Date: 2002-09-04
Speaker: SAM JOHNSON (republican)
Chamber: H
State: Texas

Mr. Speaker. I did not know we were going to come in here and try to get into a political debate. As I recall from the Committee on Education and the Workforce. we did not do any cutting. we consolidated. I do not think we have taken one red cent out of the Social Security trust fund. and we do not intend to. I think that it is important for the people to know that they can count on the future. that they can put their money into a savings account and count on it to be there for their kids to go to school. if that is what they desire to use it for. Mr. Speaker. it is an honor for me to be here today to solve a problem brought to my attention by a constituent. Great ideas do not always start from inside the Beltway or from pundits or strategists. They come from good Americans back home. like my friends Paul and Jeanette Miesse of Plano. Their son. Kyle. attends Jasper High School where he is in the tenth grade and participates in ROTC. Kyle is considering applying to the Naval Academy. I want to help them make that a reality. Kyles dad researched the 529 Education Savings Account. As you know. 529 savings plans. run by the States. allow parents and others to put money aside for college to grow tax free. and. as long as the money is spent on education. the money is spent tax free. These tax incentives are an important way to encourage savings for higher education. Current law provides penaltyfree refunds from 529 plans for certain situations. such as when the student receives a scholarship. The problem with this is the definition of the word "scholarship." It excludes appointments to the United States service academies. such as West Point. Annapolis. or my favorite. the Air Force Academy. Under the Tax Code. these appointments are considered commissions in the military and so are different from scholarships. Hardworking students and athletes across America are rewarded with scholarships to colleges and universities. Congress recognized the hard work of these young people when we permitted their parents to receive penaltyfree rebates of their contributions to 529 plans. In addition to academic and athletic scholarships. the IRS and Treasury have told us if a student earns an ROTC scholarship. their plan can make penaltyfree rebates. It is only the United States military academy students who are not eligible for this benefit. Serving this country is a noble profession. Congress ought to encourage. not discourage. young people to join our armed forces. especially today. and the clarification we are making today will ensure that all students who attend our United States military academies get the same treatment under 529 plans as their peers. Given that each Congressman is eligible to make appointments to the United States service academies. I think all of us in Congress have a direct interest in making sure we solve the problem. On average I nominate about 40 students from the Third District of Texas to the service academies. I think when hardworking. patriotic young Americans are rewarded with an appointment to a service academy. we should not turn around and impose a 10 percent penalty on their patents who saved for their childrens education. We should provide the same penaltyfree withdrawals for the plebe. the middy and the cadet as we provide to those who play sports. earn an academic scholarship or pay for school through ROTC. Again. I want to thank my constituents. Paul. Jeanette and Kyle Miesse of Plano. who brought this issue to my attention. To my knowledge. at no time during the consideration of this legislation did we consider the issue of appointments to the service academies. I believe the omission was simply an oversight. and I encourage the passage of this bill that will permanently extend the education tax breaks included in the tax law we enacted last year. I do not see how anybody can vote against helping parents send their kids to school and help make it permanent. I want to thank the chairman for including in this bill that clarification. It is people like this in our own districts that make a difference.