Oct
30
Written by:
Andy Hogue
10/30/2009 3:01 PM
Comptroller Susan Combs announced her plans to recommend that no changes be made to the refund policy of a state-run college tuition savings and discount plan.
Combs previously said she felt that the Texas Guaranteed Tuition Plan (TGTP) was on the road to insolvency -- with a projected $1.7-2.1 billion in the hole as early as 2015. Combs said she plans to suggest to the Texas Prepaid Higher Education Board (which oversees the fund) on Nov. 5 that the former refund policy be retained. Previously, Combs recommended that refunds for cancelled contracts be limited.
If the board adopts Combs’ recommendation, families will no longer need to decide by Nov. 30 whether to cancel their contract in order to receive tuition-based earnings, the Comptroller's press release said. Combs also plans to present recommendations to allow families who cancelled contracts during an ongoing opt-out period to resume their contracts if they so choose.
“A recent decision to limit refunds for cancelled contracts was due to a grave concern over the solvency of the TGTP and my commitment to fiscal responsibility," Combs said. "At the same time, I have listened to the concerns of legislators and contract-holders, and I am recommending any changes to the program be postponed until the Legislature convenes in 2011.”
Combs said she had been advising state leaders on a coming shortfall since 2007.
“I am very pleased by the interest and attention shown by legislators and their willingness to address the financial stability of the guaranteed tuition plan,” Combs said. “I ask that the Legislature conduct an interim study of the projected $1.7 billion-$2.1 billion shortfall, which may start to appear as soon as 2015. This is an issue that should be addressed sooner than later, and I believe the Legislature needs to start funding the plan in 2011 to fix the projected plan deficit.”