Senate Bill 0130er

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  2         An act relating to postsecondary education;

  3         amending s. 240.551, F.S.; providing for the

  4         transfer of Florida Prepaid College Program

  5         benefits to certain applied technology diploma

  6         programs and vocational certificate programs;

  7         requiring the direct-support organization to

  8         operate under written contract with the board;

  9         providing contract requirements; requiring an

10         annual financial and compliance audit; allowing

11         the Florida Prepaid College Board to permit

12         direct-support organizations established under

13         this section to use the property, facilities,

14         and personal services of the board; providing

15         for such direct-support organizations to invest

16         funds with the moneys invested under the

17         Florida Prepaid College Trust Fund; amending s.

18         240.553(20), F.S.; modifying the type of legal

19         counsel required prior to implementing the

20         program; providing an effective date.

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22  Be It Enacted by the Legislature of the State of Florida:

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24         Section 1.  Subsections (10) and (22) of section

25  240.551, Florida Statutes, are amended to read:

26         240.551  Florida Prepaid College Program.--

27         (10)  TRANSFER OF BENEFITS TO PRIVATE AND OUT-OF-STATE

28  COLLEGES AND UNIVERSITIES AND TO AREA TECHNICAL CENTERS.--A

29  qualified beneficiary may apply the benefits of an advance

30  payment contract toward:

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  1         (a)  A qualified beneficiary may apply a community

  2  college plan, university plan, or dormitory residence plan

  3  toward Any eligible independent college or university. An

  4  independent college or university that which is located and

  5  chartered in Florida, that is not for profit, that is

  6  accredited by the Commission on Colleges of the Southern

  7  Association of Colleges and Schools or the Accrediting

  8  Commission of the Association of Independent Colleges and

  9  Schools, and that which confers degrees as defined in s.

10  246.021, is shall be eligible for such application. The board

11  shall transfer, or cause to have transferred, to the eligible

12  independent college or university designated by the qualified

13  beneficiary an amount not to exceed the redemption value of

14  the advance payment contract within a state postsecondary

15  institution. If In the event that the cost of registration or

16  housing fees at the independent college or university is less

17  than the corresponding fees at a state postsecondary

18  institution, the amount transferred shall not exceed the

19  actual cost of registration or housing fees. A No transfer

20  authorized under pursuant to this paragraph may not shall

21  exceed the number of semester credit hours or semesters of

22  dormitory residence contracted on behalf of a qualified

23  beneficiary.

24         (b)  A qualified beneficiary may apply the benefits of

25  an advance payment contract toward An eligible out-of-state

26  college or university. An out-of-state college or university

27  that which is not for profit and is accredited by a regional

28  accrediting association, and that which confers baccalaureate

29  degrees, is shall be eligible for such application. The board

30  shall transfer, or cause to have transferred, an amount not to

31  exceed the redemption value of the advance payment contract or


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  1  the original purchase price plus 5 percent compounded

  2  interest, whichever is less, after assessment of a reasonable

  3  transfer fee. If In the event that the cost of registration or

  4  housing fees charged the qualified beneficiary at the eligible

  5  out-of-state college or university is less than this

  6  calculated amount, the amount transferred shall not exceed the

  7  actual cost of registration or housing fees. Any remaining

  8  amount shall be transferred in subsequent semesters until the

  9  transfer value is depleted. A No transfer authorized under

10  pursuant to this paragraph may not shall exceed the number of

11  semester credit hours or semesters of dormitory residence

12  contracted on behalf of a qualified beneficiary.

13         (c)  An applied technology diploma program or

14  vocational certificate program conducted by a community

15  college listed in s. 240.3031 or an area technical center

16  operated by a district school board. The board shall transfer

17  or cause to be transferred to the community college or area

18  technical center designated by the qualified beneficiary an

19  amount not to exceed the redemption value of the advance

20  payment contract within a state postsecondary institution. If

21  the cost of the fees charged by the college or center, as

22  authorized in s. 239.117, is less than the corresponding fees

23  at a state postsecondary institution, the amount transferred

24  may not exceed the actual cost of the fees. A transfer

25  authorized under this paragraph may not exceed the number of

26  semester credit hours contracted on behalf of a qualified

27  beneficiary.

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29  Notwithstanding any other provision in this section, an

30  institution must be an "eligible educational institution"

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  1  under section 529 of the Internal Revenue Code to be eligible

  2  for the transfer of advance payment contract benefits.

  3         (22)  DIRECT-SUPPORT ORGANIZATION; AUTHORITY.--

  4         (a)  The board may establish a direct-support

  5  organization which is:

  6         1.  A Florida corporation, not for profit, incorporated

  7  under the provisions of chapter 617 and approved by the

  8  Secretary of State.

  9         2.  Organized and operated exclusively to receive,

10  hold, invest, and administer property and to make expenditures

11  to or for the benefit of the program.

12         3.  An organization which the board, after review, has

13  certified to be operating in a manner consistent with the

14  goals of the program and in the best interests of the state.

