This blog that I link to is spreading lies about the KAPT program and Kentucky State Treasurer Jonathan Miller.
Here are the facts:
The budget passed Monday by the Senate would raid $13.7 million from Kentucky’s Affordable Prepaid Tuition (KAPT), a program which makes it easier for families to afford college for their kids and grandkids. The KAPT fund contains the hard-earned personal savings of nearly 9000 Kentucky families who have put their own money in KAPT to save for their kids’ and grandkids’ education. The Senate has no right to raid this fund and use the money for special interest programs. The Attorney General’s office has issued a letter with its opinion that such a raid would be unconstitutional under Kentucky law.
A January study from an independent actuarial firm declared that the KAPT Fund is financially stable in the short and long term and has an actuarial surplus of more than $2 million. KAPT’s total investments exceed $100 million. KAPT is a self-sustaining, debt-free program that never has used taxpayer dollars. KAPT is managed by the Kentucky Higher Education Assistance Authority, and its investment performance has been outstanding.
KAPT’s financial security comes from the backing of the Unclaimed Property Fund, which the General Assembly in 2000 declared was available to back up KAPT in the case of liabilities due to potential excessive tuition increases. When three years of unexpected double-digit tuition increases occurred – because of cuts proposed by the state Senate -- money was transferred from the KAPT Reserve to meet program liabilities. These transfers were authorized by the Attorney General’s office and Governor Fletcher’s administration.
If David Williams believes that the KAPT program is in financial jeopardy – and it is NOT – then why is he trying to take $13.7 million from the fund? If David Williams believes that college tuition is rising at extraordinary rates, then why does he not fully fund higher education, and why is he trying to shut down a program that makes college more affordable? This just reveals his hypocrisy and the solely partisan motives behind his attacks on the program.
The Senate budget would also shut down KAPT to new enrollment. With the program financially healthy, it would be unjust to deny this opportunity to affordable higher education to thousands of new Kentucky families.
Last fall’s enrollment charged premiums on new contracts. These premiums led to an additional program surplus of over $1 million. Shutting down KAPT to new enrollment would eliminate the ability of the program to enhance its financial security through the charging of premiums.
Future management of the KAPT program rests in the hands of the Fletcher Administration. Their staff and their appointees will be making the decisions on future enrollments. Why is David Williams trying to tie the Governor’s hands on this issue by shutting down KAPT to new enrollment?