Dec 7, 2009: Local Investments and National Initiatives Ensure NM Students’ Continued Access to Money for College

I recently had the opportunity to speak to students at Rio Rancho High School about leadership, the importance of graduating from high school, and the impact education will have on their future earning power. As a high school student, I realized there were primarily two ways to access a college education – through strong academics and through athletics. Both of these paths can create scholarship opportunities. New Mexico students planning to attend college and their parents have additional options when it comes to paying for a post-secondary education, including student loans, New Mexico’s 529 college savings programs, and the Federal Family Education Loan Program. I am pleased that over the past 3 years the New Mexico State Treasurer’s Office (STO) has created and supported state and national initiatives to ensure that New Mexico students continue to have access to money for college.



In 2008 and 2009, the STO purchased bonds issued by the New Mexico Education Assistance Foundation (NMEAF). The NMEAF was created by the New Mexico Legislature in 1981. The statute that creates the NMEAF also appoints the state treasurer to serve on the NMEAF board. The NMEAF conducts business as New Mexico Student Loans (NMSL). The primary function of the NMSL as a nonprofit organization is to provide loans for New Mexico residents and students who attend New Mexico colleges and universities. The bonds the STO purchased provided a short-term investment opportunity at a competitive rate. Most importantly, by purchasing these bonds the STO assisted the NMSL in providing educational loans for parents and students during the 2008-2009 and 2009-2010 academic years.



On a national level, I am working with other state treasurers to urge Congress to enact legislation that will help parents and students get the most out of their college savings. The National Association of State Treasurers (NAST) has encouraged Congress to exclude from employees’ gross income and wages certain contributions to employees’ 529 savings plans or 529 scholarship programs. Most recently, NAST is encouraging legislation that will provide 529 plan participants with a longer period of time to take distributions for qualified higher education expenses. In many states, college savings programs are administered by the state treasurer. New Mexico’s 529 college savings programs are governed by the Education Trust Board, which is administratively attached to the New Mexico Higher Education Department. Although states differ in college savings plan administration, NAST has a strong and collective interest in helping families plan and save for higher education expenses.



Earlier this year, I also reached out to President Obama and the New Mexico Congressional Delegation asking them to consider alternatives to the Fiscal year 2010 budget proposal that calls for the elimination of the Federal Family Education Loan Program (FFELP). The FFELP has helped millions of students attend college since its inception in 1965. The program is also a good example of how the federal government can collaborate with states, the private sector, and nonprofit organizations like NMEAF to enhance students’ access to higher education. As a result of New Mexico’s initiative to preserve this important program, NAST has asked the Administration and Congress to consider maintaining the successful components of the FFELP.



I have always believed that one can achieve anything with a good education. Studies have shown that over a lifetime individuals with a college degree can earn $600,000 to $1 million more than those without a college degree. In January 2010 I will assume the presidency of NAST. As NAST president and as your State Treasurer I look forward to continuing and advancing these important initiatives locally and nationally. There is no question that the education of our children is crucial to our participation in the global economy.



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