SELECTION OF FINANCIAL INSTITUTION AS PLAN MANAGER.

(a) The board shall contract with one or more financial institutions to serve as plan manager and to invest the money in savings trust accounts. The board shall ensure that investments by a plan manager are made with the judgment and care that persons of prudence, discretion, and intelligence exercise in the management of the property of another, not in regard to speculation but in regard to the permanent disposition of funds, considering the probable income as well as the probable safety of capital.

(b) The board shall solicit proposals from financial institutions to serve as plan managers.

(c) The board shall select a plan manager or managers from among bidding financial institutions that demonstrate the most advantageous combination to account owners and beneficiaries, based on the following factors:

(1) financial stability and integrity;

(2) the ability of the financial institution, directly or through a subcontract, to satisfy recordkeeping and reporting requirements;

(3) the financial institution's strategy for promoting the plan and the investment that the financial institution is willing to make to promote the plan;

(4) the historic ability of the portfolios or investment strategies to be used by the financial institution to track the estimated costs of higher education as calculated by the United States Department of Education;

(5) the fees, if any, proposed to be charged to account owners for maintaining accounts;

(6) the minimum contributions that the financial institution will require and the willingness of the financial institution to accept contributions through payroll deduction plans or systematic deposit plans; and

(7) any other proposed benefits to this state or to its residents.

(d) The board may require that any financial institution selected provide several investment options to account owners, taking into consideration the age of the beneficiary and the number of years remaining until likely enrollment at an eligible educational institution. To the extent permitted by federal law, the investment options may include mutual funds, fixed annuities, variable annuities, and variable life insurance policies.