Another Win For Child Development Accounts
Wednesday, June 12th, 2019 @ 11:07AM
Kudos to the Center for Social Development (CSD) at the Brown School at Washington University in St. Louis for another win in its efforts to expand the use of child development accounts (CDA) to alleviate generational poverty. Thanks to the persistent efforts of CSD Policy Director Margaret Clancy who spearheaded support for the legislation, beginning January 1, 2020, all newborns in Nebraska will receive a 529 college savings account. Legislative Bill 610 passed with unanimous bipartisan support and was signed into law by Governor Pete Ricketts on May 31, 2019.
Clancy, one of the nation’s leading experts on CDAs, advised Nebraska state treasurer John Murante on various policy options, provided research findings, and testified on provisions in the bill, resulting in legislation the entire legislature supported. The accounts will be funded through private entities and state sources (not general funds). The bill includes a provision that will allow families with incomes below 200 percent of the federal poverty line to apply for a $2 matching contribution for every $1 deposited in their accounts. Families with incomes between 250 and 200 percent of the poverty threshold can apply for a dollar for dollar matching contribution.
In the CSD announcement, Clancy stated: “State legislators are creating a structure and paving the way for all Nebraska children to succeed, perhaps particularly those from disadvantaged families. Nebraska’s legislation provides enormous potential to engage corporations, nonprofits, educators, communities and state resident families in building assets for children’s education.”
The Center for Social Development under the leadership of Director Dr. Michael Sherraden, the George Warren Brown Distinguished University Professor at the School of Social Work, has assisted with implementing CDAs in Pennsylvania, Maine, Nevada, Rhode Island, Connecticut and Massachusetts, and legislation is pending in several other states, including Illinois and California. They have helped to implement CDAs in Singapore and Israel and is consulting with several other countries.
Sherraden and Clancy have proposed federal legislation for child development accounts that is currently being reviewed by Congresswoman Barbara Lee’s office. In March they convened a stellar panel at the National Press Club to announce their proposed legislation and examine the potential of child development accounts to significantly reduce poverty for disadvantaged families in the United States. Their work supports the aspirations of several of the 12 Grand Challenges for Social Work, including Ensure Healthy Development for All Youth and Build Financial Capability for All.
Congresswoman Lee, a social worker who represents California’s 13th Congressional District that covers the Oakland area, chairs both the Congressional Social Work Caucus and the Out-of-Poverty Caucus which she co-founded in the wake of the devastation left by Hurricane Katrina in 2005. She also chairs the Majority Leader’s Task Force on Poverty, Income Inequality and Opportunity which she co-founded with Majority Leader Steny Hoyer (D-MD-5). Her portfolio, which includes work on Congressional committees, is heavily weighted with issues of poverty and equity. The CDA bill could be a vehicle that moves the nation in a positive direction.
But we will wait and see, given the current environment in Congress. How soon the gridlock will end is anyone’s guess. The House has passed dozens of bills that would assist low- and middle-income families, but they remain blocked by Senate Majority Leader Mitch McConnell’s refusal to act on these legislative initiatives. Should the CDA proposed be introduced as a bill, it too will be stalled by the bottleneck of ignored legislation. So why bother? Because, getting a legislative idea into a bill and the legislative process is a slow slog even in the best environment. It takes time to get bills through committees and onto the House floor for a vote. It will take time to build support and get enough co-sponsors for the bill to be taken seriously. You do it because there is no other way. Most legislation takes years and several Congresses to get through the process.
The great news is that social work research is having an impact on the laws of the country. We look forward to learning about more situations where social work researchers are influencing legislation at the federal, state, and local levels.