF
ALABAMA
REGULAR SESSION 2009
SENATE CALENDAR NO. 21
TWENTY-THIRD LEGISLATIVE DAY
04/23/2009
________________________
REGULAR CALENDAR
________________________

By Senators Bedford and Holley (With Substitute):
SB581 Relating to the Alabama Prepaid Affordable College Tuition (PACT) Program; to amend Sections 16-33C-1, 16-33C-2.1, 16-33C-3, 16-33C-4, 16-33C-5, 16-33C-6, 16-33C-7, 16-33C-8, 16-33C-9, 16-33C-10, and 16-33C-13, Code of Alabama 1975, and to add Sections 16-33C-5.1 and 16-33C-6.1 to the Code of Alabama 1975, to transfer the administration of the PACT Program, including existing rights, contracts, and obligations, from the State Treasurer to the Teachers' Retirement System of Alabama; to suspend new enrollments in the program indefinitely and to ratify and confirm actions taken pursuant to the current suspension; to define the term tuition and qualified fees and specify the duties of the Board of Control regarding tuition and qualified fees; to authorize the State Treasurer for the ACES Trust
Fund and the Board of Control for the PACT Trust Fund to solicit and accept funds for the PACT Program from the State of Alabama, the Legislature, and any other available source of funds, public or private; to require the Governor include in the budget, and the Legislature to annually appropriate necessary funds, from any available funding source, to ensure that the PACT Program meets its obligations and maintains actuarial soundness for the life of the program; to provide upon dissolution that remaining funds be used to repay funding sources for advances to the program, rather than to the Alabama Commission on Higher Education for the establishment of a scholarship program; to provide upon dissolution of the ACES Program that remaining funds be deposited into the ACES Opportunity Enhancement Fund,
in lieu of being treated as abandoned property; to require each eligible educational institution to accept the total tuition and qualified fees paid for PACT beneficiaries as payment in full; to prohibit discriminatory practices by institutions; and to provide for implementation and monitoring by the Alabama Commission on Higher Education, upon the advice of the Board of Control.
Finance and Taxation General Fund
Number of amendments: 0
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FISCAL NOTE
Senate Bill 581 as introduced:
(1) immediately transfers from the State Treasurer to the Teachers Retirement System (TRS) Board of Control all matters of any nature whatsoever pertaining to the administration of the Alabama Prepaid Affordable College Tuition (PACT) Program;
(2) provides that the Board of Control may, in addition to all other powers previously granted to the PACT Board, adjust the terms of existing PACT contracts in order to preserve the actuarial soundness of the PACT
Trust Fund;
(3) indefinitely suspends new enrollments in the PACT Program;
(4) requires, for the life of the PACT program, an annual appropriation from any source of funds to be requested by the Governor and made by the Legislature in amount that is certified by the TRS Board of Control to be actuarially necessary, with such appropriations to be repaid by excess PACT Program operating revenue;
(5) requires, from now until the end of the 2012 Fall Term, eligible institutions to accept as payment in full the amount of tuition and qualified fees paid by the PACT Program for the 2009 Spring Term, with the amount of such tuition and qualified fees thereafter determined by the TRS Board of Control based upon the investment performance of the PACT Trust Fund;
(6) provides that the Legislative Council and the Legislature can recommend or enforce penalties, including appropriation reductions and punitive payments, upon any eligible institution found by the Alabama Commission on Higher Education (ACHE) or the Examiners of Public Accounts to either be non-compliant with the tuition-related provisions of this bill or have engaged in discriminatory practices against a current or potential PACT beneficiary;
(7) provides that, upon dissolution, all PACT-related fund balances would be transferred (after all costs and liabilities are repaid) to the Education Trust Fund rather than to ACHE;
(8) provides that the Alabama College Education Savings (ACES) Program shall continue to operate under the oversight of the State Treasurer and the current ACES Board;
(9) provides that, upon dissolution, all ACES-related fund balances would be deposited into the ACES Opportunity Enhancement Fund rather than administered in accordance with the Alabama Uniform Disposition of Unclaimed Property Act; and
(10) appropriates to the State Treasurer, in both FY 2009 and FY 2010, any amounts necessary and available in both the ACES Administrative Fund and the ACES Opportunity Enhancement Fund.
As substituted and as amended by the Committee on Finance and Taxation General Fund:
(1) eliminates the requirement that the PACT Program repay from its excess reserves any funds provided to the program upon the recommendation of the Governor and appropriation by the Legislature;
- 162 -
(2) removes as one of the enumerated powers of the TRS Board of Control the ability to define the terms and conditions of PACT contracts;
(3) provides that ACHE shall issue tuition-related compliance reports annually rather than quarterly; and
(4) provides that no PACT contract in force as of the effective date of the act shall be altered or changed in any way, and all benefits, promises, and/or guarantees included in such contracts shall be paid, provided,
and/or honored in full.
____________________________
Roger Bedford, Chairperson
Finance and Taxation General Fund
_____________________________

