Ellington

JACKSON, Miss. (AP) — Mississippi's prepaid college tuition plan likely won't be reopening for additional enrollments until sometime next year at the earliest, according to State Treasurer Lynn Fitch.

Like most investors, the Mississippi Prepaid Affordable College Tuition plan had an excellent first quarter in the stock market. That could cut its projected shortfall. But the board that runs the plan voted Wednesday to trim its assumption about how much money the fund will make on future investments. Under accounting rules, that will drive up the amount of the shortfall.

The board, at Fitch's request, did not sell new contracts during last fall's enrollment period. Under the plan, contracts cover future college costs, with money invested for when students enroll. Fitch and board members agreed in April to make changes that would allow the prepaid plan to reopen, but there are a number of remaining issues that auditors have urged the board to consider before reopening. Committees have discussed some of those concerns but haven't reached decisions.

"We're trying to stand this program back up, but in a sustainable way," Fitch said. "We will continue to pace ourselves through that process."

At last report, the fund was more than $80 million short of future tuition needs, with 80 percent of the assets needed to cover its obligations. That funding level will be recalculated after June 30, but could be lower because of investment gains. The fund increased by 6.8 percent to $291 million in the first three months of 2013.

Investment adviser Charlie Mulfinger of Graystone Consulting, though, said it was unrealistic to expect the fund's mix of stocks, bonds and other investments to continue to rise at that rate.

"You're probably wondering why, if we just had a great quarter, why we're lowering rates," Mulfinger said. "It's because of what we expect in the future."

Fund investments have earned 5.4 percent a year since it was created, although the fund projected it would earn 7.3 percent after it paid fees to money managers. The board voted Wednesday to lower that expected rate of return slightly to 7 percent after fees, a level that Fitch called "realistic."

Fitch said the board remains in talks with community colleges and universities about the schools somehow shouldering the burden for part of future costs.

"We're looking at moving some of the liability to the institutions of higher learning and the community colleges," she said.