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ARIZONA HOUSE OF REPRESENTATIVESFifty-fourth Legislature Second Regular Session |
Senate:
GOV DPA 5-0-2-0 | 3rd Read: 26-0-4-0
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SB 1528: family college savings program; treasurer
Sponsor: Senator Leach, LD 11
Transmitted to the Governor
Overview
Transfers the Family College Savings Program (Program) to the Office of the State Treasurer and establishes the State Board of Investment (Board) as the trustee of the Program.
History
The Commission for Postsecondary Education (Commission), among other statutory requirements, is required to develop, implement and act as the trustee of the Program. The Program Trust Fund consists of the assets of the Program and the monies are continuously appropriated (A.R.S. § 15-1873).
The Family College Savings Program Oversight Committee, in addition to other statutorily prescribed requirements, is required to recommend financial institutions for approval by the Commission to act as the depositories and managers of family college savings accounts (A.R.S. § 15-1872).
Qualified higher education expenses is defined as meaning or including the following subject to section 529 of the internal revenue code: 1) required school related expenses for a designated beneficiary to enroll at or attend an eligible educational institution; 2) expenses for special needs services for a special needs beneficiary in connection with enrolling or attending; 3) expenses for computer equipment, software or internet access that will be primarily used by the beneficiary during enrollment at an eligible education institution; 4) tuition to enroll in or attend an elementary or secondary public, private or religious school (A.R.S. § 15-1871).
A 529 plan is a savings plan that is tax-advantaged and designed to encourage saving for education costs in the future. This type of plan is known as a "qualified tuition plan" that is authorized by Section 529 of the Internal Revenue Code. All states and the District of Columbia sponsor at least one type of 529 plan (www.sec.gov).
Provisions
1. Repeals the Program Oversight Committee. (Sec. 2)
2. Establishes the Board as the trustee of the Program and the State Treasurer as the administer of the Program. (Sec. 8, 9)
3. Requires the Board to approve financial institutions to act as the depositories and managers of family college savings accounts and allows the Board to adopt rules of administration and implementation. (Sec. 2)
4. Authorizes the State Treasurer to use existing investment funds established in statute, upon approval by the Board, to negotiate and select the financial institution or institutions to act as the depository and manager of the Program. (Sec. 3)
5. Directs the State Treasurer to appoint a Family College Savings Program Advisory Committee (Committee) for the purposes of assisting the State Treasurer in promoting and raising awareness of the Program, especially for increasing access to the Program among economically disadvantaged minority and underrepresented student populations. (Sec. 10)
6. States that the Committee will consist of the following members:
a) The State Treasurer or their designee, who also serves as the chair of the Committee;
b) One member representing a community college district in a county with a population of 500,000 people or more and one member representing a community college district in a county with a population of less than 500,000 people;
c) A representative of a university under the jurisdiction of the Arizona Board of Regents;
d) A representative of an accredited private educational institution that offers associate, baccalaureate or higher degrees;
e) A representative of an accredited private educational institution that offers private vocational training;
f) A teacher who currently provides classroom instruction in Arizona;
g) A federally recognized Indian tribe representative;
h) A United States Department of Labor-approved apprenticeship program representative; and
i) Two public Arizona residents. (Sec. 10)
7. Requires the Committee to do the following:
a) Make recommendations and assist the State Treasurer with promotional and informational activities relating to the Program; and
b) Meet at least once each calendar quarter and a majority of the members constitutes a quorum for transacting business. (Sec. 10)
8. Specifies that Committee members are not eligible to receive compensation or expense reimbursements. (Sec. 10)
9. Instructs the Office of the State Treasurer to provide necessary staff services to the Committee. (Sec. 10)
10. Specifies that the Committee is repealed on July 1, 2028. (Sec. 10)
11. Stipulates the following relating to the transfer of the Program to the State Treasurer:
a) All administrative matters, contracts and judicial and quasi-judicial actions of the Commission that relate to the Program are transferred on the effective date of this Act and retain the same status with the State Treasurer;
b) All adopted rules by the Commission remain in full force until superseded by rules adopted by the Board or the State Treasurer;
c) All FTE positions, property, records, data, investigative findings, obligations and appropriated and non-appropriated monies remaining unspent and unencumbered by the Commission in relation to the Program are transferred to the State Treasurer; and
d) The Commission must cooperate and coordinate with the State Treasurer for successful transition of the Program from the Commission to the State Treasurer during the transfer period. (Sec. 11)
12. Exempts the Board from rulemaking for one year for the purpose of adopting rules relating to the Program. (Sec. 12)
13. Contains a legislative intent clause. (Sec. 13)
14. Defines board and treasurer. (Sec. 1)
15. Modifies the definitions of financial institution, qualified higher education expenses and qualified withdrawal. (Sec. 1)
16. Makes technical and conforming changes. (Sec. 1, 2, 3, 4, 5, 6, 7, 8, 9)
17. Contains an effective date of October 1, 2020. (Sec. 14)
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SB 1528
Initials SJ Page 0 Transmitted
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