15  Unless so certified, the organization may not use the name of

16  the program.

17         4.  Subject to an annual postaudit by an independent

18  certified public accountant in accordance with rules

19  promulgated by the board. The annual audit shall be submitted

20  to the State Board of Administration and the Auditor General

21  for review. The State Board of Administration and Auditor

22  General shall have the authority to require and receive from

23  the organization or its independent auditor any detail or

24  supplemental data relative to the operation of the

25  organization.

26         (b)  The direct-support organization shall operate

27  under written contract with the board. The contract must

28  provide for:

29         1.  Approval of the articles of incorporation and

30  bylaws of the direct-support organization by the board.

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  1         2.  Submission of an annual budget for the approval of

  2  the board. The budget must comply with rules adopted by the

  3  board.

  4         3.  An annual financial and compliance audit of its

  5  financial accounts and records by an independent certified

  6  public accountant in accordance with rules adopted by the

  7  board.

  8         4.  Certification by the board that the direct-support

  9  organization is complying with the terms of the contract and

10  in a manner consistent with the goals and purposes of the

11  board and in the best interest of the state. Such

12  certification must be made annually and reported in the

13  official minutes of a meeting of the board.

14         5.  The reversion to the board, or to the state if the

15  board ceases to exist, of moneys and property held in trust by

16  the direct-support organization for the benefit of the board

17  or program if the direct-support organization is no longer

18  approved to operate for the board or if the board ceases to

19  exist.

20         6.  The fiscal year of the direct-support organization,

21  which must begin July 1 of each year and end June 30 of the

22  following year.

23         7.  The disclosure of material provisions of the

24  contract and of the distinction between the board and the

25  direct-support organization to donors of gifts, contributions,

26  or bequests, and such disclosure on all promotional and

27  fundraising publications.

28         (c)  An annual financial and compliance audit of the

29  financial accounts and records of the direct-support

30  organization must be performed by an independent certified

31  public accountant. The audit must be submitted to the board


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  1  for review and approval. Upon approval, the board shall

  2  certify the audit report to the Auditor General for review.

  3  The board and Auditor General shall have the authority to

  4  require and receive from the organization or its independent

  5  auditor any detail or supplemental data relative to the

  6  operation of the organization.

  7         (d)  The identity of donors who desire to remain

  8  anonymous shall be confidential and exempt from the provisions

  9  of s. 119.07(1) and s. 24(a), Art. I of the State

10  Constitution, and such anonymity shall be maintained in the

11  auditor's report. Information received by the organization

12  that is otherwise confidential or exempt by law shall retain

13  such status. Any sensitive, personal information regarding

14  contract beneficiaries, including their identities, is exempt

15  from the provisions of s. 119.07(1) and s. 24(a), Art. I of

16  the State Constitution.

17         (e)(b)  The chair and the executive director of the

18  board shall be directors of the direct-support organization

19  and shall jointly name three other individuals to serve as

20  directors of the organization.

21         (f)  The board may authorize the direct-support

22  organization established in this subsection to use program

23  property, except money, and use facilities and personal

24  services subject to the provisions of this section. If the

25  direct-support organization does not provide equal employment

26  opportunities to all persons regardless of race, color,

27  religion, sex, age, or national origin, it may not use the

28  property, facilities, or personal services of the board. For

29  the purposes of this subsection, the term "personal services"

30  includes full-time personnel and part-time personnel as well

31  as payroll processing as prescribed by rule of the board. The


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  1  board shall adopt rules prescribing the procedures by which

  2  the direct-support organization is governed and any conditions

  3  with which such a direct-support organization must comply to

  4  use property, facilities, or personal services of the board.

  5         (g)  The board may invest funds of the direct-support

  6  organization which have been allocated for the purchase of

  7  advance payment contracts for scholarships with receipts for

  8  advance payment contracts.

  9         Section 2.  Subsection (20) of section 240.553, Florida

10  Statutes, is amended to read:

11         240.553  Florida College Savings Program.--

12         (20)  PROGRAM IMPLEMENTATION

13  RESTRICTIONS.--Implementation of the program may not begin

14  until the board has received the following:

15         (a)  A favorable written and unqualified opinion from

16  counsel specializing in federal tax matters indicating that

17  the program constitutes a qualified state tuition program

18  under s. 529 of the Internal Revenue Code;

19         (b)  A written and unqualified opinion from a qualified

20  member of the United States Patent Bar indicating that the

21  implementation of the program or the operation of the program

22  will not knowingly infringe upon any patent or copyright

23  specifically related to the financing of higher education

24  expenses;

25         (c)  A written and unqualified opinion of qualified

26  counsel specializing in federal securities law that the

27  program and the offering of participation in the program does

28  are not violate subject to federal securities law; and

29         (d)  A written and unqualified opinion from the board's

30  litigation counsel indicating that the implementation or

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  1  operation of the program will not adversely impact any pending

  2  litigation against the board.

  3         Section 3.  This act shall take effect July 1, 2000.

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