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General Assembly Substitute Bill No. 6659
January Session, 2021
AN ACT CONCERNING TH E ESTABLISHMENT OF T HE
CONNECTICUT BABY BON D TRUST.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. (NEW) (Effective July 1, 2021) As used in this section and 1
sections 2 to 8, inclusive, of this act: 2
(1) "Designated beneficiary" means an individual born on or after July 3
1, 2021, whose birth was subject to medical coverage provided under 4
HUSKY Health, as defined in section 17b-290 of the general statutes; 5
(2) "Eligible expenditure" means an expenditure associated with any 6
of the following, each as prescribed by the Treasurer: (A) Education of a 7
designated beneficiary; (B) purchase of a home in Connecticut by a 8
designated beneficiary; (C) investment in a business in Connecticut by 9
a designated beneficiary; or (D) any investment in financial assets or 10
personal capital that provides long-term gains to wages or wealth; and 11
(3) "Trust" means the Connecticut Baby Bond Trust. 12
Sec. 2. (NEW) (Effective July 1, 2021) (a) There is established the 13
Connecticut Baby Bond Trust. The trust shall constitute an 14
instrumentality of the state and shall perform essential governmental 15
functions as provided in sections 1 to 8, inclusive, of this act. The trust 16 Substitute Bill No. 6659
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shall receive and hold all payments and deposits or contributions 17
intended for the trust, as well as gifts, bequests, endowments or federal, 18
state or local grants and any other funds from any public or private 19
source and all earnings until disbursed in accordance with section 7 of 20
this act. 21
(b) The amounts on deposit in the trust shall not constitute property 22
of the state and the trust shall not be construed to be a department, 23
institution or agency of the state. Amounts on deposit in the trust shall 24
not be commingled with state funds and the state shall have no claim to 25
or against, or interest in, such funds. Any contract entered into by or any 26
obligation of the trust shall not constitute a debt or obligation of the state 27
and the state shall have no obligation to any designated beneficiary or 28
any other person on account of the trust and all amounts obligated to be 29
paid from the trust shall be limited to amounts available for such 30
obligation on deposit in the trust. The amounts on deposit in the trust 31
may only be disbursed in accordance with the provisions of section 7 of 32
this act. The trust shall continue in existence as long as it holds any 33
deposits or has any obligations and until its existence is terminated by 34
law and upon termination any unclaimed assets shall return to the state. 35
Property of the trust shall be governed by section 3-61a of the general 36
statutes. 37
(c) The Treasurer shall be responsible for the receipt, maintenance, 38
administration, investing and disbursements of amounts from the trust. 39
The trust shall not receive deposits in any form other than cash. 40
Sec. 3. (NEW) (Effective July 1, 2021) The Treasurer, on behalf of the 41
trust and for purposes of the trust, may: 42
(1) Receive and invest moneys in the trust in any instruments, 43
obligations, securities or property in accordance with section 4 of this 44
act; 45
(2) Enter into one or more contractual agreements, including 46
contracts for legal, actuarial, accounting, custodial, advisory, 47 Substitute Bill No. 6659
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management, administrative, advertising, marketing and consulting 48
services for the trust and pay for such services from the assets of the 49
trust; 50
(3) Procure insurance in connection with the trust's property, assets, 51
activities or deposits to the trust; 52
(4) Apply for, accept and expend gifts, grants or donations from 53
public or private sources to enable the trust to carry out its objectives; 54
(5) Adopt regulations in accordance with chapter 54 of the general 55
statutes for purposes of this act; 56
(6) Sue and be sued; 57
(7) Establish one or more funds within the trust; and 58
(8) Take any other action necessary to carry out the purposes of this 59
act, and incidental to the duties imposed on the Treasurer pursuant to 60
this act. 61
Sec. 4. (NEW) (Effective July 1, 2021) Notwithstanding the provisions 62
of sections 3-13 to 3-13h, inclusive, of the general statutes, the Treasurer 63
