The happenings "inside" the Wisconsin State Treasury and across the street at the State Capitol

Archive for March, 2011


The Importance of saving for college


There is a definite link to the amount of financial success we have and the amount of education we receive. One of the largest factors in determining how much money we make over the course of our lives is our level of education. Generally, the more education, the more money made. That is highlighted in this report from the U.S. Census Bureau.

Workers with a bachelor’s degree make nearly $1 million more over the course of their lifetime compared with workers that possess only a high school education. According to data compiled by the Census Bureau in 2008, workers over 25 who have a bachelor’s degree earn an average of $60,954 a year, while those with just a high school diploma earn $33,618.

Unfortunately for parents, the cost of higher education is not getting any cheaper. According to a 2010 U.S. News and World Report article, the average annual cost of sending a child to a 4-year public institution started at $10,000 and jumped up to an average $17,000 if the child chose a 4-year private university. Historically, college tuition rates have increased at about twice the rate of inflation, and our current situation closely follows this trend. Education isn’t getting any cheaper.

If you’re a parent, you need to start saving now, and EdVest, Wisconsin’s 529 College Savings program, can help you do it. Any family member over 18 can open an account in the name of a child, and make an investment in our future. Currently, there are more than 250,000 accounts in Wisconsin’s College Savings Program, averaging a little over $9,000 per account – a good start for the next generation.

If you can, start saving today! It’s fast, easy, and you can sign up for an account online; just follow this link: http://www.wellsfargoadvantagefunds.com/wfweb/wf/ev/account/online.jsp?BV_UseBVCookie=yes


Wisconsin’s College Savings Plan


There are a lot of parents that look into the eyes of their newborn child and dream of the future they might have, the goals they might achieve, the dreams they might turn into reality. But, most parents probably don’t think about how their small child will accomplish all that…much less the actual cost of achieving the goals through education.

If all parents started thinking about the rising cost of education when their children were just infants, handling the economic pressure years later would be simple. Imagine putting a dollar a day into savings account for your child when they were just one year old. For 17 years, you’d accumulate $6,205. This, of course, doesn’t take into account interest earned. But regular savings accounts won’t get you where you need to be.

This is where the Wisconsin College Savings Plan can help. EdVest works almost like a 401k or IRA by allowing you to invest contributions into mutual funds or other similar investments. The plan itself offers investment accounts that range from aggressive to moderate to conservative depending on what you are comfortable with. As with all investment accounts, the amount in there may go up or down depending on the option chosen.

EdVest allows any family member to open an account as long as they are 18 years or over.  The account is in the name of the child, but the account owner still has control. The money in the account can be used for tuition, fees, room and board, books and other higher education eligible expenses…and it can be used at most public and private institutions nationwide. Even if the child doesn’t go to college, but heads off to a trade or technical school or wants to be the next Top Chef, EdVest money can help them pay for that dream!

You can even use an EdVest account for yourself! Let’s say your child doesn’t go to school after high school but you have put all that money in there. You can take it and put yourself through school – and maybe change careers or just expand your knowledge! As long as the money is used for post-secondary education, there are no penalties for withdrawing it from the EdVest account!

And, two of the best benefits of an EdVest account – you receive up to a $3,000 per year tax deduction on your state taxes! This applies to grand-parents, aunts and uncles who have opened an account for a child – not just parents! And the second – all earnings are exempt from state and federal income tax when used for educational costs.

Want to learn more about Wisconsin’s College Savings Plan? Click on www.edvest.com and start helping a child achieve their goals and make those dreams a reality.

Fast Facts on College Savings

250,000
The number of accounts in Wisconsin’s College Savings Program

$22,000
The average amount of debt a student carries upon graduation from college

$15
You can open an EdVest account for as little as $15 a month

$2.5 Billion
The amount of money invested in Wisconsin’s College Savings Program

$1 Million
How much more a college education is worth over the course of a lifetime

$170,000
How much a child born today will pay for college at a public institution

8%
The average tuition inflation rate each year (more than double the general inflation rate)

 


Turning Abandoned Property into Cash for Wisconsinites


Since 2007, the Office of State Treasurer has been involved with EBay in selling the abandoned contents of safe deposit boxes.

These items are turned over to our office after non-payment of rent for 5 years. We then hold onto them for several more years. If the contents have value, we sell the items on EBay and have been very successful in turning the items into cash.

There are several reasons we need to hold these auctions – the biggest is space. Our vault is not that large and every year we receive, on average, the contents of about 200 abandoned safe deposit boxes. A lot of these boxes contain important paperwork. But some have collectible coins, jewelry, savings bonds and physical stock certificates. We hold onto the savings bonds and try to find the owners. The important documents are held for 2 years until we shred them. The coins and jewelry are held for 3 years until they are sold on EBay.

The second reason we sell the items on EBay is that we can make more money for the owners. EBay is a cheap way for us to quickly unload the items and turn them into cash. That cash is then held in the property owners name until they claim it. All items are taken to an appraiser prior to sale and we have noticed the coins sold are going for double their appraised value; the jewelry is bought for just about appraised value. With the prices of gold and silver so high, we have noticed amazingly high bids for jewelry.

In November of 2009, we started doing monthly auctions and in 2010 made more than $120,000 in our EBay Auctions! All of that money is waiting to be claimed by the owners who abandoned their safe deposit boxes or their heirs.

