§3129.4. Louisiana Education Tuition and Savings Plan and Fund

            A. The Board of Regents, or its successor, is authorized to formulate, develop, adopt, implement, then manage and otherwise administer the Louisiana Education Tuition and Savings Plan, which shall be comprised of an education savings program based on issuance of interest-bearing education notes. Prior to adoption by the Board of Regents, the board shall submit the proposed plan in writing to the House and Senate Committees on Education for review and comment.

            B. The Board of Regents is authorized to adopt appropriate and necessary rules, regulations, and program guidelines to implement an education savings program based on issuance by the state of interest bearing education notes. Such rules, regulations, and program guidelines shall be consistent with the provisions of this Section relating to the education savings plan and shall include but not be limited to the following:

            (1) The program shall be designed to allow parents and other eligible participants to purchase, at a discounted rate, interest bearing education notes issued by the state in the name of a qualified beneficiary and redeemable for permitted educational expenses incurred by the beneficiary upon acceptance by and matriculation at any public or private institution of higher education in the state.

            (2) Eligible participants shall include parents, family members, and other persons, within or without the state; however, the qualified beneficiary shall be a Louisiana resident at the time of purchase of the note. The program shall include provisions setting forth the circumstances and terms under which a purchaser of an education note may substitute one qualified person for another as a beneficiary.

            (3) The education notes shall be marketed in various denominations, including one thousand dollar denominations, shall have from five to twenty-two year maturities, and shall pay accrued interest upon maturity as provided for by the program.

            (4) Interest earned by the purchaser on an education note shall be exempt from Louisiana income tax.

            (5) The program shall provide that if a qualified beneficiary is not admitted to a state public or private institution of higher education or chooses to attend an out-of-state higher education institution, the purchaser of the education note may redeem the note, minus administrative fees, with a substantial penalty applied to the return of accrued interest which shall be provided for by the rules.

            (6) The program shall permit a purchaser of an education note to redeem the note upon the death or permanent and total disability of the qualified beneficiary without penalty. The program also shall provide for other circumstances when the education note is not or cannot be used for permitted purposes.

            C.(1) There shall be established in the state treasury as a special permanent fund the Louisiana Education Tuition and Savings Fund, hereinafter referred to as the "Tuition and Savings Fund". The fund shall be comprised of one account for both the Louisiana Student Tuition Assistance and Revenue Trust Program established in Chapter 22-A of this Title and the Louisiana Student Tuition Assistance and Revenue Trust Kindergarten Through Grade Twelve Program established in Chapter 22-B of this Title and a separate account for the educational savings program authorized by this Section. A "Savings Enhancement Fund" shall be established as a special permanent sub-account within the Louisiana Student Tuition Assistance and Revenue Trust Program and Louisiana Student Tuition Assistance and Revenue Trust Kindergarten Through Grade Twelve Program Account. As budgeted by the Louisiana Tuition Trust Authority, the legislature shall annually appropriate state general funds to be deposited by the state treasurer in the Savings Enhancement Fund. Monies in the Savings Enhancement Fund shall be used, as appropriated, to make earnings enhancements to the beneficiaries of eligible education savings accounts established under the Louisiana Student Tuition Assistance and Revenue Trust Program by Chapter 22-A of this Title. All revenues and interest earnings generated pursuant to programs of the Louisiana Education Tuition and Savings Plan, the Louisiana Student Tuition Assistance and Revenue Trust Program, and the Louisiana Student Tuition Assistance and Revenue Trust Kindergarten Through Grade Twelve Program shall be credited to their respective fund accounts or sub-accounts. The monies in this fund shall be used solely to finance the permitted educational benefits provided by the respective programs. All unexpended and unencumbered monies in fund accounts and their respective sub-accounts at the end of a fiscal year shall remain in such fund accounts or sub-accounts and be available for appropriation in the next fiscal year. The monies in the fund shall be invested by the state treasurer in accordance with state law and as provided for by program rules, regulations, and guidelines, and interest earned on the investment of these monies shall be credited to the respective fund accounts or sub-accounts, following compliance with the requirement of Article VII, Section 9(B) of the Constitution of Louisiana relative to the Bond Security and Redemption Fund. However, principal deposited by account owners and interest earned thereon is not public money and therefore is not subject to the requirements of Article VII, Section 9(B) of the Constitution of Louisiana.

            (2) The legislature shall make yearly appropriations from the respective account and sub-account, if applicable, to the Board of Regents for the purposes established in this Section and to the Louisiana Tuition Trust Authority for the purposes established in Chapter 22-A and Chapter 22-B of this Title.

            D. Repealed by Acts 1993, No. 732, §2, eff. June 21, 1993.

            Acts 1989, No. 252, §1, eff. June 26, 1989; Acts 1990, No. 969, §1, eff. July 23, 1990; Acts 1993, No. 732, §§1 and 2, eff. June 21, 1993; Acts 1995, No. 547, §1, eff. June 18, 1995; Acts 2003, No. 221, §2, eff. June 5, 2003; Acts 2018, No. 687, §2, eff. May 30, 2018.