Bill to provide $236M to Ala. prepaid tuition program up for vote Tuesday in Senate committee

Chairman: Ala. prepaid tuition bill up for vote

MONTGOMERY, Ala. — The sponsor of a bill to shore up Alabama’s financially troubled prepaid college tuition program is optimistic it will pass a state Senate committee next week.

The Senate Fiscal Responsibility and Accountability Committee held a public hearing Wednesday on a bill by the committee’s chairman, Democratic Sen. Ted Little of Auburn. His bill would provide $236 million to the Prepaid Affordable College Tuition plan from state education revenue over an eight-year period.

Little said his committee will meet Tuesday to vote on the bill, and he expects it to pass, possibly with some changes. The committee’s vote would send it to the Senate for consideration.

Little’s bill is one of five offered by legislators to address the financial problems, but it has received the most attention in the Senate.

Patti Lambert, president of the Save Alabama PACT organization, said a consensus seems to be developing in the Legislature to fix PACT. “I’m very hopeful,” she said.

During the public hearing, parents said they signed contracts with the PACT program because the state promised four years of college tuition for their children, and the program’s name implied a commitment by the state.

Paula Reynolds, a Montgomery widow with two children in the program, said she’s counting on the program to get her children through college.

“Please honor the PACT agreement that we made in good faith,” she urged the committee.

The program worked fine for many years, with a board investing the parents’ money and using it to pay tuition. But then tuition costs rose faster than expected and investments lost value, leaving the program unable to cover its future obligations. PACT’s board is looking at paying less-than-full tuition for some participants in the 2010-2011 school year.

Little’s bill would pump in money from 2014 through 2021 to help the program meet its full tuition obligations.

University lobbyist Gordon Stone, executive director of the Alabama Higher Education Partnership, said universities “could live with” Little’s bill.

Teacher lobbyist Paul Hubbert, executive secretary of the Alabama Education Association, said $236 million is not enough unless the Legislature rewrites Little’s bill to limit universities to raising tuition by 2.5 percent annually for the 45,000 PACT participants.

On average, tuition has been going up more than 7 percent annually.

Stone said universities would object because tuition matters should be left to their boards of trustees.

Some members of the Save Alabama PACT organization told legislators they need to find a solution during the current session or expect a flood of lawsuits aimed at making the state stand behind the contracts.

Hubbert agreed the state should support the contracts.

“Whether there is a legal obligation, there is a moral obligation,” he said.