| 1 | A bill to be entitled |
| 2 | An act relating to prepaid college board programs; |
| 3 | amending s. 1009.971, F.S.; providing that the Florida |
| 4 | Prepaid College Board shall have the power to provide for |
| 5 | the transfer of ownership of an advance payment contract |
| 6 | under the Florida Prepaid College Program or a |
| 7 | participation agreement under the Florida College Savings |
| 8 | Program upon inheritance, devise, or bequest; providing |
| 9 | procedures and requirements with respect to such transfer |
| 10 | of ownership; providing for specification of application |
| 11 | contents by rule; providing applicability; amending ss. |
| 12 | 1009.972, 1009.98, and 1009.981, F.S.; authorizing the |
| 13 | transfer of funds retained from terminated advance payment |
| 14 | contracts, canceled contracts, and terminated |
| 15 | participation agreements to the direct-support |
| 16 | organization established under pt. IV of ch. 1009, F.S., |
| 17 | for use by the Florida Prepaid Tuition Scholarship Program |
| 18 | and for children of specified members of the armed forces |
| 19 | of the United States who die while participating in the |
| 20 | combat theater of operations for Operation Iraqi Freedom |
| 21 | or Operation Enduring Freedom; providing an effective |
| 22 | date. |
| 23 |
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| 24 | Be It Enacted by the Legislature of the State of Florida: |
| 25 |
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| 26 | Section 1. Paragraph (z) is added to subsection (4) of |
| 27 | section 1009.971, Florida Statutes, to read: |
| 28 | 1009.971 Florida Prepaid College Board.-- |
| 29 | (4) FLORIDA PREPAID COLLEGE BOARD; POWERS AND DUTIES.--The |
| 30 | board shall have the powers and duties necessary or proper to |
| 31 | carry out the provisions of ss. 1009.97-1009.984, including, but |
| 32 | not limited to, the power and duty to: |
| 33 | (z) Provide for the transfer of ownership of an advance |
| 34 | payment contract or a participation agreement by operation of |
| 35 | law upon inheritance, devise, or bequest. An heir of a deceased |
| 36 | purchaser or a deceased benefactor may make an application to |
| 37 | the board under oath for a change in the purchaser or benefactor |
| 38 | and, upon receipt of a completed application, the board may |
| 39 | change the ownership of the advance payment contract or |
| 40 | participation agreement, as appropriate, to the heir. The board |
| 41 | shall specify by rule the information that must be included in |
| 42 | the application. When the application is made by an heir of a |
| 43 | deceased purchaser or deceased benefactor who died intestate, it |
| 44 | shall not be necessary to accompany the application with an |
| 45 | order of a probate court if the heir files with the board an |
| 46 | affidavit stating that the estate is not indebted and the |
| 47 | surviving spouse, if any, and the heirs, if any, have amicably |
| 48 | agreed among themselves upon a division of the estate. If the |
| 49 | deceased purchaser or deceased benefactor died testate, the |
| 50 | application shall be accompanied by a certified copy of the |
| 51 | will, if probated, and an affidavit stating that the estate is |
| 52 | solvent with sufficient assets to pay all just claims or, if the |
| 53 | will is not being probated, by a sworn copy of the will and an |
| 54 | affidavit stating that the estate is not indebted. Upon the |
| 55 | approval by the board of an application from an heir, the heir |
| 56 | shall become the purchaser of the advance payment contract or |
| 57 | the benefactor of the participation agreement. This subsection |
| 58 | does not apply when a purchaser or benefactor has designated in |
| 59 | writing to the board the person who will succeed to the |
| 60 | ownership of the advance payment contract or participation |
| 61 | agreement in the event of the purchaser's or benefactor's death, |
| 62 | and that person survives the purchaser or benefactor. |
| 63 | Section 2. Subsection (5) of section 1009.972, Florida |
| 64 | Statutes, is amended to read: |
| 65 | 1009.972 Florida Prepaid College Trust Fund.-- |
| 66 | (5) Notwithstanding the provisions of chapter 717, funds |
| 67 | associated with terminated advance payment contracts pursuant to |
| 68 | s. 1009.98(4)(k) and canceled contracts for which no refunds |
| 69 | have been claimed shall be retained by the board. The board |
| 70 | shall establish procedures for notifying purchasers who |
| 71 | subsequently cancel their advance payment contracts of any |
| 72 | unclaimed refund and shall establish a time period after which |
| 73 | no refund may be claimed by a purchaser who canceled a contract. |
| 74 | The board may transfer funds retained from such terminated |
| 75 | advance payment contracts and canceled contracts to the direct- |
| 76 | support organization established pursuant to s. 1009.983 for the |
| 77 | Florida Prepaid Tuition Scholarship Program to provide matching |
| 78 | funds for prepaid tuition scholarships for economically |
| 79 | disadvantaged youth who remain drug free and crime free and for |
| 80 | children of members of the armed forces and Coast Guard of the |
| 81 | United States who die while participating in the combat theater |
| 82 | of operations for Operation Iraqi Freedom or Operation Enduring |
| 83 | Freedom on or after the date on which this act becomes a law and |
| 84 | were Florida residents at the time of their death or have listed |
| 85 | Florida as their domicile at the time of their death. |
| 86 | Section 3. Paragraph (k) of subsection (4) of section |
| 87 | 1009.98, Florida Statutes, is amended to read: |
| 88 | 1009.98 Florida Prepaid College Program.-- |
