PRESS RELEASE: City Council Approves Nation’s Largest Children’s Savings Account Program

Los Angeles - City Council unanimously approved giving every incoming first grader in LAUSD a savings account dedicated for higher education today. The Children’s Savings Account (CSA) program, dubbed “Opportunity LA,” has been pioneered by Councilmember David Ryu, in partnership with County Supervisors Mark Ridley-Thomas and Hilda L. Solis, and LAUSD Boardmembers Nick Melvoin and Monica Garcia. Modeled after existing CSA programs in San Francisco, Boston, St. Louis, and other cities and states, Opportunity LA will be the nation’s largest, establishing dedicated savings accounts with $50 seed deposits for every student enrolled in an LAUSD public or affiliated charter school.

FOR IMMEDIATE RELEASE:  

November 6, 2019

 

Contact for Councilmember Ryu:

Mark Pampanin

mark.pampanin@lacity.org

213.407.7616

 

City Council Approves Nation’s Largest Children’s Savings Account Program

“Opportunity LA” will create savings accounts for every LAUSD student

Los Angeles - City Council unanimously approved giving every incoming first grader in LAUSD a savings account dedicated for higher education today. The Children’s Savings Account (CSA) program, dubbed “Opportunity LA,” has been pioneered by Councilmember David Ryu, in partnership with County Supervisors Mark Ridley-Thomas and Hilda L. Solis, and LAUSD Boardmembers Nick Melvoin and Monica Garcia. Modeled after existing CSA programs in San Francisco, Boston, St. Louis, and other cities and states, Opportunity LA will be the nation’s largest, establishing dedicated savings accounts with $50 seed deposits for every student enrolled in an LAUSD public or affiliated charter school.

“Opportunity LA is about more than dollars and cents, it’s about the worth of every child in Los Angeles,” Councilmember Ryu said. “This is a city where 80 percent of our students live at or below the poverty line, and where vast inequality in education continues to exist. Opportunity LA tells our young people that no matter your background, your immigration status, or what zip code you live in, you have a right to a brighter future - and we want to invest in you.”

"When we invest in our youngest Angelenos, we do more than open the doors to a higher education and a brighter future for every student — we strengthen our city as a place of opportunity and belonging for all," said Mayor Eric Garcetti. "Opportunity LA ensures no barrier stands between our students and their dreams, equips local families with the foundation for long-term prosperity, and encourages underserved communities to see the promise of a college degree, a good-paying job, and a steady career in their children's future."

“Opportunity LA gives both City and County governments a chance to invest in a different kind of infrastructure: human infrastructure,” said Supervisor Mark Ridley-Thomas. “With this critical investment, we can facilitate the economic security and mobility of children in low-to-moderate income families to secure the future of our communities.”

“Saving for college early helps build positive, lifelong financial habits. By enabling youth to build college savings and raising their educational expectations, Children’s Savings Accounts can put a college or trade school education within reach,” said Supervisor Hilda L. Solis. “With families and students struggling to afford the rising costs of college, investing in a Children’s Savings Account can alleviate this burden and help create a pathway to lifelong success.”

The CSA program will roll out in the 2020-2021 academic year for an initial 10% of LAUSD first graders, or roughly 4,000 students. Within five years, it will grow to include every LAUSD first grader, automatically granting them a dedicated savings account when they enroll. This program is universal, regardless of income, background or immigration status. It passed today after a rally of City, County and LAUSD leaders, as well as education activists, urging support outside City Hall. Following today’s Council vote, it will be voted on by the LA County Board of Supervisors, where it has been championed by Supervisors Ridley-Thomas and Solis, and the LAUSD Board, where the effort has been led by Board Member Nick Melvoin, later this year.

“This initiative may start with a small, simple investment, but it has the potential to produce big, life-changing results for our students,” said LAUSD Boardmember Nick Melvoin. “I am thrilled to lead LA Unified in this historic partnership with the City Council and County Board of Supervisors and eager to continue our progress toward making universal college savings accounts a reality.”

Thirty years ago, full-time workers with a high school diploma earned 40% less than full-time workers with a bachelor’s degree. Today, the difference is 84%. In that same period, the share of jobs that require a post-secondary degree has more than doubled. Moreover, children from high-income families are 8 times more likely to get a bachelor’s degree than those from low-income families.

College enrollment rates in Los Angeles are improving, but are still below the average for California and nationwide.

Data has shown that a low-income child with up to $500 in a dedicated savings account 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. In a school district with many low-income and unhoused students, a CSA program could produce remarkable results for high school graduation rates and enrollment in higher education. In San Francisco, which launched its CSA program in 2011, students with these accounts are 24% more likely to see themselves going to college, and families are 32% more likely to be more informed about their financial aid options. 

Opportunity LA is fully funded for the first two years through state and federal grants. Earlier this year, the State Legislature approved $25 million in the State budget to support the development of local CSA programs, an allocation strongly supported by Governor Gavin Newsom. A partner financial institution to manage the accounts has not yet been identified, and will be selected in early 2020. 

Find the Council file here.

Learn more about the program here.

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Los Angeles City Councilmember David E. Ryu represents the 4th Council District which includes Griffith Park, Sherman Oaks, Toluca Lake, Hollywood, Hollywood Hills, Los Feliz, Silver Lake, Miracle Mile, Hancock Park, Windsor Square, Larchmont and portions of Koreatown and Van Nuys. 


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