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Treasury urges law changes to tailor PA 529 GSP investments as families use accounts for K–12 tuition
Summary
Treasury told the committee that outreach and a TAP Act change are needed so Pennsylvania’s Guaranteed Savings Plan (GSP) can be invested for shorter horizons as families use 529 funds for K–12 tuition and other non‑four‑year expenses.
Pennsylvania’s Treasurer told the House Appropriations Committee that 529 college‑savings accounts are being used more broadly—by families to pay for community college, technical training, apprenticeships and K–12 tuition—and that state law should allow investments and actuarial assumptions to reflect shorter time horizons.
"I myself go to all 67 counties every single year, and I talk about PA 529 everywhere I go... it's for trade schools, technical schools, qualified apprenticeships, k through 12 tuition. So it's it's very, very broad," Treasurer Garrity said. She added the department expanded outreach and held about 1,000 events last year to correct the public perception that 529s are only for four‑year degrees.
Garrity described the TAP Act, a legislative change specific to the Guaranteed Savings Plan (GSP), as intended to let Treasury adjust the GSP’s investment strategy because the plan was built on actuarial assumptions that assume withdrawals start at age 18. "The GSP was designed for families saving for higher education, not kindergarten. And so that's why we need to adjust our investment strategy, to make it a little shorter time horizon," she told the committee.
The treasurer said families already use 529 funds for K–12: "Families have used well over $100,000,000 to pay through K‑twelve tuition expenses." She also described administrative improvements—transitioning university payments from paper checks to ACH and broader outreach that included rural counties—to increase both cost efficiencies and account participation.
Committee members asked about resources. Garrity said Treasury’s outreach team expanded to eight people and held roughly 830 in‑person events across 39 counties last year. She described an advisory board for the TAP program with 19 members representing education, business and government; the board issues an annual report with recommendations for the General Assembly and governor.
No formal legislative action occurred during the hearing. Treasury pledged to continue outreach and to provide advisory board recommendations to legislators.
