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.

(2) PREPAID COLLEGE PLANS.—At a minimum, the board shall make advance payment contracts available for two independent plans to be known as the Florida College System institution 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 Florida College System institution 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 Florida College System institution plan, the advance payment contract may 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. Florida College System institution 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, 2009, the board may offer an advance payment contract for the Florida College System institution plan covering prepaid registration fees and the fees authorized in s. 1009.23. Such a contract may be offered in specific increments for use toward an associate degree. The total number of hours purchased for a qualified beneficiary may not exceed the average number of hours required for the conference of an associate degree.

(b)1. Through the university plan, the advance payment contract may 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 s. 1009.24(9)-(12), 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 s. 1009.24(16) 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.

4. Effective July 1, 2009, the board may offer an advance payment contract for the university plan covering prepaid registration fees, the fees authorized in s. 1009.24(9)-(12), and the tuition differential authorized in s. 1009.24(16). Such a contract may be offered in specific increments for use toward a baccalaureate degree. The total number of hours purchased for a qualified beneficiary may not exceed the average number of hours required for the conference of a baccalaureate degree.

(c) The cost of participation in contracts authorized under paragraph (a) or paragraph (b) shall be based primarily on the current and projected fees included in the plan within the Florida College System or the State University System, respectively, the number of credit hours or semesters included in the plan, 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)1. 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 is admitted to the state university and finds housing with a qualified nonprofit organization, as defined in subparagraph 2., that is approved by the state university, the state university may transfer or cause to have transferred to the qualified nonprofit organization the fees associated with dormitory residence. If a qualified beneficiary fails to be admitted to a state university or chooses to attend a Florida College System institution that operates one or more dormitories or residency opportunities, or has one or more dormitories or residency opportunities operated by the Florida College System institution direct-support organization, the qualified beneficiary may transfer or cause to have transferred to the Florida College System institution, or Florida College System institution direct-support organization, the fees associated with dormitory residence. If a qualified beneficiary attends a Florida College System institution and finds housing with a qualified nonprofit organization, as defined in subparagraph 2., that is approved by the Florida College System institution, the Florida College System institution may transfer or cause to have transferred to the qualified nonprofit organization the fees associated with dormitory residence. Dormitory fees transferred to a Florida College System institution, Florida College System institution direct-support organization, or qualified nonprofit organization may not exceed the average fees charged for state university dormitory residence for the purposes of this section, or the fees charged for Florida College System institution or Florida College System institution direct-support organization dormitories or residency opportunities, whichever is less.

2. For purposes of this paragraph, the term “qualified nonprofit organization” means a nonprofit organization under s. 501(c)(3) of the United States Internal Revenue Code which provides one or more dormitories or residency opportunities to students enrolled full-time in a state university or Florida College System institution, primarily supports students that lack financial resources, and has been approved by the board for inclusion in the plan.

(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 any eligible educational institution as defined in s. 529 of the Internal Revenue Code. 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. Any advertisement disseminated by a for-profit educational institution which references the Stanley G. Tate Florida Prepaid College Program shall clearly state the following: “While the benefits of the Florida Prepaid College contract may be used at this institution, the Florida Prepaid College Board does not endorse any particular educational institution.”

(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.

(5) REFUNDS.—

(a) A refund may not exceed the amount paid into the fund by the purchaser except as provided in paragraphs (b), (c), and (f).

(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 may 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) A refund may not 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 Florida College System institution 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.

(f) A purchaser of an advance payment contract entered into pursuant to subsection (9) or s. 1009.983 may receive a refund equal to the redemption value of the unused portion of the advance payment contract at a state postsecondary institution if the refund is used exclusively to fund additional scholarships purchased pursuant to subsection (9) or s. 1009.983.

(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 Florida College System institution, college, or university in which a beneficiary may enroll or is enrolled. Florida College System institutions, colleges, and universities shall maintain such information as exempt from the provisions of s. 119.07(1).

(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.

(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.

(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.

(10) PAYMENTS ON BEHALF OF QUALIFIED BENEFICIARIES.—

(a) As used in this subsection, the term:

1. “Actuarial reserve” means the amount by which the expected value of the assets exceeds the expected value of the liabilities of the trust fund.

2. “Dormitory fees” means the fees included under advance payment contracts pursuant to paragraph (2)(d).

