Fredericksburg-area congressional representatives Abigail Spanberger, D–7th District, and Rob Wittman, R–1st District, introduced bipartisan legislation Friday to expand the use of 529 college savings accounts to include workforce programs for students.
The bill, called the Freedom to Invest in Tomorrow’s Workforce Act, would allow students to use their 529 funds to pay for training, certification and credentialing programs, in addition to traditional two- or four-year college degree programs.
“Not every job needs a four-year degree,” Spanberger said. “How do we ensure that we are culturally respecting and affirming through legislation that the jobs that drive our communities and economies are really important? The basic element of letting people save for those sorts of [training and credentialing] programs is a piece of it.”
In addition to tuition and fees for these programs, the new legislation would also permit students to use 529 funds to pay for related books and testing costs. Currently, 529 accounts can only be used to pay for tuition at colleges, vocational schools and universities that are eligible for federal grant funds.
Spanberger said expanding how 529 funds can be used “works for those who are lifelong learners and those doing continuing education” to enhance their current careers.
“This bill gives people the ability to save for that,” she said.
In 2017, use of 529 funds to pay for tuition at private K–12 schools was approved, and Virginia 529 CEO Mary Morris said the new proposed legislation would create “a continuum of use with no gaps.”
“There is emphasis in Virginia and around the country in looking at different ways to prepare for jobs in the 21st century,” said Morris. “You might need to re-train for a job that has changed or you might be an older adult going back to school. This [legislation] really opens up possibilities.”
According to the National Skills Coalition, middle-skill jobs, which require more than a high school education but not a bachelor’s degree, comprise the largest component of America’s labor market, but employers are struggling to find trained workers to fill these jobs.
Middle-skill jobs make up 49 percent of Virginia’s labor market, the coalition found, but only 39 percent of the workforce is trained to fill those jobs.
The number of Virginia residents prepared for high- and low-skilled jobs exceeds available opportunities in the state, the coalition found.
Morris said Virginia 529 is excited about and supportive of the bill because it recognizes that “there are different pathways” through higher education.
“It’s not a one-size-fits-all approach,” she said. “Not everyone is ready at age 18 for a four- or two-year college, but that doesn’t mean your life stalls. Education never stops, really.”
Morris said Virginia 529 also hopes the Senate passes the SECURE retirement act that cleared the House in May. That bill also includes portions that affect 529 funds, allowing them to be used to pay down student debt and to pay for certain apprenticeship programs.
The new Spanberger–Wittman bill is similar to legislation proposed in the Senate earlier this year.
In a press release, Wittman said, “One of my top priorities is ensuring our students cultivate the skill sets needed to thrive in today’s workforce.”
“It is our job as legislators to give students every opportunity to succeed, and I look forward to working with Rep. Spanberger to advance this important legislation for our Commonwealth,” he said.
Spanberger said it is “vitally important” that the bill is bipartisan.
“Ensuring that students and workers across the country and across Virginia can have the ability to pursue new experiences and new training is important to the economy and the lives of the individuals,” she said. “It’s something we can agree on, and every place we can find agreement is a good place to put that flag in the ground.”