Chapter 1009, Part IV - PREPAID
COLLEGE BOARD PROGRAMS, Florida Statutes (2007)
1009.97 General
Provisions
(1) Legislative Finding
(2) Legislative Intent
(3) Definitions
1009.971
Florida Prepaid College Board
(1) Creation
(2) Membership
(3) Elections; Meetings
(4) Powers and Duties
(5) Contractual Services
(6) Qualified
Tuition Program Status
1009.972 Florida
Prepaid College Trust Fund
1009.973 Comprehensive
Investment Plans
1009.974 Exemption
from Claims of Creditors
1009.975 Payroll Deduction
Authority
1009.976 Annual
Report
1009.98 Florida Prepaid College Program (The
“Florida Prepaid College Plan”)
(1) Creation
(2) Prepaid College Plans
(3) Transfer of Benefits to Private,
Out-of-State Colleges and Area Technical Centers
(4) Advance Payment Contracts
(5) Refunds
(6) Confidentiality of Account
Information
(7) Obligations of Board
(8) Program Termination
(9) Scholarships
1009.981 Florida College Savings Program (The
“Florida College Investment Plan”)
(1) Florida College
Savings Program
(2) Participation Agreements
(3) Distributions for Qualified Higher
Education Expenses
(4) Refunds
(5) Material Misrepresentation; Penalty
(6) Confidentiality of Account
Information
(7) Obligations of Board
(8) Program Termination
(9) State Pledge
1009.982 Disclaimer
1009.983 Direct-Support Organization;
Authority
1009.984 Florida Prepaid Tuition Scholarship
Program
1009.97 General
Provisions--
(1) LEGISLATIVE FINDING;
EDUCATIONAL OPPORTUNITY.--The Legislature recognizes
that educational opportunity at the postsecondary level
is a critical state interest and is best ensured through
the provision of postsecondary institutions that are
geographically and financially accessible, that
affordability and accessibility of higher education are
essential to the welfare and well-being of the residents
of the state and are a critical state interest, and that
promoting and enhancing financial access to
postsecondary institutions serve a legitimate public
purpose.
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(2) LEGISLATIVE
INTENT.--It
is the intent of the Legislature that a prepaid program
be established through which many of the costs
associated with postsecondary attendance may be paid in
advance and fixed at a guaranteed level for the duration
of undergraduate enrollment and that this program
fosters timely financial planning for postsecondary
attendance and to encourage employer participation in
such planning through program contributions on behalf of
employees and the dependents of employees. It is further
the intent of the Legislature that a savings program be
established as a supplement and alternative to the
prepaid program to allow persons to make contributions
to a trust account to meet some or all of the qualified
higher education expenses of a designated beneficiary,
consistent with federal law authorizing such programs,
but without a guarantee by the state that such
contributions, together with the investment return on
such contributions, if any, will be adequate to pay for
qualified higher education expenses, to enable
participants to save for qualified higher education
expenses, and to provide a choice to persons who
determine that the overall educational needs of their
families are best suited to a savings program or who
wish to save to meet postsecondary educational needs
beyond the traditional 4-year curriculum. Finally, the
Legislature intends that the prepaid program and the
savings program be conducted in a manner to maximize
program efficiency and effectiveness.
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(3)
DEFINITIONS.--As used in ss.
1009.97-1009.984, the term:
(a) "Advance
payment contract" means a contract entered into by the
board and a purchaser pursuant to s.
1009.98.
(b) "Board" means the Florida
Prepaid College Board.
(c) "Trust fund" means
the Florida Prepaid College Trust Fund.
(d)
"Prepaid program" means the Stanley G. Tate Florida
Prepaid College Program established pursuant to s.
1009.98.
(e) "Purchaser" means a person who
makes or is obligated to make advance registration or
dormitory residence payments in accordance with an
advance payment contract.
(f) "Qualified beneficiary"
means:
1. A resident of this state at the
time a purchaser enters into an advance payment contract
on behalf of the resident;
2. A
nonresident who is the child of a noncustodial parent
who is a resident of this state at the time that such
parent enters into an advance payment contract on behalf
of the child; or
3. For purposes of
advance payment contracts entered into pursuant to s.
1009.983, a graduate of an accredited high school in
this state who is a resident of this state at the time
he or she is designated to receive the benefits of the
advance payment contract.
(g)
"Registration fee" means tuition fee, financial aid fee,
building fee, and Capital Improvement Trust Fund
fee.
(h) "State postsecondary
institution" means any public community college or state
university.
(i) "Benefactor" means any
person making a deposit, payment, contribution, gift, or
other expenditure into the savings
program.
(j) "Designated beneficiary"
means:
1. Any individual designated in
the participation agreement;
2. Any
individual defined in s. 152(a)(1)-(8) of the Internal
Revenue Code; or
3. Any individual
receiving a scholarship from interests in the program
purchased by a state or local government or an
organization described in s. 501(c)(3) of the Internal
Revenue Code.
(k) "Eligible educational
institution" means an institution of higher education
that qualifies under s. 529 of the Internal Revenue Code
as an eligible educational
institution.
(l) "Internal Revenue Code"
means the Internal Revenue Code of 1986, as defined in
s. 220.03(1), and regulations adopted pursuant
thereto.
(m) "Participation agreement"
means an agreement between the board and a benefactor
for participation in the savings program for a
designated beneficiary.
(n) "Savings
program" means the Florida College Savings Program
established pursuant to s. 1009.981.
(o)
"Qualified higher education expenses" means higher
education expenses permitted under s. 529 of the
Internal Revenue Code and required for the enrollment or
attendance of a designated beneficiary at an eligible
educational institution, including undergraduate and
graduate schools, and any other higher education
expenses that are permitted under s. 529 of the Internal
Revenue Code.
(p) "Prepaid fund" means
the fund within the trust fund into which moneys
belonging to the prepaid program are deposited and
held.
(q) "Savings fund" means the fund
within the trust fund into which moneys belonging to the
savings program are deposited and held.
History.--s.
481, ch. 2002-387; s. 1, ch. 2006-303.
