Maine Philanthropist Steps in Where Hillary Suggests Government Should Tread

It was in September that Senator Hillary Clinton told folks at a Congressional Black Caucus forum: “I like the idea of giving every baby born in America a $5,000 account that will grow over time so when that young person turns 18, if they have finished high school, they will be able to access it to go to college.” It was a new version of a prior campaign prong, one that sought a $500 such contribution from the government for each child born in America.

The Drudge Report moved in quickly on that latest version, offering the following headline: “A BOND IN EVERY BASSINET: HILLARY PROPOSES $5,000 FOR EVERY U.S. BABY.” The critics continued to blister the suggestion and soon Clinton backed down. On October 9 she went on to state that the concept of baby bonds were “on the back burner.”

Maine Parents Will Get a Bond in Each Bassinet
The late Harold Alfond, former shoe mogul turned philanthropist, has stepped in with his own version of the concept and will give each child in the State of Maine such a gift. Having used the practice with his own grandchildren and great-grandchildren, Mr. Alfond will now give parents of every child born in Maine a $500 check to begin saving for a college education.

Alfond who died in November at the age of 93 already has his name on a multitude of college and community buildings as well as athletic facilities across the state. But his latest legacy of generosity will likely live on for generations with his extraordinary gift to Maine children.

According to a family spokesman, the former shoe company magnate was looking out over Belgrade Lake, a family gathering point during the summer, and asked, “What more can I do for the children of this state?” He then came up with his plan to give every infant born in Maine a scholarship to begin a College Investing Plan.

Alfond went on the set up a program through NextGen, the fifth-largest college savings plan in the country. Earnings in the program grow tax-deferred and all withdrawals are both federal and Maine state income tax-free if the funds are used for qualified higher education expenses. The Finance Authority of Maine (FAME) will administer the program.

During 2008 the program will be piloted. All babies born at MaineGeneral hospitals in Augusta and Waterville who are Maine residents will be eligible to receive the $500 grant. The only thing parents must do to receive the funds is open a NextGen savings account in the baby’s name before the child’s first birthday. The program will work with hospitals to ensure all parents are aware of the college savings option.

By 2009, the desire is to expand the program to the entire state. Given that Maine’s birth rate is around 14,000 per year, the cost per year will be $7 million. The plan will continue on in perpetuity provided parents access the program as it was designed.

Parents who fail to make any contributions to the account will see about $2,000 for college at the time the child turns 18. However, if parents add a modest $50 a month to the initial amount, the account should grow to more than $25,000 over that time period.

Children will be able to use the account for any educational pursuit that qualifies under the 529 college savings program the state runs. If the money is not used for education prior to the person’s 28th birthday, then the money will be returned to the pool for others to use. At all times, the Alfond funds are kept separate so as not to create and issues down the road with returned funds.

Of course, the program is as much a challenge to others as it is a gift to the future. It is a challenge to parents to take advantage of the extraordinary kindness of Alfond. It is a challenge for others to step in to help the gift of higher education become a reality for more children.

Noted the Chancellor of the University of Maine System, Richard Patenaude,

“The Harold Alfond College Challenge is truly stunning in its vision and its impact. I’m proud to live in a state where there’s such a tradition of generosity, neighborliness and civic-mindedness.”

Governmental Responsibility?
It was but a few weeks ago that former President Bill Clinton made the following comments.

“Even though I approved of Afghanistan and opposed Iraq from the beginning, I still resent that I was not asked or given the opportunity to support those soldiers,” Mr. Clinton said.

All the blogs focused on the inconsistency of the statements about the war but not too many addressed the latter aspect of the comment, “the opportunity to support those soldiers.” Clinton was referring to the Bush tax cuts and the failure to fully fund the war.

But of course, should Mr. Clinton have so chosen, he could have still supported the troops financially despite the tax cut. He could have written a check in addition to taking the time to ridicule the inappropriateness of the Bush tax cuts during a time of war.

That is the caveat though, one need not be asked. One can simply do what needs to be done. That is the legacy of Howard Alfond, a man who has stepped in time and again without being asked. And now Maine has the very program Senator Clinton sought.