If you want to get an email notice of when our monthly auction will begin, click here and sign up for an alert!

If you want to visit our EBay page, click here.

We have an auction going on right now with lots of silver coins and a few gold coins!


Amending Wisconsin’s Constitution


The process to amend the State constitution requires several steps so I thought that I should take the opportunity to walk you through each of those steps.

Amending the state constitution must follow a specific process as stated in Article 12.  The most common route of amending the constitution requires a 3 vote process. The amendment must be introduced in either the Assembly or the Senate where a majority of members must vote in favor.  If approved, the Secretary of State will publish the proposed amendment for three months in the official state newspaper.  The next session of the legislature must pass the same proposed amendment without changes.

Once the amendment has passed through 2 concurrent sessions of the legislature, the proposed amendment is placed on the ballot for the next general election. At that point, the people of Wisconsin get their chance to decide.  If the voters, by simple majority, approve the proposal, the Government Accountability Board certifies that the citizens of Wisconsin have approved and ratified the amendment, and it subsequently becomes part of the state’s constitution.

Since the ratification of the Wisconsin Constitution in 1848, the legislature has adopted 156 acts or joint resolutions to amend the constitution.  Some of those resolutions included multiple issues, which by necessity had to be split when they appeared on the ballot. Hence, when the final tally is examined, voters have voted 142 out of 192 times to amend 126 sections of the constitution.

Compared to the U.S. Constitution, that may seem like a lot, but according to a 2007 article by Joseph Ranney in the Marquette Law Review, Wisconsin has actually amended its constitution less often than most states.

Here are a few other facts about the Wisconsin constitution and the amendment process:

1.)    Wisconsin has the 7th oldest constitution in the country, the oldest outside of the New England area

2.)    Our current constitution, adopted in 1848, was actually the 2nd one proposed, the first having been proposed in 1846. http://www.wisconsinhistory.org/turningpoints/tp-015/

3.)    There are actually 2 ways to amend the state constitution; one is the process described above, while the other is by constitutional convention.  To call a constitutional convention, a simple majority of both houses of the legislature must vote to call a convention. If the call to convention passes, it is placed on the ballot for the next election, where a simple majority of the voters must vote in favor of the convention. The following session, the legislature would then call for the convention.

The Wisconsin State Constitution: http://legis.wisconsin.gov/rsb/unannotated_wisconst.pdf


Starting the Process of Amending the Wisconsin Constitution


Great Seal of the state of Wisconsin

Image via Wikipedia

When I began my campaign for State Treasurer, I promised the voters of Wisconsin that my primary goal was to create greater efficiency in government. That is why I ran on the primary issue of eliminating the offices of State Treasurer and Secretary of State.

Earlier today, I was proud to announce that I have worked with the Legislative Reference Bureau to draft a Joint Resolution to amend the state constitution that calls for the elimination the State Treasurer and Secretary of State’s offices, thus fulfilling my campaign promise to the voters of Wisconsin.  The bill will begin in the State Assembly, where Representative Scott Krug will introduce the amendment on my behalf.

The amendment recommends the following changes to the state constitution:

1. The State Treasurer and Secretary of State’s office will be eliminated at the end of our current terms which last until the first Monday in January 2015.

2. The 3 member Board of Commissioners of Public Lands, which presently consists

of the Secretary of State, the State Treasurer, and the Attorney General, would be changed. Under this proposal: the Attorney General remains a member, but with the elimination of the State Treasurer and Secretary of State, the Lieutenant Governor becomes a member; the State Superintendent of Public Instruction would become a member if the both offices are both deleted from the constitution.

Because the proposed amendment will have more than one object or purpose, the elimination of each office must be considered as a separate ballot question meaning the people could elect to eliminate only one of the offices.

3. The Secretary of State is replaced by the Attorney General as 3rd in the line of gubernatorial succession.

I ran for public office because I felt that our public officials were disconnected from and disingenuous with the public. I take the bond of trust between the people of Wisconsin and myself seriously, and I am thrilled that I could fulfill my central campaign promise so early in my term.


Treasury Notes


A lot of people don’t realize this, but the Office of State Treasurer is dealing with billions of dollars a day.

Billions with a big “B”.

In February, the amount of money we were in charge of, deposited and withdrew from programs, totaled $6,199,559, 203 – give or take a few cents.

One of the biggest programs we work with is the Local Government Investment Pool. Transactions for that program hit $1,586,700,197 in February. On a daily basis, the LGIP manager was depositing and withdrawing, on average, $83,510,536 daily! All of this money is used by local government entities for projects in their communities. The LGIP makes up 37.6% of the State Investment Fund, the investment vehicle for cash and short-term investments of various state and local government funds. These funds are invested by the State of Wisconsin Investment Board (SWIB), which invests the funds with three objectives in mind – safety of the principal, liquidity, and competitive money market returns. 97% of the fund is currently invested in U.S. Government Securities.

The College Savings Plan, or EdVest, had total assets in February of $2,634,903,732. And Unclaimed Property’s Program Value reached $399,485,870. There are 1.8 million accounts in unclaimed property.

And the $6.2 billion doesn’t even count the money the State Treasurer helps manage as a Commissioner on the Board of Commissioners of Public Lands. That‘s $840 Million with $32.2 Million gross earnings last year.

For more on what we do, read our monthly Treasury Notes!