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1009.971 Florida Prepaid College
Board.--
(1) FLORIDA PREPAID
COLLEGE BOARD; CREATION.--The
Florida Prepaid College Board is hereby created as a
body corporate with all the powers of a body corporate
for the purposes delineated in this section. The board
shall administer the prepaid program and the savings
program, and shall perform essential governmental
functions as provided in ss. 1009.97-1009.984. For the
purposes of s. 6, Art. IV of the State Constitution, the
board shall be assigned to and administratively housed
within the State Board of Administration, but it shall
independently exercise the powers and duties specified
in ss. 1009.97-1009.984.
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(2) FLORIDA PREPAID
COLLEGE BOARD; MEMBERSHIP.--The board
shall consist of seven members to be composed of the
Attorney General, the Chief Financial Officer, the
Chancellor of the State University System, the
Deputy Commissioner of Community Colleges, and three
members appointed by the Governor and subject to
confirmation by the Senate. Each member appointed by the
Governor shall possess knowledge, skill, and experience
in the areas of accounting, actuary, risk management, or
investment management. Each member of the board not
appointed by the Governor may name a designee to serve
on the board on behalf of the member; however, any
designee so named shall meet the qualifications required
of gubernatorial appointees to the board. Members
appointed by the Governor shall serve terms of 3 years.
Any person appointed to fill a vacancy on the board
shall be appointed in a like manner and shall serve for
only the unexpired term. Any member shall be eligible
for reappointment and shall serve until a successor
qualifies. Members of the board shall serve without
compensation but shall be reimbursed for per diem and
travel in accordance with s. 112.061. Each member of the
board shall file a full and public disclosure of his or
her financial interests pursuant to s. 8, Art. II of the
State Constitution and corresponding statute.
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(3) FLORIDA PREPAID
COLLEGE BOARD; ELECTIONS; MEETINGS.--The
board shall annually elect a board member to serve as
chair and a board member to serve as vice chair and
shall designate a secretary-treasurer who need not be a
member of the board. The secretary-treasurer shall keep
a record of the proceedings of the board and shall be
the custodian of all printed material filed with or by
the board and of its official seal. Notwithstanding the
existence of vacancies on the board, a majority of the
members shall constitute a quorum. The board shall take
no official action in the absence of a quorum. The board
shall meet, at a minimum, on a quarterly basis at the
call of the chair.
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(4) FLORIDA PREPAID
COLLEGE BOARD; POWERS AND DUTIES.--The board
shall have the powers and duties necessary or proper to
carry out the provisions of ss. 1009.97-1009.984,
including, but not limited to, the power and duty to:
(a) Appoint an executive director to serve as the
chief administrative and operational officer of the
board and to perform other duties assigned to him or her
by the board.
(b) Adopt an official seal and rules.
(c) Sue and be sued.
(d) Make and execute
contracts and other necessary instruments.
(e)
Establish agreements or other transactions with federal,
state, and local agencies, including state universities
and community colleges.
(f) Administer the trust
fund in a manner that is sufficiently actuarially sound
to defray the obligations of the prepaid program and the
savings program, considering the separate purposes and
objectives of each program. The board shall annually
evaluate or cause to be evaluated the actuarial
soundness of the prepaid fund. If the board perceives a
need for additional assets in order to preserve
actuarial soundness of the prepaid program, the board
may adjust the terms of subsequent advance payment
contracts to ensure such soundness.
(g) Invest funds
not required for immediate disbursement.
(h) Appear
in its own behalf before boards, commissions, or other
governmental agencies.
(i) Hold, buy, and sell any
instruments, obligations, securities, and property
determined appropriate by the board.
(j) Require a
reasonable length of state residence for qualified
beneficiaries.
(k) Segregate contributions and
payments to the trust fund into the appropriate fund.
(l) Procure and contract for goods and services,
employ personnel, and engage the services of private
consultants, actuaries, managers, legal counsel, and
auditors in a manner determined to be necessary and
appropriate by the board.
(m) Solicit and accept
gifts, grants, loans, and other aids from any source or
participate in any other way in any government program
to carry out the purposes of ss. 1009.97-1009.984.
(n) Require and collect administrative fees and
charges in connection with any transaction and impose
reasonable penalties, including default, for delinquent
payments or for entering into an advance payment
contract or a participation agreement on a fraudulent
basis.
(o) Procure insurance against any loss in
connection with the property, assets, and activities of
the trust fund or the board.
(p) Impose reasonable
time limits on use of the benefits provided by the
prepaid program or savings program. However, any such
limitations shall be specified within the advance
payment contract or the participation agreement,
respectively.
(q) Delineate the terms and conditions
under which payments may be withdrawn from the trust
fund and impose reasonable fees and charges for such
withdrawal. Such terms and conditions shall be specified
within the advance payment contract or the participation
agreement.
(r) Provide for the receipt of
contributions in lump sums or installment
payments.
(s) Require that purchasers of advance
payment contracts or benefactors of participation
agreements verify, under oath, any requests for contract
conversions, substitutions, transfers, cancellations,
refund requests, or contract changes of any nature.
Verification shall be accomplished as authorized and
provided for in s. 92.525(1)(a).
(t) Delegate
responsibility for administration of one or both of the
comprehensive investment plans required in s. 1009.973
to persons the board determines to be qualified. Such
persons shall be compensated by the board.
(u)
Endorse insurance coverage written exclusively for the
purpose of protecting advance payment contracts, and
participation agreements, and the purchasers,
benefactors, and beneficiaries thereof, including group
life policies and group disability policies, which are
exempt from the provisions of part V of chapter 627.
(v) Form strategic alliances with public and private
entities to provide benefits to the prepaid program,
savings program, and participants of either or both
programs.
(w) Solicit proposals and contract,
pursuant to s. 287.057, for the marketing of the prepaid
program or the savings program, or both together. Any
materials produced for the purpose of marketing the
prepaid program or the savings program shall be
submitted to the board for review. No such materials
shall be made available to the public before the
materials are approved by the board. Any educational
institution may distribute marketing materials produced
for the prepaid program or the savings program; however,
all such materials shall be approved by the board prior
to distribution. Neither the state nor the board shall
be liable for misrepresentation of the prepaid program
or the savings program by a marketing agent.
(x)
Establish other policies, procedures, and criteria to
implement and administer the provisions of ss.
1009.97-1009.984.
