MONTGOMERY — The board that oversees Alabama’s prepaid college tuition plan agreed Tuesday to keep paying tuition, but not to allow new children to enroll in the financially ailing program.

The board of the Prepaid Affordable College Tuition Plan also agreed to seek help from the state Legislature to shore up its shrinking assets, which are now less than half the money it needs to pay future tuition obligations. The plan has more than 48,000 participants, who range from newborns to current college students.

“For sure we can pay summer school tuition,” said state Treasurer Kay Ivey, who oversees the program and serves as chairman of its board.

Tuition for fall 2009 could depend on help from the legislature, which is scheduled to end its session May 18.

More than 200 anxious parents and grandparents with children in the program packed the board meeting.

Patti Lambert, a Decatur real estate agent who paid for six of her grandchildren to participate, said, “People feel a little calmer, but they still have a lot of questions to be answered.”

There are nearly 12,000 students currently attending college under the plan.

Lt. Gov. Jim Folsom Jr., a board member, told participants, “This program is going to survive, and we are going to fix this problem in the Legislature.”

“He made a big statement here that he is going to have to back up,” Lambert said.

The program allows parents or grandparents to pay a fixed amount when a child is young in return for getting four years of tuition at an in-state college when the child finishes high school. The program invests the money, mostly in the stock market, in anticipation that the earnings will grow faster than tuition.

In most years that has happened. As of Sept. 30, 2007, the program had $899 million in assets, which would have covered 97 percent of its future obligations for tuition.

But then the turmoil on Wall Street plunged its assets to $431 million on Feb. 28. The program’s actuary, Bob Crompton, said the program would need an additional $481 million to meet its future tuition obligations for all participants.

One option for the board was to close the program and pay back the money participants had put into it. But the board voted unanimously not to do that — a move that drew applause from families in the audience.

“At least they’ve come up with some options and they are not closing it,” said Bob Fekete of Wetumpka, whose 12-year-old daughter and 8-year-old son are program participants.

Alabama’s problem is not unique. Several others are scrambling to meet their tuition obligations, and some states have frozen enrollment. Alabama’s board said the freeze on new participants will be indefinite.

Alabama’s board also created a three-member committee to work with the Legislature on solutions: Ivey, Folsom and state two-year college Chancellor Bradley Byrne.

House Speaker Seth Hammett, D-Andalusia, pointed out to the House on Tuesday that the panel chose three people considering running for governor in 2010.

One announced candidate for governor, Democratic U.S. Rep. Artur Davis of Birmingham, issued a statement Tuesday calling the board’s action’s “a Band-Aid on a festering problem.” Davis said the board “should have issued an ironclad commitment that any students currently enrolled will have the cost of their tuition borne by the state.”

Folsom, who has a son in college using the program, said ideas the Legislature could consider include prohibiting public universities from passing along tuition increases to the program and creating interim financing for it.

Rep. Craig Ford, a Gadsden Democrat with two children in the program, introduced two options in the Legislature on Tuesday. Both would provide $150 million over five years to shore up funding in anticipation of a turnaround in the stock market.

One would take money from a state natural gas trust fund. The other would use the state’s unclaimed property fund and money from an account used to pay economic incentives to new industries.

Jeff Emerson, Gov. Bob Riley’s communications director, said he is ready to work with the board and Legislature on a solution.