The proposed bill establishes the "Rhode Island Baby Bond Trust," which aims to create a financial trust for children born to families enrolled in the Rhode Island Works program. Each designated beneficiary, defined as a child born on or after January 1, 2026, will have $3,000 allocated to their trust upon birth. The funds will be managed by the general treasurer, who will invest them until the child reaches maturity. Eligible expenditures for the funds include attending higher education or vocational schools, purchasing a home, starting a business in Rhode Island, or making investments that yield long-term financial benefits.

The bill outlines the responsibilities of the general treasurer, including the receipt, maintenance, administration, and investment of trust funds. It specifies that the trust's assets will not be considered state property and that the state will have no claim to or interest in the funds. Additionally, the trust's earnings will be exempt from state taxation, although distributions will be subject to income tax. The bill also ensures that the funds in the trust will not affect the designated beneficiary's eligibility for state or local assistance programs.

The act will take effect upon passage, contingent on the availability of sufficient public or private funds to administer the trust.

Statutes affected:
6071: 33-21.1-23