Senator Wayne A. Harper proposes the following substitute bill:




Chief Sponsor: Wayne A. Harper

House Sponsor: Adam Robertson


8     General Description:
9          This bill amends provisions relating to 529 savings plans.
10     Highlighted Provisions:
11          This bill:
12          ▸     permits the Utah Educational Savings Plan to use another related name for business;
13     and
14          ▸     modifies the eligibility criteria for a beneficiary of the Student Prosperity Savings
15     Program.
16     Money Appropriated in this Bill:
17          None
18     Other Special Clauses:
19          This bill provides retrospective operation.
20     Utah Code Sections Affected:
21     AMENDS:
22          53B-8a-103, as last amended by Laws of Utah 2011, Chapters 46 and 342
23          53B-8a-201, as enacted by Laws of Utah 2017, Chapter 389 and last amended by
24     Coordination Clause, Laws of Utah 2017, Chapter 382

26     Be it enacted by the Legislature of the state of Utah:
27          Section 1. Section 53B-8a-103 is amended to read:
28          53B-8a-103. Creation of Utah Educational Savings Plan -- Powers and duties of
29     plan -- Certain exemptions.
30          (1) There is created the Utah Educational Savings Plan, which may also be known and
31     [function as] do business as:
32          (a) the Utah Educational Savings Plan Trust[.]; or
33          (b) another related name.
34          (2) The plan:
35          (a) is a non-profit, self-supporting agency that administers a public trust;
36          (b) shall administer the various programs, funds, trusts, plans, functions, duties, and
37     obligations assigned to the plan:
38          (i) consistent with sound fiduciary principles; and
39          (ii) subject to review of the board; and
40          (c) shall be known as and managed as a qualified tuition program in compliance with
41     Section 529, Internal Revenue Code, that is sponsored by the state.
42          (3) The plan may:
43          (a) make and enter into contracts necessary for the administration of the plan payable
44     from plan money, including:
45          (i) contracts for goods and services; and
46          (ii) contracts to engage personnel, with demonstrated ability or expertise, including
47     consultants, actuaries, managers, counsel, and auditors for the purpose of rendering
48     professional, managerial, and technical assistance and advice;
49          (b) adopt a corporate seal and change and amend [it from time to time] the corporate
50     seal;
51          (c) invest money within the program, administrative, and endowment funds in
52     accordance with the provisions under Section 53B-8a-107;
53          (d) enter into agreements with account owners, any institution of higher education, any
54     federal or state agency, or other entity as required to implement this chapter;
55          (e) solicit and accept any grants, gifts, legislative appropriations, and other money from
56     the state, any unit of federal, state, or local government, or any other person, firm, partnership,

57     or corporation for deposit to the administrative fund, endowment fund, or the program fund;
58          (f) make provision for the payment of costs of administration and operation of the plan;
59          (g) carry out studies and projections [in order] to advise account owners regarding:
60          (i) present and estimated future higher education costs; and
61          (ii) levels of financial participation in the plan required [in order] to enable account
62     owners to achieve their educational funding objective;
63          (h) participate in federal, state, local governmental, or private programs;
64          (i) create public and private partnerships, including investment or management
65     relationships with other 529 plans or entities;
66          (j) promulgate, impose, and collect administrative fees and charges in connection with
67     transactions of the plan, and provide for reasonable service charges;
68          (k) procure insurance:
69          (i) against any loss in connection with the property, assets, or activities of the plan; and
70          (ii) indemnifying any member of the board from personal loss or accountability arising
71     from liability resulting from a member's action or inaction as a member of the plan's board;
72          (l) administer outreach efforts to:
73          (i) market and publicize the plan and [its] the plan's products to existing and
74     prospective account owners; and
75          (ii) encourage economically challenged populations to save for post-secondary
76     education;
77          (m) adopt, trademark, and copyright names and materials for use in marketing and
78     publicizing the plan and [its] the plan's products;
79          (n) administer the funds of the plan;
80          (o) sue and be sued in [its] the plan's own name;
81          (p) own institutional accounts in the plan to establish and administer:
82          (i) scholarship programs; or
83          (ii) other college savings incentive programs, including programs designed to enhance
84     the savings of low income account owners investing in the plan; and
85          (q) have and exercise any other powers or duties that are necessary or appropriate to
86     carry out and effectuate the purposes of this chapter.
87          (4) (a) Except as provided in Subsection (4)(b), the plan is exempt from the provisions

88     of Title 63G, Chapter 2, Government Records Access and Management Act.
89          (b) (i) The annual audited financial statements of the plan described in Section
90     53B-8a-111 are public records.
91          (ii) Financial information that is provided by the plan to the Division of Finance and
92     posted on the Utah Public Finance Website in accordance with Section 63A-3-402 is a public
93     record.
94          Section 2. Section 53B-8a-201 is amended to read:
95          53B-8a-201. Definitions.
96          As used in this part:
97          (1) "529 savings account" means a tax-advantaged method of saving for higher
98     education costs on behalf of a particular individual that:
99          (a) meets the requirements of Section 529, Internal Revenue Code; and
100          (b) is managed by the plan.
101          (2) "Child" means an individual less than 20 years of age.
102          (3) "Community partner" means a nonprofit organization that provide services to a
103     child who is economically disadvantaged or a family member, legal guardian, or legal
104     custodian of a child who is economically disadvantaged.
105          (4) "Donation" means a gift, grant, donation, or any other conveyance of money by a
106     person other than the Legislature that is not made directly for the benefit or on behalf of a
107     particular individual.
108          (5) "Economically disadvantaged" means that a child is:
109          (a) experiencing intergenerational poverty;
110          (b) a member or foster child of a family with an annual income at or below 185% of
111     the federal poverty level; [or]
112          (c) living with a legal custodian or legal guardian with an annual family income at or
113     below 185% of the federal poverty level[.]; or
114          (d) living with a legal custodian or legal guardian who can attest that the child or the
115     child's household is receiving services benefitting low-income households or individuals.
116          (6) "Eligible individual" means an individual who:
117          (a) is at least 15 years of age and under 20 years of age;
118          (b) is a student in grade 10, grade 11, or grade 12 in Utah;

119          (c) is economically disadvantaged; and
120          (d) receives, or has a family member, a foster family member, or a legal custodian or
121     legal guardian who receives, services from a community partner.
122          (7) "Federal poverty level" means the poverty level as defined by the most recently
123     revised poverty income guidelines published by the United States Department of Health and
124     Human Services in the Federal Register.
125          (8) "Higher education costs" means the same as that term is defined in Section
126     53B-8a-102.5, except that the expenses must be incurred at:
127          (a) a credit-granting institution of higher education within the state system of higher
128     education;
129          (b) a private, nonprofit college or university in the state that is accredited by the
130     Northwestern Association of Schools and Colleges; or
131          (c) a technical college.
132          (9) "Intergenerational poverty" means the same as that term is defined in Section
133     35A-9-102.
134          (10) "Program" means the Student Prosperity Savings Program created in Section
135     53B-8a-202.
136          Section 3. Retrospective operation and effective date.
137          (1) Except as provided in Subsection (2), this bill has retrospective operation to
138     January 1, 2018.
139          (2) The amendments to Section 53B-8a-201 take effect on May 8, 2018.