(y) Adopt procedures to govern contract dispute
proceedings between the board and its vendors.
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(5) FLORIDA PREPAID COLLEGE BOARD;
CONTRACTUAL SERVICES.--The board shall solicit
proposals and contract, pursuant to s. 287.057,
for:
(a) The services of records administrators.
(b) Investment consultants to review the performance
of the board's investment managers and advise the board
on investment management and performance and investment
policy, including the contents of the comprehensive
investment plans.
(c) Trustee services firms to
provide trustee and related services to the board. The
trustee services firm shall agree to meet the
obligations of the board to qualified beneficiaries if
moneys in the fund fail to offset the obligations of the
board as a result of imprudent selection or supervision
of investment programs by such firm.
(d) Investment
managers to provide investment portfolios for the
prepaid program or the savings program. Investment
managers shall be limited to authorized insurers as
defined in s. 624.09, banks as defined in s. 658.12,
associations as defined in s. 665.012, authorized
Securities and Exchange Commission investment advisers,
and investment companies as defined in the Investment
Company Act of 1940. All investment managers shall have
their principal place of business and corporate charter
located and registered in the United States. In
addition, each investment manager shall agree to meet
the obligations of the board to qualified beneficiaries
if moneys in the fund fail to offset the obligations of
the board as a result of imprudent investing by such
provider. Each authorized insurer shall evidence
superior performance overall on an acceptable level of
surety in meeting its obligations to its policyholders
and other contractual obligations. Only qualified public
depositories approved by the Chief Financial Officer
shall be eligible for board consideration. Each
investment company shall provide investment plans as
specified within the request for proposals.
The goals of the board in procuring such services
shall be to provide all purchasers and benefactors with
the most secure, well-diversified, and beneficially
administered prepaid program or savings program
possible, to allow all qualified firms interested in
providing such services equal consideration, and to
provide such services to the state at no cost and to the
purchasers and benefactors at the lowest cost possible.
Evaluations of proposals submitted pursuant to this
subsection shall include, but not be limited to, fees
and other costs that are charged to purchasers or
benefactors that affect account values, or that impact
the operational costs of the prepaid program or the
savings program; past experience and past performance in
providing the required services; financial history and
current financial strength and capital adequacy to
provide the required services; and capabilities and
experience of the proposed personnel that will provide
the required services.
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(6) QUALIFIED TUITION
PROGRAM STATUS.--
Notwithstanding any other provision of ss. 1009.97-1009.984, the
board may adopt rules necessary for the prepaid program
and the savings program each to retain its status as
a "qualified tuition program" in order
to maintain its tax-exempt status or other similar status
of the program, purchasers, and qualified beneficiaries
under the Internal Revenue Code. The board shall inform
participants in the prepaid program and the savings
program of changes to the tax or securities status of
advance purchase contracts and participation agreements.
History.--s. 482, ch. 2002-387; s.
1964, ch. 2003-261; s. 141, ch. 2007-217.
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1009.972 Florida
Prepaid College Trust Fund.--
(1) There is created within the State Board of
Administration the Florida Prepaid College Trust Fund.
The trust fund shall be segregated into two separate
funds, the prepaid fund and the savings fund.
(2)
The prepaid fund shall consist of state appropriations,
moneys acquired from other governmental or private
sources for the prepaid program, and moneys remitted in
accordance with advance payment contracts. Dividends,
interest, and gains accruing to the prepaid fund shall
increase the total funds available for the prepaid
program. If dividends, interest, and gains for the
prepaid fund exceed the amount necessary for program
administration and disbursements, the board may
designate an additional percentage of the prepaid fund
to serve as a contingency fund.
(3) The savings fund
shall consist of appropriations, moneys acquired from
other governmental or private sources for the savings
program, and moneys remitted in accordance with
participation agreements. The amounts on deposit in the
savings fund shall remain therein and shall be available
solely for carrying out the purposes of the savings
program.
(4) Any balance contained within the trust
fund, and within each fund in the trust fund, at the end
of a fiscal year shall remain therein and shall be
available for carrying out the purposes of each
respective program and the direct-support organization
established pursuant to s. 1009.983. Moneys contained
within the trust fund shall be exempt from the
investment requirements of s. 17.57. All funds deposited
in the prepaid fund may be invested pursuant to s.
215.47. Any funds of a direct-support organization
created pursuant to s. 1009.983 shall be exempt from the
provisions of this section.
(5) Notwithstanding
chapter 717, funds associated with terminated advance
payment contracts pursuant to s. 1009.98(4)(k) and
canceled contracts for which no refunds have been
claimed shall be retained by the board. The board shall
establish procedures for notifying purchasers who
subsequently cancel their advance payment contracts of
any unclaimed refund and shall establish a time period
after which no refund may be claimed by a purchaser who
canceled a contract. The board may transfer funds
retained from such terminated advance payment contracts
and canceled contracts to the Florida Prepaid Tuition
Scholarship Program to provide matching funds for
prepaid tuition scholarships for economically
disadvantaged youth who remain drug free and crime free.
In addition, such funds may be used for any other
scholarship programs approved by the board under s.
1009.983(8)(b), provided that any matching funds are
obtained solely from the private sector.
(6) The
assets of the prepaid fund and the savings fund shall be
maintained, invested, and expended solely for the
purposes of the prepaid program and the savings program,
respectively, and shall not be loaned, transferred, or
otherwise used by the state for any purpose other than
the purposes of ss. 1009.97-1009.984. This subsection
shall not be construed to prohibit the board from
investing in, by purchase or otherwise, bonds, notes, or
other obligations of the state or an agency or
instrumentality of the state. Unless otherwise specified
by the board, assets of the prepaid fund and the savings
fund shall be expended in the following order of
priority:
(a) To make payments to state
postsecondary institutions on behalf of qualified
beneficiaries or designated beneficiaries.
(b) To
make refunds upon termination of advance payment
contracts or participation agreements.
(c) To pay
the costs of administration and operations for the
prepaid program and the savings program.
History.--s. 483, ch. 2002-387; s.
1965, ch. 2003-261; s. 2, ch. 2006-303.
