(a) The Commissioner shall administer the program pursuant to this Chapter. The Commissioner may make changes to the program as required for participants to obtain or maintain the federal tax benefits or treatment provided by § 529 of the Internal Revenue Code of 1986, as amended, or successor legislation.

(b) The Commissioner shall implement the program through the use of financial organizations as account depositories and managers. Individuals may establish accounts directly with an account depository.

(c) The Commissioner shall solicit proposals from financial organizations to act as program managers and trustees. Financial organizations submitting proposals shall describe the investment instruments that will be held in accounts. The Commissioner shall select a program manager based on the following criteria:

(1) The financial stability and integrity of the financial organization;

(2) The safety of the investment instruments being offered;

(3) The ability of the investment instruments to track the expected increasing costs of higher education;

(4) The ability of the financial organization to satisfy recordkeeping and reporting requirements;

(5) The financial organization’s plan for promoting the program and the resources it will commit to promote the program;

(6) The fees, if any, proposed to be charged to persons for opening accounts;

(7) The minimum initial deposit and minimum contributions that the financial organization will require;

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(8) The ability of the financial organization to accept electronic withdrawals, including payroll deduction plans; and

(9) Other benefits to Guam or its residents included in the proposal.

(d) The Commissioner may enter into a management contract of up to ten (10) years in duration with a financial organization. The management contract shall, at a minimum, require the financial organization to:

(1) Take any action required to keep the program in compliance with § 50004 of this Chapter and to manage the program so as to qualify it as a qualified state tuition plan under § 529 of the Internal Revenue Code of 1986, as amended, or successor legislation;

(2) Keep adequate records of each account, keep each account segregated from every other account, and provide the Commissioner with the information necessary to prepare the statements required by § 50004;

(3) Compile information contained in statements required by § 50004 of this Chapter and provide the compilations to the
Commissioner;

(4) If there is more than one program manager, provide the Commissioner with the information necessary to determine compliance with § 50004;

(5) Provide the Commissioner access to its books and records to the extent needed to determine compliance with the contract;

(6) Administer and invest all accounts for the benefit of the account owner;

(7) Be audited at least annually by a firm of independent certified public accountants selected by the program manager, and to provide the results of the audit to the Commissioner;

(8) Provide the Commissioner with copies of all regulatory filings and reports related to the program made by it during the term of the management contract or while it is holding any accounts, other than confidential filings or reports that are not part of the program. The program manager shall provide, for review by the Commissioner, the results of any periodic examination of the manager by any local or federal banking, insurance, or securities commission, except as such

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reports may not be disclosed under applicable law or rules enacted by the Commissioner; and

(9) Provide the information required by Rule 15c2-12(b )(5) under the Securities Exchange Act of 1934 pursuant to a continuing disclosure certificate for the benefit of the account owners.

(e) The Commissioner may select more than one financial organization for the program.

(f) The Commissioner may require an audit to be conducted of the operations and financial position of the program manager at any time if the Commissioner has any reason to be concerned about the financial position, the recordkeeping practices, or the status of accounts held by the program manager.

(g) During the term of any contract with a program manager, the Commissioner shall conduct examinations of the manager and its handling of accounts. The examination shall be conducted at least biennially if the manager is not otherwise subject to periodic examination by the Commissioner, the Federal Deposit Insurance Corporation or a similar entity.

(h) The Commissioner may adopt rules necessary to implement the program.