(a) Prepaid Tuition Contract. — A contract entered into between the Board of Directors of the College Savings Plans of Mississippi Trust Funds and a purchaser pursuant to this article.

(b) Trust fund. — There is created a special fund in the State of Mississippi Treasury Department to be designated as the “Mississippi Prepaid Affordable College Tuition Trust Fund” (hereinafter referred to as the trust fund or fund) and to be administered by the State of Mississippi Treasury Department. The fund shall consist of state appropriations, monies acquired from other governmental or private sources, and money remitted in accordance with prepaid tuition contracts. In the event that dividends, interest and gains exceed the amount necessary for program administration and disbursements, the board may designate a percentage of the fund to serve as a contingency fund.

(c) Purchaser. — A person, corporation, trust, charitable organization or other such entity that makes or is obligated to make advance payments in accordance with a prepaid tuition contract entered into pursuant to this article. However, no purchaser may request or accept any form of compensation, fee, commission, service charge or any other form of payment or remuneration for entering into a contract for the benefit of a nonresident beneficiary.

(d) Beneficiary. — (i) The beneficiary of a prepaid tuition contract must be eighteen (18) years of age or younger at the time the purchaser enters into the contract and must be: (A) a resident of this state at the time the purchaser enters into the contract; or (B) a nonresident if the purchaser is a resident of this state at the time that the contract is entered into.

(ii) The board may require a reasonable period of residence in this state for a beneficiary or the purchaser.

(iii) A beneficiary is considered a resident for purposes of tuition regardless of the beneficiary’s residence on the date of enrollment. However, for contracts entered into after July 1, 2003, this provision only applies to nonresident beneficiaries if (A) the original purchaser was the parent, grandparent or legal guardian of the beneficiary; or (B) the beneficiary was a resident of Mississippi at the time the contract was purchased.

(e) Institution of higher education. — Any public institution of higher learning or public community or junior college located in Mississippi.

(f) Tuition. — The quarter, semester or term charges and all required fees imposed by an institution of higher education as a condition of enrollment by all students.

(g) Board or board of directors. — The Board of Directors of the College Savings Plans of Mississippi Trust Funds as provided in Section 37-155-7.

(h) Legislature. — The Legislature of Mississippi.