Public Act 102-1047
 
SB3991 EnrolledLRB102 25847 RJF 35196 b


  
    AN ACT concerning State government.
  
 
    Be it enacted by the People of the State of Illinois,
 
represented in the General Assembly:
  
 
 
    Section 5. The State Treasurer Act is amended  by changing 
Section 16.8 as follows:
 
    (15 ILCS 505/16.8)
    Sec. 16.8. Illinois Higher Education Savings Program.
    (a)     Definitions.  As used in this Section:
    "Beneficiary" means an eligible child named as a recipient 
of seed funds.
    "Eligible child" means a child born or adopted after 
December 31, 2022, to a parent who is a resident of Illinois at 
the time of the birth or adoption, as evidenced by 
documentation received by the Treasurer from the Department of 
Revenue, the Department of Public Health, or another State or 
local government agency.
    "Eligible educational institution" means institutions that 
are described in Section 1001 of the federal Higher Education 
Act of 1965 that are eligible to participate in Department of 
Education student aid programs.
    "Fund" means the Illinois Higher Education Savings Program 
Fund.
    "Omnibus account" means the pooled collection of seed 
funds owned and managed by the State Treasurer in the College 
Savings Pool under this Act.
    "Program" means the Illinois Higher Education Savings 
Program.
    "Qualified higher education expense" means the following: 
(i) tuition, fees, and the costs of books, supplies, and 
equipment required for enrollment or attendance at an eligible 
educational institution; (ii) expenses for special needs 
services, in the case of a special needs beneficiary, which 
are incurred in connection with such enrollment or attendance; 
(iii) certain expenses for the purchase of computer or 
peripheral equipment, computer software, or Internet access 
and related services as defined under Section 529 of the 
Internal Revenue Code; (iv) room and board expenses incurred 
while attending an eligible educational institution at least 
half-time; (v) expenses for fees, books, supplies, and 
equipment required for the participation of a designated 
beneficiary in an apprenticeship program registered and 
certified with the Secretary of Labor under the National 
Apprenticeship Act (29 U.S.C. 50); and (vi) amounts paid as 
principal or interest on any qualified education loan of the 
designated beneficiary or a sibling of the designated 
beneficiary, as allowed under Section 529 of the Internal 
Revenue Code.
    "Seed funds" means the deposit made by the State Treasurer 
into the Omnibus Accounts for Program beneficiaries.
    (b)   Program established. The State Treasurer shall 
establish the Illinois Higher Education Savings Program as a 
part of the College Savings Pool under Section 16.5 of this 
Act, subject to appropriation by the General Assembly. The 
State Treasurer shall administer the Program for the purposes 
of expanding access to higher education through savings.
    (c)   Program enrollment. The State Treasurer shall enroll 
all eligible children in the Program beginning in 2023, after 
receiving records of recent births, adoptions, or dependents 
from the Department of Revenue, the Department of Public 
Health, or another State or local government agency designated 
by the Treasurer. Notwithstanding any court order which would 
otherwise prevent the release of information, the Department 
of Public Health is authorized to release the information 
specified under this subsection (c) to the State Treasurer for 
the purposes of the Program established under this Section.
        (1) Beginning in 2021, the Department of Public Health 
    shall provide the State Treasurer with information on 
    recent Illinois births and adoptions including, but not 
    limited to: the full name, residential address, birth 
    date, and birth record number of the child and the full 
    name and residential address of the child's parent or 
    legal guardian for the purpose of enrolling eligible 
    children in the Program. This data shall be provided to 
    the State Treasurer by the Department of Public Health on 
    a quarterly basis, no later than 30 days after the end of 
    each quarter, or some other date and frequency as mutually 
    agreed to by the State Treasurer and the Department of 
    Public Health.
        (1.5)    Beginning in 2021, the Department of Revenue 
    shall provide the State Treasurer with information on tax 
    filers claiming dependents or the adoption tax credit 
    including, but not limited to: the full name, residential 
    address, email address, phone number, birth date, and 
    social security number or taxpayer identification number 
    of the dependent child and of the child's parent or legal 
    guardian for the purpose of enrolling eligible children in 
    the Program. This data shall be provided to the State 
    Treasurer by the Department of Revenue on at least an 
    annual basis, by July 1 of each year or another date 
    jointly determined by the State Treasurer and the 
    Department of Revenue. Notwithstanding anything to the 
    contrary contained within this paragraph (2), the 
    Department of Revenue shall not be required to share any 
    information that would be contrary to federal law, 
    regulation, or Internal Revenue Service Publication 1075. 
        (2)   The State Treasurer shall ensure the security and 
    confidentiality of the information provided by the 
    Department of Revenue, the Department of Public Health, or 
    another State or local government agency, and it shall not 
    be subject to release under the Freedom of Information 
    Act.
        (3)   Information provided under this Section shall only 
    be used by the State Treasurer for the Program and shall 
    not be used for any other purpose.
        (4)   The State Treasurer and any vendors working on the 
    Program shall maintain strict confidentiality of any 
    information provided under this Section, and shall 
    promptly provide written or electronic notice to the 
    providing agency of any security breach. The providing 
