Bill Text: NH HB577 | 2015 | Regular Session | Amended
Bill Title: Establishing a childrens savings account program, and relative to the bonding authority of the city of Dover.
Spectrum: Bipartisan Bill
Status: (Passed) 2015-07-28 - Signed by the Governor on 7/27/2015; Chapter 271; Sections 1 & 2 Effective 7/1/2015, Remaining Effective 7/27/2015 [HB577 Detail]
Download: New_Hampshire-2015-HB577-Amended.html
HB 577-FN-A-LOCAL - AS AMENDED BY THE HOUSE
18Feb2015… 0309h
2015 SESSION
15-0359
04/05
HOUSE BILL 577-FN-A-LOCAL
AN ACT establishing a children’s savings account program.
SPONSORS: Rep. Gile, Merr 27; Rep. Lovejoy, Rock 36; Rep. Gargasz, Hills 27; Rep. Barry, Hills 21; Rep. Wallner, Merr 10
This bill establishes the children’s savings account program, including a commission and fund, for the purpose of establishing children’s savings accounts for children attending public kindergarten.
This bill is a request of the committee to study the feasibility of funding a kindergarten to college/career ready program and a universal college savings account established in 2014, 122.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
18Feb2015… 0309h
15-0359
04/05
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Fifteen
AN ACT establishing a children’s savings account program.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Purpose. The general court finds that there is sufficient need and significant scholarly research to support the development of a children’s savings account program that increases opportunities for college and career success for all students; that engages and incentivizes positive postsecondary education savings behavior for low and moderate income families; and that provides financial literacy education for all children and their parents in cooperation with local public school systems.
2 New Chapter; New Hampshire Children’s Savings Account Program. Amend RSA by inserting after chapter 195-H the following new chapter:
CHAPTER 195-I
NEW HAMPSHIRE CHILDREN’S SAVINGS ACCOUNT PROGRAM
195-I:1 Program Established. There is hereby established in the office of the state treasurer the New Hampshire children’s savings account program. The purpose of the program is to increase opportunities for college and career success for all students, to encourage positive postsecondary education savings behavior for low and moderate income families, and to provide, in cooperation with the public schools, financial literacy education for all students and their parents.
195-I:2 Commission Established.
I. The children’s savings account program commission is hereby established to ensure the proper administration, management, and development of the children’s savings account program. The members of the commission shall be as follows:
(a) Two members from the house of representatives, appointed by the speaker of the house of representatives.
(b) One member from the senate, appointed by the president of the senate.
(c) The state treasurer, or designee.
(d) The director of the division of higher education, department of education, or designee.
(e) The chairperson of the university system of New Hampshire board of trustees, or designee.
(f) The director of the New Hampshire financial literacy education program, or designee.
(g) One member from a community philanthropic organization, appointed by the governor.
(h) One member representing the interests of the New Hampshire children’s trust fund, appointed by the governor.
(i) One member from the New Hampshire Higher Education Assistance Foundation, appointed by the foundation.
(j) One member from the Coos Coalition for Young Children and Families, appointed by that organization.
(k) One member representing the Federal Reserve Bank of Boston, appointed by the bank.
(l) One member representing the New Hampshire Community Loan Fund, appointed by that organization.
II. The commission shall elect a chairperson from its membership, and any other officers it deems necessary. The terms of the elected members of the commission shall be coterminous with their terms in office; the terms of all other appointed members shall be 3 years. In the event of a vacancy, a new member shall be appointed for the unexpired term in the same manner as the original appointment. Eight members of the commission shall constitute a quorum.
III. Members of the commission shall serve without compensation, but shall be reimbursed for necessary travel and other necessary expenses. Legislative members shall receive mileage at the legislative rate when attending to the duties of the commission.
IV. The department of education shall provide administrative and clerical support to the commission as may be necessary.
V. The commission shall keep written records of all its proceedings.
VI. No member of the commission shall have any personal interest in the gains or profits of any investment made by the commission; nor shall any member of the commission, directly or indirectly, for such member or as an agent, in any manner use the same except to make such current and necessary payments as are authorized by the commission; nor shall any member of the commission become an endorser or surety, or in any manner an obligor, for money loaned to or borrowed from the commission.
VII. Members of the commission shall be held harmless from either criminal or civil liability for any decisions made or services rendered under the provisions of this chapter.
195-I:3 Duties of the Commission. The commission shall:
I. Investigate methods for encouraging increased participation of families with young children, including those of low and moderate income, in the New Hampshire college tuition savings plan as defined in RSA 195-H and other children’s savings plans.
