Rep. Maura Hirschauer

Filed: 4/2/2024

 

 


 

 


 
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1
AMENDMENT TO HOUSE BILL 4720

2    AMENDMENT NO. ______. Amend House Bill 4720 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The State Treasurer Act is amended by changing
5Section 16.8 as follows:
 
6    (15 ILCS 505/16.8)
7    Sec. 16.8. Illinois Higher Education Savings Program.
8    (a) Definitions. As used in this Section:
9    "Beneficiary" means an eligible child named as a recipient
10of seed funds.
11    "Eligible child" means a child born or adopted after
12December 31, 2022, to a parent who is a resident of Illinois at
13the time of the birth or adoption, as evidenced by
14documentation received by the Treasurer from the Department of
15Revenue, the Department of Public Health, or another State or
16local government agency.

 

 

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1    "Eligible educational institution" means institutions that
2are described in Section 1001 of the federal Higher Education
3Act of 1965 that are eligible to participate in Department of
4Education student aid programs.
5    "Fund" means the Illinois Higher Education Savings Program
6Fund.
7    "Omnibus account" means the pooled collection of seed
8funds owned and managed by the State Treasurer in the College
9Savings Pool under this Act.
10    "Program" means the Illinois Higher Education Savings
11Program.
12    "Qualified higher education expense" means the following:
13(i) tuition, fees, and the costs of books, supplies, and
14equipment required for enrollment or attendance at an eligible
15educational institution; (ii) expenses for special needs
16services, in the case of a special needs beneficiary, which
17are incurred in connection with such enrollment or attendance;
18(iii) certain expenses for the purchase of computer or
19peripheral equipment, computer software, or Internet access
20and related services as defined under Section 529 of the
21Internal Revenue Code; (iv) room and board expenses incurred
22while attending an eligible educational institution at least
23half-time; (v) expenses for fees, books, supplies, and
24equipment required for the participation of a designated
25beneficiary in an apprenticeship program registered and
26certified with the Secretary of Labor under the National

 

 

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1Apprenticeship Act (29 U.S.C. 50); and (vi) amounts paid as
2principal or interest on any qualified education loan of the
3designated beneficiary or a sibling of the designated
4beneficiary, as allowed under Section 529 of the Internal
5Revenue Code.
6    "Seed funds" means the deposit made by the State Treasurer
7into the Omnibus Accounts for Program beneficiaries.
8    (b) Program established. The State Treasurer shall
9establish the Illinois Higher Education Savings Program as a
10part of the College Savings Pool under Section 16.5 of this
11Act, subject to appropriation by the General Assembly. The
12State Treasurer shall administer the Program for the purposes
13of expanding access to higher education through savings.
14    (c) Program enrollment. The State Treasurer shall enroll
15all eligible children in the Program beginning in 2023, after
16receiving records of recent births, adoptions, or dependents
17from the Department of Revenue, the Department of Public
18Health, or another State or local government agency designated
19by the Treasurer. Notwithstanding any court order which would
20otherwise prevent the release of information, the Department
21of Public Health is authorized to release the information
22specified under this subsection (c) to the State Treasurer for
23the purposes of the Program established under this Section.
24        (1) Beginning in 2021, the Department of Public Health
25    shall provide the State Treasurer with information on
26    recent Illinois births and adoptions including, but not

 

 

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1    limited to: the full name, residential address, birth
2    date, and birth record number of the child and the full
3    name and residential address of the child's parent or
4    legal guardian for the purpose of enrolling eligible
5    children in the Program. This data shall be provided to
6    the State Treasurer by the Department of Public Health on
7    a quarterly basis, no later than 30 days after the end of
8    each quarter, or some other date and frequency as mutually
9    agreed to by the State Treasurer and the Department of
10    Public Health.
11        (1.5) Beginning in 2021, the Department of Revenue
12    shall provide the State Treasurer with information on tax
13    filers claiming dependents or the adoption tax credit
14    including, but not limited to: the full name, residential
15    address, email address, phone number, birth date, adjusted
16    gross income, and social security number or taxpayer
17    identification number of the dependent child and of the
18    child's parent or legal guardian for the purpose of
19    enrolling eligible children in the Program. This data
20    shall be provided to the State Treasurer by the Department
21    of Revenue on at least an annual basis, by July 1 of each
22    year or another date jointly determined by the State
23    Treasurer and the Department of Revenue. Notwithstanding
24    anything to the contrary contained within this paragraph
25    (2), the Department of Revenue shall not be required to
26    share any information that would be contrary to federal

 

 

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1    law, regulation, or Internal Revenue Service Publication
2    1075.
3        (2) The State Treasurer shall ensure the security and
4    confidentiality of the information provided by the
5    Department of Revenue, the Department of Public Health, or
6    another State or local government agency, and it shall not
7    be subject to release under the Freedom of Information
8    Act.
9        (3) Information provided under this Section shall only
10    be used by the State Treasurer for the Program and shall
11    not be used for any other purpose.
12        (4) The State Treasurer and any vendors working on the
13    Program shall maintain strict confidentiality of any
14    information provided under this Section, and shall
15    promptly provide written or electronic notice to the
16    providing agency of any security breach. The providing
17    State or local government agency shall remain the sole and
18    exclusive owner of information provided under this
19    Section.
20    (d) Seed funds. After receiving information on recent
21births, adoptions, or dependents from the Department of
22Revenue, the Department of Public Health, or another State or
23local government agency, the State Treasurer shall make
24deposits into an omnibus account on behalf of eligible
25children. The State Treasurer shall be the owner of the
26omnibus accounts.