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1009.973
Comprehensive investment plans.--The Florida
Prepaid College Board shall establish separate
comprehensive investment plans for the prepaid program
and for the savings program, each subject to the
approval of the State Board of Administration. Each
comprehensive investment plan shall specify the
investment policies to be utilized by the board in its
administration of each respective program. The board may
place assets of each program in investment products
pursuant to the comprehensive investment plan for each
respective program and in such proportions as may be
designated or approved under the plan for each
respective program. Such products shall be underwritten
and offered in compliance with the applicable federal
and state laws, regulations, and rules by persons
authorized by applicable federal and state authorities.
A purchaser may not direct the investment of his or her
contribution to the prepaid program. A benefactor or
designated beneficiary may not direct the investment of
any contributions to the savings program other than the
specific fund options provided by the board, if any.
Board members and employees of the board are not
prohibited from purchasing advance payment contracts or
entering into participation agreements by virtue of
their fiduciary responsibilities as members of the board
or official duties as employees of the board.
History.--s. 484, ch. 2002-387.
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1009.974 Exemption from
claims of creditors.--Moneys paid into or
out of the trust fund by or on behalf of a purchaser or
qualified beneficiary of an advance payment contract or
benefactor or designated beneficiary of a participation
agreement are exempt, as provided by s. 222.22, from all
claims of creditors of the purchaser or the qualified
beneficiary of an advance payment contract or the
benefactor or designated beneficiary of a participation
agreement, respectively, provided that the advance
payment contract or participation agreement has not been
terminated. Neither moneys paid into the prepaid program
or savings program nor benefits accrued through the
prepaid program or savings program may be pledged for
the purpose of securing a loan.
History.--s. 485, ch. 2002-387.
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1009.975 Payroll
deduction authority.--The state or any state
agency, county, municipality, or other political
subdivision may, by contract or collective bargaining
agreement, agree with any employee to remit payments
toward advance payment contracts or participation
agreements through payroll deductions made by the
appropriate officer or officers of the state, state
agency, county, municipality, or political subdivision.
Such payments shall be held and administered in
accordance with ss. 1009.97-1009.984.
History.--s. 486, ch. 2002-387.
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1009.976 Annual
report.--On
or before March 31 of each year, the Florida Prepaid
College Board shall prepare or cause to be prepared
separate reports setting forth in appropriate detail an
accounting of the prepaid program and the savings
program which include a description of the financial
condition of each respective program at the close of the
fiscal year. The board shall submit copies of the
reports to the Governor, the President of the Senate,
the Speaker of the House of Representatives, and the
minority leaders of the House and Senate and shall make
the report for the prepaid program available to each
purchaser and the report for the savings program
available to each benefactor and designated beneficiary.
The accounts of the fund for the prepaid program and the
savings program shall be subject to annual audits by the
Auditor General.
History.-- s. 487, ch.
2002-387.
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1009.98 Stanley G. Tate Florida
Prepaid College Program.--
(1) STANLEY G. TATE
FLORIDA PREPAID COLLEGE PROGRAM;
CREATION.--There is created the Stanley G. Tate
Florida Prepaid College Program to provide a medium
through which the cost of registration and dormitory
residence may be paid in advance of enrollment in a
state postsecondary institution at a rate lower than the
projected corresponding cost at the time of actual
enrollment. Such payments shall be combined and invested
in a manner that yields, at a minimum, sufficient
interest to generate the difference between the prepaid
amount and the cost of registration and dormitory
residence at the time of actual enrollment. Students who
enroll in a state postsecondary institution pursuant to
this section shall be charged no fees in excess of the
terms delineated in the advance payment contract.
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(2) PREPAID COLLEGE PLANS.--At a
minimum, the board shall make advance payment contracts
available for two independent plans to be known as the
community college plan and the university plan. The
board may also make advance payment contracts available
for a dormitory residence plan. The board may restrict
the number of participants in the community college
plan, university plan, and dormitory residence plan,
respectively. However, any person denied participation
solely on the basis of such restriction shall be granted
priority for participation during the succeeding year.
(a)1. Through the community college plan, the advance
payment contract shall provide prepaid registration fees
for a specified number of undergraduate semester credit
hours not to exceed the average number of hours required
for the conference of an associate degree. Qualified
beneficiaries shall bear the cost of any laboratory fees
associated with enrollment in specific courses. Each
qualified beneficiary shall be classified as a resident
for tuition purposes, pursuant to s. 1009.21, regardless
of his or her actual legal residence.
2. Effective
July 1, 1998, the board may provide advance payment
contracts for additional fees delineated in s. 1009.23,
not to exceed the average number of hours required for
the conference of an associate degree, in conjunction
with advance payment contracts for registration fees.
Community college plan contracts purchased prior to July
1, 1998, shall be limited to the payment of registration
fees as defined in s. 1009.97.
(b)1. Through the
university plan, the advance payment contract shall
provide prepaid registration fees for a specified number
of undergraduate semester credit hours not to exceed the
average number of hours required for the conference of a
baccalaureate degree. Qualified beneficiaries shall bear
the cost of any laboratory fees associated with
enrollment in specific courses. Each qualified
beneficiary shall be classified as a resident for
tuition purposes pursuant to s. 1009.21, regardless of
his or her actual legal residence.
2. Effective July
1, 1998, the board may provide advance payment contracts
for additional fees delineated in 1s. 1009.24(8)-(11),
for a specified number of undergraduate semester credit
hours not to exceed the average number of hours required
for the conference of a baccalaureate degree, in
conjunction with advance payment contracts for
registration fees. Such contracts shall provide prepaid
coverage for the sum of such fees, to a maximum of 45
percent of the cost of registration fees. University
plan contracts purchased prior to July 1, 1998, shall be
limited to the payment of registration fees as defined
in s. 1009.97.
3. Effective July 1, 2007, the board
may provide advance payment contracts for the tuition
differential authorized in 2s. 1009.24(15) for a
specified number of undergraduate semester credit hours,
which may not exceed the average number of hours
required for the conference of a baccalaureate degree,
in conjunction with advance payment contracts for
registration fees.
(c) The cost of participation in
contracts authorized under paragraph (a) or paragraph
(b) shall be based primarily on the current and
projected registration fees within the Florida Community
College System or the State University System,
respectively, and the number of years expected to elapse
between the purchase of the plan on behalf of a
qualified beneficiary and the exercise of the benefits
provided in the plan by such beneficiary.
