§ 21-21K-3 — Education savings program created; education trust fund

created; purpose; investment of accounts by third parties; board review; program administration fund created; purpose. A. The "education savings program" is created to allow interested persons to enter into education investment agreements with the board as a means to save money to pay a beneficiary's eligible expenses for an education. The education savings program may consist of one or more education savings plans. The board shall administer the education savings program through accounts established in the education trust fund pursuant to education investment agreements. Money in an account may be used by the beneficiary for qualified higher education expenses. B. The board shall develop and administer the education savings program in a manner that allows account owners and beneficiaries to obtain and maintain federal income tax benefits or treatment provided by the Internal Revenue Code for qualified tuition programs and exemptions under the federal securities laws. C. The "education trust fund" is created as a nonreverting fund in the state treasury. The fund shall be administered by the board to carry out the education savings program. The fund consists of separate trust accounts held in the name of account owners. Income from investment of the fund shall be credited to the separate accounts. D. The board may contract with one or more managers to invest the contributions deposited to the education trust fund. The board and the managers shall account for each contribution by an account owner. E. Amounts may be withdrawn or transferred from trust accounts in the education trust fund only as provided in the related education investment agreements. All money contributed to accounts established in the fund are held in trust by the board and the respective managers for the sole benefit of the respective account owners and beneficiaries. F. The "program administration fund" is created as a nonreverting fund in the state treasury. The fund consists of all administrative and other fees received by the board pursuant to education investment agreements and contracts with managers and any other money credited to the fund. The state treasurer shall invest the fund, and the investment income shall be credited to the fund. Money in the fund may be used to pay costs of establishing, marketing and otherwise administering the education savings program in accordance with the Education Trust Act. Disbursements from the fund shall be by warrants of the secretary of finance and administration on vouchers signed by the director of the board or the director's authorized representative.

Legislative History

Laws 1997, ch. 259, § 3; 1999, ch. 221, § 2; 2001, ch. 270, § 2; repealed and