Bonilla Introduces Legislation to Help Parents Pay for College

February 21, 2014 10:00 am · 26 comments

Assemblywoman Susan A. Bonilla today announced she is partnering with California State Treasurer Bill Lockyer to introduce legislation to provide valuable tax relief for families that invest in the state’s 529-college savings plan, called ScholarShare.

“Children with college savings accounts are seven-times more likely to attend college,” said Assemblywoman Bonilla. “Our legislation will increase the number of families saving for college and also increase the amount of money they set aside for higher education.”

California is one of only seven states with personal income taxes that do not offer any type of tax incentives for saving with a 529 plan. Furthermore, 52 percent of California college graduates have student debt, and the average California student loan balance is $25,700.

Bonilla’s legislation, AB 1956, would encourage California families to put away more money for college by providing a refundable tax credit of 20 percent of the amount contributed to ScholarShare up to $2,500, for a maximum credit of $500 per year. The credit would be limited to taxpayers with annual incomes of $100,000 for single filers and $200,000 for joint filers.

“This tax credit plan would expand college savings opportunities for low- and middle-income families,” said Treasurer Lockyer. “That would ensure our state more broadly shares the economic prosperity created by higher education. AB 1956 also would ease student debt burdens. In the process, it would give California’s economy a long-term boost by providing families more than $1 billion to spend on goods and services they otherwise would have spent to pay off loans.”

AB 1956 will be heard in a policy committee hearing later this spring.

Mac February 21, 2014 at 10:10 AM

Could have used something like this when my 2 Girls were in college.
I`m still paying off things.

WC February 21, 2014 at 10:44 AM

Ok! A $500 dollar credit each year, that will limit student debt when it’s about 25K a year for college. At least it’s a start but feels more like a headline creator/PR move.

Would Lockyer go away already!

Anon February 21, 2014 at 10:56 AM

“Could have used something like this when my 2 Girls were in college.
I`m still paying off things.”

Let them pay for it– your job is over or are they still living at home & having you do the laundry & making them all their meals??

Have them man up & be responsible

unknown February 21, 2014 at 11:20 AM

Make jobs so people can take care of them selves. In stead of the gov’t making everyone a loser! No matter what, you will still have to pay back the “free” money. Remember “free” is four letter word!

Always Right February 21, 2014 at 11:37 AM

Here we go again. Democrats adding fuel to a fire they started.

Most of the loan and grant programs the democrats have pushed on taxpayers to fund education over the last decade or more have created a huge debt burden for middle class families. These programs give free rides for ” C” students who came from poor families, and forced middle class kids with ” A” grade point averages to take on huge loans.

A complete disaster – unqualified students admitted to college with poor preparation are given free or highly subsidized admission, and then they drop out. A waste of money. Meantime middle class students who are well prepared are burdened by obscenely high tuition (used to subsidize the unqualified students) and huge loans.

This is Obama’s dream, and a middle class nightmare.

The democrats run most of the education establishments in this country, so it was a win win for them. ,

WC44 February 21, 2014 at 11:52 AM

It has been crazy that CA has not offered some incentive on this. Wish it had been there 15 years ago for me to take advantage of.

Richardsfamily February 21, 2014 at 12:43 PM

go to community college its cheeper, anyone can afford it

Sheila February 21, 2014 at 1:06 PM

This sounds good to me. My parents paid for my education (they’re well educated) as well as the education for my brothers.

My husband and I paid the education of our children, who are doing well financially.

If you want a successful career, you need a bachelors degree or an advanced degree, depending on your chosen profession.

I’m strongly in favor of parents paying for the education of their children. College students shouldn’t have to graduate 25K in debt.

I’m also well aware that not all parents can afford it. That’s what student loans are for.

Jess February 21, 2014 at 1:38 PM

Some of the people commenting here misunderstand Bonilla’s proposal. This isn’t the government giving away “free” money for college. It’s giving parents a small tax break if they put money away in a college savings plan so they will be able to pay for their own children’s college education. It’s similar to the federal government giving you a break on your income taxes if you contribute to your IRA. It’s a way to encourage people to save for the future.

Here's a thought.... February 21, 2014 at 1:53 PM

Pass a law limiting the ridiculous tuition we pay ! If he can fog a mirror, a prospective student can borrow almost endlessly and the university system has raped our children and their future by raising tuition higher and higher and higher ! They know damn well what they have done and the don’t give a sh*t. They build country clubs to attract students and it’s sickening. It’s so out of control that many kids graduate these days without the ability to ever repay the debt.

