LOS ANGELES (CNS) - The Los Angeles City Council today voted to create a children's savings account program for higher education that would begin in the first grade.
The program is called Opportunity L.A. and would start first-graders off with $50 in a savings account strictly for the purpose of one day paying for college or a form of higher education. The program was proposed by City Councilman David Ryu, who spoke about it with a backdrop of kindergartners from Ninth Street School at the South Courtyard at City Hall.
“Imagine what this means for a child growing up without a parent to talk to them about college,” Ryu said. “For the child who doesn't know what the future holds, and for the child who doesn't know where he or she is going to sleep at night or the amazing things they are capable of, Opportunity L.A. is more than just a bank account, it's a promise.”
The City Council voted unanimously to create the account program, 12-0.
Los Angeles County Supervisor Mark Ridley-Thomas said California has a distinction of having some of the richest communities and some of the poorest, and in order for children to have a fair chance at higher education, the city must invest in their education.
“African American and Latino households are disproportionately affected,” Ridley-Thomas said. “More than 80% of LAUSD students live below the poverty line ... this affects real human beings like these children that are standing behind us. They have faces, they have names, they have histories and they have futures, and our objective today is to impact their future in the most positive way possible.”
According to figures provided at the City Council meeting, LAUSD officials said 28% of its families do not bank or are “underbanked.”
The councilman said full-time workers today earn 84% less when they don't have a high school diploma and children from high-income families are eight times more likely to get a bachelor's degree than low-income children.
“It's been said that we sit in the shade today because someone planted a seed a long time ago, and that's what we're doing today,” LAUSD Board of Education member Nick Melvoin said. “These savings accounts will help incentivize kids to do better in school.”
Ryu's office stated that the program is fully funded through the first two years by federal and state grants, and the state Legislature approved $25 million to support such accounts. A partner financial institution to manage the accounts will be selected in 2020.
The program is to begin during the 2020-21 academic year for an initial 10% of LAUSD first-graders, about 4,000 students. Within five years, it would grow to include all first-graders, regardless of income, background or immigration status. It could be the largest children's savings account program in the nation, Ryu said.
Ryu's office said similar programs exist in San Francisco, Boston, St. Louis and other cities, and data has shown that a low-income child with up to $500 in savings is three times more likely to enroll in and four times more likely to graduate from post-secondary education than a similar low-income child with no savings.