| 89 | (4) ADVANCE PAYMENT CONTRACTS.--The board shall develop |
| 90 | advance payment contracts for registration and may develop |
| 91 | advance payment contracts for dormitory residence as provided in |
| 92 | this section. Advance payment contracts shall be exempt from |
| 93 | chapter 517 and the Florida Insurance Code. Such contracts shall |
| 94 | include, but not be limited to, the following: |
| 95 | (k) The period of time after which advance payment |
| 96 | contracts that have not been terminated or the benefits used |
| 97 | shall be considered terminated. Time expended by a qualified |
| 98 | beneficiary as an active duty member of any of the armed |
| 99 | services of the United States shall be added to the period of |
| 100 | time specified by the board. No purchaser or qualified |
| 101 | beneficiary whose advance payment contract is terminated |
| 102 | pursuant to this paragraph shall be entitled to a refund. |
| 103 | Notwithstanding chapter 717, the board shall retain any moneys |
| 104 | paid by the purchaser for an advance payment contract that has |
| 105 | been terminated in accordance with this paragraph. Such moneys |
| 106 | may be transferred to the direct-support organization |
| 107 | established pursuant to s. 1009.983 for the Florida Prepaid |
| 108 | Tuition Scholarship Program to provide matching funds for |
| 109 | prepaid tuition scholarships for economically disadvantaged |
| 110 | youths who remain drug free and crime free and for children of |
| 111 | members of the armed forces and Coast Guard of the United States |
| 112 | who die while participating in the combat theater of operations |
| 113 | for Operation Iraqi Freedom or Operation Enduring Freedom on or |
| 114 | after the date on which this act becomes a law and were Florida |
| 115 | residents at the time of their death or have listed Florida as |
| 116 | their domicile at the time of their death. |
| 117 | Section 4. Paragraph (b) of subsection (2) of section |
| 118 | 1009.981, Florida Statutes, is amended to read: |
| 119 | 1009.981 Florida College Savings Program.-- |
| 120 | (2) PARTICIPATION AGREEMENTS.-- |
| 121 | (b) The board shall develop a participation agreement |
| 122 | which shall be the agreement between the board and each |
| 123 | benefactor, which may include, but is not limited to: |
| 124 | 1. The name, date of birth, and social security number of |
| 125 | the designated beneficiary. |
| 126 | 2. The amount of the contribution or contributions and |
| 127 | number of contributions required from a benefactor on behalf of |
| 128 | a designated beneficiary. |
| 129 | 3. The terms and conditions under which benefactors shall |
| 130 | remit contributions, including, but not limited to, the date or |
| 131 | dates upon which each contribution is due. Deposits to the |
| 132 | savings program by benefactors may only be in cash. Benefactors |
| 133 | may contribute in a lump sum, periodically, in installments, or |
| 134 | through electronic funds transfer or employer payroll |
| 135 | deductions. |
| 136 | 4. Provisions for late contribution charges and for |
| 137 | default. |
| 138 | 5. Provisions for penalty fees for withdrawals from the |
| 139 | program. |
| 140 | 6. The name of the person who may terminate participation |
| 141 | in the program. The participation agreement must specify whether |
| 142 | the account may be terminated by the benefactor, the designated |
| 143 | beneficiary, a specific designated person, or any combination of |
| 144 | these persons. |
| 145 | 7. The terms and conditions under which an account may be |
| 146 | terminated, modified, or converted, the name of the person |
| 147 | entitled to any refund due as a result of termination of the |
| 148 | account pursuant to such terms and conditions, and the amount of |
| 149 | refund, if any, due to the person so named. |
| 150 | 8. Penalties for distributions not used or made in |
| 151 | accordance with s. 529 of the Internal Revenue Code. |
| 152 | 9. Any charges or fees in connection with the |
| 153 | administration of the savings fund. |
| 154 | 10. The period of time after which each participation |
| 155 | agreement shall be considered to be terminated. Time expended by |
| 156 | a designated beneficiary as an active duty member of any of the |
| 157 | armed services of the United States shall be added to the period |
| 158 | specified pursuant to this subparagraph. Should a participation |
| 159 | agreement be terminated, the balance of the account, after |
| 160 | notice to the benefactor, shall be declared unclaimed and |
| 161 | abandoned property. The board shall retain any moneys paid by |
| 162 | the benefactor for a participation agreement that has been |
| 163 | terminated in accordance with this subparagraph. Such moneys may |
| 164 | be transferred to the direct-support organization established |
| 165 | pursuant to s. 1009.983 for the Florida Prepaid Tuition |
| 166 | Scholarship Program to provide matching funds for prepaid |
| 167 | tuition scholarships for economically disadvantaged youths who |
| 168 | remain drug free and crime free and for children of members of |
| 169 | the armed forces and Coast Guard of the United States who die |
| 170 | while participating in the combat theater of operations for |
| 171 | Operation Iraqi Freedom or Operation Enduring Freedom on or |
| 172 | after the date on which this act becomes a law and were Florida |
| 173 | residents at the time of their death or have listed Florida as |
| 174 | their domicile at the time of their death. |
| 175 | 11. Other terms and conditions deemed by the board to be |
| 176 | necessary or proper. |
| 177 | Section 5. This act shall take effect July 1, 2005. |