SMMUSD HDQTRS ‚Äî A Malibu-based firm announced this week that it would launch a unique program to help employees save for their children‚Äôs college education and help fund the local school district at the same time.
Dun & Bradstreet Credibility Corp., a firm that helps businesses build their credit, will offer employees special college savings plans called 529s and, to sweeten the deal, the firm has committed to matching their employees‚Äô contributions to the accounts, dollar for dollar.
The firm will then make a second matching donation straight to the Santa Monica-Malibu Unified School District, officials at the company pledged.
Dun & Bradstreet will replicate the model in the five other cities in which it has offices. The program is expected to cost millions, said Jeff Stibel, CEO of the company.
“We know how precarious the funding situation is, and we‚Äôre proud to do our part,” Stibel said.
The announcement comes at a good time for the district, which is working to get its controversial districtwide fundraising program up and running for elementary schools by 2013.
That fundraising duty is in the hands of the Santa Monica-Malibu Education Foundation, which is expected to raise enough money to cover a “premium program” for the entire school district.
That is undefined at this point, but the foundation and district believes they‚Äôll need roughly $4 million to pull it off.
The Education Foundation got a big boost when Peggy Bergmann, a supporter of education in Santa Monica, bequeathed $4.8 million to support underprivileged kids‚Äô music programs and other uses.
The organization is still pushing for additional corporate help, like that offered by Dun & Bradstreet, said Linda Gross, executive director of the Education Foundation.
“We have been having one-on-one meetings with corporations. It takes time, but it‚Äôs part of the process of educating the community of the direction that the district is going in,” Gross said.
Dun & Bradstreet have not yet announced how or where it will donate the money, just that they hope it will “directly impact the kids.”
If the program proceeds as planned, it will help kids in the district today and as they transition into higher education.
It‚Äôs a boon to parents because it allows them to start saving for their children‚Äôs higher education early and offers special tax incentives unavailable in regular savings accounts.
The money in the College Savings Plan, called ScholarShare in California, is taxed before it ever goes into the account but is not taxed again when it comes out, even if the family chooses an investment option that accrues interest over the life of the plan.
Then, when the child in question is ready to go to college, the family can dip into that pot of cash to pay for education-related expenses like tuition, books, food and housing.
It keeps parents from being hit by the cost of college all at once, said Bill Ainsworth, press secretary for California State Treasurer Bill Lockyear.
“A college education helps create a brighter future for a child. ScholarShare provides parents, grandparents, relatives and friends with a great way to invest in that child‚Äôs future,” Ainsworth said.
There‚Äôs no direct benefit to Dun & Bradstreet for putting out that much cash for their employees, but Stibel hopes it will pay dividends in the long run.
“When we look at the next 20 and 30 years, our biggest concern is that we can‚Äôt find talent in the United States,” Stibel said. “We could complain about it and ask the government to do something, or we can take a stand.”
By investing in employees‚Äô children today, the 175-year-old company hopes to buy itself some stability in the future.