The PACT Board voted May 20 to pay fall and spring tuition for program participants and adopted a resolution to conduct a financial study.
This decision affects the 48,000 participants in the PACT Program.
The program has lost over half of its worth in the stock market, but still has enough to cover the 58 to 68 million dollars required to pay tuition for the next year and to reimburse the initial investment of all participants.
The Retirement Systems of Alabama is conducting a study to determine a source for future funding.
This study will be presented to Gov. Bob Riley and the Alabama Legislature within 30 to 45 days.
The main decision affecting current PACT participants is whether to remove their money from the program and reinvest elsewhere, or to stick with the program and hope for funding
If participants remove their money, they will get their initial investment plus one percent interest and minus some fees.
This may benefit those who have recently invested, but would be detrimental to people who invested many years ago and who now have students close to college age.
Patti Lambert, founder of the Save the Alabama PACT group, encourages people to leave their money in the program. "The least you will get is what you paid in, and if you leave it in, you may get an education." Lambert said.
Lambert said the challenge facing the Legislature is determining a way to pay the tuition of 48,000 participants.
She has already begun hearing stories from students who will be unable to stay class if PACT falls through.
"It would put a huge strain on my family if PACT did not pay," said Amanda Harbison, senior in animal sciences/muscle foods. "It was my Grandmom's inheritance that paid for the program and I need two more years of tuition. It would be unfair if my parents paid the money and then their kids were not able to use it."
Lambert sees the only way to obtain legislative support and funding for the program is to sign up huge numbers of people to Save the Alabama PACT.
She encourages people to sign up to the Facebook group, Save Alabama PACT.
Lambert said that "baby steps" have been made as "talk about closing it down (has changed) to positively funding through spring."
Though the future of PACT still hangs in the balance, she is encouraged by the progress made so far.
"It is not fair for equal students to pay different amounts," said Mike Reynolds, director of student financial services at Auburn University.
The goal of the independent study is to indicate, with a reliable range of numbers, what it would take to bail out the program. This solution will be brought before the Legislature during the 2010 session beginning in January.
Riley has said he will call a special session if the legislators can assure him that a consensus has been reached and legislation putting this solution into practice will be passed.
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