114943-1:n:10/16/2009:LFO-JI/csh

Regarding the Alabama Prepaid Affordable College Tuition Program (PACT) created as part of the Wallace-Folsom College Savings Investment Plan by the Alabama Legislature, to express the intent of the Legislature regarding PACT contracts; and to provide that the benefits provided under each PACT contract in force as of the effective date of this act shall be honored, regardless of the date the contract was issued.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:

Section 1. The Legislature of Alabama created as part of the Wallace-Folsom College Savings Investment Plan the Alabama Prepaid Affordable College Tuition Program (PACT). PACT was specifically created for the purpose of encouraging timely financial planning for higher education, and many Alabamians have entered into PACT contracts since the program's inception. While the language of these contracts may not have been uniform, the intention of each purchaser was clear: by entering into a PACT contract, tuition and mandatory fees would be paid by the program for all PACT beneficiaries. It is the intent of the Legislature to honor the promises contained in each PACT contract.

Section 2. Notwithstanding any provision of law to the contrary, all benefits payable under PACT contracts in force as of the effective date of this act, regardless of the date the contracts were issued, will be honored by the state in the event assets of the PACT Trust Fund become insufficient to cover the obligations owed to any beneficiary of a PACT contract.

Section 3. This act shall become effective immediately upon its passage and approval by the Governor, or its otherwise becoming law.