(1) There is hereby established the Colorado education savings program which shall be administered by the authority and which shall include, but need not be limited to, components concerning bonds and certificates, education, financial incentives, and alternative payment plans. In furtherance of the Colorado education savings program and in addition to any powers, duties, and responsibilities enumerated in this article, the authority may:
Designate the bonds or certificates of participation of the authority as Colorado education savings bonds or certificates;
Designate the bonds or certificates of participation of issuers other than the authorityas Colorado education savings bonds or certificates if the issuer of such instruments applies for such designation and if such instruments satisfy the criteria established in subsection (2) of this section.
(2) Bonds or certificates of participation may be designated as Colorado education savings bonds or certificates pursuant to subsection (1) of this section if such instruments satisfy the following criteria:
The bonds or certificates are structured and are to be marketed statewide by the underwriters in such a manner as to attract a broad range of investors in the retail Colorado bond market, including, but not limited to, parents, grandparents, or others who are interested in planning for the college education of their children;
The interest on the bonds or certificates is exempt from Colorado income taxation;
The bonds or certificates are issued by a state or local governmental entity, agency,institution, subdivision, district, or financing authority on its own behalf or on behalf of a nonprofit organization which is exempt from federal taxation pursuant to section 501 (c)(3) of the "Internal Revenue Code of 1986", as amended, or on behalf of a nonprofit corporation which is organized principally for the support and benefit of such state or local governmental entity, agency, institution, subdivision, district, financing authority, or nonprofit corporation;
The bonds or certificates, at the time such instruments are designated as Coloradoeducation savings bonds or certificates, are rated in one of the two highest rating categories of such instruments by one or more nationally recognized organizations which regularly rate such obligations;
The bonds or certificates are either zero-coupon, deep discount, or comparable instruments and the maturation dates of such instruments are structured to the extent possible both to accommodate the financing needs of the issuer or the entity on whose behalf the instruments are being issued and to fulfill the needs of individuals planning on using the proceeds of such instruments for education purposes.
The authority shall collaborate with the Colorado commission on higher education onthe development of educational materials designed to inform parents and others concerning the importance of accumulating the financial resources necessary to pay for a child's college education and the options available to accomplish that accumulation of resources, including the option of investing in Colorado education savings bonds or certificates.
The authority shall evaluate the feasibility of:
Payment of financial incentives to holders of Colorado education savings bonds orcertificates if, at maturity, the proceeds of such bonds or certificates are applied to expenses incurred for education in the state of Colorado;
Staggered or periodic forms of payment for Colorado education savings bonds orcertificates, including, but not limited to, payroll deduction plans;
Matching employer-employee purchase plans for Colorado education savings bondsor certificates.
(5) No bond, certificate, or other financial instrument sold, traded, conveyed, or otherwise transferred in the state shall bear the designation, logo, trade name, or trademark of a Colorado education savings bond or certificate, nor shall any such bond or financial instrument be called, described, marketed, or otherwise be made to appear to a reasonable person to be a Colorado education savings bond or certificate unless such bond or financial instrument has been so designated pursuant to this section.
Source: L. 88: Entire section added, p. 849, § 3, effective April 20. L. 89: Entire section R&RE, p. 983, § 4, effective April 12. L. 98: (2)(e) and (4)(a) amended, p. 606, § 8, effective May 4.