SF 3120
1st Engrossment - 94th Legislature (2025 - 2026)
Posted on 04/16/2026 09:01 a.m.
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A bill for an act
relating to higher education; establishing a children's savings account program for
higher education in certain counties; creating a pilot grant program; requiring a
report; appropriating money; amending Minnesota Statutes 2024, section 136G.03,
subdivision 1, by adding subdivisions; proposing coding for new law in Minnesota
Statutes, chapter 136G.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2024, section 136G.03, subdivision 1, is amended to read:
Sec. 2.
Minnesota Statutes 2024, section 136G.03, is amended by adding a subdivision to
read:
new text begin Subd. 6a. new text end
new text begin Children's higher education investment account. new text end
new text begin
"Children's higher education
investment account" means the account established in the special revenue fund under section
136G.15, subdivision 7.
new text end
Sec. 3.
Minnesota Statutes 2024, section 136G.03, is amended by adding a subdivision to
read:
new text begin Subd. 12a. new text end
new text begin Eligible child. new text end
new text begin
"Eligible child" means a current Minnesota resident under 18
years of age, born on or after July 1, 2026, in either:
new text end
new text begin
(1) Stearns, Wright, Sherburne, Rice, or Benton counties; or
new text end
new text begin
(2) Ramsey or Hennepin counties, if the child's biological mother is eligible for the
medical assistance program under chapter 256B.
new text end
Sec. 4.
Minnesota Statutes 2024, section 136G.03, is amended by adding a subdivision to
read:
new text begin Subd. 17a. new text end
new text begin Low-income households. new text end
new text begin
"Low-income households" means households
where children or households are identified by the commissioner or by other means as
low-income for purposes of the program.
new text end
Sec. 5.
Minnesota Statutes 2024, section 136G.03, is amended by adding a subdivision to
read:
new text begin Subd. 21b. new text end
new text begin MinneKIDS account. new text end
new text begin
"MinneKIDS account" means an account created by
the commissioner in which designated money for an eligible child is held.
new text end
Sec. 6.
Minnesota Statutes 2024, section 136G.03, is amended by adding a subdivision to
read:
new text begin Subd. 21c. new text end
new text begin MinneKIDS affiliate. new text end
new text begin
"MinneKIDS affiliate" means an entity designated
by the commissioner to contribute to MinneKIDS accounts under section 136G.15.
new text end
Sec. 7.
new text begin
[136G.15] MINNESOTA KIDS INVESTMENT AND DEVELOPMENT
SCHOLARSHIP PROGRAM.
new text end
new text begin Subdivision 1. new text end
new text begin MinneKIDS accounts. new text end
new text begin
(a) The commissioner must create a MinneKIDS
account on behalf of an eligible child no more than 90 days after:
new text end
new text begin
(1) receiving birth data for an eligible child from the Department of Health pursuant to
subdivision 4; or
new text end
new text begin
(2) receiving a request from a parent or guardian of an eligible child that does not have
a MinneKIDS account.
new text end
new text begin
(b) The commissioner must provide the parent or guardian a simple process for opting
the parent or guardian's eligible child out of the MinneKIDS account program. Within 30
days of receiving a request to opt an eligible child out of the MinneKIDS account program,
the commissioner must close the eligible child's MinneKIDS account and return any money
in the account to the children's higher education investment account.
new text end
new text begin
(c) Only the commissioner, the plan administrator, a MinneKIDS affiliate, or other entity,
individual, or government approved by the commissioner may contribute money to an
eligible child's MinneKIDS account.
new text end
new text begin
(d) Money deposited in a MinneKIDS account must be invested pursuant to section
136G.07.
new text end
new text begin
(e) A MinneKIDS account established pursuant to this section, any additional deposits,
and any investment earnings will remain assets of and be owned by the state until used for
the payment of qualified higher education expenses at an eligible education institution.
new text end
new text begin
(f) The commissioner may accept for deposit into the children's higher education
investment account gifts, grants, awards, matching contributions, interest income, and
appropriations from individuals, businesses, state and local governmental entities, and
nonstate and third-party sources for the program on terms the commissioner deems advisable.
