Ontario High School students hone their welding skills. A new savings plan approved by the city this year could help students afford further education in college and training schools after high school. (Enterprise file photo)
ONTARIO – The city of Ontario is going into the education business, setting up a process to see that about 1,000 children in the city can start or grow a college savings fund.
This fall, Ontario will make $100 available for each student in kindergarten, third, sixth, ninth and 12th grades.
The money will have to go into a special savings fund that can only be used for education expenses after high school.
The Ontario City Council on Tuesday, Jan. 25, unanimously voted to set aside $130,000 in unexpected marijuana tax collections to fund the effort.
The idea was sponsored by Mayor Riley Hill and Council President Ken Hart. They are also key leaders in a local nonprofit called Poverty to Prosperity, which has as part of its objective expanding career education programs locally.
“We’re trying to help the students, we’re trying to help the schools,” Hill said during the council discussion.
The council was cheered on by a virtual appearance of State Treasurer Tobias Read, who said the program called “Ontario Promise” was a “wonderful concept.”
Read noted that the state treasury already manages programs for the college savings funds, referred to as 529 accounts. Such accounts can be opened with as little as $25 and anyone – relatives and friends – can add money.
He noted that research shows that any child with a college savings account is three times as likely to go on to college and four times as likely to graduate.
In Ontario, the educational funds can be drawn to pay for college, community college, technical training and other school costs.
The program will be open for any child living within the boundaries of the Ontario School District as of Nov. 1. They won’t have to be enrolled in the district itself.
City officials initially anticipated retaining a local administrator to run the program, but Hart confirmed after the decision that the city would instead rely on the state treasury. He said that would cut costs to run Ontario Promise.
City Manager Adam Brown and Hart noted the $130,000 comes out of the current city budget and there is no assurance such spending could continue in the years ahead.
“This program will be difficult to sustain over time with a required appropriation each year,” Brown said in a report to the council.
He said creating an endowment could fund the scholarship program off future earnings. He calculated that an endowment -– a kind of permanent savings account – could produce $130,000 a year if it earned 5% on its holdings.
The council vote was unanimous from Hill, Hart and Councilors John Kirby, Susann Mills, Eddie Melendrez, Sam Baker and Michael Braden.
EXCELLENCE IN JOURNALISM – Available for $5 a month. Subscribe to the digital service of the Enterprise and get the very best in local journalism. We report with care, attention to accuracy, and an unwavering devotion to fairness. Get the kind of news you’ve been looking for – day in and day out from the Enterprise.