    State or local government agency shall remain the sole and 
    exclusive owner of information provided under this 
    Section.
    (d)     Seed funds. After receiving information on recent 
births, adoptions, or dependents from the Department   of 
Revenue, the Department of Public Health, or another State or 
local government agency, the State Treasurer shall make 
deposits into an omnibus account on behalf of eligible 
children. The State Treasurer shall be the owner of the 
omnibus accounts.
        (1)     Deposit amount. The seed fund deposit for each 
    eligible child shall be in the amount of $50. This amount 
    may be increased by the State Treasurer by rule. The State 
    Treasurer may use or deposit funds appropriated by the 
    General Assembly together with moneys received as gifts, 
    grants, or contributions into the Fund. If insufficient 
    funds are available in the Fund, the State Treasurer may 
    reduce the deposit amount or forego deposits.
        (2)   Use of seed funds. Seed funds, including any 
    interest, dividends, and other earnings accrued, will be 
    eligible for use by a beneficiary for qualified higher 
    education expenses if:
            (A)   the parent or guardian of the eligible child 
        claimed the seed funds for the beneficiary by the 
        beneficiary's 10th birthday;
            (B)   the beneficiary has completed secondary 
        education or has reached the age of 18; and
            (C)   the beneficiary is currently a resident of the 
        State of Illinois. Non-residents are not eligible to 
        claim or use seed funds.
        (3)   Notice of seed fund availability. The State 
    Treasurer shall make a good faith effort to notify 
    beneficiaries and their parents or legal guardians of the 
    seed funds' availability and the deadline to claim such 
    funds.
        (4)   Unclaimed seed funds. Seed funds and any interest 
    earnings that are unclaimed by the beneficiary's 10th 
    birthday or unused by the beneficiary's 26th birthday will 
    be considered forfeited. Unclaimed and unused seed funds 
    and any interest earnings will remain in the omnibus 
    account for future beneficiaries.
    (e)     Financial education. The State Treasurer may develop 
educational materials that support the financial literacy of 
beneficiaries and their legal guardians, and may do so in 
collaboration with State and federal agencies, including, but 
not limited to, the Illinois State Board of Education and 
existing nonprofit agencies with expertise in financial 
literacy and education.
    (f) Supplementary deposits and partnerships. The State 
Treasurer may make supplementary deposits to children in 
financially insecure households if sufficient funds are 
available. Furthermore, the     Incentives and partnerships. The 
State Treasurer may develop partnerships with private, 
nonprofit, or governmental organizations to provide additional 
savings incentives, including conditional cash transfers or 
matching contributions that provide a savings incentive based 
on specific actions taken or other criteria.
    (g)     Illinois Higher Education Savings Program Fund. The 
Illinois Higher Education Savings Program Fund is hereby 
established as a special fund in the State treasury. The Fund 
shall be the official repository of all contributions, 
appropriated funds, interest, and dividend payments, gifts, or 
other financial assets received by the State Treasurer in 
connection with the operation of the Program or related 
partnerships. All such moneys shall be deposited in the Fund 
and held by the State Treasurer as custodian thereof. The 
State Treasurer may accept gifts, grants, awards, matching 
contributions, interest income, and appropriated funds from 
individuals, businesses, governments, and other third-party 
sources to implement the Program on terms that the Treasurer 
deems advisable. All interest or other earnings accruing or 
received on amounts in the Illinois Higher Education Savings 
Program Fund shall be credited to and retained by the Fund and 
used for the benefit of the Program. Assets of the Fund must at 
all times be preserved, invested, and expended only for the 
purposes of the Program and must be held for the benefit of the 
beneficiaries. Assets may not be transferred or used by the 
State or the State Treasurer for any purposes other than the 
purposes of the Program.  In addition, no moneys, interest, or 
other earnings paid into the Fund shall be used, temporarily 
or otherwise, for inter-fund borrowing or be otherwise used or 
appropriated except as expressly authorized by this Act.  
Notwithstanding the requirements of this subsection (g), 
amounts in the Fund may be used by the State Treasurer to pay 
the administrative costs of the Program.
    (h)   Audits and reports. The State Treasurer shall include 
the Illinois Higher Education Savings Program as part of the 
audit of the College Savings Pool described in Section 16.5. 
The State Treasurer shall annually prepare a report that 
includes a summary of the Program operations for the preceding 
fiscal year, including the number of children enrolled in the 
Program, the total amount of seed fund deposits, the rate of 
seed deposits claimed, and, to the extent data is reported and 
available, the racial, ethnic, socioeconomic, and geographic 
data of beneficiaries and of children in financially insecure 
households who may receive automatic bonus deposits. Such 
other information that is relevant to make a full disclosure 
of the operations of the Program and Fund may also be reported 
and such other information that is relevant to make a full 
disclosure of the operations of the Program and Fund. The 
report shall be made available on the Treasurer's website by 
January 31 each year, starting in January of 2024. The State 
Treasurer may include the Program in other reports as 
warranted.
    (i)   Rules. The State Treasurer may adopt rules necessary 
to implement this Section.

(Source: P.A. 101-466, eff. 1-1-20; 102-129, eff. 7-23-21; 
102-558, eff. 8-20-21.)