LB748 revises the Nebraska Educational Savings Plan Trust, Nebraska’s 529 college savings program, to expand the ways account funds may be used and to update the program’s administration. The bill amends definitions and operating provisions so that trust funds may be used not only for qualified postsecondary education expenses, but also for recognized postsecondary credential programs. It also updates the list of qualified expenses to include, under specified conditions and effective dates, tuition for elementary and secondary school, in addition to existing postsecondary uses such as tuition, fees, books, supplies, room and board, special needs services, computer technology, and qualified education loan payments.
The bill reorganizes and clarifies the structure of the trust by creating and describing three separate funds: the Program Fund, the Expense Fund, and the Administrative Fund. It confirms the State Treasurer as trustee, preserves the role of the State Investment Officer and Nebraska Investment Council in investing trust assets, and authorizes the Treasurer to enter into participation agreements with account owners, educational institutions, and credential programs. It also sets out rules for contributions, beneficiary changes, successor owners, cancellations, and the treatment of unused balances, while preserving the portability of funds for use at eligible institutions and, beginning in 2026, at elementary and secondary schools.
LB748’s impact on state law is to broaden and modernize Nebraska’s 529-style savings program and align it more closely with federal tax provisions governing education savings accounts. It amends multiple sections of the Nebraska Revised Statutes Supplement, repeals the original sections, and updates the legal framework for tax-advantaged education savings accounts, including the treatment of contributions, earnings, distributions, and nonqualified withdrawals. The bill also clarifies that the program operates without General Fund appropriations and that account assets are protected from levy, garnishment, and similar legal process.
The overall sentiment around the bill appears strongly favorable. The measure advanced unanimously from the first stage and then passed final reading by a wide margin, 46-3, before being approved by the Governor. That voting pattern suggests broad legislative support for expanding education savings options and allowing families more flexibility in how trust funds are used.
The main points of contention likely centered on the policy expansion beyond traditional higher education savings, especially the use of trust funds for elementary and secondary school tuition and for nondegree credential programs. Those changes may raise concerns about the scope of the program, the effect on public education funding, and whether 529 resources should be used for K-12 or workforce credentialing purposes rather than only college expenses. The bill text itself also reflects careful attention to federal tax compliance and administrative limits, indicating that any debate probably focused more on policy direction than on the mechanics of the trust.
LB748 amends Nebraska statutes governing the Nebraska Educational Savings Plan Trust, expanding eligible uses of account funds to include recognized postsecondary credential programs and, beginning on a future date, elementary and secondary school tuition. It also updates the trust’s administrative structure, fund accounting, investment authority, participation agreements, and distribution rules, while preserving the tax-advantaged and creditor-protected status of account assets under state law. The bill affects account owners, beneficiaries, the State Treasurer, the State Investment Officer, educational institutions, and credentialing programs.
The bill appears to have enjoyed broad bipartisan support. It advanced unanimously early in the process and passed final reading 46-3, indicating that most lawmakers favored expanding education savings flexibility and updating the trust’s statutory framework. The absence of recorded committee transcript opposition also suggests limited public controversy in the available record.
The most likely areas of disagreement were the policy choices to allow trust funds for K-12 tuition and for recognized postsecondary credential programs, which move the program beyond its traditional college-savings focus. Critics of such expansions typically worry about diversion of resources from higher education savings, effects on public school funding, and whether the program should subsidize private or alternative education pathways. Supporters likely viewed the changes as modernizing the trust and making it more useful for families and workforce training.