Public Act 90-0546 of the 90th General Assembly
Public Act 90-0546
SB878 Re-enrolled LRB9003362THpk
AN ACT relating to prepaid tuition contracts, amending a
named Act.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 1. Short title. This Act may be cited as the
Illinois Prepaid Tuition Act.
Section 5. Purpose. The General Assembly finds and
declares that the general welfare and security of the State
are enhanced by access to higher education for all residents
of the State who desire that education and who demonstrate
the qualifications necessary to pursue that education.
Furthermore, it is desirable that residents of the State who
seek to pursue higher education be able to choose attendance
at the higher education institution that offers programs and
services most suitable to their needs. Accordingly,
endeavors that serve the higher education needs of the people
of the State represent an essential function of State
government.
During the past decade, students have been paying more
and borrowing more to finance the increasing cost of higher
education at Illinois colleges and universities as well as at
similar institutions nationwide. Federal and state
governments' capacity to fund college scholarships and grants
cannot fully meet the current and future demand for higher
education nor is it reasonable to expect that paying for
college is solely a governmental responsibility. It is --
and has always been -- a shared responsibility among the
student, the family, State government, and the federal
government. Consequently, the intent of this Act is to both
encourage and better enable Illinois families to help
themselves finance the cost of higher education, specifically
through a program that provides Illinois families with a
method of State tax-free and federally tax-deferred savings
for college tuition.
Section 10. Definitions. In this Act:
"Illinois public university" means the University of
Illinois, Illinois State University, Chicago State
University, Governors State University, Southern Illinois
University, Northern Illinois University, Eastern Illinois
University, Western Illinois University, or Northeastern
Illinois University.
"Illinois community college" means a public community
college as defined in Section 1-2 of the Public Community
College Act.
"MAP-eligible institution" means a public institution of
higher education or a nonpublic institution of higher
education whose students are eligible to receive need-based
student financial assistance through State Monetary Award
Program (MAP) grants administered by the Illinois Student
Assistance Commission under the Higher Education Student
Assistance Act and whose students also are eligible to
receive benefits under Section 529(a) of the Internal Revenue
Code of 1986, as specified by the federal Small Business Act
of 1996 and subsequent amendments to this federal law.
"Illinois prepaid tuition contract" or "contract" means a
contract entered into between the State and a Purchaser under
Section 45 to provide for the higher education of a qualified
beneficiary.
"Illinois prepaid tuition program" or "program" means the
program created in Section 15.
"Purchaser" means a person who makes or has contracted to
make payments under an Illinois prepaid tuition contract.
"Public institution of higher education" means an
Illinois public university or Illinois community college.
"Nonpublic institution of higher education" means any
MAP-eligible educational organization, other than a public
institution of higher education, that provides a minimum of
an organized 2-year program at the postsecondary level and
that operates in conformity with standards substantially
equivalent to those of public institutions of higher
education. "Nonpublic institution of higher education" does
not include any educational organization used principally for
sectarian instruction, as a place of religious teaching or
worship, or for any religious denomination for the training
of ministers, rabbis, or other professional persons in the
field of religion.
"Qualified beneficiary" means (i) anyone who has been a
resident of this State for at least 12 months prior to the
date of the contract, or (ii) a nonresident, so long as the
purchaser has been a resident of the State for at least 12
months prior to the date of the contract, or (iii) any person
less than one year of age who is a relative of an Illinois
resident.
"Tuition" means the quarter or semester charges imposed
on a qualified beneficiary to attend a MAP-eligible
institution.
"Mandatory Fees" means those quarter or semester fees
imposed upon all students enrolled at a MAP-eligible
institution.
"Registration Fees" means the charges derived by
combining tuition and mandatory fees.
"Contract Unit" means 15 credit hours of instruction at a
MAP-eligible institution.
"Panel" means the advisory panel created under Section
20.
"Commission" means the Illinois Student Assistance
Commission.
Section 15. Creation of Illinois prepaid tuition
program. There is created the Illinois prepaid tuition
program to be administered by the Illinois Student Assistance
Commission. This program is to be administered so that the
full cost of tuition and mandatory fees at Illinois public
universities and Illinois community colleges may be paid in
advance of enrollment through the prior purchase of an
Illinois prepaid tuition contract. The Commission may enter
into contracts as may be necessary to provide for
administration of the program and shall develop and implement
rules and regulations necessary for the efficient
administration of the program.
All reasonable charges incidental to the administration
of the program by the Commission shall be paid in the initial
start-up period for the program's operation from the General
Revenue Fund, pursuant to appropriations made for that
purpose by the General Assembly. Those charges and expenses
in subsequent years shall be paid exclusively from the
Illinois Prepaid Tuition Trust Fund established by Section 35
of this Act.
Section 20. Advisory Panel. The Illinois prepaid
tuition program shall be administered by the Illinois Student
Assistance Commission, with advice and counsel from an
advisory panel appointed by the Commission. The Illinois
prepaid tuition program shall be administratively housed
within the Commission, and the advisory panel shall have such
duties as are specified in this Act.
