When the new law that abolished the Maryland 529 agency that oversaw college savings plan goes into effect June 1, the job of administering the program’s assets will fall to Maryland Treasurer Dereck Davis.
Gov. Wes Moore signed the bill into law during a ceremony in the Maryland State House on Monday.
It will be Davis’ job to sort through the problems that cropped up under the administration of the prepaid trust. He told WTOP he’ll begin to work as expeditiously as he can to sort through the issues reported by account holders.
“We do know that people are dependent on this money” to pay college tuition bills now and in the future, said Davis. He repeated his intent to get the program’s finances in order: “That’s my obligation and my pledge to the parents as well as to the General Assembly.”
In March, at hearings in Annapolis, parents told state lawmakers that their dreams for their children’s college savings accounts turned into potential nightmares as they were either locked out of their accounts or found their interest payments suspended. In some cases, parents reported that projected interest of thousands of dollars evaporated due to what the then-administrators of the Maryland 529 programs said was an error in calculations.
“This is scary; this is scary stuff,” said Victoria Sansone, as she told members of a Senate committee that she has one daughter graduating this year and triplets graduating next year.
Sansone explained she had a decade-old investment of more than $167,000 in the program. Repeating that she would have four children in college at once in the 2024-2025 academic year, Sansone told lawmakers, “I am literally shaking in my seat. You guys need to help us correct this and get our money refunded. I beg of you.”
Now that the bill has been signed by Moore, parents are waiting to see what can be done.
Asked about account holders who may be skeptical about what the Treasurer’s Office can do to help, Davis told WTOP, “They have a right to be skeptical based on what has transpired thus far. All I would ask is that they just judge me on what my office has done once we’ve taken control of the program.”
During the same March hearing where parents testified about their concerns with the savings plans, Davis asked for “time and patience” to work toward solutions for account holders.
Speaking to WTOP, Davis said, “In trying to clear this calculation error thing, we’re going to have that done well, well before a year.”
One parent told lawmakers that if they needed to go into the state’s rainy day fund to make parents whole, that’s what they should do. Davis said, “Rainy day is off the table, simply because it wasn’t included in the legislation.”
While the finances are sorted out, Davis said his office would be reaching out to colleges and universities, especially those in Maryland, “to see if we can get them to be flexible with account holders knowing that this money is on the way.”
