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Comptroller Reverses Position on Texas Tomorrow FundComptroller Susan Combs announced today that she has reversed her decision not to honor commitments to pay earnings to some families who put their savings in the Texas Tomorrow Fund. The earlier decision affected those families who planned for college using the fund, but who no longer expected their children to need or use the fund for college tuition. The Comptroller chairs the board that governs the Texas Tomorrow Fund, and will ask the board to formally reverse the action she had previously recommended that changed the terms of contracts that families had signed. I believe this reversal is the right decision. I think it's vital that the state keep its word when it offers a savings fund like the Texas Tomorrow Fund. After I learned of the Comptroller's original decision, I expressed my strong objection in a letter which was co-signed by 42 of my Democratic House colleagues. I also worked with Rep. Jim McReynolds (D-Lufkin) on a request to the Texas Attorney General to determine whether the action was legal, and whether the Comptroller or board was obligated to notify affected families of the pending change during the public comment period before final approval by the board. Since college tuitions were deregulated in 2003, the fund's investments have had a much harder time keeping up with rising tuitions. Any shortfall in the fund to pay for tuition and fees is guaranteed by the state. The board's earlier action was an attempt to reduce a small part of the cost of the state's future obligation to back the commitments of the fund, but the savings came at a cost to the families who had invested. Ms. Combs cited "the concerns of legislators and contract-holders" in deciding to ask the board to reverse her previous recommendation. She announced that she intends to ask the board to allow families who withdrew from the fund to resume their contracts if they choose to do so. She did not say how many families had withdrawn, nor is there any way to know how many of those families moved their Texas Tomorrow Fund savings into CDs or other accounts that have penalties for withdrawal. I hope this issue shines a light on the impact that unlimited tuition increases have had on Texas families. I look forward to working with the Comptroller as we move forward.
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