It’s never too early to start developing financial health and wellness.
With that in mind, the House Early Childhood Finance and Policy Division included a provision in its omnibus education bill that would create a college savings account pilot program for some of Minnesota’s youngest citizens.
Pinto recognized the “thoughtful discussions” and work of the division this session, but added there is more to be done to improve the state’s early childhood programming.
“Each of our pieces doesn’t go as far as I would like, as somebody who has been working on early childhood issues for years and years, but … this is a great start and a next step,” he said.
One such stride is based on a bill sponsored by Rep. Koahly Her (DFL-St. Paul) that would fund a matching grant of $500,000 to the City of St. Paul to establish college savings accounts and provide a $50 seed deposit for each child born in the city starting in Fiscal Year 2020.
“The hope of the CSA is to serve as a pilot for the rest of the state,” Her explained at an earlier hearing. “CSAs have traditionally been established by cities in partnership with public and private entities. As of 2019, there are 62 CSA programs in 35 states that serve over 450,000 children.”
The goal is to not only to give each child a college savings account, but to provide families and children with financial resources and wraparound services to improve economic health and wellness.
“We know the research says that a small amount early on can make a huge difference for the life of the students,” Pinto said.
He successfully offered an amendment that would provide clarifying language on how the program – if successful — could be expanded statewide.
“We want to make sure that we have children and students from around the state be able to take advantage of it over time, and this outlines the steps for doing that,” Pinto said.
Rep. Josh Heintzeman (R-Nisswa) shared concern over the proposal saying it would shift the responsibility of teaching financial literacy away from family members and personal connections, and would place it on the state.
“There may be cases where that can work,” he said. “But I think more and more we’re giving that opportunity, maybe even that responsibility, away. A parent who might, or a grandparent who might say ‘Hey, I’d like to make that connection for this person,’ well the state of Minnesota is now going to do that.”
Other notable provisions in the omnibus education bill would increase funding for early learning scholarships by $12 million in the upcoming biennium, for a total appropriation of $153 million. It would also appropriate $47 million in the 2020-21 biennium to maintain 4,000 voluntary pre-K seats that are set to expire this year.
Rep. Mary Franson (R-Alexandria) opposes the bill saying that it doesn’t go far enough in funding early learning scholarships and fails to reform the often criticized child care quality rating system called Parent Aware.
“We have heard time and time again, from providers who were able to show up and testify, on how unfair that system is,” she said.