Reel it in Susan !

mike mac February 21, 2014 at 2:13 PM

I am in favor of limiting funds to the government by whatever means can be done. But I agree with #5 that government creates the problem to start.

Happy Thursday February 21, 2014 at 2:17 PM

I’m with Sheila……

ANON February 21, 2014 at 2:20 PM

“College students shouldn’t have to graduate 25K in debt.”

A good college costs more than that- make them pay it off themselves – let them think they are doing something
–give them some responsibility –make them mature

Elwood February 21, 2014 at 2:47 PM

Bonilla saves the world again!

I feel so much better now that I’ve received another dose of Bonilla dimmiecrat bull**** feel good!

Cowellian February 21, 2014 at 2:54 PM

The huge increase in the cost of a college education is directly tied to the massive increase in federal funding for higher education. The more the federal government is willing to dump into the pockets of schools, the more the schools are willing to accept from the government.

Ted K., SuperMax February 21, 2014 at 3:11 PM

Tough to pay/save for college when the freekin’ liberals of this state keeps raising taxes, subsidizing illegals aliens, and the Board of Regents/Cal State Trustees increase tuition & fees.

anon February 21, 2014 at 3:23 PM

Not every kid needs to go to college. Too many have majors that won’t pay much.

RANDOM TASK February 21, 2014 at 3:27 PM

ty #16 some refuse to see the obvious

Mark February 21, 2014 at 3:41 PM

If it is REALLY about helping the middle class educate their children, don’t limit the tax break to only those who choose to enroll in the California 529. Most states have 529 plans. Some have more than one. There are a ton of options out there. This proposal is the same as investing in the stock market with the caveat that you have to pick from a list given to you containing only 2% of the currently available stocks. Would that make sense? Let us choose from 50 states, not just one.

I bet with $25,000 many of us could pick a 529 plan from another state with lower fees, sales loads, or better investment choices and earn more than we could with the California plan including the $500 tax break.

If it is REALLY about helping pay for higher education, allow the tax incentive for ALL state 529 plans.

Sacto Rob February 21, 2014 at 4:54 PM

This is nice. While she’s at it, maybe Assemblywoman Bonilla and the rest of her super-majority party can also spend some time figuring out how to cut the costs of running our public colleges and universities. Tuition and fee increases in the past couple of decades are criminally out of control, but nothing is being done to rein in the overhead costs.

Ven Exeter February 21, 2014 at 5:40 PM

I’m surprised anyone would complain about this. This is the first proposal I’ve seen in years from a Democrat that will actually benefit working tax payers. While it is only a drop a bucket, it is much better than the zero tax break one currently gets for contributing to a 529 plan or Coverdell IRA.

It will likely never get enacted, as it makes too much sense to enact legislation that rewards parents who take responsibility and save for their child’s future. Our state legislature is much more comfortable handing out tax payer dollars to the children of parents who are irresponsible law breakers who contribute nothing to society.

@Sacto Rob February 21, 2014 at 5:45 PM

It’s not the overhead that’s the problem. It’s the fact that they raise tuition commensurate with what students can borrow. The more they can borrow, the higher the tuition! They’re not going to leave any money on the table and now, the ROI on college has been eroded to next to nothing.

The liberal elitist university wonks have screwed our younger generations.

guest February 21, 2014 at 6:01 PM

A few years ago I wondered why tuition rates were skyrocketing. I knew something was up, but didn’t know what. Now I do. Escalated prices for tuition means incremental invasion by government into the private lives of it’s citizens. When will we look towards ourselves again for achievement in life and push government out, back where it belongs. The incremental, but generational intrusions are wrong for a free society to exist.

By the way, had poor parents, no college $ help. Worked high-paying jobs in summer (Alaska fisheries) and part-time during school if I had to (not often). Graduated in 4 years and about $15K in debt, or $3750 debt per year, no big deal. Can’t do that today.

That’s what I mean by government intrusion. The infection is spreading. Also, cut all $200K job salaries in half. Some will leave, fine. We were fine before you came (well, better actually).

Boneguy1 February 22, 2014 at 9:33 AM

Why not Vouchers for School Choice?

@Boneguy1 February 22, 2014 at 11:34 AM

vouchers would be the nail in the coffin. A voucher will only help the rich who can afford the expense of what a voucher would not cover. Seriously the only way a voucher would be good is if schools could not charge for anything above the voucher. Otherwise only rich will have the ability to go to good schools.

Connie Dobbs February 22, 2014 at 2:45 PM

#25 Unlike now.

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