The advisory panel shall consist of 7 members who are
appointed by the Commission, including one recommended by the
State Treasurer, one recommended by the State Comptroller,
one recommended by the Director of the Bureau of the Budget,
and one recommended by the Executive Director of the Board of
Higher Education. Each panel member shall possess knowledge,
skill, and experience in at least one of the following areas
of expertise: accounting, actuarial practice, risk
management, or investment management. Members shall serve
3-year terms except that, in making the initial appointments,
the Commission shall appoint 2 members to serve for 2 years,
2 members to serve for 3 years, and 3 members to serve for 4
years. Any person appointed to fill a vacancy on the panel
shall be appointed in a like manner and shall serve for only
the unexpired term. Advisory panel members shall be eligible
for reappointment and shall serve until a successor is
appointed and confirmed. Panel members shall serve without
compensation but shall be reimbursed for expenses. Before
being installed as a member of the advisory panel, each
nominee shall file verified written statements of economic
interest with the Secretary of State as required by the
Illinois Governmental Ethics Act and with the Board of Ethics
as required by Executive Order of the Governor.
The advisory panel shall meet at least twice annually.
At least once each year the Commission Chairman shall
designate a time and place at which the advisory panel shall
meet publicly with the Illinois Student Assistance Commission
to discuss issues and concerns relating to the Illinois
prepaid tuition program.
Section 25. Additional powers of the Commission. The
Commission has the following specific powers relating to
administration of the Illinois prepaid tuition program:
(1) To direct funds to be invested, if not required
for immediate disbursement.
(2) To require a reasonable length of State
residence for qualified beneficiaries of Illinois prepaid
tuition contracts.
(3) To annually restrict the number of participants
in any prepaid tuition plan authorized by the Commission,
provided that any person denied participation solely on
the basis of such restriction shall be given priority
consideration when opportunities to participate in the
plan are offered during the subsequent year.
(4) To appropriately segregate contributions and
payments to the Illinois prepaid tuition program into
various accounts and funds.
(5) To solicit and accept gifts, grants, loans, and
other financial assistance from any appropriate source,
and to participate in any other way in any governmental
program that will carry out the express purposes of this
Section.
(6) To require and collect administrative fees and
charges in connection with any transaction and to impose
reasonable penalties, including default, for delinquent
payments or for entering into an Illinois prepaid tuition
contract on a fraudulent basis.
(7) To impose reasonable time limits on use of the
Illinois prepaid tuition benefits provided by the
program, so long as those limitations are specified
within the Illinois prepaid tuition contract.
(8) To indicate the terms and conditions under
which Illinois prepaid tuition contracts may be
terminated and to impose reasonable fees and charges for
such termination, so long as those terms and conditions
are specified within the Illinois prepaid tuition
contract.
(9) To provide for the receipt of contributions to
the program in lump sum or installment payments.
(10) To require that purchasers of Illinois prepaid
tuition contracts verify in writing or by any other
method acceptable to the Commission any requests for
contract conversions, substitutions, transfers,
cancellations, refund requests, or contract changes of
any nature.
Section 30. Advisory Panel duties and responsibilities.
(a) Advice and review. The panel shall offer advice and
counseling regarding the investments of the Illinois prepaid
tuition program with the objective of obtaining the best
possible return on investments consistent with actuarial
soundness of the program. The panel is required to annually
review and advise the Commission on provisions of the
strategic investment plan for the prepaid tuition program.
The panel is also charged with reviewing and advising the
Commission with regard to the annual report that describes
the current financial condition of the program. The panel at
its own discretion also may advise the Commission on other
aspects of the program.
(b) Investment plan. The Commission annually shall
adopt a comprehensive investment plan for purposes of this
Section. The comprehensive investment plan shall specify the
investment policies to be utilized by the Commission in its
administration of the Illinois Prepaid Tuition Trust Fund
created by Section 35. The Commission may direct that assets
of those Funds be placed in savings accounts or may use the
same to purchase fixed or variable life insurance or annuity
contracts, securities, evidence of indebtedness, or other
investment products pursuant to the comprehensive investment
plan and in such proportions as may be designated or approved
under that plan. Those insurance, annuity, savings, and
investment products shall be underwritten and offered in
compliance with applicable federal and State laws, rules, and
regulations by persons who are authorized thereunder to
provide those services. The Commission shall delegate
responsibility for preparing the comprehensive investment
plan to the Executive Director of the Commission. Nothing in
this Section shall preclude the Commission from contracting
with a private corporation or institution to provide such
services as may be a part of the comprehensive investment
plan or as may be deemed necessary for implementation of the
comprehensive investment plan, including, but not limited to,
providing consolidated billing, individual and collective
record keeping and accounting, and asset purchase, control,
and safekeeping.
