Alabama Legislators Consider Tuition Plan Study

The tuition plan's board meets May 20 in Montgomery to consider what to do about assets that equal about half of future liabilities.

The prepaid tuition program allows parents or grandparents to pay a fixed amount for a child in anticipation of getting four years of tuition at a state university upon graduation from high school. For nearly two decades, the program's board invested the money and used the earnings to pay tuition.

But stock market losses and higher-than-expected increases in tuition sliced the fund roughly in half over the past 1 1/2 years in Alabama. Some other states have frozen enrollment, redesigned their programs, or charged parents more.

The tuition plan is separate from the Alabama Higher Education 529 Fund, which allows parents to invest money for a child's college expenses.

Senate Majority Leader Zeb Little, D-Cullman, said lawmakers want to assure participants that the Legislature will solve tuition program's problems, but they need detailed financial information to devise a long-term solution. That solution doesn't have to come in the current legislative session, he said Monday

"There is no imminent danger. The funding is there for the next several years," he said.