I really don’t think the out-of-state students ought to be receiving more than their investment. Allowing out-of-state tuitions was one of the reasons this thing went broke.  The advantage of this was two-fold in the inception.  You got your school paid and Alabama got the tuition.  I have two companies and I buy and sell from each.  It is a win-win.  Perhaps they began out-of-state tuitions to keep people from pulling their money out but you can’t keep expanding a program that is breaking and expect it not to go faster.  The original agreement was quite specific about out-of-state tuition: they wouldn’t.  If you chose to go out of state, you would receive your money back with their blessing.  Only Alabama colleges should have gotten the contracts.

How to fix it now that they have allowed it?  I don’t know.  I don’t bet.

LEIA,What do you think about the new plan to save the program? Going with an annuity approach to it and getting the necessary funds to keep it going by reducing the aid to out of state students,I think is the aim of this plan.Sounds reasonable to me but I would guess not so for the out of state students.

But that is the point, Carl.  This is not like a 401K….at least it wasn’t in the beginning.  It was a contract and they even admitted the change from contract into a speculation in 2006.  That was when they offered a choice of stock market options and changed the name of the project as well.  Before 2006, It is a trust fund couched in specific contractual language.  As an attorney, I can tell you I know whereby I speak.  There are several law suits in the works, but they have agreed to honor mine so I don’t think I will join them.  Whether the state “can” or not is not even an issue.  It must unless it is broken entirely because it backed it with public funds.

I know a lot of parents were counting on the program to help with the escalating costs of college but I don’t see how the state can justify helping this group of investors with their children’s education unless it was for all the kids in the state.This program seems to have been mismanaged to loose that much,but it’s like my 401k,it’s practically gone and it’s not coming back and like most other tax payers I don’t see any bailout coming from the state to help at this time of Hugh deficits in the state budget.

I am a PACT contract holder since 1993 and it was quite different then.  Since 2006, it is a market venture adn you choose one of several risks to take; but then, it was a “trust fund” written in certain contract terms whereby the state would back it up.  I was told on the phone that it would hold as long as the state government held.

I thought the people were the state? But no matter,I think I smell another bailout request coming over the horizion to be footed by the tax payers.

PACT is the State.

Sounds like they want the state to further insure their holdings at a time of huge deficits.