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State officials say there’s a nugget hidden inside the state’s 2018-19 budget legislation that could pay dividends to Pennsylvania children for decades.
The bill, known as Keystone Scholars, sets the stage for every newborn that is a Pennsylvania resident or adopted by a Pennsylvania family to start life with a $100 scholarship grant account beginning Jan. 1, 2019.
The bill builds on a pilot program launched by state Treasurer Joe Torsella, who campaigned on a pledge to create a universal scholarship grant program for the state’s newborns. The pilot program , is funded largely though foundation grants in Westmoreland, Indiana, Luzerne, Mifflin, Delaware and Elk counties in February.
“Keystone Scholars sends a powerful message to Pennsylvania’s future workforce. This $100 investment shows that we believe in the children of the Commonwealth and see a bright future for every one of them. No matter where they live in Pennsylvania or where their talents take them, Keystone Scholars will be there,” Torsella said thanking lawmakers for the bipartisan effort to pass the program.
Torsella said the statewide program, with an estimated price tag of $14 million a year to cover each of the 140,000 babies born here, won’t tap tax revenues. The law calls for it to be funded with a combination of philanthropic donations and surplus earnings within the PA Guaranteed Savings Program.
“As of March 31, 2018, our actuarial status was 117.61%. Since the end of fiscal year 2011-12, it has remained at over 100%. The assets in the fund have always remained in the fund and the assets utilized for the Keystone Scholars program will do the same. They will grow to be utilized by the eligible recipients for approved higher education expenses,” Torsella spokeswoman Heidi Havens said.
Havens said the surplus totaled $267.7 million.
Officials estimate each $100 account held in the state’s PA 529 college savings account should grow to about $400 by the time the holder is ready to tap it. Families can tap the accounts for college or career training expenses until a child turns 29.
Pennsylvania joins Connecticut, Maine, Rhode Island and Nevada, all of which previously adopted universal infant scholarship programs.