Higher education: financial aid; Michigan education trust act; modify. Amends secs. 4 & 8 of 1986 PA 316 (MCL 390.1424 & 390.1428).

This bill modifies the Michigan Education Trust Act to update definitions and rules for advance tuition payment contracts, directly affecting individuals who purchase these contracts to fund future college education. The legislation clarifies who qualifies as a beneficiary and purchaser while establishing specific conditions under which a contract can be terminated, such as when a student dies, is not admitted to a state school, or chooses to attend a different type of institution. It also outlines how refunds are calculated upon termination, specifying that payments may be reduced based on the number of credit hours completed and allowing for the transfer of funds to other eligible colleges if the student changes schools. By amending existing sections of the law, the bill aims to ensure the trust operates with updated terminology and clearer procedures for handling contract cancellations and refunds.