SJ0006 103RD GENERAL ASSEMBLY

SJ0006 LRB103 24910 LAW 51244 r

SENATE JOINT RESOLUTION

WHEREAS, 529 college savings plans are important tools for Illinois families who want to save for their children's college education; they offer a diverse range of investment options, tax-deferred growth, and withdrawals free of state and federal taxes when those withdrawals are used for qualified higher education expenses such as tuition, fees, books, certain room and board costs, computer equipment, and required supplies; and

WHEREAS, While the first college savings plans were developed by states in 1988 as innovative programs designed to help families and students save for higher education expenses, it was not until the enactment of Section 529 of the Internal Revenue Code by Congress in 1996 that college savings plans began to rapidly gain popularity across the country; and

WHEREAS, Today, all 50 states and the District of Columbia offer 529 college savings plans; 12.5 million 529 accounts have been opened, more than $253 billion dollars have been saved for future higher education expenses, and more than one million students nationwide have withdrawn funds from 529 accounts to help pay higher education expenses; and

WHEREAS, The Illinois Treasurer currently offers and administers two 529 college savings plans, the Bright Start College Savings Plan and the Bright Directions College Savings Plan; and

WHEREAS, In 2018, Morningstar, which independently evaluates and rates college savings plans, selected the Bright Start 529 College Savings Plan as a Gold-Rated 529 and granted the Bright Directions Advisor-Guided 529 College Savings Plan a silver rating, which was the highest rating for all advisor-sold plans; and

WHEREAS, 529 college savings plans allow families to save for tuition at two-year and four-year institutions, including vocational, trade, community, state, or technical schools; and

WHEREAS, Illinois residents can claim a state tax deduction on contributions of up to $10,000 a year ($20,000 for married couples filing jointly) to any state plan; and

WHEREAS, In 2000, the average tuition rate at an Illinois public university was $4,160, while the average rate at a private four-year institution was $15,625; in 2018, those rates skyrocketed to $15,182 for public universities and $36,747 for private universities; and

WHEREAS, Federal financial aid awards have shifted away from student grants and moved to providing access to guaranteed student loans so that, today, nearly 63 percent of all federal financial aid is in the form of loans, substantially increasing the number of college graduates who will face the burden of repaying significant student loan debt upon entering the workforce; and

WHEREAS, As of 2018, student loan debt had reached $1.5 trillion nationally, which rose from $548 billion in 2007, and more than 1.6 million Illinois residents had student loans totaling more than $52 billion; and

WHEREAS, When Illinoisans are burdened with student loan debt, they are not able to buy homes, cars, and other products that boost our economy; and

WHEREAS, College savings plans, such as Bright Start and Bright Directions, help families limit or eliminate future student loan debt by helping them save for future higher education expenses; and

WHEREAS, The contributions families make today pay off in the form of an increased earning potential for their children in the future, with a college graduate earning an average of $1 million more than a high school graduate during his or her career, according to the United States Census Bureau; and

WHEREAS, May 29th is recognized nationally as 529 College Savings Day to help raise awareness across the country of the importance of saving for college with the help of 529 college savings plans; therefore, be it

RESOLVED, BY THE SENATE OF THE ONE HUNDRED THIRD GENERAL ASSEMBLY OF THE STATE OF ILLINOIS, THE HOUSE OF REPRESENTATIVES CONCURRING HEREIN, that we declare May 29, 2023 as 529 College Savings Day in the State of Illinois; and be it further

RESOLVED, That we urge all Illinoisans to explore the benefits that 529 college savings plans offer families; and be it further

RESOLVED, That suitable copies of this resolution be delivered to the Governor of Illinois, the Director of the Illinois Student Assistance Commission, the Treasurer of Illinois, the Director of the Community College Board, and the Director of the Board of Higher Education.