(c) Program management. The Commission may not delegate
its management functions, but may arrange to compensate for
personalized investment advisory services rendered with
respect to any or all of the investments under its control an
investment advisor registered under Section 8 of the Illinois
Securities Law of 1953 or any bank or other entity authorized
by law to provide those services. Nothing contained herein
shall preclude the Commission from subscribing to general
investment research services available for purchase or use by
others. The Commission also shall have authority to
compensate for accounting, computing, and other necessary
services.
(d) Annual report. The Commission shall annually
prepare or cause to be prepared a report setting forth in
appropriate detail an accounting of all Illinois prepaid
tuition program funds and a description of the financial
condition of the program at the close of each fiscal year.
Included in this report shall be an evaluation by at least
one nationally recognized actuary of the financial viability
of the program. This report shall be submitted to the
Governor, the President of the Senate, the Speaker of the
House of Representatives, the Auditor General, and the Board
of Higher Education on or before March 1 of the subsequent
fiscal year. This report also shall be made available to
purchasers of Illinois prepaid tuition contracts and shall
contain complete Illinois prepaid tuition contract sales
information, including, but not limited to, projected
postsecondary enrollment data for qualified beneficiaries.
(e) Marketing plan. Selection of a marketing agent for
the Illinois prepaid tuition program must be approved by the
Commission. At least once every 3 years, the Commission
shall solicit proposals for marketing of the Illinois prepaid
tuition program in accordance with the Illinois Securities
Law of 1953 and any applicable provisions of federal law.
The entity designated pursuant to this paragraph shall serve
as a centralized marketing agent for the program and shall
have exclusive responsibility for marketing the program. No
contract for marketing the Illinois prepaid tuition program
shall extend for longer than 3 years. Any materials produced
for the purpose of marketing the program shall be submitted
to the Executive Director of the Commission for approval
before they are made public. Any Illinois MAP-eligible
institution may distribute marketing materials produced for
the program, so long as the Executive Director of the
Commission approves the distribution in advance. Neither the
State nor the Commission shall be liable for
misrepresentation of the program by a marketing agent.
(f) Accounting and audit. The Commission shall annually
cause to be prepared an accounting of the trust and shall
transmit a copy of the accounting to the Governor, the
President of the Senate, the Speaker of the House, and the
minority leaders of the Senate and House of Representatives.
The Commission shall also make available this accounting of
the trust to any purchaser of an Illinois prepaid tuition
contract, upon request. The accounts of the Illinois prepaid
tuition program shall be subject to annual audits by the
Auditor General or a certified public accountant appointed by
the Auditor General.
Section 35. Illinois Prepaid Tuition Trust Fund.
(a) The Illinois Prepaid Tuition Trust Fund is created
as the repository of all moneys received by the Commission in
conjunction with the Illinois prepaid tuition program. The
Illinois Prepaid Tuition Trust Fund also shall be the
official repository of all contributions, appropriations,
interest and dividend payments, gifts, or other financial
assets received by the Commission in connection with
operation of the Illinois prepaid tuition program. All such
moneys shall be deposited in the Illinois Prepaid Tuition
Trust Fund and held by the State Treasurer as ex-officio
custodian thereof, outside of the State Treasury, separate
and apart from all public moneys or funds of this State.
All interest or other earnings accruing or received on
amounts in the Illinois Prepaid Tuition Trust Fund shall be
credited to and retained by the Fund. Moneys, interest, or
other earnings paid into the Fund shall not be transferred or
allocated by the Commission, the State Treasurer, or the
State Comptroller to any other fund, nor shall the Governor
authorize any such transfer or allocation, while any
contracts are outstanding. In addition, no moneys, interest,
or other earnings paid into the Fund shall be used,
temporarily or otherwise, for interfund borrowing or be
otherwise used or appropriated except as expressly authorized
in this Act.
The Illinois Prepaid Tuition Trust Fund and each
individual participant account that may be created in that
Fund in conjunction with the Illinois prepaid tuition program
shall be subject to audit in the same manner as funds and
accounts belonging to the State of Illinois and shall be
protected by the official bond given by the State Treasurer.
(b) The Commission from time to time shall direct the
State Treasurer to invest moneys in the Illinois Prepaid
Tuition Trust Fund that are not needed for immediate
disbursement, in accordance with provisions of the investment
plan approved by the Commission.
(c) The Executive Director of the Commission shall, at
such times and in such amounts as shall be necessary, prepare
and send to the State Comptroller vouchers requesting payment
from the Illinois Prepaid Tuition Trust Fund for: (i) tuition
and fee payments to MAP-eligible institutions on behalf of
qualified beneficiaries of Illinois prepaid tuition
contracts, and (ii) payments associated with administration
of the Illinois prepaid tuition program.
(d) The Governor shall indicate in a separate document
submitted concurrent with each annual State budget the
estimated amount of moneys in the Illinois Prepaid Tuition
Trust Fund which shall be necessary and sufficient, during
that State fiscal year, to discharge all obligations
anticipated under Illinois prepaid tuition contracts. The
Governor also shall indicate in a separate document submitted
concurrent with each annual State budget the amount of moneys
from the Illinois Prepaid Tuition Trust Fund necessary to
cover anticipated expenses associated with administration of
the program. The Commission shall obtain concurrence from a
nationally recognized actuary as to all amounts necessary for
the program to meet its obligations. These amounts shall be
certified annually to the Governor by the Commission no later
than January 30.
