MONTGOMERY, AL (WBRC) - Alabama's treasurer says the PACT program will likely be broke by 2015 unless it gets an additional $338 million in cash.
The PACT plan's investments took a big hit as the stock market began to slide and the country went into a recession in 2009. State lawmakers and PACT participants thought that crisis was solved last year when the state legislature injected more than half a billion dollars into the program.
With 40,000 contracts left to pay out, some running until the year 2032, State Treasurer Young Boozer says the state may be forced to give refunds.
"We don't want to give people refunds either," said Boozer on Thursday. "What we want to do is get to the final destination, get this thing completed in 2032 and that's what our objective is."
In addition to the lower rate of return on the pact fund's investments, Boozer says steep tuition increases at Alabama and Auburn are contributing to the shortfall.
The funding issue is not immediate, but Boozer says he would like to see the legislature do something by next year.
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