Treasury candidate wants PACT fix

By Dale Liesch (Contact) | Dadeville Record

Published Wednesday, March 3, 2010

As the debate over how to handle the 45,000 participants in Alabama’s financially troubled prepaid college tuition program heats up, one candidate for state treasurer believes the state should keep its promise.

Charley Grimsley told a group of supporters at Cecil’s Public House in Alexander City Wednesday “it’s time for Alabama to live up to its end of the deal.”

“Forty-five thousand people bought into this contract and made a contract with the state,” Grimsley said. “The state said ‘show us the money and we’ll show you an education.’”

Grimsley added he believes fixing the problem is not only morally right, but also makes good financial sense because it could lead to an increase in tax revenue for the state in the future.

“The difference between (the earning potential) of high school and college graduates is $1 million over a lifetime,” Grimsley said. “Those 45,000 PACT participants would account for an economic impact of $50 billion in their lives and they would pay $6 billion more in state taxes.”

Grimsley said current action in the legislature could spark a “huge battle” between K-12 education interests and higher education interests because separate bills designed to help PACT with $256 million from expiring bond issues have passed the House and Senate and they differ on whether to put a cap on tuition at state universities for plan participants.

A bill introduced by State Sen. Ted Little passed the Senate before being subbed in a House committee for a similar bill introduced by State Rep. Craig Ford that would cap tuition, Grimsley said.

Grimsley, a third-generation community banker, said he supports putting a cap on tuition to ensure the money set aside for the plan is sufficient to pay out the remaining contracts.

“The only way (the bill) solves the problem is with caps,” Grimsley said. “Without caps you’re only postponing the problem.”

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