GUARANTEE SOUGHT FOR CURRENT CONTRACTS

Democrats aim to protect prepaid tuition


Published: Thursday, January 15, 2004 at 6:01 a.m.
Last Modified: Thursday, January 15, 2004 at 12:29 a.m.

Facts

FYI: PROGRAM

  • To date, 925,000 contracts have been sold and 660,00 children enrolled in the prepaid tuition program.
  • State Rep. Ken Gottlieb said Wednesday the program's reserves shrunk from $369 million a year ago to $169 million this year because of sharp tuition increases.

  • TALLAHASSEE - The highly popular prepaid tuition program in Florida is in trouble, and House Democrats said Wednesday they want the Republican-led Legislature to guarantee its solvency for all contract owners.
    The Florida Prepaid College Plan, created in 1988, allows parents to save for their children's college by paying affordable monthly premiums. Parents can choose to purchase a two-year community college education, a four-year university education, or a combination of the two.
    To date, 925,000 contracts have been sold and 660,00 children enrolled, a prepaid spokesman said Wednesday.
    But sharp tuition increases recently have cut into the program's effectiveness and threaten its future viability. The Legislature has been reluctant to shore up the program while allowing the state's 11 public universities to pass on double-digit tuition increases.
    State Rep. Ken Gottlieb said Wednesday the program's reserves shrunk from $369 million a year ago to $169 million this year because of sharp tuition increases.
    The Miramar Democrat wants the Legislature to guarantee current enrollees will get the benefit they sought when they agreed to buy the contracts. "This simply gives parents a level of certainty that their child can go to college," he said.
    And Tuesday, Florida's university presidents continued to press for controlling tuition rates during a workshop held by the House Education Appropriations Committee.
    Stanley Tate, chairman of the prepaid tuition program, said increases over 6 percent threaten the viability of the program.
    "We're part of the problem up here," conceded Rep. Ron Greenstein, D-Coconut Creek. "We need to be more of the cure."
    The Florida plan is managed by private money managers but it is financially guaranteed by the state.

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