Alabama PACT
The Alabama PACT program (pre-paid college tuition) has been a hot topic on the news and internet. It sems that the investments of this program have taken a beating in the market and there is not sufficient monies to pay college tuition for all those enrolled.
Although the PACT is not a state agency, the solitications for it, from its inception until 2004, clearly implied that the “full faith and credit” of the State of Alabama was behind the program and that payment of tuition was guaranteed. This illusion concerning the obligation of the State was reinforced by the fact prominent Alabama politicans sat on the Board of Directors.
As an old lawyer, I see lawsuits acoming. Some of them will be for fraud and seek punitive damages. I also foresee some enterprising lawyers naming the Directors as defendants and seeking to hold them personally liable. Now some of those same politicians are talking about the moral obligation of the State and the need for the State (i.e. taxpayers) to guarantee the payments.
That raises a question. These Directors are potentially (I stress potentially) personally liable and are they using their official positions to urge the State to cover that liability?
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Update - the first lawsuit was filed today
That didn’t take long. Here’s the link.