AB67 - Establishes the Nevada Baby Bonds Program. (BDR 18-477)

A.B. 67 - *AB67* ASSEMBLY BILL NO. 67–COMMITTEE ON GOVERNMENT AFFAIRS (ON BEHALF OF THE STATE TREASURER) PREFILED NOVEMBER 20, 2024 ____________ Referred to Committee on Government Affairs SUMMARY—Establishes the Nevada Baby Bonds Program. (BDR 18-477) FISCAL NOTE: Effect on Local Government: No. Effect on the State: Contains Appropriation not included in Executive Budget. ~ EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. AN ACT relating to the State Treasurer; establishing the Nevada Baby Bonds Program and the Nevada Baby Bonds Trust Fund; setting forth the duties and responsibilities of the State Treasurer in administering the Program and Trust Fund; authorizing the State Treasurer to adopt regulations relating to the Program; making an appropriation; and providing other matters properly relating thereto. Legislative Counsel’s Digest: The Nevada Constitution requires the State Treasurer to perform such duties as 1 may be prescribed by law. (Nev. Const. Art. 5, § 22) Section 8 of this bill: (1) 2 establishes the Nevada Baby Bonds Program and the Nevada Baby Bonds Trust 3 Fund; and (2) requires the State Treasurer to administer the Program and Trust 4 Fund. Sections 6 and 7 of this bill, respectively, define the terms “Program” and 5 “Trust Fund.” 6 Section 4 of this bill establishes that a “designated beneficiary” under the 7 Program is a natural person born in this State on or after January 1, 2026, whose 8 birth was subject to medical coverage provided under Medicaid, as defined in 9 section 5 of this bill, or the Children’s Health Insurance Program, as defined in 10 section 3 of this bill. 11 Section 9 of this bill requires the State Treasurer, within the limits of money 12 made available for this purpose, to credit $3,200 in the Trust Fund to each 13 designated beneficiary. If the money available in the Trust Fund is insufficient to 14 cover all designated beneficiaries for a particular year, section 9 requires the State 15 Treasurer to: (1) determine the appropriate number of designated beneficiaries for 16 – 2 – - *AB67* whom money is available; and (2) select by lottery the designated beneficiaries who 17 will receive a credit of $3,200 in the Trust Fund. 18 Section 9 authorizes a designated beneficiary to submit a claim to the State 19 Treasurer to receive money credited to the designated beneficiary in the Trust Fund 20 if the designated beneficiary: (1) is at least 18 but less than 30 years of age; (2) has 21 been a resident of this State for at least the 12 months immediately preceding the 22 submission of the claim; (3) attests that he or she will use the money for certain 23 purposes; and (4) has successfully completed a course in financial literacy approved 24 by the State Treasurer. 25 Section 10 of this bill requires the State Treasurer to provide an annual 26 statement to each designated beneficiary, which includes certain information. 27 Section 11 of this bill provides that, with certain exceptions, any money 28 deposited into the Trust Fund must not be used to calculate the personal assets of a 29 designated beneficiary for purposes of determining eligibility of the designated 30 beneficiary for: (1) any disability, medical or other health benefits administered by 31 this State; or (2) any student loan program, student grant program or other student 32 financial aid program administered by this State. 33 Section 12 of this bill: (1) sets forth certain requirements and limitations on the 34 State Treasurer in investing and reinvesting the money in the Trust Fund; and (2) 35 authorizes the State Treasurer to enter into certain contracts and procure insurance 36 for the Trust Fund, apply for, accept and expend any gifts, grants and donations and 37 take any other action necessary to carry out the provisions of law related to the 38 Program. 39 Sections 13 and 15 of this bill provide, with certain exceptions, that all 40 information about a designated beneficiary which is contained in a record or file in 41 the possession, control or custody of the State Treasurer is confidential. 42 Section 14 of this bill authorizes the State Treasurer to adopt any regulations 43 necessary to carry out the provisions of law relating to the Program, including, 44 without limitation, requirements relating to the course in financial literacy for 45 designated beneficiaries required by section 9. 46 Section 16 of this bill makes an appropriation to the Nevada Baby Bonds Trust 47 Fund. 48 THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS: Section 1. Chapter 226 of NRS is hereby amended by adding 1 thereto the provisions set forth as sections 2 to 14, inclusive, of this 2 act. 3 Sec. 2. As used in sections 2 to 14, inclusive, of this act, 4 unless the context otherwise requires, the words and terms defined 5 in sections 3 to 7, inclusive, of this act have the meanings ascribed 6 to them in those sections. 