(d)
Through the dormitory residence plan, the advance
payment contract may provide prepaid housing fees for a
maximum of 10 semesters of full-time undergraduate
enrollment in a state university. Dormitory residence
plans shall be purchased in increments of 2 semesters.
The cost of participation in the dormitory residence
plan shall be based primarily on the average current and
projected housing fees within the State University
System and the number of years expected to elapse
between the purchase of the plan on behalf of a
qualified beneficiary and the exercise of the benefits
provided in the plan by such beneficiary. Qualified
beneficiaries shall have the highest priority in the
assignment of housing within university residence halls.
Qualified beneficiaries shall bear the cost of any
additional elective charges such as laundry service or
long-distance telephone service. Each state university
may specify the residence halls or other university-held
residences eligible for inclusion in the plan. In
addition, any state university may request immediate
termination of a dormitory residence contract based on a
violation or multiple violations of rules of the
residence hall or other university-held residences. In
the event that sufficient housing is not available for
all qualified beneficiaries, the board shall refund the
purchaser or qualified beneficiary an amount equal to
the fees charged for dormitory residence during that
semester. If a qualified beneficiary fails to be
admitted to a state university or chooses to attend a
community college that operates one or more dormitories
or residency opportunities, or has one or more
dormitories or residency opportunities operated by the
community college direct-support organization, the
qualified beneficiary may transfer or cause to have
transferred to the community college, or community
college direct-support organization, the fees associated
with dormitory residence. Dormitory fees transferred to
the community college or community college
direct-support organization may not exceed the maximum
fees charged for state university dormitory residence
for the purposes of this section, or the fees charged
for community college or community college
direct-support organization dormitories or residency
opportunities, whichever is less.
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(3) TRANSFER OF BENEFITS TO PRIVATE AND
OUT-OF-STATE COLLEGES AND UNIVERSITIES AND TO CAREER
CENTERS.--A qualified beneficiary may apply the
benefits of an advance payment contract toward:
(a)
An independent college or university that is located and
chartered in Florida, that is accredited by the
Commission on Colleges of the Southern Association of
Colleges and Schools or the Accrediting Council for
Independent Colleges and Schools, and that confers
degrees as defined in s. 1005.02. Any advertisement
disseminated by an eligible for-profit independent
college or university that references the Stanley G.
Tate Florida Prepaid College Program shall clearly state
the following: "While the benefits of a Florida Prepaid
College contract may be utilized at this institution,
the Florida Prepaid College Board does not endorse any
particular college or university."
(b) An
out-of-state college or university that is not for
profit and is accredited by a regional accrediting
association, and that confers degrees.
(c) An
applied technology diploma program or career certificate
program conducted by a community college listed in s.
1004.02(2) or career center operated by a district
school board.
The board shall transfer or cause to be transferred
to the institution designated by the qualified
beneficiary an amount not to exceed the redemption value
of the advance payment contract at a state postsecondary
institution. If the cost of registration or housing fees
at such institution is less than the corresponding fees
at a state postsecondary institution, the amount
transferred may not exceed the actual cost of
registration and housing fees. A transfer authorized
under this subsection may not exceed the number of
semester credit hours or semesters of dormitory
residence contracted on behalf of a qualified
beneficiary. Notwithstanding any other provision in this
section, an institution must be an "eligible educational
institution" under s. 529 of the Internal Revenue Code
to be eligible for the transfer of advance payment
contract benefits.
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(4) ADVANCE PAYMENT CONTRACTS.--The
board shall develop advance payment contracts for
registration and may develop advance payment contracts
for dormitory residence as provided in this section.
Advance payment contracts shall be exempt from chapter
517 and the Florida Insurance Code. Such contracts shall
include, but not be limited to, the following:
(a)
The amount of the payment or payments and the number of
payments required from a purchaser on behalf of a
qualified beneficiary.
(b) The terms and conditions
under which purchasers shall remit payments, including,
but not limited to, the date or dates upon which each
payment shall be due.
(c) Provisions for late
payment charges and for default.
(d) Provisions for
penalty fees for withdrawals from the fund.
(e)
Except for an advance payment contract entered into
pursuant to subsection (9) or s. 1009.983, the name and
date of birth of the qualified beneficiary on whose
behalf the contract is drawn and the terms and
conditions under which another person may be substituted
as the qualified beneficiary.
(f) The name of any
person who may terminate the contract. The terms of the
contract shall specify whether the contract may be
terminated by the purchaser, the qualified beneficiary,
a specific designated person, or any combination of
these persons.
(g) The terms and conditions under
which a contract may be terminated, modified, or
converted, the name of the person entitled to any refund
due as a result of termination of the contract pursuant
to such terms and conditions, and the amount of refund,
if any, due to the person so named.
(h) The number
of semester credit hours or semesters of dormitory
residence contracted by the purchaser.
(i) The state
postsecondary system toward which the contracted credit
hours or semesters of dormitory residence will be
applied.
(j) The assumption of a contractual
obligation by the board to the qualified beneficiary to
provide for a specified number of semester credit hours
of undergraduate instruction at a state postsecondary
institution, not to exceed the average number of credit
hours required for the conference of the degree that
corresponds to the plan purchased on behalf of the
qualified beneficiary or to provide for a specified
number of semesters of dormitory residence, not to
exceed the number of semesters of full-time enrollment
required for the conference of a baccalaureate degree.
(k) The period of time after which advance payment
contracts that have not been terminated or the benefits
used shall be considered terminated. Time expended by a
qualified beneficiary as an active duty member of any of
the armed services of the United States shall be added
to the period of time specified by the board. A
purchaser or qualified beneficiary whose advance payment
contract is terminated pursuant to this paragraph is not
entitled to a refund. Notwithstanding chapter 717, the
board shall retain any moneys paid by the purchaser for
an advance payment contract that has been terminated in
accordance with this paragraph. Such moneys may be
transferred to the Florida Prepaid Tuition Scholarship
Program to provide matching funds for prepaid tuition
scholarships for economically disadvantaged youths who
remain drug free and crime free. In addition, such funds
may be used for any other scholarship programs approved
by the board under s. 1009.983(8)(b), provided that any
matching funds are obtained solely from the private
sector.