 

 

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1        (1) Deposit amount. The seed fund deposit for each
2    eligible child shall be in the amount of $50. This amount
3    may be increased by the State Treasurer by rule. The State
4    Treasurer may use or deposit funds appropriated by the
5    General Assembly together with moneys received as gifts,
6    grants, or contributions into the Fund. If insufficient
7    funds are available in the Fund, the State Treasurer may
8    reduce the deposit amount or forego deposits.
9        (2) Use of seed funds. Seed funds, including any
10    interest, dividends, and other earnings accrued, will be
11    eligible for use by a beneficiary for qualified higher
12    education expenses if:
13            (A) the parent or guardian of the eligible child
14        claimed the seed funds for the beneficiary by the
15        beneficiary's 10th birthday;
16            (B) the beneficiary has completed secondary
17        education or has reached the age of 18; and
18            (C) the beneficiary is currently a resident of the
19        State of Illinois. Non-residents are not eligible to
20        claim or use seed funds.
21        (3) Notice of seed fund availability. The State
22    Treasurer shall make a good faith effort to notify
23    beneficiaries and their parents or legal guardians of the
24    seed funds' availability and the deadline to claim such
25    funds.
26        (4) Unclaimed seed funds. Seed funds and any interest

 

 

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1    earnings that are unclaimed by the beneficiary's 10th
2    birthday or unused by the beneficiary's 26th birthday will
3    be considered forfeited. Unclaimed and unused seed funds
4    and any interest earnings will remain in the omnibus
5    account for future beneficiaries.
6    (e) Financial education. The State Treasurer may develop
7educational materials that support the financial literacy of
8beneficiaries and their legal guardians, and may do so in
9collaboration with State and federal agencies, including, but
10not limited to, the Illinois State Board of Education and
11existing nonprofit agencies with expertise in financial
12literacy and education.
13    (f) Supplementary deposits and partnerships. The State
14Treasurer may make supplementary deposits to children in
15financially insecure households if sufficient funds are
16available and if funds are deposited into the omnibus accounts
17as described in subsection (d). Subject to appropriation, the
18State Treasurer may make supplementary deposits of $50, or
19greater if designated by the State Treasurer by rule, into the
20account of each beneficiary whose parent or legal guardian has
21an adjusted gross income below the Illinois median household
22income as determined by the most recent U.S. Census Bureau
23American Community Survey 5-Year Data for the previous
24calendar year. The supplementary deposits shall be limited to
25one deposit per beneficiary. Furthermore, the State Treasurer
26may develop partnerships with private, nonprofit, or

 

 

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1governmental organizations to provide additional savings
2incentives, including conditional cash transfers or matching
3contributions that provide a savings incentive based on
4specific actions taken or other criteria.
5    (g) Illinois Higher Education Savings Program Fund. The
6Illinois Higher Education Savings Program Fund is hereby
7established as a special fund in the State treasury. The Fund
8shall be the official repository of all contributions,
9appropriated funds, interest, and dividend payments, gifts, or
10other financial assets received by the State Treasurer in
11connection with the operation of the Program or related
12partnerships. All such moneys shall be deposited into the Fund
13and held by the State Treasurer as custodian thereof. The
14State Treasurer may accept gifts, grants, awards, matching
15contributions, interest income, and appropriated funds from
16individuals, businesses, governments, and other third-party
17sources to implement the Program on terms that the Treasurer
18deems advisable. All interest or other earnings accruing or
19received on amounts in the Illinois Higher Education Savings
20Program Fund shall be credited to and retained by the Fund and
21used for the benefit of the Program. Assets of the Fund must at
22all times be preserved, invested, and expended only for the
23purposes of the Program and must be held for the benefit of the
24beneficiaries. Assets may not be transferred or used by the
25State or the State Treasurer for any purposes other than the
26purposes of the Program. In addition, no moneys, interest, or

 

 

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1other earnings paid into the Fund shall be used, temporarily
2or otherwise, for inter-fund borrowing or be otherwise used or
3appropriated except as expressly authorized by this Act.
4Notwithstanding the requirements of this subsection (g),
5amounts in the Fund may be used by the State Treasurer to pay
6the administrative costs of the Program.
7    (g-5) Fund deposits and payments. On July 15 of each year,
8beginning July 15, 2023, or as soon thereafter as practical,
9the State Comptroller shall direct and the State Treasurer
10shall transfer the sum of $2,500,000, or the amount that is
11appropriated annually by the General Assembly, whichever is
12greater, from the General Revenue Fund to the Illinois Higher
13Education Savings Program Fund to be used for the
14administration and operation of the Program.
15    (h) Audits and reports. The State Treasurer shall include
16the Illinois Higher Education Savings Program as part of the
17audit of the College Savings Pool described in Section 16.5.
18The State Treasurer shall annually prepare a report that
19includes a summary of the Program operations for the preceding
20fiscal year, including the number of children enrolled in the
21Program, the total amount of seed fund deposits, the rate of
22seed deposits claimed, and, to the extent data is reported and
23available, the racial, ethnic, socioeconomic, and geographic
24data of beneficiaries and of children in financially insecure
25households who may receive automatic bonus deposits. Such
26other information that is relevant to make a full disclosure

 

 

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1of the operations of the Program and Fund may also be reported.
2The report shall be made available on the Treasurer's website
3by January 31 each year, starting in January of 2024. The State
4Treasurer may include the Program in other reports as
5warranted.
6    (i) Rules. The State Treasurer may adopt rules necessary
7to implement this Section.
8(Source: P.A. 102-129, eff. 7-23-21; 102-558, eff. 8-20-21;
9102-1047, eff. 1-1-23; 103-8, eff. 6-7-23.)".