Terms and Conditions




1) To obtain a one-time Alfond Grant, a NextGen account must be opened naming the child as the beneficiary and the account owner must accept the Alfond Grant offer on or before the child's first birthday (Grant Acceptance).  The child must be a Maine resident at the time the Grant Acceptance is submitted to the Finance Authority of Maine (FAME).  The Grant Acceptance and NextGen Account Application (if a new account) must be received at FAME on or before the child’s first birthday.   


2) The Alfond Grant will be considered the initial contribution into the NextGen account.  No other contribution to the account is required.


3) An eligible child may receive only one Alfond Grant.  In the event more than one individual opens a NextGen account for the same child, the Alfond Grant will be awarded to the first account that submits the Grant Acceptance to FAME.  In the event multiple Grant Acceptances are received on the same day for the same beneficiary, a NextGen account will be selected for awarding of the grant at the discretion of FAME.


4) FAME will credit the Alfond Grant to the NextGen account only after the account is opened, account number assigned, and the Grant Acceptance is received at FAME. It may take up to eight weeks to process the award.  Once awarded to a NextGen account,  the Alfond Grant remains allocated to that NextGen account subject to Section 6 below.


5) The Alfond Grant, including any earnings on grant funds, may not be transferred to another beneficiary and may not be rolled over to another state Section 529 plan.


6) The Alfond Grant, including any earnings on the grant, is forfeited in the following circumstances:

 a)     the NextGen account is closed; or

 b)     the NextGen account owner makes a lifetime transfer of the NextGen account to anyone other than the  

       account beneficiary or the beneficiary’s parent or guardian; or

 c)     the beneficiary dies; or

 d)     the Alfond Grant has not been used by the beneficiary’s 28 birthday; or

 e)     the aggregate value of the Alfond Grant does not exceed $50 for at least 18 months; or

 f)      in the event of fraud or misrepresentation by the account owner.


7)    The Alfond Grant is funded by the Alfond Scholarship Foundation (ASF).  ASF may, at any time, modify or terminate Alfond Grants.


Default Investment Option:  A NextGen Client Direct Series Account Application submitted for the purpose of obtaining the Alfond Grant, other than an application submitted through an electronic application process, will be accepted without investment option(s) selected.  However, any contributions made to the account will be 100% allocated to and invested in the appropriate iShares Age-Based Portfolio, managed by BlackRock, unless and until a different investment allocation for existing and/or future contributions is directed by the account owner.  An application submitted through an electronic application process will not be accepted without investment option(s) selected.


Release of Information:   Acceptance of grant funds is the account owner’s authorization that  FAME may share an Alfond Grant account owner’s non-public personal information and information about NextGen account activity from time to time in order to conduct research to evaluate and improve the Alfond Grant, which may include publishing of aggregated non-personally identifiable information. FAME may also share such information with the Alfond Scholarship Foundation for its non-commercial charitable, educational and aspirational purposes.


Investment of Grant Funds: Alfond Grants will be invested at the discretion of the Alfond Scholarship Foundation.  Neither the account owner nor the beneficiary has the ability to direct the investment of grant funds. 


Ownership of Grant Funds:  Although allocated to a particular NextGen account, grant funds are not the property of the account owner or the beneficiary and may only be withdrawn for qualified higher education expenses.  Grant funds, including any earnings on grant funds, will be fully used before other contributions to the NextGen account or earnings thereon, if any, are used for qualified higher education expenses. 


Use of Grant Funds:  To use grant funds, the NextGen account owner must certify that such funds are being used for qualified higher education expenses, as required by FAME. If grant funds are withdrawn and the withdrawal is subsequently determined to have been fraudulent, FAME may off-set the amount fraudulently obtained from any funds remaining in the NextGen account.


Tax Consequences:  Alfond Grants have been designed so that the  grant, including any earnings, used for certain qualified higher education expenses will be treated as a scholarship as defined by the Internal Revenue Code.  Grants can be used for tuition, fees, certain room and board expenses, books, supplies and certain equipment.  However, any portion of grants used as payment for room and board costs may be subject to federal and/or state income tax.  Similarly, any portion of grant awards used to pay for qualified higher education expenses at schools not eligible for Title IV financial aid may not be eligible for federal and/or state tax-exempt treatment. Notwithstanding the design of the grant programs, the Internal Revenue Service could take the position that grant awards are subject to federal income taxation in the year the grant is awarded or the year in which the funds are withdrawn. NextGen account owners and beneficiaries should consult their own tax advisor regarding the tax treatment of grant funds awarded. 


Verification  Acceptance of grant funds is the account owner’s authorization for FAME to undertake, at its discretion, investigation to verify that the NextGen account owner meets the program requirements. FAME reserves the right at all times to require evidence of eligibility to receive a grant and may conduct investigations to determine eligibility without obtaining additional consent from the NextGen account owner or beneficiary after a grant has been credited to a NextGen account.  In the event a subsequent investigation reveals that the grant was obtained through misrepresentation or fraud, FAME may revoke the grant.


Refusal: The account owner for an eligible NextGen account who does not wish to receive any grant automatically awarded to an account must contact FAME in writing to request that the grant not be awarded (if the request is received prior to awarding) or that the grant funds and any earnings be rescinded (if the request is received after the grant has been awarded).


Not Eligible: Grants will not be awarded to accounts established as scholarship accounts by state or local government or 501(c)(3) organizations.