SB-0856, As Passed Senate, January 17, 2008

SENATE BILL No. 856

October 25, 2007, Introduced by Senators JANSEN, HUNTER, KUIPERS, JACOBS, THOMAS, ANDERSON, BASHAM, BARCIA, OLSHOVE, BROWN, SANBORN, GILBERT, GLEASON, PAPPAGEORGE, JELINEK, CLARKE, VAN WOERKOM, BRATER and SCHAUER and referred to the Committee on Homeland Security and Emerging Technologies.

     A bill to amend 1986 PA 316, entitled

"Michigan education trust act,"

by amending sections 9 and 11 (MCL 390.1429 and 390.1431).

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 9. (1) There is created under the jurisdiction and

control of the board an advance tuition payment fund. Payments

received by the trust from purchasers on behalf of qualified

beneficiaries or from any other source, public or private, shall be

placed in the fund. The fund may be divided into separate accounts.

     (2) Assets of the trust shall not be are not considered state

money, common cash of the state, revenue for the purposes of

sections 26 to 34 of article IX of the state constitution of 1963,

nor or state money for the purposes of Act No. 259 of the Public

Acts of 1982, being sections 1982 PA 259, MCL 12.61 to 12.64. of

the Michigan Compiled Laws.

     (3) Unless otherwise provided by resolution of the board,

assets of the trust shall be expended in the following order of

priority:

     (a) To make payments to state institutions of higher education

on behalf of qualified beneficiaries.

     (b) To make refunds upon termination of an advance tuition

payment contract.

     (c) To pay the costs of administration and organization of the

trust and the fund.

     (4) Assets Except as provided in subsection (5), the board may

invest assets of the trust may be invested in any instrument,

obligation, security, or property considered appropriate by the

trust board and may be pooled for investment purposes with

investments of the state, including, but not limited to, state

pension funds, on such terms and conditions as are agreeable to the

trust board.

     (5) The board shall comply with the divestment from terror act

in making investments under this act.

     Sec. 11. In addition to the powers granted by other provisions

of this act, the board shall have the powers necessary or

convenient to carry out and effectuate the purposes, objectives,

and provisions of this act, the purposes and objectives of the

trust, and the powers delegated by other laws or executive orders,

including, but not limited to, the power to:

     (a) Invest Except as provided in section 9(5), invest any

money of the trust, at the board's discretion, in any instruments,

obligations, securities, or property determined proper by the

board, and name and use depositories for its money.

     (b) Pay money to state institutions of higher education from

the trust.

     (c) Impose reasonable residency requirements for qualified

beneficiaries.

     (d) Impose reasonable limits on the number of participants in

the trust.

     (e) Segregate contributions and payments to the trust into

various accounts and funds.

     (f) Contract for goods and services and engage personnel as is

necessary and engage the services of private consultants,

actuaries, managers, legal counsel, and auditors for rendering

professional, management, and technical assistance and advice,

payable out of any money of the trust.

     (g) Solicit and accept gifts, grants, loans, and other aids

from any person or the federal, state, or a local government or any

agency of the federal, state, or a local government, or to

participate in any other way in any federal, state, or local

government program.

     (h) Charge, impose, and collect administrative fees and

charges in connection with any transaction and provide for

reasonable penalties, including default, for delinquent payment of

fees or charges or for fraud.

     (i) Procure insurance against any loss in connection with the

trust's property, assets, or activities.

     (j) Sue and be sued; to have a seal and alter the same at

pleasure; to have perpetual succession; to make, execute, and

deliver contracts, conveyances, and other instruments necessary or

convenient to the exercise of its powers; and to make and amend

bylaws.

     (k) Enter into contracts on behalf of the state.

     (l) Administer the funds of the trust.

     (m) Indemnify or procure insurance indemnifying any member of

the board from personal loss or accountability from liability

resulting from a member's action or inaction as a member of the

board, including, but not limited to, liability asserted by a

person on any bonds or notes of the authority.

     (n) Impose reasonable time limits on use of the tuition

benefits provided by the trust, if the limits are made a part of

the contract.

     (o) Define the terms and conditions under which money may be

withdrawn from the trust, including, but not limited to, reasonable

charges and fees for any such withdrawal, if the terms and

conditions are made a part of the contract.

     (p) Provide for receiving contributions in lump sums or

periodic sums.

     (q) Establish policies, procedures, and eligibility criteria

to implement this act.

     (r) Enter into arrangements with Michigan institutions of

higher education for the trust to offer on behalf of the

institution advance tuition payment contracts under which the

Michigan institution of higher education will be contractually

obligated to provide a beneficiary under the contract with credit

hours of higher education in addition to those required for a

baccalaureate degree.

     Enacting section 1. This amendatory act does not take effect

unless Senate Bill No. 846                                    

            of the 94th Legislature is enacted into law.