ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Tuesday, December 3, 1996 TAG: 9612030095
SECTION: VIRGINIA PAGE: C-1 EDITION: METRO
DATELINE: RICHMOND
SOURCE: PHILIP WALZER LANDMARK NEWS SERVICE
THE PROGRAM OFFERS parents a variety of payment plans guaranteeing tuition and fees when their children go to a state college.
Hoping to drum up business for the state's new prepaid tuition plan, Gov. George Allen on Monday became its first customer, signing up his two children.
``A lot of politicians talk about a lot of different things,'' Allen said during a news conference at a Richmond elementary school. ``I'm going to put my money where my mouth is.''
The first sign-up period for the program began Monday. It runs through Feb.28.
The program offers parents a variety of payment schedules guaranteed to cover tuition and fees when their children begin school at a state-supported college. It does not apply to room and board.
Parents can pay anything from $12 a month to cover one year of community college for an infant to a one-time $16,699 for four years at a university for a current ninth-grader.
Allen chose a middle-of-the-road plan, paying a lump sum for one year at a four-year school for each of his kids. It will cost him $3,893 for his 5-year-old son, Forrest, and $4,003 for his 8-year-old daughter, Tyler.
The program ``will take some of the guesswork and risk out of financing a higher education,'' Allen said after signing two much-enlarged applications in front of a gaggle of reporters and about 50 serious-looking fifth-graders in the library of Crestview Elementary School.
In Killeen, Texas - where most of the phone calls to the Virginia program's toll-free number are routed - operators had little free time Monday. In the first four hours of business, they took more than 800 calls, said Rick Thomssen, customer service director of the Sallie Mae Servicing Corp., which handles phone inquiries for the Virginia program. In previous weeks, the average for an entire day was about 500, said Diana Cantor, the director of the program.
It's too early to estimate how many people will sign up, Cantor said. Allen was the first known customer. Cantor said she will check the Central Fidelity lockbox in Richmond today, where the applications are to be sent, to see how many others have come in.
Gordon Davies, director of the State Council of Higher Education and a member of the board overseeing the program, warned last month not to expect a rush of customers at the outset. ``Everybody waits till the end, partly out of procrastination,'' he said at a state council meeting.
That's what happened in Texas this year, Cantor said. Of the 41,000 people who signed up, 32,000 did so in the last two days.
Even so, the Virginia program - formally known as the Higher Education Tuition Trust Fund - is working to catch people's attention early.
On Monday, the program began a $750,000 advertising campaign across the commonwealth. And at the news conference, state officials were pitching a tuition payment as just the thing for Christmas or Hanukkah.
``It's the perfect time for a gift,'' Allen said. ``It doesn't have to be parents. It can be grandparents, aunts and uncles.''
Maryanne Ring, one of the operators in Texas, said callers usually ask about the basics of the program, such as the tax status of the payments. (They are exempt from taxes until the child enters school and then are taxed at the student's rate.)
But program officials have fielded more unusual queries. Leslie Strickler, a part-time consultant, remembers a newly married couple wondering if they could sign up - before their child was born. (The answer: ``No.'')
Cantor also heard from someone apparently hoping to skirt the state residency requirement. Could he rent an apartment in Arlington for a month and still qualify for the program?
She told him that her staff would not be verifying the residency of applicants - but to consider the possibility that a nasty neighbor might rat on him.
Monica Hagger, a Hampton mother of two, called a few weeks ago seeking the basics. She's still pondering whether to join. ``If I don't plan for this, I don't know what to do when the time comes,'' she said Monday.
That's the kind of foresight the program will encourage, Allen predicted Monday. Although he has campaigned to get government out of people's lives, Allen said, ``It's good government policy to encourage savings, thrift and individual responsibility.''
The program, he said, also is in sync with his effort to make ``higher education more accessible and affordable to Virginians.'' In the past 15 years, he said, tuition and fees have risen an average of 7.5 percent a year at Virginia schools.
To rein in the increases, Allen and the General Assembly approved a 3 percent cap on annual tuition increases from 1994 to 1996 and a tuition freeze from 1996 to 1998. On Monday, Allen repeated his pledge to extend the freeze through the year 2000 before he leaves office in 1999.
The University of Virginia alumnus acknowledged one bit of bad news under the prepaid tuition plan: Although the payments will be accepted at any four-year state-supported school in Virginia, applicants are asked to list their top two choices.
Neither of Allen's children listed the University of Virginia. Tyler's favorite was the College of William and Mary and Forrest's was Virginia Tech.
For information about prepaid tuition, call (888) 567-0540. The first sign-up period will end Feb.28, but payments will not be due until May1. The program will have additional sign-up periods, but prices may change.
LENGTH: Long : 101 lines ILLUSTRATION: GRAPHIC: Chart by staff: Paying for college KEYWORDS: MGRby CNB