Bill > A2124

Introduced Session

This bill establishes the New Jersey Baby Bond Account Program and Baby Bond Account Fund in the Department of the Treasury and appropriates the sum of $70,000,000 from the General Fund to the Baby Bond Account Fund. The purpose of the program is to credit each eligible individual in the State with a $2,000 deposit into an individual account in the Baby Bond Account Fund by the program. An eligible individual is any infant born on or after January 1, 2021 to a family domiciled in this State or outside of this State, provided the individual establishes residence in the State within six months of birth, and who resides in a household having an annual household income on the individual's date of birth that does not exceed 200 percent of the federal poverty level. The bill requires the State Treasurer to establish in the fund an account for each eligible individual and credit each account with $2,000. The State Treasurer will credit to each individual account the amounts credited to the fund, which are attributable to the account holder of the account. In the event a person or entity wishes to make a deposit into an individual account or an account holders wishes to transfer money to the individual account of a family member or dependent, the bill authorizes the State Treasurer to accept such deposits and to process such transfers, in a manner and method to be determined by the State Treasurer. The money within an individual account may only be distributed when the account holder attains the age of 18, with an exemption of qualified tuition and related expenses for eligible students, defined by the federal Internal Revenue Code of 1986. The moneys within an individual account may only be used for the following expenses: (1) post-secondary educational expenses of the account holder; (2) acquisition costs of a primary residence of the account holder; (3) qualified business capitalization expenses of the account holder, as determined by the program; and (4) any other investment in financial assets or personal capital that provides long-term gains to wages and wealth, as determined by the program. This bill requires that the money in the Baby Bond Account Fund will be managed by an 11-member Baby Bond Account Board, established pursuant to this bill, and will be invested in permitted investments or held in interest-bearing accounts. The board will consist of five ex-officio members, as follows: the State Treasurer or the State Treasurer's designee; the State Comptroller or the State Comptroller's designee; the Director of the Office of Management and Budget or the director's designee; the Chief Executive of the Economic Development Authority or the chief executive officer's designee; the Commissioner of Human Services or the commissioner's designee; and six public members with the Governor, the Speaker of the General Assembly, and the Senate President each appointing two members each. The board will hold a fiduciary duty to the fund and will make investments with the reasonable expectation that the return on each investment will be commensurate with the risk associated with each investment. The board will select and employ an executive director who will be responsible for the administration of the Baby Bond Account Program. The executive director will also be required notify each eligible individual's family of their potential eligibility for the Baby Bond Account Program. The executive director will also provide each eligible individual's family with information about the program's eligibility criteria, application process, guidelines, procedures, and requirements for withdrawing money from an individual account to be used for qualified expenses. Lastly, the executive director will be required to make economic literacy training available to each eligible individual's family. The board will determine the economic literacy training curriculum to fulfill this provision, provided that, at a minimum, the curriculum offers a basic understanding of budgets and savings accounts, credit and interest, how to use financial services, and how to use a savings plan to reach the account holder's savings goal for an individual account.

AI Summary

Committee Categories

Bill Moen (D)*,  Verlina Reynolds-Jackson (D)*,  Melinda Kane (D),  Balvir Singh (D),  Shavonda Sumter (D), 

Introduced, Referred to Assembly Children, Families and Food Security Committee (on 01/09/2024)

Official Document