Councilmember David A. Catania
Councilmember Sharon Ambrose
Councilmember Carol Schwartz
Councilmember Sandra Allen
A BILL IN THE COUNCIL OF THE DISTRICT OF COLUMBIA
Councilmembers David A. Catania, Sharon Ambrose, Carol Schwartz and Sandra Allen
introduced the following bill, which was referred to the Committee on Economic Development
with comments from the Committee on Human Services
To establish Opportunity Accounts for residents of the District of Columbia to provide
incentives for low- income families and individuals to accrue assets for education,
housing, retirement, and medical purposes.
BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this bill may be cited
as the "Opportunity Account Act of 1999".
Sec. 2. Definitions.
(a). "Opportunity Account" means a savings account opened and maintained at a
financial institution by a saver participating in the District of Columbia’s Opportunity
Account program for the restricted purpose of providing funds for an eligible use.
(b) "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.
(c) "Eligible Use" means Education, Purchase of a home, Retirement, and/or
Medical Emergency.
(1) "Education" means a post-secondary program of instruction provided by a
college, university, community college, area vocational-technical school, professional
institution or specialized degree granting college or school legally authorized to grant
degrees. It shall also include a job training or related educational program approved by
the District of Columbia’s Department of Employment Services. The term shall not include a
school of theology.(2) "Purchase of a home" means the costs of acquiring, constructing, or
reconstructing a principal residence, including any usual or reasonable settlement,
financing or other closing costs.(3) "Retirement" means reaching the age at which a person is eligible for
Social Security benefits.(4) "Medical Emergency" means a debilitating or life threatening illness.
(d) "Saver" means an individual or family who resides in the District of
Columbia and whose annual income at the time of enrollment is not more than 200% of the
Federal poverty guideline.
(e) "Matching funds" means an amount equal to 50%, up to $500 per year, of
the amount deposited into an Opportunity Account by a saver during a five-year period,
with a lifetime limit of $2,500.
Sec. 3. Application. A saver must have income at or below 200% of the
Federal poverty guideline and assets of $25,000 or less to apply for an Opportunity
Account. An individual who is a dependent of another person for income tax purposes shall
not be an eligible saver. An individual who is a debtor for a judgment resulting from
nonpayment of a court-ordered child support obligation shall not be an eligible saver.
Sec. 4. Continued participation. A saver whose income is at or below
200% of the federal poverty guideline at the beginning of the calendar year may continue
to make deposits to the Opportunity Account. Once a saver’s income exceeds 200% of the
federal poverty guideline, a saver will be ineligible to make deposits or receive matching
funds in the next calendar year.
Sec. 5. Agreement. Each saver shall sign an Opportunity Account
Agreement that includes the amount of scheduled deposits into the Opportunity Account
during the five-year period, the amount of the savings goal, and the proposed eligible use
of the Opportunity Account and the matching funds.
Sec. 6. Deposits. A saver shall only deposit money that is derived
from household earned income or from state or federal income tax credits.
Sec. 7. Eligibility for match. A saver shall fulfill the requirements
of the plan for a minimum of one year, but not more than five years. The funds in the
Opportunity Account shall be used for the eligible use within five years of the last year
in which deposits are made, and in the case of retirement, within five years of meeting
the age requirement.
Sec. 8. Withdrawal. Matching funds will be provided upon satisfactory
evidence that the amount being withdrawn from the Opportunity Account is being used for an
eligible use. Withdrawals from an Opportunity Account for an eligible use shall be made
payable to the legal entity providing the eligible use. Matching funds shall be paid to
the same legal entity. Funds saved for retirement shall be paid directly to the saver.
Sec. 9. Termination. A saver who decides to withdraw deposits made to
an Opportunity Account for a use other than an eligible use shall terminate the
Opportunity Account agreement and upon such termination, shall be entitled to withdraw the
funds. However, the saver shall forfeit all matching funds and corresponding interest.
Sec. 10. The Department of Community and Economic Development shall
develop rules and regulations for the operation of the program, including standards for
Opportunity Account Agreements, reporting requirements and the payment of administrative
costs.
Sec. 11. The Department of Community and Economic Development shall
make matching funds available from funds appropriated for this purpose and shall ensure
payment of the maximum matching funds required during the five-year period for all
Opportunity Account Agreements.
Sec. 12. Fiscal Impact Statement.
Sec. 13. This act shall take effect following approval by the Mayor
(or in the event veto by the Mayor, action by the Council to override the veto), approval
by the Financial Responsibility and Management Assistance Authority as provided in section
203(a) of the District of Columbia Financial Responsibility and Management Assistance Act
of 1995, approved April 17, 1995 (109 Stat. 116; D.C. Code §47-392.3(a)), a 30-day period
of Congressional review as provided in section 602(c)(1) of the District of Columbia Home
Rule Act, approved December 24, 1973 (87 Stat. 813; D.C. Code §1-2033(c)(1)), and
publication in the District of Columbia Register.