During the first 18 months of operation of the Illinois
prepaid tuition program, the Governor shall request an
appropriation to the Commission from general funds sufficient
to pay for start-up costs associated with establishment of
the program. This appropriation constitutes a loan that shall
be repaid to the General Revenue Fund within 5 years by the
Commission from prepaid tuition program contributions.
Subsequent program administrative costs shall be provided
from reasonable fees and charges equitably assessed to
purchasers of prepaid tuition contracts.
(e) If the Commission determines that there are
insufficient moneys in the Illinois Prepaid Tuition Trust
Fund to pay contractual obligations in the next succeeding
fiscal year, the Commission shall certify the amount
necessary to meet these obligations to the Board of Higher
Education, the Governor, the President of the Senate, and the
Speaker of the House of Representatives. The Governor shall
submit the amount so certified to the General Assembly as
soon as practicable, but no later than the end of the current
State fiscal year.
(f) In the event the Commission, with the concurrence of
the Governor, determines the program to be financially
infeasible, the Commission may discontinue, prospectively,
the operation of the program. Any qualified beneficiary who
has been accepted by and is enrolled or will within 5 years
enroll at a MAP-eligible institution shall be entitled to
exercise the complete benefits specified in the Illinois
prepaid tuition contract. All other contract holders shall
receive an appropriate refund of all contributions and
accrued interest up to the time that the program is
discontinued.
Section 45. Illinois prepaid tuition contracts.
(a) The Commission may enter into an Illinois prepaid
tuition contract with a purchaser under which the Commission
contracts on behalf of the State to pay full tuition and
mandatory fees at an Illinois public university or Illinois
community college for a qualified beneficiary to attend the
MAP-eligible institution to which the qualified beneficiary
is admitted. Each contract shall contain terms, conditions,
and provisions that the Commission determines to be necessary
for ensuring the educational objectives and sustainable
financial viability of the Illinois prepaid tuition program.
(b) Each contract shall have one designated purchaser
and one designated qualified beneficiary. Unless otherwise
specified in the contract, the purchaser owns the contract
and retains any tax liability for its assets only until the
first distribution of benefits. Once a partial benefit of the
contract has been disbursed, any tax liability attributable
to the contract and its assets becomes a tax liability of the
qualified beneficiary, unless otherwise specified in the
contract. Contracts shall be purchased in units of 15 credit
hours at any MAP-eligible institution.
(c) Without exception, benefits may be received by a
qualified beneficiary of an Illinois prepaid tuition contract
no earlier than 3 years from the date the contract is
purchased.
(d) A prepaid tuition contract shall contain, but is not
limited to, provisions for (i) refunds or withdrawals in
certain circumstances, with or without interest or penalties;
(ii) conversion of the contract at the time of distribution
from accrued prepayment value at one type of MAP-eligible
institution to the accrued prepayment value at a different
type of MAP-eligible institution; (iii) portability of the
accrued value of the prepayment value for use at an
out-of-state higher education institution; (iv)
transferability of the contract benefits within the qualified
beneficiary's immediate family; and (v) a specified benefit
period during which the contract may be redeemed.
(e) Each Illinois prepaid tuition contract also shall
contain, at minimum, all of the following:
(1) The amount of payment or payments and the
number of payments required from a purchaser on behalf of
a qualified beneficiary.
(2) The terms and conditions under which purchasers
shall remit payments, including, but not limited to, the
date or dates upon which each payment shall be due.
(3) Provisions for late payment charges and for
default.
(4) Provisions for penalty fees payable incident to
an authorized withdrawal.
(5) The name, date of birth, and social security
number of the qualified beneficiary on whose behalf the
contract is drawn and the terms and conditions under
which the contract may be transferred to another
qualified beneficiary.
(6) The name and social security number of any
person who may terminate the contract, together with
terms that specify whether the contract may be terminated
by the purchaser, the qualified beneficiary, a specific
designated person, or any combination of these persons.
(7) The terms and conditions under which a contract
may be terminated, the name and social security number of
the person entitled to any refund due as a result of the
termination of the contract pursuant to those terms and
conditions, and the method for determining the amount of
a refund.
(8) The time limitations, if any, within which the
qualified beneficiary must claim his or her benefits
through the program.
(9) Other terms and conditions determined by the
Commission to be appropriate.
(f) In addition to the contract provisions set forth in
subsection (e), each Illinois prepaid tuition contract shall
include:
(1) The number of credit hours contracted by the
purchaser.
(2) The type of MAP-eligible institution and the
prepaid tuition plan toward which the credit hours shall
be applied.