II. Establish and promote kindergarten to college savings plans pilot programs in Coos county and in the city of Manchester no later than September of 2016, which would consist of creating a savings account at a local financial institution with a minimum deposit of $50.00 for each eligible child attending public kindergarten in Coos county and in the city of Manchester, and would include financial literacy education for such children and their families in cooperation with local public schools.
III. Establish policies that ensure that children’s savings accounts are accessible and eventually offered on an opt-out basis statewide, and are seeded with state funds, including matching funds and donations from local or private philanthropic foundations, and are connected to local public school financial literacy education programs.
IV. Develop administrative and operational practices such as staffing, structuring, managing, marketing, and funding mechanisms to sustain a statewide children’s savings accounts program and include clearly stated objectives, action plans, and evaluation procedures.
V. Establish recordkeeping and reporting procedures regarding the status of the children's savings account program fund, including records of beginning balances, contributions, earnings, bonuses, and matches earned by each program participant during the fiscal year.
VI. Establish a fund raising plan to secure state matching funds from federal, state, or private sources.
VII. Establish ongoing communication with the New Hampshire college tuition savings plan advisory commission established in RSA 195-H to ensure that more families become educated about the potential of investing in the New Hampshire college tuition savings program, and to facilitate the advisory committee’s future administration and responsibility for the children’s savings account program.
195-I:4 Reports.
I.(a) The treasurer shall, as needed, issue requests for proposals to evaluate and determine proposals which are best suited to the reporting and recordkeeping needs of the children's savings account program and fund.
(b) The commission shall consider and, if appropriate, give preference to proposals which best demonstrate experience in administering financial programs requiring individual account maintenance and reporting.
(c) The final selection of the proposal shall be made by the commission.
II. The state treasurer shall make quarterly reports regarding the status of the children’s savings account program and children’s savings account fund to the commission.
(a) At least annually, the commission shall issue or cause to be issued to each participant, a statement which shall include the participant’s beginning balance, contributions, and earnings credited to their account during the previous fiscal year.
(b) At least annually, the commission shall make or cause to be made an annual report regarding the status of the children’s savings account program to each participant in the program and to the state library.
195-I:5 Children’s Savings Account Fund Established. There is established a children’s savings account fund in the office of the state treasurer. This fund shall be kept distinct and separate from other funds. The fund shall be administered by the children’s savings account commission established in RSA 195-I:2 and shall be nonlapsing and continually appropriated to the commission for the purposes of establishing children’s savings accounts initially through pilot programs, and eventually statewide, pursuant to RSA 195-I:3. The commission may accept and shall deposit any gifts, grants, donations, or other moneys from any source into the fund.
3 Effective Date. This act shall take effect July 1, 2015.
LBAO
15-0359
Amended 02/26/15
HB 577-FN-A-LOCAL FISCAL NOTE
AN ACT establishing a children’s savings account program.
FISCAL IMPACT:
The Treasury Department and Department of Education state this bill, as amended by the House (Amendment #2015-0309h), may increase state restricted revenue and expenditures by an indeterminable amount in FY 2016 and each year thereafter. There will be no fiscal impact on county and local revenue and expenditures.
METHODOLOGY:
The Treasury Department states this bill establishes the children’s savings account program commission, and the children’s savings account (CSA) program. The commission would be responsible for administering the CSA program, including two pilot programs in Coos County and Manchester, no later than September 2016. The pilot programs will provide each eligible child with a minimum deposit of $50. The Department states this bill also creates the CSA Fund, a nonlapsing fund within the Department, administered by and continually appropriated to the commission. The bill also allows the commission to accept gifts, grants and donations for deposit into the CSA fund. Any revenue from these sources cannot be determined at this time. The Department states it currently does not possess the staffing resources necessary to deliver the administrative functions required under this bill.
The Department of Education states there are approximately 1,300 children entering public kindergarten in Coos County and Manchester each year. Consequently, if all children were to receive the minimum deposit of $50 then the cost of the pilot program for one year would be $65,000 ($50*1,300). However, it is not clear whether all 1,300 children would be eligible for the program. The Department states this bill also includes financial literacy support for such children and their families, and it estimates such costs to be less than $5,000. The Department estimates it will cost $30,000 to pay a contractor to draft associated policies, operational practices, record keeping procedures, and fund raising plans. The Department reports the amount of revenue generated for the CSA program is indeterminable at this time.