new text end
new text begin Subd. 2. new text end
new text begin Parent or guardian notification. new text end
new text begin
(a) No more than 30 days after creating a
MinneKIDS account for an eligible child pursuant to subdivision 1, and then at least once
in each subsequent year until the MinneKIDS account is closed, the commissioner must
notify at least one parent or legal guardian of the eligible child about the program. The
notification must include information regarding all of the following:
new text end
new text begin
(1) how the parent or legal guardian may opt the eligible child out of the program;
new text end
new text begin
(2) the MinneKIDS account opened for the eligible child pursuant to paragraph (a), and
any deposit provided pursuant to subdivision 3;
new text end
new text begin
(3) how the parent or legal guardian may view the balance of the eligible child's
MinneKIDS account;
new text end
new text begin
(4) how the parent or legal guardian may establish and contribute to a separate Minnesota
college savings plan account;
new text end
new text begin
(5) how the parent or legal guardian may link a MinneKIDS account to a separate
Minnesota college savings plan account;
new text end
new text begin
(6) how the eligible child may qualify for additional deposits, as applicable;
new text end
new text begin
(7) limitations on contributions to the MinneKIDS account pursuant to subdivision 1;
and
new text end
new text begin
(8) ownership status of money held in a MinneKIDS account described in subdivision
1 and that the money in the account will be forfeited and returned to the program if the
eligible child does not use it before reaching 26 years of age.
new text end
new text begin
(b) The commissioner must translate notifications and information regarding the program
established in this section into common languages spoken throughout Minnesota.
new text end
new text begin Subd. 3. new text end
new text begin Provision of birth data. new text end
new text begin
(a) No later than 90 days after a birth is registered
under section 144.215 for an eligible child, and notwithstanding section 144.225, subdivision
2, the commissioner of health must, on a quarterly basis, provide the commissioner with
the following birth data for each eligible child in a file format as defined by the commissioner:
new text end
new text begin
(1) the eligible child's name and birth date;
new text end
new text begin
(2) the name and contact information of each parent of the eligible child, including the
parent's street address;
new text end
new text begin
(3) if provided to the Department of Health, the parent's mobile telephone number and
email address;
new text end
new text begin
(4) amended birth record information of an eligible child to assist the commissioner in
verifying a legal name change of an eligible child; and
new text end
new text begin
(5) any other information the commissioner requests as necessary for administering this
section.
new text end
new text begin
(b) Except data that is classified as confidential pursuant to section 144.225, subdivision
2, this subdivision does not apply to data that is classified as not public data as defined in
section 13.02, subdivision 8a, or that is sealed by court order.
new text end
new text begin
(c) Any birth data provided to the commissioner under this section is private data on
individuals as defined in section 13.02, subdivision 12.
new text end
new text begin Subd. 4. new text end
new text begin Disbursements. new text end
new text begin
(a) Money in a MinneKIDS account designated for an eligible
child, including any investment earnings, must be used for the purpose of providing awards
for qualified higher education expenses associated with the attendance of the eligible child
at an eligible educational institution.
new text end
new text begin
(b) Notwithstanding anything to the contrary in this section, "qualified higher education
expenses" must not include any tuition or other expenses in connection with enrollment or
attendance at an elementary or secondary public, private, or religious school.
new text end
new text begin
(c) The commissioner must make a distribution directly to an eligible educational
institution on behalf of the beneficiary when the beneficiary:
new text end
new text begin
(1) requests a distribution from the MinneKIDS account;
new text end
new text begin
(2) self-certifies that the beneficiary is enrolled at an eligible educational institution; and
new text end
new text begin
(3) self-certifies that the beneficiary has resided in the state of Minnesota for at least
one year immediately preceding the payment of qualified higher education expenses on the
beneficiary's behalf.
new text end
new text begin
(d) If the beneficiary requests a distribution pursuant to paragraph (c), but has no account
balance with the eligible educational institution, then the eligible educational institution
must distribute money received on the beneficiary's behalf pursuant to this subdivision
directly to the beneficiary for the purpose of paying the beneficiary's qualified higher
education expenses.
new text end
new text begin Subd. 5. new text end
new text begin Account closures; forfeiture. new text end
new text begin
(a) The money in a MinneKIDS account must
remain invested pursuant to section 136G.07 until the earlier of the date:
new text end
new text begin
(1) the beneficiary of a MinneKIDS account requests a distribution pursuant to
subdivision 5; or
new text end
new text begin
(2) the account is closed pursuant to paragraph (b).
new text end
new text begin
(b) If the beneficiary has not used all or any portion of the money in the beneficiary's
MinneKIDS account for a qualified higher education expense for any reason, including
death or disability of the beneficiary, by the time the beneficiary has achieved 26 years of
age, then:
new text end
new text begin
(1) the beneficiary's MinneKIDS account must be closed; and
new text end
new text begin
(2) the money in the beneficiary's MinneKIDS account must be forfeited and deposited
into the children's higher education investment account.
