Audit presented on state's college savings program - WLOX.com - The News for South Mississippi

Audit presented on state's college savings program

The bottom line is we want our children to go to college. We want them to go to college in our state The bottom line is we want our children to go to college. We want them to go to college in our state
It's a very complex, detail audit," said State Treasure Lynn Fitch. It's a very complex, detail audit," said State Treasure Lynn Fitch.
JACKSON, MS (Mississippi News Now) -

Tuesday morning independent auditors laid out more than a dozen financial concerns with the state's college savings program known as MPACT.

It's a very complex, detail audit," said State Treasure Lynn Fitch.

Fitch froze the program last fall to new enrollees and requested the audit after finding what she says are red flags in its sustainability. MPACT has been under funded since 2001 and is close to $100 million in the hole. Yearly return investments average just more than four percent, which is below the 7.8 percent needed for the program to stay alive. Fitch says much of that comes from the recent recession and low revenue years for the state.

"When it was created 15 years ago, we were getting double digit interest earnings so the program was very fit, very sound," said Fitch.

Adding to the concerns are students picking expensive schools and tuition hikes happening faster than the program can keep up with. With the audit now complete, Fitch says the board will have a better idea of what changes need to be made, like the possibility of year round enrollment. Fitch says she does not intend on shutting the program down, and for the 22,000 people already enrolled, their investments will be fully honored.

"The bottom line is we want our children to go to college. We want them to go to college in our state," said Fitch.

"The program needs some adjustment. It's not broken. It's still a viable program," said legislative board member, Republican Senator John Polk of Hattiesburg.

Polk says the state still backs the program and he doesn't expect it to be closed, only altered.

"I think with a few good income years, good market years, we can see the program very viable again," said Polk.

"I think we have a good product here. We've got a good audit to work with. We have the opportunity to open this program again," said Fitch.

There's no time frame on when or which recommendations the board will use to make changes to the program. The program isn't expected to be opened again until next year.

Copyright 2012 MSNewsNow. All rights reserved.

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