(3) The explicit contractual obligation of the
Commission to the qualified beneficiary to provide a
specific number of credit hours of undergraduate
instruction at a MAP-eligible institution, not to exceed
the median number of credit hours required for the
conference of a degree that corresponds to the plan
purchased on behalf of the qualified beneficiary.
(g) The Commission shall indicate by rule the conditions
under which refunds are payable to a contract purchaser.
Generally, no refund shall exceed the amount paid into the
Illinois Prepaid Tuition Trust Fund by the purchaser. In the
event that a contract is converted from a Public University
Plan described in subsection (j) of this Section to a
Community College Plan described in subsection (k) of this
Section, the refund amount shall be reduced by the amount
transferred to the Illinois community college on behalf of
the qualified beneficiary. Except where the Commission may
otherwise rule, refunds may exceed the amount paid into the
Illinois Prepaid Tuition Trust Fund only under the following
circumstances:
(1) If the qualified beneficiary is awarded a grant
or scholarship, the terms of which duplicate the benefits
included in the Illinois prepaid tuition contract, then
moneys paid for the purchase of the contract shall be
returned to the purchaser, in semester installments that
coincide with the matriculation by the qualified
beneficiary, in an amount equal to the lesser of (i) the
original purchase price plus 2% interest compounded
annually, or (ii) the current cost of tuition and
mandatory fees at the MAP-eligible institution where the
qualified beneficiary is enrolled.
(2) In the event of the death or total disability
of the qualified beneficiary, moneys paid for the
purchase of the Illinois prepaid tuition contract shall
be returned to the purchaser together with all accrued
earnings.
(3) If an Illinois prepaid tuition contract is
converted from a Public University Plan to a Community
College Plan, then the amount refunded shall be the value
of the original Illinois prepaid tuition contract minus
the value of the contract after conversion.
No refund shall be authorized under an Illinois prepaid
tuition contract for any semester partially attended but not
completed.
Moneys paid into or out of the Illinois Prepaid Tuition
Trust Fund by or on behalf of the purchaser or the qualified
beneficiary of an Illinois prepaid tuition contract are
exempt from all claims of creditors of the purchaser or
beneficiary, so long as the contract has not been terminated.
The State or any State agency, county, municipality, or
other political subdivision, by contract or collective
bargaining agreement, may agree with any employee to remit
payments toward the purchase of Illinois prepaid tuition
contracts through payroll deductions made by the appropriate
officer or officers of the entity making the payments. Such
payments shall be held and administered in accordance with
this Act.
(h) Nothing in this Act shall be construed as a promise
or guarantee that a qualified beneficiary will be admitted to
a MAP-eligible institution or to a particular MAP-eligible
institution, will be allowed to continue enrollment at a
MAP-eligible institution after admission, or will be
graduated from a MAP-eligible institution.
(i) The Commission shall develop and make prepaid
tuition contracts available under a minimum of at least 2
independent plans to be known as the Public University Plan
and the Community College Plan.
Contracts shall be purchased in units of 15 credit hours
at either an Illinois public university or an Illinois
community college. The minimum purchase amount per qualified
beneficiary shall be one unit or 15 credit hours. The
maximum purchase amount shall be 9 units (or 135 credit
hours) for the Public University Plan and 4 units (or 60
credit hours) for the Community College Plan.
(j) Public University Plan. Through the Public
University Plan, the Illinois prepaid tuition contract shall
provide prepaid registration fees, which include full tuition
costs as well as mandatory fees, for a specified number of
undergraduate credit hours, not to exceed the maximum number
of credit hours required for the conference of a
baccalaureate degree. In determining the cost of
participation in the Public University Plan, the Commission
shall reference the combined mean-weighted current
registration fees from all Illinois public universities.
In the event that a qualified beneficiary for whatever
reason chooses to attend an Illinois community college, the
qualified beneficiary may convert the average number of
credit hours required for the conference of an associate
degree from the Public University Plan to the Community
College Plan and may retain the remaining Public University
Plan credit hours or may request a refund for prepaid credit
hours in excess of those required for conference of an
associate degree. In determining the amount of any refund,
the Commission also shall recognize the current relative
credit hour cost of the 2 plans when making any conversion.
Qualified beneficiaries shall bear the cost of any
laboratory or other non-mandatory fees associated with
enrollment in specific courses. Qualified beneficiaries who
are not Illinois residents shall bear the difference in cost
between in-state registration fees guaranteed by the prepaid
tuition contract and tuition and other charges assessed upon
out-of-state students by the MAP-eligible institution.
(k) Community College Plan. Through the Community
College Plan, the Illinois prepaid tuition contract shall
provide prepaid registration fees, which include full tuition
costs as well as mandatory fees, for a specified number of
undergraduate credit hours, not to exceed the maximum number
of credit hours required for the conference of an associate
degree. In determining the cost of participation in the
Community College Plan, the Commission shall reference the
combined mean-weighted current registration fees from all
Illinois community colleges.
