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Committee OKs measure letting state treasurer apply to oversee proposed federal child savings accounts
Summary
The committee approved House Bill 1447 authorizing the state treasurer to apply to be a nonbank custodian for proposed federal child savings accounts (referred to in discussion as "Trump accounts" or 5(30)a accounts). Members asked about oversight and what protections would exist if funds are mishandled; details of a state program would require future rules and design work.
Representative Ball presented HB 1447 to give the state treasurer legislative approval to apply to the federal government to be a nonbank custodian for federal child savings accounts that would deposit $1,000 per child (as described by the sponsor) and allow parental contributions. Ball said the bill does not itself create the program at the state level; it merely allows the treasurer to apply for custodian status.
Members questioned what protections would be in place if funds were misappropriated and whether the proposed accounts would duplicate or interact with existing 529 plans. Ball said the federal program design would determine accountability and that parents could still contribute to other savings vehicles; he and other members discussed possible alternative program names and state safeguards. The committee approved the bill with eight ayes, one nay and one present not voting.
