ASSUMPTIONS:
2. Under
the federal Achieving a Better Life Experience (“ABLE”) Act of 2014, Congress
authorized states to establish accounts to assist individuals and families in
saving for qualified disabilities expenses such as education, housing,
transportation, employment training and support, assistive technology and
personal support services, health, prevention and wellness, financial
management and administrative services, legal fees, expenses for oversight and
monitoring, funeral and burial expenses, and other expenses which are approved
by the federal regulations. This
legislation establishes an ABLE program in Delaware, which allows the creation
of savings accounts with tax advantages similar to 529 College Savings Plans.
3. This
legislation establishes a seven member Board who will oversee the ABLE Plan.
This legislation tasks the Treasurer’s Office with supporting the Board and
carrying out their functions.
4. This
is a new federal program – only recently passed by Congress in December of 2014
– and currently no states have an ABLE program up and running. The IRS is in
the process of developing regulations around ABLE accounts and is expected to
complete these regulations in the mid to late summer 2015.
5. In
order to conduct an RFP for an ABLE program administrator, develop regulations,
market the program, and staff the ABLE Board, the Treasurer’s Office will need
one casual seasonal position - a part time Financial Investment Program
Specialists (PG 15). This position will
work 29.5 hours a week at a rate of $26.62/hour and has an estimated first year
cost of $28,467 (which includes OECs).
It is estimated that the casual seasonal will be hired in the 2nd
quarter of fiscal year 2016; therefore, there will only be 9 months of salary
expense in the first year. Fiscal year 2017 cost estimates include a full year
of salary expense.
6. In
fiscal year 2017 it is assumed the ABLE program will become self-sustaining and
will generate enough fees to cover the cost associated with the casual seasonal
position. It is anticipated that the position will switch funded from general
funds to appropriated special funds in fiscal year 2017.
7. On-going
costs are assumed to be supported by the application, account, and
administrative fees, approved by the Board and charged by the program, as
necessary to sustain operations. No
funding is assumed for legal, investment, or audit expenses after start-up.
8.
The Department of Finance estimates a
negligible decrease of general fund revenues as a result of interest earnings
accruing in tax free accounts.
Cost:
Fiscal Year 2016 $ 28,467 (GF)
Fiscal Year 2017 $ 37,955 (ASF)
Fiscal Year 2018 $ 37,955 (ASF)
Office of Controller General
(Amounts are shown in whole dollars)
March 25, 2015
CAS:CAS
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