In the event that a qualified beneficiary for whatever
reason chooses to attend an Illinois public university, the
qualified beneficiary's prepaid tuition contract shall be
converted for use at that Illinois public university by
referencing the current average mean-weighted credit hour
value of registration fees at Illinois community colleges
relative to the corresponding value of registration fees at
Illinois public universities.
Qualified beneficiaries shall bear the cost of any
laboratory or other non-mandatory fees associated with
enrollment in specific courses. Qualified beneficiaries who
are not Illinois residents shall bear the difference in cost
between in-state registration fees guaranteed by the prepaid
tuition contract and tuition and other charges assessed upon
out-of-state students by the MAP-eligible institution.
(l) A qualified beneficiary may apply the benefits of
any Illinois prepaid tuition contract toward a nonpublic
institution of higher education. In the event that a
qualified beneficiary for whatever reason chooses to attend a
nonpublic institution of higher education, the qualified
beneficiary's prepaid tuition contract shall be converted for
use at that nonpublic institution of higher education by
referencing the current average mean-weighted credit hour
value of registration fees purchased under the contract. The
Commission shall transfer, or cause to have transferred, this
amount, less a transfer fee, to the nonpublic institution on
behalf of the beneficiary. In the event that the cost of
registration charged to the beneficiary at the nonpublic
institution of higher education is less than the aggregate
value of the Illinois prepaid tuition contract, any remaining
amount shall be transferred in subsequent semesters until the
transfer value is fully depleted.
(m) A qualified beneficiary may apply the benefits of
any Illinois prepaid tuition contract toward an eligible
out-of-state college or university. Institutional eligibility
for out-of-state colleges and universities shall be
determined by the Commission, but in making those
determinations the Commission shall recognize that the
benefits of an Illinois prepaid tuition contract may not be
used at any postsecondary educational institution that is
both operated for-profit and located outside of Illinois. In
the event that a qualified beneficiary for whatever reason
chooses to attend an eligible out-of-state college or
university, the qualified beneficiary's prepaid tuition
contract shall be converted for use at that college or
university by referencing the current average mean-weighted
credit hour value of registration fees purchased under the
contract. The Commission shall transfer, or cause to have
transferred, this amount, less a transfer fee, to the college
or university on behalf of the beneficiary. In the event
that the cost of registration charged to the beneficiary at
the eligible out-of-state college or university is less than
the aggregate value of the Illinois prepaid tuition contract,
any remaining amount shall be transferred in subsequent
semesters until the transfer value is fully depleted.
(n) Illinois prepaid tuition contracts may be purchased
either by lump sum or by installments. All installment
contracts shall be for 5 years, except that contracts that
purchase at least 120 credit hours may be payable, by
installments, over a 10-year period. No penalty shall be
assessed for early payment of installment contracts.
(o) The Commission shall annually adjust the price of
new contracts, in accordance with the annual changes in
registration fees at Illinois public universities and
community colleges.
Section 50. Confidentiality and disclosure. Information
that (i) identifies the purchasers or qualified beneficiaries
of any Illinois prepaid tuition contract or any terms or
provisions of any such contract as those terms and provisions
relate to a particular purchaser or qualified beneficiary, or
(ii) discloses any other matter relating to the participation
of any such purchaser or qualified beneficiary in the
Illinois prepaid tuition program or in any independent plan
under which that program is administered, is exempt from
inspection, copying, or disclosure under the Freedom of
Information Act. The Commission may authorize the program's
records administrator to release such information to
appropriate personnel at the MAP-eligible institution at
which the beneficiary may enroll or is enrolled or to another
state or federal agency, for purposes that the Commission
deems appropriate, in accordance with applicable state and
federal law. However, any such institution or agency to which
that information is released shall ensure the continued
confidentiality of the information.
Section 55. Tax exemption. The assets of the Illinois
Prepaid Tuition Trust Fund and its income and operation shall
be exempt from all taxation by the State of Illinois and any
of its subdivisions. The accrued earnings of Illinois
prepaid tuition contracts once disbursed on behalf of an
eligible beneficiary shall be similarly exempt from all
taxation by the State of Illinois and any of its
subdivisions, so long as they are used for educational
purposes in accordance with the provisions of an Illinois
prepaid tuition contract.
Section 60. Securities Registration Exemption. Illinois
prepaid tuition contracts shall be exempt from registration
under the Illinois Securities Law of 1953. However no
contract may be sold or otherwise transferred by the
purchaser or qualified beneficiary without the prior approval
of the Commission, except in accordance with the terms
explicitly set forth in the contract.
Section 65. Construction. Nothing in this Act or in an
Illinois prepaid tuition contract shall be construed as a
promise or guarantee by the Program or the State that a
person will be admitted to any MAP-eligible institution or to
a particular MAP-eligible institution, will be allowed to
continue to attend a MAP-eligible institution after having
been admitted, or will be graduated from a MAP-eligible
institution.