Sheila-when do you anticipate a vote on SB581?

This is what I wrote to my State Legislator:

Please help protect the future of Alabama by endorsing any policies that will ensure the payment of PACT college tuition fees.  I purchased a PACT contract several years ago in good faith to allow my son to obtain a college education.  I can think of no greater cause that would benefit the State more than to allow participating students the full benefit of the PACT.  PACT students not only have the opportunity to be future leaders, but taxpayers and voters as well. What faith will investors have in any Alabama state sponsored program if the PACT fails?  Imagine the damage to Alabama’s reputation in the eyes of the Nation if we do not even support our own education programs.  Alabama can not afford to fail.  Not to mention that litigation will likely drain any remaining financial resources of the PACT.   I understand the impact of current economic conditions, however I did not borrow money recklessly, carelessly accumulate credit card debt, or purchase a luxury item I can not afford, but invested hard earned money in Alabama.  Your concern for this matter is desperately needed.

The following note from my representative, Randy Hinshaw, in response to my "rant" came today:

"You are not forgotten and we are still working towards protecting PACT participants."

rh

Dave said, "Sheila-when do you anticipate a vote on SB581?"

I don't think there's really any way to tell.  They will get to it if and when they get to it.  The next day for Senate is Tuesday, 4/28, I think.  And, we don't need to forget that it requires two legislative bodies for passage.  Sorry, it took so long to answer.  I had to make a personal trip to Montgomery today. 

Here's a pretty good blog to follow the "goings on" in Montgomery:
http://alabama2009legislativesession.blogspot.com/

Stupid idea?  If the State agrees to fund the PACT 100% under SB581, does it really matter to us if they have a tuition freeze for PACT participants? Is Bronner the only one who has proposed this?  I know, actuarially, it would be easier to project with at least a few definites, but...  If they are funding ours at 100%, does removal of the freeze on PACT tuition affect us? 

Also, just doing a little figuring:
1.  Approximately 15% of UA's funding is from the State http://www.al.com/news/birminghamnews/m … amp;coll=2
"State appropriations - this year, close to $498 million - make up about 15 percent of the budget for the system's three campuses in Tuscaloosa, Birmingham and Huntsville. The full system budget was $4.3 billion this year, including the UAB Health System, according to system spokeswoman Kellee Reinhart."

2.  Approximately 10% of the students at Alabama and Auburn are on the PACT,
http://www.ache.state.al.us/Notes&N … olders.pdf
"About 63 percent of all PACT recipients attend Auburn or the University of Alabama's main campus in Tuscaloosa, according to the fund, making up 10 percent of each school's student body. Fitch said talks have focused on those schools."

3.  Only 912 of the early contract beneficiaries are currently attending college.  How many later contract beneficiaries are currently attending?
http://m.montgomeryadvertiser.com/apps/ … ate=wapart
"Of the 6,292 who signed the "guaranteed payment" contract, 912 are currently in college, and 5,380 are not yet in college."

Interesting concept, huh?

This is not very encouraging.  From the Treasurer's PACT website:

UPDATE – April 24, 2009
• There has been no movement on any legislation regarding PACT this week.  SB581 has made the most progress and is available for final passage by the Senate. It would then travel to the House. The session ends May 18, 2009.
• The last of the Spring school invoices are being paid.
• Normal filings are being made on the two lawsuits. There is no news to report on these.