3. “Fiscal year” means the fiscal year of the state pursuant to s. 215.01.

4. “Local fees” means the fees covered by an advance payment contract provided pursuant to subparagraph (2)(b)2.

5. “Tuition differential” means the fee covered by advance payment contracts sold pursuant to subparagraph (2)(b)3.

(b) Effective with the 2022-2023 academic year and thereafter, and notwithstanding s. 1009.24, the amount paid by the board to any state university on behalf of a qualified beneficiary of an advance payment contract whose contract was purchased before July 1, 2034, shall be:

1. As to registration fees, if the actuarial reserve is less than 5 percent of the expected liabilities of the trust fund, the board shall pay the state universities 5.5 percent above the amount assessed for registration fees in the preceding fiscal year. If the actuarial reserve is between 5 percent and 6 percent of the expected liabilities of the trust fund, the board shall pay the state universities 6 percent above the amount assessed for registration fees in the preceding fiscal year. If the actuarial reserve is between 6 percent and 7.5 percent of the expected liabilities of the trust fund, the board shall pay the state universities 6.5 percent above the amount assessed for registration fees in the preceding fiscal year. If the actuarial reserve is equal to or greater than 7.5 percent of the expected liabilities of the trust fund, the board shall pay the state universities 7 percent above the amount assessed for registration fees in the preceding fiscal year, whichever is greater.

2. As to the tuition differential, if the actuarial reserve is less than 5 percent of the expected liabilities of the trust fund, the board shall pay the state universities 5.5 percent above the amount assessed for the tuition differential fee in the preceding fiscal year. If the actuarial reserve is between 5 percent and 6 percent of the expected liabilities of the trust fund, the board shall pay the state universities 6 percent above the amount assessed for the tuition differential fee in the preceding fiscal year. If the actuarial reserve is between 6 percent and 7.5 percent of the expected liabilities of the trust fund, the board shall pay the state universities 6.5 percent above the amount assessed for the tuition differential fee in the preceding fiscal year. If the actuarial reserve is equal to or greater than 7.5 percent of the expected liabilities of the trust fund, the board shall pay the state universities 7 percent above the amount assessed for the tuition differential fee in the preceding fiscal year.

3. As to local fees, the board shall pay the state universities 5 percent above the amount assessed for local fees in the preceding fiscal year.

4. As to dormitory fees, the board shall pay the state universities 6 percent above the amount assessed for dormitory fees in the preceding fiscal year.

5. Qualified beneficiaries of advance payment contracts purchased before July 1, 2007, are exempt from paying any tuition differential fee.

(c) Notwithstanding the amount assessed for registration fees, the tuition differential, or local fees, the amount paid by the board to any state university on behalf of a qualified beneficiary of an advance payment contract purchased before July 1, 2034, may not exceed 100 percent of the amount charged by the state university for the aggregate sum of those fees.

(d) Notwithstanding the amount assessed for dormitory fees, the amount paid by the board to any state university on behalf of a qualified beneficiary of an advance payment contract purchased before July 1, 2034, may not exceed 100 percent of the amount charged by the state university for dormitory fees.

(e) Notwithstanding the number of credit hours used by a state university to assess the amount for registration fees, tuition, tuition differential, or local fees, the amount paid by the board to any state university on behalf of a qualified beneficiary of an advance payment contract purchased before July 1, 2034, may not exceed the number of credit hours taken by that qualified beneficiary at the state university.

(f) The board shall pay state universities the actual amount assessed in accordance with law for registration fees, the tuition differential, local fees, and dormitory fees for advance payment contracts purchased on or after July 1, 2034.

(g) The board shall annually evaluate or cause to be evaluated the actuarial soundness of the trust fund.

(11) IMPLEMENTATION PROCEDURES.—

(a) A prepaid college plan may be purchased, accounted for, used, and terminated as provided in s. 1002.394.

(b) A qualified beneficiary may apply the benefits of an advance payment contract toward the program fees of a program designed for students with disabilities conducted by a state postsecondary institution. A transfer authorized under this subsection may not exceed the redemption value of the advance payment contract at a state postsecondary institution or the number of semester credit hours contracted on behalf of a qualified beneficiary. A qualified beneficiary may not be changed while a prepaid college plan contains funds contributed under s. 1002.394.