Amends TCA Title 49, Chapter 7.

This bill terminates the educational services plan tuition contracts.<br /> <br /> Under present law, the Tennessee College Savings Trust Act allows a person to enter into a tuition contract to purchase tuition units on behalf of a beneficiary at the price determined by the board of trustees of the program for the year in which the tuition unit is purchased. Each tuition unit purchased on behalf of a beneficiary entitles the beneficiary to an amount equal to 1 percent of the weighted average tuition during the academic term in which it is used. Each tuition unit covers the cost of the beneficiary's tuition in an amount no greater than 1 percent of the weighted average tuition in effect at Tennessee's four-year public universities at the time of use. An educational services plan tuition contract remains in effect after the plan is terminated if, when the plan is terminated, the beneficiary:<br /> <br /> (1) Has been accepted by or is enrolled in an institution of higher education; or<br /> <br /> (2) Is projected to graduate from high school no later than the third anniversary of the date the plan is terminated.<br /> <br /> This bill provides that:<br /> <br /> (A) An educational services plan tuition contract will not remain or otherwise be in effect after December 31, 2021, regardless of whether the requirements of items (1) and (2) above are met with respect to any particular contract;<br /> <br /> (B) The state will provide educational services plan purchasers and beneficiaries with at least 60 days written notice of the termination of the educational services plan prior to November 1, 2021. Notice must indicate that the purchaser may request use of any or all tuition units associated with the purchaser's educational plan tuition contract, request a refund, or request a rollover on or before November 1, 2021. Any rollover requested must be administered in accordance with applicable federal and state laws, rules, and regulations;<br /> <br /> (C) If the purchaser does not request use of all of the tuition units associated with the purchaser's educational services plan tuition contract, request a refund, or request a rollover on or before November 1, 2021, then a refund must be made to the person designated in the contract to receive the refund in accordance with applicable federal and state laws, rules, and regulations; provided, however, that the amount of the refund must be calculated in accordance with the board's rules for refunds following the death or permanent disability of a beneficiary; <br /> <br /> (D) The educational services plan will not reimburse tuition units after December 31, 2021; and<br /> <br /> (E) After all obligations of this bill and the costs of administering the plan are satisfied, the state treasurer may transfer all or a portion of any assets to the board of trustees for the college savings trust fund program to be used for the administration and marketing of the educational investment plan. Any assets remaining after the transfer must be transferred to the general fund. The educational investment plan is a program under present law whereby an account owner may participate to create an account in such plan and any contributor may make contributions to such an account intending for such contributions and any earnings thereon to be applied toward the qualified higher education expenses of a beneficiary.<br />