MPACT Still in Financial Hole

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Jackson, Miss. Members of the College Savings Board say there's no clear way for the Mississippi Prepaid Affordable College Tuition program to get out of its financial hole.

The program was frozen more than a year ago by State Treasurer Lynn Fitch.

Some board members want it reopened but only if it's sustainable.

“It was certainly a great opportunity 15 years ago but now, as we've seen, sustainability, recession, economic factors have caused some of them to close,” said Fitch.

The deficit sits at $82 million. During the College Savings Board's meeting they offered up a new idea of using money from unclaimed properties to help close that gap.

“I think we ought to look at that," said board member Dr. Eric Clark. "I think that is the best idea I've heard about how to cover the deficit, how to dig us out of the hole.”

If re-opened the cost for a new contract could go up by at least 20 percent. The concern for some board members then becomes, can you afford it?

“Many times that's what happens," said Fitch. "You price it out so high that you don't have any participants.”

College costs more money now. Pricing for the plans would have to reflect that.

The board voted to ask the auditing company for more details on how much they'd have to charge to avoid future deficits.

“A lot of this was baked into the cake, like I said. Some of the assumptions from the get-go lead us to where we are today,” said board member Cory Wilson.

Fitch pushed for board members to remember there are other options out there. The state currently offers other plans that let families put away for college in smaller amounts tax-free.

“If you're trying to reach the children of Mississippi, we've got to look at ways like the 529 Plan, the MACS plan that gives us the opportunity to really outreach,” Fitch said.

The board plans to meet again next month to get a more detailed look at pricing options. It wants to have recommendations ready for the legislature's return in January 2014.