(l) Other terms and conditions deemed by the
board to be necessary or proper.
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(5) REFUNDS.--
(a) No refund shall exceed the amount paid into the
fund by the purchaser except as provided in paragraphs
(b) and (c).
(b) If the beneficiary is awarded
a scholarship, the terms of which cover the benefits
included in the advance payment contracts, moneys paid
for the purchase of the advance payment contracts shall
be refunded to the purchaser in semester installments
coinciding with the tuition by the beneficiary in an
amount which, in total, does not exceed the redemption
value of the advance payment contract at a state
postsecondary institution.
(c) In the event of
the death or total disability of the beneficiary, moneys
paid for the purchase of advance payment contracts shall
be refunded to the purchaser in an amount not to exceed
the redemption value of the advance payment contract at
a state postsecondary institution.
(d) If an
advance payment contract is converted from one
registration plan to a plan of lesser value, the amount
refunded shall not exceed the difference between the
amount paid for the original contract and the amount
that would have been paid for the contract to which the
plan is converted had the converted plan been purchased
under the same payment plan at the time the original
advance payment contract was executed.
(e) No
refund shall be authorized through an advance payment
contract for any school year partially attended but not
completed. For purposes of this section, a school year
partially attended but not completed shall mean any one
semester whereby the student is still enrolled at the
conclusion of the official drop-add period but withdraws
before the end of such semester. If a beneficiary does
not complete a community college plan or university plan
for reasons other than specified in paragraph (c), the
purchaser shall receive a refund of the amount paid into
the fund for the remaining unattended years of the
advance payment contract pursuant to rules promulgated
by the board.
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(6) CONFIDENTIALITY OF ACCOUNT
INFORMATION.--Information that identifies the
purchasers or beneficiaries of any plan promulgated
under this section and their advance payment account
activities is exempt from the provisions of s.
119.07(1). However, the board may authorize the
program's records administrator to release such
information to a community college, college, or
university in which a beneficiary may enroll or is
enrolled. Community colleges, colleges, and universities
shall maintain such information as exempt from the
provisions of s. 119.07(1).
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(7) OBLIGATIONS OF BOARD.--The state
shall agree to meet the obligations of the board to
qualified beneficiaries if moneys in the fund fail to
offset the obligations of the board. The Legislature
shall appropriate to the Florida Prepaid College Trust
Fund the amount necessary to meet the obligations of the
board to qualified beneficiaries.
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(8) PROGRAM TERMINATION.--In the
event that the state determines the prepaid program to
be financially infeasible, the state may discontinue the
provision of the program. Any qualified beneficiary who
has been accepted by and is enrolled or is within 5
years of enrollment in an eligible independent college
or university or state postsecondary institution shall
be entitled to exercise the complete benefits for which
he or she has contracted. All other contract holders
shall receive a refund of the amount paid in and an
additional amount in the nature of interest at a rate
that corresponds, at a minimum, to the prevailing
interest rates for savings accounts provided by banks
and savings and loan associations.
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(9) SCHOLARSHIPS.--A nonprofit
organization described in s. 501(c)(3) of the United
States Internal Revenue Code and exempt from taxation
under s. 501(a) of the United States Internal Revenue
Code may purchase advance payment contracts for a
scholarship program that has been approved by the board
and is operated by the purchasing organization.
History.--s. 488, ch. 2002-387; s. 126, ch. 2004-357;
s. 3, ch. 2006-303; s. 3, ch. 2007-225.
1Note.--Redesignated as
subsections (9)-(12) by s. 133, ch. 2007-217.
2Note.--Tuition differential
is covered in s. 1009.24(16).
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1009.981
Florida College Savings Program.--
(1)(a) The Florida Prepaid College Board is
authorized to create, establish, and administer the
Florida College Savings Program to promote and enhance
the affordability of higher education in the state and
to enable persons to contribute funds that are combined
and invested to pay the subsequent higher education
expenses of a designated beneficiary. The board may not
implement the savings program until it has obtained:
1. A written opinion from counsel specializing in
federal tax matters indicating that the savings program
constitutes a qualified tuition program under s. 529 of
the Internal Revenue Code;
2. A written opinion from
a qualified member of the United States Patent Bar
indicating that the implementation of the savings
program or the operation of the savings program will not
knowingly infringe upon any patent or copyright
specifically related to the financing of higher
education expenses;
3. A written opinion of
qualified counsel specializing in federal securities law
that the savings program and the offering of
participation in the savings program does not violate
federal securities law; and
4. A written opinion
from the board's litigation counsel indicating that the
implementation or operation of the savings program will
not adversely impact any pending litigation against the
board.
(b) The benefactor retains ownership of all
amounts on deposit in his or her account with the
savings program up to the date of distribution on behalf
of a designated beneficiary. Earnings derived from
investment of the contributions shall be considered to
be held in trust in the same manner as contributions,
except as applied for purposes of the designated
beneficiary and for purposes of maintaining and
administering the program as provided in this section.
(c) All amounts attributable to penalties shall be
used for purposes of the savings program or as required
by the Internal Revenue Code, and other amounts received
other than contributions shall be properties of the
savings program. Proceeds from penalties shall remain
with the program and may be used for any costs or
purposes of the savings program or used as required by
the Internal Revenue Code.
(d) Deposits and
contributions to the program, the property of the board,
and the earnings on the college savings accounts are
exempt from taxation.
(e) The assets of the savings
program shall be continuously invested and reinvested in
a manner consistent with the purposes of the program,
expended on expenses incurred by the operation and
management of the savings program, or refunded to the
benefactor or designated beneficiary under the
conditions provided in the participation agreement. The
board is not required to invest directly in obligations
of the state or any political subdivision of the state
or in any investment or other fund administered by the
state.
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(2) PARTICIPATION AGREEMENTS.--
(a) The board may establish plans to permit
benefactors to prepay the qualified higher education
expenses associated with enrollment in an eligible
educational institution and may permit benefactors to
select from among alternative investment plans designed
to provide funds to pay qualified education expenses of
a designated beneficiary. The board shall not accept
contributions in excess of the amount allowed pursuant
to s. 529 of the Internal Revenue Code and shall
prescribe by rule the methodology and information
sources that shall be used to determine the projected
costs of qualified higher education expenses for
designated beneficiaries of prescribed ages.
