Virginia Code 23.1-707.1: Prepaid tuition contracts; pricing reserves; limitations
A. As used in this section:
Terms Used In Virginia Code 23.1-707.1
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Board: means the governing board of the Plan. See Virginia Code 23.1-700
- Contract: A legal written agreement that becomes binding when signed.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Plan: means the Virginia College Savings Plan. See Virginia Code 23.1-700
- Prepaid tuition contract: means the contract or account entered into by the board and a purchaser pursuant to this chapter for the advance payment of tuition at a fixed, guaranteed level for a qualified beneficiary to attend any public institution of higher education to which the qualified beneficiary is admitted. See Virginia Code 23.1-700
- Tuition: means the quarter, semester, or term charges imposed for undergraduate tuition by any public institution of higher education and all mandatory fees required as a condition of enrollment of all students. See Virginia Code 23.1-700
“Funded status” means the ratio of the assets of the Plan to the actuarially estimated value of tuition obligations of the Plan, expressed as a percentage.
“Pricing reserve” means the percentage by which the actuarially determined prepaid tuition contract price exceeds the amount estimated to meet the actuarially determined tuition obligation for such prepaid tuition contract.
B. In the event that the funded status of the Plan meets or exceeds 105 percent, the pricing reserve shall not exceed five percent.
C. In the event that the funded status of the Plan does not meet or exceed 105 percent, the pricing reserve may exceed five percent but shall not exceed 10 percent.
D. The board shall provide to the House Committee on Appropriations, the Senate Committee on Finance and Appropriations, and the Joint Legislative Audit and Review Commission written notification and a detailed explanation of any change to the pricing reserve within 30 days of such change.