new text end
new text begin
(c) The commissioner must contact the beneficiary of a MinneKIDS account 60 days
prior to closing the beneficiary's MinneKIDS account pursuant to paragraph (b) and provide
an opportunity for the beneficiary to appeal the closing of the MinneKIDS account.
new text end
new text begin
(d) If the beneficiary does not appeal the closing of a MinneKIDS account within 45
days of receiving notice under paragraph (c), then the commissioner may close the
beneficiary's MinneKIDS account and return the money to the children's higher education
investment account.
new text end
new text begin
(e) Money, less applicable penalties, collected pursuant to section 529 of the Internal
Revenue Code not used within the time period described in paragraph (b) must revert to the
children's higher education investment account after the payment of any amount determined
to be due to the federal government as a result of the reversion.
new text end
new text begin
(f) If an eligible child is opted out of the program, all money in the eligible child's
MinneKIDS account, including any investment earnings, is forfeited and must be deposited
into the children's higher education investment account in a timely manner and the eligible
child's MinneKIDS account must be closed.
new text end
new text begin Subd. 6. new text end
new text begin Account established; appropriation. new text end
new text begin
A children's higher education investment
account is created in the special revenue fund in the state treasury. Money in the account,
including appropriations and transfers made to the account and forfeited MinneKIDS account
balances returned to the account, is appropriated to the commissioner for the purposes
specified in this section. Money remaining in the account at the end of a fiscal year is not
canceled to the general fund but remains available until expended.
new text end
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective on August 1, 2028, except as provided
in section 8.
new text end
Sec. 8. new text begin MINNEKIDS PILOT PROGRAM.
new text end
new text begin Subdivision 1. new text end
new text begin Pilot grants. new text end
new text begin
By June 30, 2027, the commissioner of the Office of Higher
Education must solicit applications and make grants of $100,000 each to three separate
eligible entities under this section. Of the three awards: one must go to an entity serving an
urban community; one must go to an entity serving a rural community; and one must go to
an entity serving a Minnesota Tribal Nation or an American Indian community in Minnesota.
new text end
new text begin Subd. 2. new text end
new text begin Eligible entities. new text end
new text begin
Entities eligible to receive a grant under this section must be
based in and serving Minnesota communities and include: local units of government; Tribal
governments; nonprofit organizations; school districts; and community partnerships with
demonstrated capacity to serve children and families.
new text end
new text begin Subd. 3. new text end
new text begin Allowable uses. new text end
new text begin
An entity that receives a grant under this section must use the
grant money for:
new text end
new text begin
(1) outreach and marketing to promote MinneKIDS accounts established under Minnesota
Statutes, section 136G.15;
new text end
new text begin
(2) providing culturally responsive family financial education; and
new text end
new text begin
(3) administrative costs directly related to clauses (1) and (2).
new text end
Sec. 9. new text begin MINNEKIDS PROGRAM REPORT REQUIRED.
new text end
new text begin
(a) By February 15, 2028, the commissioner of the Office of Higher Education must
report information regarding the implementation of the program established in Minnesota
Statutes, section 136G.15, to the chairs and ranking minority members of the legislative
committees having jurisdiction over higher education. The report must include but not be
limited to:
new text end
new text begin
(1) detailed program expenditure information;
new text end
new text begin
(2) the number of accounts opened;
new text end
new text begin
(3) the number of contributions made to accounts;
new text end
new text begin
(4) information about how parents were notified about the program;
new text end
new text begin
(5) a description of the commissioner's marketing of the program;
new text end
new text begin
(6) a description of the commissioner's efforts and success in aligning or integrating
with the Minnesota 529 college savings plan established by Minnesota Statutes, section
136G.01; and
new text end
new text begin
(7) recommendations for improving the MinneKIDS program.
new text end
new text begin
(b) By February 15, 2028, the commissioner of the Office of Higher Education must
report information regarding the implementation of the MinneKIDS pilot program established
in section 8 of this act to the chairs and ranking minority members of the legislative
committees having jurisdiction over higher education. The report must include but not be
limited to:
new text end
new text begin
(1) a list of eligible entities provided grants under that section, and information regarding
the entities' progress and successes;
new text end
new text begin
(2) detailed grant expenditures for each grantee; and
new text end
new text begin
(3) recommendations for expanding the pilot program to additional local partners.
new text end
Sec. 10. new text begin APPROPRIATIONS.
new text end
new text begin
$300,000 in fiscal year 2027 is appropriated from the general fund to the commissioner
of the Office of Higher Education for MinneKIDS pilot program grants under section 8 of
this act. This is a onetime appropriation and is available until June 30, 2027.
new text end