shall invest the amounts on deposit in the trust in a manner reasonable 64
and appropriate to achieve the objectives of the trust, exercising the 65
discretion and care of a prudent person in similar circumstances with 66
similar objectives. The Treasurer shall give due consideration to rate of 67
return, risk, term or maturity, diversification of the total portfolio within 68
the trust, liquidity, the projected disbursements and expenditures and 69
the expected payments, deposits, contributions and gifts to be received. 70
The Treasurer shall not require the trust to invest directly in obligations 71
of the state or any political subdivision of the state or in any investment 72
or other fund administered by the Treasurer. The assets of the trust shall 73
be continuously invested and reinvested in a manner consistent with the 74
objectives of the trust until disbursed for qualified expenses as defined 75
by this act or expended on expenses incurred by the operations of the 76
trust. 77 Substitute Bill No. 6659
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Sec. 5. (NEW) (Effective July 1, 2021) The property of the trust and the 78
earnings on the trust shall be exempt from all taxation by the state and 79
all political subdivisions of the state. 80
Sec. 6. (NEW) (Effective July 1, 2021) (a) Notwithstanding any 81
provision of the general statutes, no moneys invested in the Connecticut 82
Baby Bond Trust shall be considered to be an asset for purposes of 83
determining an individual's eligibility for assistance under the 84
temporary family assistance program, as described in section 17b-112 of 85
the general statutes, programs funded under the federal Low Income 86
Home Energy Assistance Program block grant and the federally 87
appropriated weatherization assistance program. 88
(b) Notwithstanding any provision of the general statutes, no moneys 89
invested in the trust shall be considered to be an asset for purposes of 90
determining an individual's eligibility for need-based, institutional aid 91
grants offered to an individual at the public eligible educational 92
institutions in the state. 93
Sec. 7. (NEW) (Effective July 1, 2021) (a) The Treasurer shall establish 94
in the Connecticut Baby Bond Trust an accounting for each designated 95
beneficiary. Each such accounting shall include the amount transferred 96
to the trust pursuant to section 8 of this act, plus the designated 97
beneficiary's pro rata share of total net earnings from investments of 98
sums held in the trust. 99
(b) Upon a designated beneficiary's eighteenth birthday and 100
completion of a financial literacy requirement as prescribed by the 101
Treasurer, such beneficiary shall become eligible to receive the total sum 102
of the accounting under subsection (a) of this section to be used for a 103
qualified expense. The Treasurer may adopt regulations, in accordance 104
with the provisions of chapter 54 of the general statutes, to carry out the 105
purposes of this section. 106
(c) A designated beneficiary may submit a claim for such accounting 107
until his or her thirtieth birthday, as prescribed by the Treasurer, 108 Substitute Bill No. 6659
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provided such designated beneficiary is a resident of the state at the time 109
of such claim. If a designated beneficiary (1) is deceased before his or 110
her eighteenth birthday, or (2) fails to submit a valid claim, as 111
determined by the Treasurer, before his or her thirtieth birthday, such 112
accounting shall be credited back to the assets of the trust. 113
(d) The Treasurer and the Department of Social Services shall enter 114
into a memorandum of understanding to establish information sharing 115
practices in order to carry out the purposes of this act. 116
Sec. 8. (NEW) (Effective July 1, 2021) Upon the birth of a designated 117
beneficiary, the Treasurer shall transfer five thousand dollars from the 118
General Fund to the trust to be credited toward the accounting of such 119
designated beneficiary as described in section 7 of this act. 120
This act shall take effect as follows and shall amend the following
sections:
Section 1 July 1, 2021 New section
Sec. 2 July 1, 2021 New section
Sec. 3 July 1, 2021 New section
Sec. 4 July 1, 2021 New section
Sec. 5 July 1, 2021 New section
Sec. 6 July 1, 2021 New section
Sec. 7 July 1, 2021 New section
Sec. 8 July 1, 2021 New section
APP Joint Favorable Subst.