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SF 3739

as introduced - 91st Legislature (2019 - 2020) Posted on 05/07/2020 08:40am

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to human services; modifying the family assets for independence initiative;
amending Minnesota Statutes 2018, section 256E.35.


Section 1.

Minnesota Statutes 2018, section 256E.35, is amended to read:


Subdivision 1.


The Minnesota family assets for independence initiative
is established to provide incentives for low-income families to accrue assets for education,
housing,new text begin vehicles,new text end and economic development purposes.

Subd. 2.


(a) The definitions in this subdivision apply to this section.

(b) "Eligible educational institution" means the following:

(1) an institution of higher education described in section 101 or 102 of the Higher
Education Act of 1965; or

(2) an area vocational education school, as defined in subparagraph (C) or (D) of United
States Code, title 20, chapter 44, section 2302 (3) (the Carl D. Perkins Vocational and
Applied Technology Education Act), which is located within any state, as defined in United
States Code, title 20, chapter 44, section 2302 (30). This clause is applicable only to the
extent section 2302 is in effect on August 1, 2008.

(c) "Family asset account" means a savings account opened by a household participating
in the Minnesota family assets for independence initiative.

(d) "Fiduciary organization" means:

(1) a community action agency that has obtained recognition under section 256E.31;

(2) a federal community development credit union serving the seven-county metropolitan
area; or

(3) a women-oriented economic development agency serving the seven-county
metropolitan area.

(e) "Financial coach" means a person who:

(1) has completed an intensive financial literacy training workshop that includes
curriculum on budgeting to increase savings, debt reduction and asset building, building a
good credit rating, and consumer protection;

(2) participates in ongoing statewide family assets for independence in Minnesota (FAIM)
network training meetings under FAIM program supervision; and

(3) provides financial coaching to program participants under subdivision 4a.

(f) "Financial institution" means a bank, bank and trust, savings bank, savings association,
or credit union, the deposits of which are insured by the Federal Deposit Insurance
Corporation or the National Credit Union Administration.

(g) "Household" means all individuals who share use of a dwelling unit as primary
quarters for living and eating separate from other individuals.

(h) "Permissible use" means:

(1) postsecondary educational expenses at an eligible educational institution as defined
in paragraph (b), including books, supplies, and equipment required for courses of instruction;

(2) acquisition costs of acquiring, constructing, or reconstructing a residence, including
any usual or reasonable settlement, financing, or other closing costs;

(3) business capitalization expenses for expenditures on capital, plant, equipment, working
capital, and inventory expenses of a legitimate business pursuant to a business plan approved
by the fiduciary organization; deleted text beginand
deleted text end

(4) acquisition costs of a principal residence within the meaning of section 1034 of the
Internal Revenue Code of 1986 which do not exceed 100 percent of the average area purchase
price applicable to the residence determined according to section 143(e)(2) and (3) of the
Internal Revenue Code of 1986deleted text begin.deleted text endnew text begin; and
new text end

new text begin (5) acquisition costs of a personal vehicle only if approved by the fiduciary organization.
new text end

Subd. 3.

Grants awarded.

The commissioner shall allocate funds to participating
fiduciary organizations to provide family asset services. Grant awards must be based on a
plan submitted by a statewide organization representing fiduciary organizations. The
statewide organization must ensure that any interested unrepresented fiduciary organization
have input into the development of the plan. The plan must equitably distribute funds to
achieve geographic balance and document the capacity of participating fiduciary
organizations to manage the program deleted text beginand to raise the private matchdeleted text end.

Subd. 4.


A participating fiduciary organization must:

(1) provide separate accounts for the immediate deposit of program funds;

(2) establish a process to select participants and describe any priorities for participation;

(3) enter into a family asset agreement with the household to establish the terms of

(4) provide households with economic literacy education;

(5) provide households with information on early childhood family education;

(6) provide matching deposits for participating households;

(7) coordinate with other related public and private programs; and

(8) establish a process to appeal and mediate disputes.

Subd. 4a.

Financial coaching.

A financial coach shall provide the following to program

(1) financial education relating to budgeting, debt reduction, asset-specific training, and
financial stability activities;

(2) asset-specific training related to buying a homenew text begin or vehiclenew text end, acquiring postsecondary
education, or starting or expanding a small business; and

(3) financial stability education and training to improve and sustain financial security.

Subd. 5.

Household eligibility; participation.

(a) To be eligible for state or TANF
matching funds in the family assets for independence initiative, a household must meet the
eligibility requirements of the federal Assets for Independence Act, Public Law 105-285,
in Title IV, section 408 of that act.

(b) Each participating household must sign a family asset agreement that includes the
amount of scheduled deposits into its savings account, the proposed use, and the proposed
savings goal. A participating household must agree to complete an economic literacy training

new text begin (c) new text endParticipating households may only deposit money that is derived from household
earned income or from state and federal income tax credits.

Subd. 6.

Withdrawal; matching; permissible uses.

(a) To receive a match, a
participating household must transfer funds withdrawn from a family asset account to its
matching fund custodial account held by the fiscal agent, according to the family asset
agreement. The fiscal agent must determine if the match request is for a permissible use
consistent with the household's family asset agreement.

new text begin (b) new text endThe fiscal agent must ensure the household's custodial account contains the applicable
matching funds to match the balance in the household's account, including interest, on at
least a quarterly basis and at the time of an approved withdrawal. Matches must be deleted text beginprovided
as follows:
deleted text end

deleted text begin (1) from state grant and TANF funds,deleted text end a deleted text beginmatchingdeleted text end contribution of deleted text begin$1.50deleted text endnew text begin $3 from state
grant or TANF funds
new text end for every $1 of funds withdrawn from the family asset account deleted text beginequal
to the lesser of $720 per year or
deleted text endnew text begin not to exceednew text end a deleted text begin$3,000deleted text endnew text begin $6,000new text end lifetime limitdeleted text begin; anddeleted text endnew text begin.
new text end

deleted text begin (2) from nonstate funds, a matching contribution of no less than $1.50 for every $1 of
funds withdrawn from the family asset account equal to the lesser of $720 per year or a
$3,000 lifetime limit.
deleted text end

new text begin (c) Notwithstanding paragraph (b), if funds are appropriated for the Federal Assets for
Independence Act of 1998, and a participating fiduciary organization is awarded a grant
under that act, participating households with that fiduciary organization must be provided
matches as follows:
new text end

new text begin (1) from state grant and TANF funds, a matching contribution of $1.50 for every $1 of
funds withdrawn from the family asset account not to exceed a $3,000 lifetime limit; and
new text end

new text begin (2) from nonstate funds, a matching contribution of not less than $1.50 for every $1 of
funds withdrawn from the family asset account not to exceed a $3,000 lifetime limit.
new text end

deleted text begin (b)deleted text endnew text begin (d)new text end Upon receipt of transferred custodial account funds, the fiscal agent must make
a direct payment to the vendor of the goods or services for the permissible use.

Subd. 7.

Program reporting.

The fiscal agent on behalf of each fiduciary organization
participating in a family assets for independence initiative must report quarterly to the
commissioner of human services identifying the participants with accounts, the number of
accounts, the amount of savings and matches for each participant's account, the uses of the
account, and the number of businesses, homes, new text beginvehicles, new text endand educational services paid for
with money from the account, as well as other information that may be required for the
commissioner to administer the program and meet federal TANF reporting requirements.