7 Sec. 3. “Children’s Health Insurance Program” means the 8 program established pursuant to 42 U.S.C. §§ 1397aa to 1397jj, 9 inclusive, to provide health insurance for uninsured children from 10 low-income families in this State. 11 Sec. 4. “Designated beneficiary” means a natural person 12 born in this State on or after January 1, 2026, whose birth was 13 – 3 – - *AB67* subject to medical coverage provided under Medicaid or the 1 Children’s Health Insurance Program. 2 Sec. 5. “Medicaid” means the program established pursuant 3 to Title XIX of the Social Security Act, 42 U.S.C. §§ 1396 et seq., 4 to provide assistance for part or all of the cost of medical care 5 rendered on behalf of indigent persons. 6 Sec. 6. “Program” means the Nevada Baby Bonds Program 7 established by section 8 of this act. 8 Sec. 7. “Trust Fund” means the Nevada Baby Bonds Trust 9 Fund created by section 8 of this act. 10 Sec. 8. 1. The Nevada Baby Bonds Program is hereby 11 established, to be administered by the State Treasurer. 12 2. The Nevada Baby Bonds Trust Fund is hereby created for 13 the purpose of carrying out the Program. The Trust Fund and any 14 account established by the State Treasurer pursuant to subsection 15 3 must be administered by the State Treasurer. 16 3. The State Treasurer may establish such accounts in the 17 Trust Fund as the State Treasurer determines necessary to carry 18 out the duties of the State Treasurer pursuant to sections 2 to 14, 19 inclusive, of this act. 20 4. The Trust Fund is an instrumentality of this State, and its 21 property and income are exempt from all taxation of this State and 22 any political subdivision thereof. 23 5. The Trust Fund consists of: 24 (a) All money from public or private sources appropriated by 25 or made available to this State for the benefit of the Trust Fund; 26 and 27 (b) All earnings on the money in the Trust Fund. 28 6. The money in the Trust Fund: 29 (a) Is not the property of this State and this State has no claim 30 to or interest in such money; and 31 (b) Must not be commingled with any money of this State. 32 7. Any contract entered into by the State Treasurer on behalf 33 of the Trust Fund does not constitute a debt or obligation of this 34 State, and no designated beneficiary is entitled to any money in the 35 Trust Fund except for that money credited to the designated 36 beneficiary pursuant to section 9 of this act. 37 8. The money in the Trust Fund must be preserved, invested 38 and expended solely pursuant to and for the purposes authorized 39 by sections 2 to 14, inclusive, of this act and must not be loaned or 40 otherwise transferred or used by this State for any other purpose. 41 9. The Trust Fund must continue in existence as long as it 42 holds any deposits or has any obligations, or until its existence is 43 terminated by law. Upon termination, any unclaimed assets must 44 revert to the State General Fund. 45 – 4 – - *AB67* 10. The State Treasurer may use not more than 5 percent of 1 the money appropriated during a fiscal year for the Program to 2 pay administrative costs. 3 Sec. 9. 1. The Department of Health and Human Services 4 shall notify the State Treasurer of the birth of each designated 5 beneficiary. Except as otherwise provided in this subsection, the 6 State Treasurer shall, within the limits of money made available 7 for this purpose, credit to each designated beneficiary $3,200 in 8 the Trust Fund. If the money available for such purpose is 9 insufficient to cover all designated beneficiaries born for a 10 particular year, the State Treasurer shall: 11 (a) Determine the appropriate number of designated 12 beneficiaries for whom money in the Trust Fund is available; and 13 (b) Select by lottery the designated beneficiaries for that year 14 who will receive a credit of $3,200 in the Trust Fund. 15 2. A designated beneficiary may submit a claim to the State 16 Treasurer to receive money in the Trust Fund credited to the 17 designated beneficiary if the designated beneficiary: 18 (a) Is at least 18 but less than 30 years of age; 19 (b) Has been a resident of this State for at least the 12 months 20 immediately preceding the submission of the claim to the State 21 Treasurer; 22 (c) Attests that he or she will use the money for one or more of 23 the following purposes: 24 (1) Postsecondary education, including, without limitation, 25 vocational education or apprenticeship readiness and training; 26 (2) To purchase a home; 27 (3) To start or purchase a business; or 28 (4) To invest in financial assets or personal capital that 29 provides a long-term gain to the wages or wealth of the designated 30 beneficiary; and 31 (d) Has successfully completed a course in financial literacy 32 approved by the State Treasurer, which must include, without 33 limitation, training on the rights and protections available to 34 consumers when: 35 (1) Receiving or repaying a student loan for postsecondary 36 education; 37 (2) Purchasing a home; 38 (3) Starting or purchasing a business; and 39 (4) Investing in financial assets or personal capital that 40 provides a long-term gain to the wages or wealth of the designated 41 beneficiary. 