Substitute for SENATE BILL No. 402*
An Act providing for a feasibility study regarding implementation of a postsecondary
      education savings program.

Be it enacted by the Legislature of the State of Kansas:

Section 1. The legislature hereby declares that the availability of im-
proved access to and choice of higher education opportunities in this state
will benefit the residents of the state and that the establishment of a
postsecondary education savings program may assist residents in meeting
the expenses incurred in availing themselves of higher education oppor-
tunities. Therefore, it is the intention of this act to provide for a feasibility
study regarding implementation of a postsecondary education savings
program in this state.

Sec. 2. (a) The state treasurer shall conduct a feasibility study to de-
velop criteria for a postsecondary education savings program and to eval-
uate the financial soundness of such programs based on such criteria,
including a study of the use of private service providers for investment,
marketing, and records administration in such programs. The feasibility
study shall include, but need not be limited to, the following:

(1) Examine existing state-sponsored postsecondary education sav-
ings programs;

(2) determine participation guidelines;

(3) maximize participants' state and federal tax benefits through util-
ization of current taxation codes;

(4) study the range of coverage that savings programs provide, in-
cluding whether to restrict earnings to tuition and fees or to expand use
of earnings to additional postsecondary education costs;

(5) examine investment procedures and regulations, including re-
views of private sector managed programs;

(6) review the concept of an oversight committee or an appointed
board of directors, either of which to include the state treasurer and other
representatives affiliated with higher education and the investment com-

(b) The state treasurer shall cooperate and consult with the governor,
the state board of regents, the state board of education, public and private
institutions of postsecondary education, students, and other interested
institutions in conducting the feasibility study. The treasurer shall peri-
odically consult with the education committees of the senate and the
house of representatives, the legislative budget committee and the leg-
islative educational planning committee in evaluating the feasibility of a
fiscally sound postsecondary education savings program.

(c) The state treasurer shall present the findings regarding feasibility
of a postsecondary education savings program at a joint meeting of the
education committees of the house of representatives and the senate no
later than January 15, 1999. During such presentation, the treasurer shall
solicit comments and suggestions regarding the findings of the feasibility
study and the proposed program from the members of the committees
and shall recommend whether to proceed to implement a program.

Sec. 3. This act shall take effect and be in force from and after its
publication in the statute book.

Approved May 13, 1998