Washington parents and grandparents who bought prepaid college-tuition units under the GET program can exit the program without incurring penalties.

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Investors who bought Washington prepaid college-tuition units can pull their money out without incurring state penalties, a board that oversees the program has decided.

The decision gives account holders in the Guaranteed Education Tuition (GET) plan until December 2016 to decide whether they want to cash out.

Account holders who paid $163 or more — the price over the last four years — will receive a refund of the amount they paid.

What should you do?

Account-holders who are contemplating a change should call or email the GET staff, 1-800-955-2318 or GETInfo@wsac.wa.gov. According to GET, information about how to ask for a refund will also be posted on the website by Wednesday, at www.get.wa.gov.

Those who paid less than $163 will receive $117 — the current value of a GET unit. The cost of GET units jumped from $117 in 2011 to $163 in 2012.

The program’s managers don’t think this move spells the end of GET.

“From customer surveys and customers that have called in, we know not everyone is going to request a refund,” said Ryan Betz, associate director of marketing and communications for GET. “A lot have shared with us they still believe in the program — they’re going to stick it out, their kids are young … there’s still plenty of time and plenty of opportunity for tuition-setting policy to change.”

The refund offer comes after state lawmakers decided this year to cut the cost of college tuition. GET’s payouts are based on tuition at the most expensive public university in the state, but because tuition is falling, some investors might never recover all of their initial purchase price.

And parents whose children go to private or out-of-state schools are also concerned about losing ground because tuition at those schools continues to rise while the payout for GET units is frozen for now.

The program will begin taking requests for refunds on Wednesday. The GET fund contains about $2.87 billion, and there are 130,000 active accounts.

Those who decide to pull out of the program will receive a check in the mail, and GET staffers estimate it will take 10 to 12 weeks to issue a refund, Betz said.

There are some caveats for account-holders who decide to invest elsewhere.

Those who withdraw from GET must reinvest the money within 60 days in another IRS-recognized education-savings plan, called 529 plans after the section of the Internal Revenue Code that created them.

If the money isn’t reinvested 60 days after the refund check is issued, account-holders will face federal penalties — income tax on any gains they have made, plus an additional 10 percent penalty.

In a 529 plan, investments grow free from federal taxes, and the money is not taxed when it is taken out to pay for college. The money is typically invested in mutual funds or similar investments, much like a 401(k) or IRA. Most states offer 529 plans, which are open to investors from any state.

Washington is also considering setting up its own 529 plan.

For now, though, it is one of just a handful of states that offer a prepaid-tuition plan only. GET allows parents to pay tuition in advance, but at a premium price that’s higher than the cost of tuition today.

Unlike a 529 plan, the GET program is guaranteed to keep pace with the cost of in-state tuition, which has always either gone up each year or, more recently, been frozen by lawmakers. But this year, the Legislature rolled tuition back at public colleges by 5 to 20 percent for the next two academic years.

As part of that decision, lawmakers also froze the payout value of a GET unit at $117 for two years; before then, GET’s payout value was linked to the tuition and fees at the state’s most-expensive public university.

On Tuesday, the GET committee extended $117 as the minimum payout of a GET unit until the cost of tuition and mandatory fees at the most expensive public state university exceeds $11,700 a year — the benchmark upon which the current GET valuation is based.

Last year, the most expensive school was University of Washington Tacoma. This year, UW Tacoma tuition and mandatory fees are $11,245; next year they will drop another 10 percent.

The legislation that cut college tuition also charged the GET committee with drafting a report on the feasibility of creating a Washington 529 plan. And while that report isn’t due until December 2016, state Treasurer James McIntire, a GET committee member, said he hoped the state could have a 529 savings plan operating before then.

Just a few years ago, during the economic downturn, GET ran into funding woes when the combined forces of double-digit tuition growth and the falling value of its investments caused the program to become underfunded.

That’s not a problem today.

State Actuary Matt Smith told the GET committee Tuesday that as of June 30, the fund is 141 percent funded; it contains $2.87 billion, and the present value of its future obligations — GET payouts — is $2.04 billion, giving it a reserve of $835 million. But Smith also described the fund’s status as “highly sensitive to short-term changes in tuition growth” as well as fluctuations in investment returns.

The funded status assumes the Legislature won’t claw back the tuition cut it made earlier this year, he said. And it also doesn’t take into account stock-market fluctuations since June.