42 3. The money for which the designated beneficiary may 43 submit a claim pursuant to subsection 2 must include the: 44 – 5 – - *AB67* (a) Amount credited to the designated beneficiary pursuant to 1 subsection 1; and 2 (b) Pro rata share of the total net earnings from the investment 3 of the money held in the Trust Fund that the State Treasurer 4 determines is attributable to the designated beneficiary. 5 4. The State Treasurer must credit back to the Trust Fund all 6 money which the designated beneficiary is entitled to claim 7 pursuant to subsection 3 if the designated beneficiary: 8 (a) Dies before he or she is eligible to submit a claim to the 9 State Treasurer pursuant to subsection 2; or 10 (b) Does not submit a claim that meets the requirements set 11 forth in subsection 2 before the designated beneficiary reaches 30 12 years of age. 13 Sec. 10. 1. The State Treasurer shall provide an annual 14 statement to each designated beneficiary who receives a credit in 15 the Trust Fund pursuant to section 9 of this act which must 16 include, without limitation: 17 (a) A statement of the amount credited to the designated 18 beneficiary in the Trust Fund; 19 (b) A projection of the growth of the amount credited to the 20 designated beneficiary in the Trust Fund; 21 (c) Resources and information to promote the financial 22 wellness and literacy of the designated beneficiary; and 23 (d) Any other information about the Program that the State 24 Treasurer determines to be relevant. 25 2. The State Treasurer may request the contact information 26 of any designated beneficiary from a state agency for the purpose 27 of carrying out the provisions of subsection 1. Upon any such 28 request, a state agency shall provide the State Treasurer with the 29 contact information of a designated beneficiary. 30 Sec. 11. Except as otherwise provided by federal law, any 31 money deposited into the Trust Fund and credited to a designated 32 beneficiary, and any increase in the values thereof, must not be 33 used to calculate the personal assets of a designated beneficiary 34 for purposes of determining the eligibility of the designated 35 beneficiary for any: 36 1. Disability, medical or other health benefits administered by 37 this State; or 38 2. Student loan program, student grant program or other 39 student financial aid program administered by this State. 40 Sec. 12. 1. The State Treasurer, on behalf of the Trust 41 Fund and for trust purposes, shall: 42 (a) Except as otherwise provided in subsection 2, invest and 43 reinvest the money in the Trust Fund, including, without 44 limitation, in any instrument, obligation, security or property, in 45 – 6 – - *AB67* any manner that is reasonable and appropriate in order to achieve 1 the objectives of the Trust Fund, and while exercising the 2 discretion and care of a prudent person in similar circumstances 3 with similar objectives; and 4 (b) Give due consideration to the expected rate of return, risk, 5 term or maturity, diversification of the total investments within the 6 Trust Fund, liquidity, projected disbursements and expenditures 7 and anticipated deposits, contributions and gifts to the Trust 8 Fund. 9 2. The State Treasurer shall not, on behalf of the Trust Fund, 10 invest directly in obligations of the State or any political 11 subdivision thereof or in any investment or other fund 12 administered by the State Treasurer. 13 3. The State Treasurer, on behalf of the Trust Fund and for 14 trust purposes, may: 15 (a) Enter into contracts for the Trust Fund, including, without 16 limitation, contracts for legal, actuarial, accounting, custodial, 17 advisory, management, administrative, advertising, marketing and 18 consulting services, and pay for such contractual services from the 19 earnings on the money in the Trust Fund; 20 (b) Procure insurance for the Trust Fund in connection with 21 the property, assets, activities or deposits of the Trust Fund; 22 (c) Apply for, accept and expend any gifts, grants and 23 donations from any public or private source for the purpo [Text truncated for display. Full text available on LegiScan.]