Section 70. Scholarships, grants, or monetary
assistance. No contributions toward the purchase of an
Illinois prepaid tuition contract authorized by this Section
shall be considered in evaluating the financial situation of
the student beneficiary of the contract or be deemed a
financial resource of or a form of financial aid or
assistance to the student beneficiary, for purposes of
determining the eligibility of the student beneficiary for
any scholarship, grant or monetary assistance awarded by the
Commission, the State, or any agency thereof; nor shall
contributions toward the purchase of an Illinois prepaid
tuition contract reduce the amount of any scholarship, grant,
or monetary assistance that the student beneficiary is
eligible to be awarded by the Illinois Student Assistance
Commission, the State, or any agency thereof in accordance
with the provisions of any other Section of this Act or any
other law of the State.
Section 90. The Freedom of Information Act is amended by
changing Section 7 as follows:
(5 ILCS 140/7) (from Ch. 116, par. 207)
Sec. 7. Exemptions.
(1) The following shall be exempt from inspection and
copying:
(a) Information specifically prohibited from
disclosure by federal or State law or rules and
regulations adopted under federal or State law.
(b) Information that, if disclosed, would
constitute a clearly unwarranted invasion of personal
privacy, unless the disclosure is consented to in writing
by the individual subjects of the information. The
disclosure of information that bears on the public duties
of public employees and officials shall not be considered
an invasion of personal privacy. Information exempted
under this subsection (b) shall include but is not
limited to:
(i) files and personal information maintained
with respect to clients, patients, residents,
students or other individuals receiving social,
medical, educational, vocational, financial,
supervisory or custodial care or services directly
or indirectly from federal agencies or public
bodies;
(ii) personnel files and personal information
maintained with respect to employees, appointees or
elected officials of any public body or applicants
for those positions;
(iii) files and personal information
maintained with respect to any applicant, registrant
or licensee by any public body cooperating with or
engaged in professional or occupational
registration, licensure or discipline;
(iv) information required of any taxpayer in
connection with the assessment or collection of any
tax unless disclosure is otherwise required by State
statute; and
(v) information revealing the identity of
persons who file complaints with or provide
information to administrative, investigative, law
enforcement or penal agencies; provided, however,
that identification of witnesses to traffic
accidents, traffic accident reports, and rescue
reports may be provided by agencies of local
government, except in a case for which a criminal
investigation is ongoing, without constituting a
clearly unwarranted per se invasion of personal
privacy under this subsection.
(c) Records compiled by any public body for
administrative enforcement proceedings and any law
enforcement or correctional agency for law enforcement
purposes or for internal matters of a public body, but
only to the extent that disclosure would:
(i) interfere with pending or actually and
reasonably contemplated law enforcement proceedings
conducted by any law enforcement or correctional
agency;
(ii) interfere with pending administrative
enforcement proceedings conducted by any public
body;
(iii) deprive a person of a fair trial or an
impartial hearing;
(iv) unavoidably disclose the identity of a
confidential source or confidential information
furnished only by the confidential source;
(v) disclose unique or specialized
investigative techniques other than those generally
used and known or disclose internal documents of
correctional agencies related to detection,
observation or investigation of incidents of crime
or misconduct;
(vi) constitute an invasion of personal
privacy under subsection (b) of this Section;
(vii) endanger the life or physical safety of
law enforcement personnel or any other person; or
(viii) obstruct an ongoing criminal
investigation.
(d) Criminal history record information maintained
by State or local criminal justice agencies, except the
following which shall be open for public inspection and
copying:
(i) chronologically maintained arrest
information, such as traditional arrest logs or
blotters;
(ii) the name of a person in the custody of a
law enforcement agency and the charges for which
that person is being held;
(iii) court records that are public;
(iv) records that are otherwise available
under State or local law; or
(v) records in which the requesting party is
the individual identified, except as provided under
part (vii) of paragraph (c) of subsection (1) of
this Section.
"Criminal history record information" means data
identifiable to an individual and consisting of
descriptions or notations of arrests, detentions,
indictments, informations, pre-trial proceedings, trials,
or other formal events in the criminal justice system or
descriptions or notations of criminal charges (including
criminal violations of local municipal ordinances) and
the nature of any disposition arising therefrom,
including sentencing, court or correctional supervision,
rehabilitation and release. The term does not apply to
statistical records and reports in which individuals are
not identified and from which their identities are not
ascertainable, or to information that is for criminal
investigative or intelligence purposes.
(e) Records that relate to or affect the security
of correctional institutions and detention facilities.
(f) Preliminary drafts, notes, recommendations,
memoranda and other records in which opinions are
expressed, or policies or actions are formulated, except
that a specific record or relevant portion of a record
shall not be exempt when the record is publicly cited and
identified by the head of the public body. The exemption
provided in this paragraph (f) extends to all those
records of officers and agencies of the General Assembly
that pertain to the preparation of legislative documents.
(g) Trade secrets and commercial or financial
information obtained from a person or business where the
trade secrets or information are proprietary, privileged
or confidential, or where disclosure of the trade secrets
or information may cause competitive harm, including all
information determined to be confidential under Section
4002 of the Technology Advancement and Development Act.