(b) The board shall develop a participation
agreement which shall be the agreement between the board
and each benefactor, which may include, but is not
limited to:
1. The name, date of birth, and
social security number of the designated
beneficiary.
2. The amount of the contribution
or contributions and number of contributions required
from a benefactor on behalf of a designated
beneficiary.
3. The terms and conditions under
which benefactors shall remit contributions, including,
but not limited to, the date or dates upon which each
contribution is due. Deposits to the savings program by
benefactors may only be in cash. Benefactors may
contribute in a lump sum, periodically, in installments,
or through electronic funds transfer or employer payroll
deductions.
4. Provisions for late
contribution charges and for default.
5.
Provisions for penalty fees for withdrawals from the
program.
6. The name of the person who may
terminate participation in the program. The
participation agreement must specify whether the account
may be terminated by the benefactor, the designated
beneficiary, a specific designated person, or any
combination of these persons.
7. The terms and
conditions under which an account may be terminated,
modified, or converted, the name of the person entitled
to any refund due as a result of termination of the
account pursuant to such terms and conditions, and the
amount of refund, if any, due to the person so
named.
8. Penalties for distributions not used
or made in accordance with s. 529 of the Internal
Revenue Code.
9. Any charges or fees in
connection with the administration of the savings
fund.
10. The period of time after which each
participation agreement shall be considered to be
terminated. Time expended by a designated beneficiary as
an active duty member of any of the armed services of
the United States shall be added to the period specified
pursuant to this subparagraph. Should a participation
agreement be terminated, the balance of the account,
after notice to the benefactor, shall be declared
unclaimed and abandoned property. The board shall retain
any moneys paid by the benefactor for a participation
agreement that has been terminated in accordance with
this subparagraph. Such moneys may be transferred to the
Florida Prepaid Tuition Scholarship Program to provide
matching funds for prepaid tuition scholarships for
economically disadvantaged youths who remain drug free
and crime free.
11. Other terms and conditions
deemed by the board to be necessary or proper.
(c) The participation agreement shall clearly state
that:
1. The contract is only a debt or
obligation of the savings program and the savings fund,
and is not otherwise a debt or obligation of the
state.
2. Participation in the program does
not guarantee that sufficient funds will be available to
cover all qualified higher education expenses for any
designated beneficiary and does not guarantee admission
to or continued enrollment at an eligible educational
institution of any designated beneficiary.
(d)
The participation agreement may be freely amended
throughout its term for purposes including, but not
limited to, allowing to enable the benefactor to
increase or decrease the level of participation, change
designated beneficiaries, and carry out similar matters
permitted by this section and the Internal Revenue
Code.
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top)
(3) DISTRIBUTIONS FOR
QUALIFIED HIGHER EDUCATION EXPENSES.-- The
board shall establish requirements and procedures for
beneficiaries to realize the benefits of participation
agreements. In establishing such requirements and
procedures, the board shall make distributions in as
efficient and expeditious manner as is prudent and
possible, consistent with the Internal Revenue Code.
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(4) REFUNDS.--
(a) A
benefactor may request a refund of the principal amount
of his or her contributions, plus actual investment
earnings or minus actual investment losses on the
contributions, less any applicable penalty, and less any
amounts used to provide benefits to the designated
beneficiary.
(b) Notwithstanding paragraph
(a), a penalty may not be levied if a benefactor
requests a refund from the program due to:
1.
Death of the beneficiary.
2. Total disability
of the beneficiary.
3. Scholarship, allowance,
or payment received by the beneficiary to the extent
that the amount of the refund does not exceed the amount
of the scholarship, allowance, or payment in accordance
with federal law.
(c) If a benefactor requests
a refund of funds contributed to the program for any
cause other than those listed in paragraph (b), there
shall be imposed a penalty of 10 percent of the earnings
of the account and any applicable taxes, or the amount
required by the Internal Revenue Code. Earnings shall be
calculated as the total value of the participation
agreement, less the aggregate contributions, or in the
manner prescribed in the Internal Revenue Code.
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(5) MATERIAL MISREPRESENTATION;
PENALTY.--If the benefactor or the designated
beneficiary makes any material misrepresentation in the
application for a participation agreement or in any
communication with the board regarding the program,
especially regarding the withdrawal or distribution of
funds therefrom, the account may be involuntarily
liquidated by the board. If the account is so
liquidated, the benefactor is entitled to a refund,
subject to a 10-percent penalty or the amount required
by the Internal Revenue Code.
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(6) CONFIDENTIALITY OF ACCOUNT
INFORMATION.--Information that identifies the
benefactors or the designated beneficiary of any account
initiated under this section is confidential and exempt
from s. 119.07(1) and s. 24(a), Art. I of the State
Constitution. However, the board may authorize the
release of such information to a community college,
college, or university in which a designated beneficiary
may enroll or is enrolled. Community colleges, colleges,
and universities shall maintain the confidentiality of
such information.
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(7) OBLIGATIONS OF BOARD.--Any
contract or participation agreement entered into by or
any obligation of the board on behalf of and for the
benefit of the savings program does not constitute a
debt or obligation of the state but is an obligation of
the savings program. The state has no obligation to any
designated beneficiary or any other person as a result
of the savings program. The obligation of the savings
program is limited solely to those amounts deposited in
the savings fund. All amounts obligated to be paid from
the savings fund are limited to amounts available for
such obligation. The amounts on deposit in the savings
program may only be disbursed in accordance with the
provisions of this section.
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(8) PROGRAM TERMINATION.--The
savings program shall continue in existence until its
existence is terminated by law. If the state determines
that the savings program is financially infeasible, the
state may discontinue the savings program. Upon
termination of the savings program, all deposits shall
be returned to benefactors, to the extent possible, and
any unclaimed assets in the savings program may be
transferred to the Florida Prepaid Tuition Scholarship
Program to provide matching funds for prepaid tuition
scholarships for economically disadvantaged youths who
remain drug free and crime free.
