| (a) Plans are designed to be flexible and to allow beneficiaries
to attend their choice of institutions of higher education or private or independent
institutions of higher education.
(b) A purchaser may convert a prepaid tuition contract from
one plan to another plan during the annual enrollment period specified by
the board and upon payment of any additional amounts due under the plan to
which the contract is converted plus any required fees specified in the board's
fee schedule. The value at the time of conversion of the contract under the
original plan shall be credited against amounts due upon conversion. Such
value shall be the present lump sum actuarial value of the average amount
of tuition and required fees for junior college plans, junior/senior college
plans, and senior college plans and the estimated amount of private tuition
and required fees for the private college plan. For contracts that are paid
in full, the payment of additional amounts for conversion is determined by
applying the value at the time of the conversion of the contract purchased
under the original plan to the cost of the new plan. For contracts that are
not paid in full, the payment of additional amounts for conversion is determined
by applying the pro rata amount of the value at the time of conversion of
the contract purchased under the original plan to the cost of the new plan,
such pro rata amount determined by the number of payments paid under the contract
under the original plan by the purchaser to the number of payments required
to pay the contract under the original plan in full. If the amount due under
the plan to which the contract is converted is less than the value at the
time of conversion of the contract under the original plan, such excess amounts
shall be credited against other amounts due through the term of the contract.
If the amount to be credited under the preceding sentence exceeds the amount
due through the term of the contract, such excess shall be refunded to the
purchaser less any applicable fees.
(c) A purchaser may transfer ownership of a prepaid tuition
contract to another eligible purchaser, provided the transfer is accomplished
without consideration and, if the beneficiary is a nonresident of Texas, the
substitute purchaser meets the applicable residency requirements.
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| Source Note: The provisions of this §7.71 adopted to be effective January 8, 1996, 20 TexReg 11124; amended to be effective November 15, 1996, 21 TexReg 10889; amended to be effective December 3, 1997, 22 TexReg 11716; amended to be effective July 14, 2002, 27 TexReg 6042 |