Nothing contained in this paragraph (g) shall be
construed to prevent a person or business from consenting
to disclosure.
(h) Proposals and bids for any contract, grant, or
agreement, including information which if it were
disclosed would frustrate procurement or give an
advantage to any person proposing to enter into a
contractor agreement with the body, until an award or
final selection is made. Information prepared by or for
the body in preparation of a bid solicitation shall be
exempt until an award or final selection is made.
(i) Valuable formulae, designs, drawings and
research data obtained or produced by any public body
when disclosure could reasonably be expected to produce
private gain or public loss.
(j) Test questions, scoring keys and other
examination data used to administer an academic
examination or determined the qualifications of an
applicant for a license or employment.
(k) Architects' plans and engineers' technical
submissions for projects not constructed or developed in
whole or in part with public funds and for projects
constructed or developed with public funds, to the extent
that disclosure would compromise security.
(l) Library circulation and order records
identifying library users with specific materials.
(m) Minutes of meetings of public bodies closed to
the public as provided in the Open Meetings Act until the
public body makes the minutes available to the public
under Section 2.06 of the Open Meetings Act.
(n) Communications between a public body and an
attorney or auditor representing the public body that
would not be subject to discovery in litigation, and
materials prepared or compiled by or for a public body in
anticipation of a criminal, civil or administrative
proceeding upon the request of an attorney advising the
public body, and materials prepared or compiled with
respect to internal audits of public bodies.
(o) Information received by a primary or secondary
school, college or university under its procedures for
the evaluation of faculty members by their academic
peers.
(p) Administrative or technical information
associated with automated data processing operations,
including but not limited to software, operating
protocols, computer program abstracts, file layouts,
source listings, object modules, load modules, user
guides, documentation pertaining to all logical and
physical design of computerized systems, employee
manuals, and any other information that, if disclosed,
would jeopardize the security of the system or its data
or the security of materials exempt under this Section.
(q) Documents or materials relating to collective
negotiating matters between public bodies and their
employees or representatives, except that any final
contract or agreement shall be subject to inspection and
copying.
(r) Drafts, notes, recommendations and memoranda
pertaining to the financing and marketing transactions of
the public body. The records of ownership, registration,
transfer, and exchange of municipal debt obligations, and
of persons to whom payment with respect to these
obligations is made.
(s) The records, documents and information relating
to real estate purchase negotiations until those
negotiations have been completed or otherwise terminated.
With regard to a parcel involved in a pending or actually
and reasonably contemplated eminent domain proceeding
under Article VII of the Code of Civil Procedure,
records, documents and information relating to that
parcel shall be exempt except as may be allowed under
discovery rules adopted by the Illinois Supreme Court.
The records, documents and information relating to a real
estate sale shall be exempt until a sale is consummated.
(t) Any and all proprietary information and records
related to the operation of an intergovernmental risk
management association or self-insurance pool or jointly
self-administered health and accident cooperative or
pool.
(u) Information concerning a university's
adjudication of student or employee grievance or
disciplinary cases, to the extent that disclosure would
reveal the identity of the student or employee and
information concerning any public body's adjudication of
student or employee grievances or disciplinary cases,
except for the final outcome of the cases.
(v) Course materials or research materials used by
faculty members.
(w) Information related solely to the internal
personnel rules and practices of a public body.
(x) Information contained in or related to
examination, operating, or condition reports prepared by,
on behalf of, or for the use of a public body responsible
for the regulation or supervision of financial
institutions or insurance companies, unless disclosure is
otherwise required by State law.
(y) Information the disclosure of which is
restricted under Section 5-108 of the Public Utilities
Act.
(z) Manuals or instruction to staff that relate to
establishment or collection of liability for any State
tax or that relate to investigations by a public body to
determine violation of any criminal law.
(aa) Applications, related documents, and medical
records received by the Experimental Organ
Transplantation Procedures Board and any and all
documents or other records prepared by the Experimental
Organ Transplantation Procedures Board or its staff
relating to applications it has received.
(bb) Insurance or self insurance (including any
intergovernmental risk management association or self
insurance pool) claims, loss or risk management
information, records, data, advice or communications.
(cc) Information and records held by the Department
of Public Health and its authorized representatives
relating to known or suspected cases of sexually
transmissible disease or any information the disclosure
of which is restricted under the Illinois Sexually
Transmissible Disease Control Act.
(dd) Information the disclosure of which is
exempted under Section 7 of the Radon Mitigation Act.
(ee) Firm performance evaluations under Section 55
of the Architectural, Engineering, and Land Surveying
Qualifications Based Selection Act.
(ff) Information the disclosure of which is
restricted and exempted under Section 50 of the Illinois
Prepaid Tuition Act.
(2) This Section does not authorize withholding of
information or limit the availability of records to the
public, except as stated in this Section or otherwise
provided in this Act.
(Source: P.A. 87-241; 87-673; 87-895; 88-444.)
Section 99. Effective date. This Act takes effect upon
becoming law.