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(9) STATE PLEDGE.--The state pledges
to benefactors and designated beneficiaries of the
savings program that the state will not limit or alter
the rights under this section which are vested in the
program until such obligations are met and discharged.
However, this subsection does not preclude such
limitation if adequate provision is made by law for the
protection of the benefactors and designated
beneficiaries pursuant to the obligations of the board,
and, if the state or the board determines that the
savings program is not financially feasible, the state
or the board may discontinue the program. If the program
is discontinued, the board shall refund to benefactors
their contributions to the program, plus any investment
earnings or minus any investment losses. The board, on
behalf of the state, may include this pledge and
undertaking by the state in participation agreements.
History.--s. 489, ch. 2002-387; s.
1, ch. 2005-130.
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1009.982 Disclaimer.--Nothing in ss.
1009.97-1009.984 shall be construed as a promise or
guarantee that a qualified beneficiary or a designated
beneficiary will be admitted to a state postsecondary
institution or to a particular state postsecondary
institution, will be allowed to continue enrollment at a
state postsecondary institution after admission, or will
be graduated from a state postsecondary institution.
History.--s. 490, ch. 2002-387.
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1009.983
Direct-support organization;
authority.--
(1) The Florida Prepaid College Board
may establish a direct-support organization which is:
(a) A Florida corporation, not for profit,
incorporated under the provisions of chapter 617 and
approved by the Secretary of State.
(b) Organized
and operated exclusively to receive, hold, invest, and
administer property and to make expenditures to or for
the benefit of the board.
(c) An organization which
the board, after review, has certified to be operating
in a manner consistent with the goals of the board and
in the best interests of the state. Unless so certified,
the organization may not use the name of the prepaid
program or savings program.
(2) The direct-support
organization shall operate under written contract with
the board. The contract must provide for:
(a)
Approval of the articles of incorporation and bylaws of
the direct-support organization by the board.
(b)
Submission of an annual budget for the approval of the
board. The budget must comply with rules adopted by the
board.
(c) Certification by the board that the
direct-support organization is complying with the terms
of the contract and in a manner consistent with the
goals and purposes of the board and in the best interest
of the state. Such certification must be made annually
and reported in the official minutes of a meeting of the
board.
(d) The reversion to the board, or to the
state if the board ceases to exist, of moneys and
property held in trust by the direct-support
organization for the benefit of the board or prepaid
program if the direct-support organization is no longer
approved to operate for the board or if the board ceases
to exist.
(e) The fiscal year of the direct-support
organization, which must begin July 1 of each year and
end June 30 of the following year.
(f) The
disclosure of material provisions of the contract and of
the distinction between the board and the direct-support
organization to donors of gifts, contributions, or
bequests, and such disclosure on all promotional and
fundraising publications.
(3) The direct-support
organization shall provide for an annual financial audit
in accordance with s. 215.981. The board and Auditor
General may require and receive from the organization or
its independent auditor any detail or supplemental data
relative to the operation of the organization.
(4)
The identity of donors who desire to remain anonymous
shall be confidential and exempt from the provisions of
s. 119.07(1) and s. 24(a), Art. I of the State
Constitution, and such anonymity shall be maintained in
the auditor's report. Information received by the
organization that is otherwise confidential or exempt by
law shall retain such status. Any sensitive, personal
information regarding contract beneficiaries, including
their identities, is exempt from the provisions of s.
119.07(1) and s. 24(a), Art. I of the State
Constitution.
(5) The chair and the executive
director of the board shall be directors of the
direct-support organization and shall jointly name, at a
minimum, three other individuals to serve as directors
of the organization.
(6) The board may authorize the
direct-support organization established in this section
to use board property, except money, and use facilities
and personal services subject to the provisions of this
section. If the direct-support organization does not
provide equal employment opportunities to all persons
regardless of race, color, religion, sex, age, or
national origin, it may not use the property,
facilities, or personal services of the board. For the
purposes of this section, the term "personal services"
includes full-time personnel and part-time personnel as
well as payroll processing as prescribed by rule of the
board. The board shall adopt rules prescribing the
procedures by which the direct-support organization is
governed and any conditions with which such a
direct-support organization must comply to use property,
facilities, or personal services of the board.
(7)
The board may invest funds of the direct-support
organization which have been allocated for the purchase
of advance payment contracts for scholarships with
receipts for advance payment contracts.
(8)(a) The
direct-support organization shall administer the Florida
Prepaid Tuition Scholarship Program pursuant to the
provisions of s. 1009.984.
(b) The board may
establish and administer additional scholarship programs
supported from escheated funds retained by the board
pursuant to s. 1009.972(5) provided that any matching
funds for such scholarships are obtained solely from the
private sector. The board shall develop criteria for
approval of additional scholarship programs supported
from escheated funds. The direct-support organization's
annual report shall include a list of any additional
scholarship programs approved by the board pursuant to
this subsection, including a description of the programs
and the amount of escheated funds utilized to fund the
programs.
History.--s. 491, ch. 2002-387; s.
4, ch. 2006-303.
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1009.984 Florida
Prepaid Tuition Scholarship Program.--The
Florida Prepaid Tuition Scholarship Program is
established to provide economically disadvantaged youth
with prepaid postsecondary tuition scholarships. The
direct-support organization established pursuant to s.
1009.983 shall administer the program with the
assistance and cooperation of the Department of
Education to:
(1) Provide an incentive for
economically disadvantaged youth to improve school
attendance and academic performance in order to graduate
and pursue a postsecondary education.
(2)
Obtain the commitment and involvement of private sector
entities by virtue of funding matches with a ratio of 50
percent provided by the private sector and 50 percent
provided by the state.
(3) Purchase prepaid
tuition scholarships for students certified by the
Department of Education to the direct-support
organization who meet minimum economic and school
requirements and remain drug free and crime free.
(a) For the purpose of this subsection, "drug free"
means not being convicted of, or adjudicated delinquent
for, any violation of chapter 893 after being designated
a recipient of a Florida prepaid tuition
scholarship.
(b) For the purpose of this
subsection, "crime free" means not being convicted of,
or adjudicated delinquent for, any felony or first
degree misdemeanor as defined in ss. 775.08 and 775.081
after being designated a recipient of a Florida prepaid
tuition scholarship.
History.--s. 492, ch.
2002-387.
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