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164A.704 Duties of board.

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Page 1 of 2 164A.704 Duties of board. The board shall: <br>(1) Promulgate administrative regulations, set fees, and adopt procedures as are necessary to implement the provisions of KRS 164A.700 to 164A.709; (2) Enter into contractual agreements, including contracts for legal, actuarial, financial, and consulting services; (3) Invest moneys in the fund in any instruments, obligations, securities, or property as permitted by KRS 164A.701(4) and deemed appropriate by the board; (4) Procure insurance to protect against any loss in connection with the fund's property, assets, or activities and to indemnify board members from personal loss or <br>accountability from liability arising from any action or inaction as a board member; (5) Make arrangements with eligible educational institutions in the Commonwealth to fulfill obligations under prepaid tuition contracts, including, but not limited to, <br>payment from the fund of the tuition cost on behalf of a qualified beneficiary to <br>attend an eligible educational institution in which the beneficiary is admitted and <br>enrolled; (6) Develop requirements, procedures, and guidelines regarding prepaid tuition contracts, including but not limited to, the termination, withdrawal, or transfer of <br>payments under a prepaid tuition contract; tuition shortfalls; number of participants; <br>time limitations for prepaid tuition contracts and the use of tuition benefits; tuition <br>conversions; payment schedules; payroll deductions; penalties for failure of <br>purchasers to adhere to contracts; and transfer of prepaid tuition credits towards <br>private education in the Commonwealth or for out-of-state institutions; (7) Have the actuarial soundness of the fund evaluated by a nationally recognized independent actuary annually, by October 1 of each year, to determine: <br>(a) The amount of prepaid tuition for each tuition plan; and for each eligible educational institution for specific academic years, the corresponding value; (b) Whether additional assets are necessary to defray the obligations of the portion of the fund relating to contracts entered into before April 25, 2006, <br>and when those funds will be needed. <br>1. For purposes of this paragraph, a &quot;real liability expected to accrue during <br>the next biennium&quot; exists if the amount in the fund representing <br>contracts entered into before April 25, 2006, is not sufficient to meet all <br>anticipated distributions under contracts entered into before April 25, <br>2006, and the expense of maintaining and operating the fund for the <br>upcoming biennium. 2. If the report of the actuary submitted in an odd-numbered year reflects <br>that there will be a real liability expected to accrue during the next <br>biennium, the secretary of the Finance and Administration Cabinet shall <br>include in the budget request for the cabinet an appropriation to the <br>board in an amount necessary to meet the real liability in each fiscal year <br>of the biennium, and the General Assembly shall appropriate the <br>necessary funds; and Page 2 of 2 (c) Whether additional assets are necessary to defray the obligations of the portion of the fund relating to contracts entered into after April 25, 2006, and <br>when those funds will be needed. If the assets of the portion of the fund <br>relating to contracts entered into after April 25, 2006, are insufficient to <br>ensure the actuarial soundness of that portion of the fund, as reported by the <br>actuary, the board shall adjust the price of subsequent purchases of prepaid <br>tuition contracts to the extent necessary to restore the actuarial soundness of <br>the fund. The board may suspend the sale of prepaid tuition contracts until the <br>next annual actuarial evaluation is completed if the board determines the <br>action is needed to restore the actuarial soundness of the fund. During a <br>suspension of sales of contracts, the board and Tuition Account Program <br>Office shall continue to service existing contract accounts and meet all <br>obligations under existing prepaid tuition contracts; and (8) Make an annual report each year by November 1 to the Legislative Research Commission and the Governor showing the fund's condition, and whether additional <br>assets will be necessary to defray the obligations of the fund. Effective: April 25, 2006 <br>History: Amended 2006 Ky. Acts ch. 252, Pt. XXXI, sec. 4, effective April 25, 2006. -- Amended 2005 Ky. Acts ch. 162, sec. 5, effective July 1, 2005. -- Amended 2002 <br>Ky. Acts ch. 25, sec. 4, effective July 15, 2002. -- Created 2000 Ky. Acts ch. 163, <br>sec. 4, effective July 14, 2000.