(a) Each child born on or after July 1, 2020, who is a California resident at the time of birth is eligible for the program.

(b) No later than 90 days after a birth certificate is registered for a child described in subdivision (a), the State Department of Public Health shall provide the board with identifiable birth data for the child in a file format as defined by the board. The birth data shall include, but not necessarily be limited to, the child’s name and birth date and the name and contact information of each parent of the child, including the parent’s street address. The birth data is confidential and shall not be disclosed except as necessary for the program. No more than 90 days after receiving the birth data from the department, the board shall notify each parent of each eligible child about the program. The notification shall include information on all of the following:

(1) How the parent may opt out of the program.

(2) The KIDS Account opened for the child pursuant to subdivision (f).

(3) How the parent may establish a separate account pursuant to Article 19 (commencing with Section 69980) and contribution matching opportunities provided pursuant to that article.

(c) The board shall make a child’s designated balance in a KIDS Account viewable by the child’s parent or legal guardian through a secured internet link.

(d) The board may periodically inform a child’s parent or legal guardian of the balance of a KIDS Account, including earnings designated for the child, information on how the parent or legal guardian may establish a separate account pursuant to Article 19 (commencing with Section 69980), and information on contribution matching opportunities provided pursuant to that article.

(e) The board shall translate program notifications and information provided pursuant to subdivisions (b) to (d), inclusive, into languages pursuant to Section 7295.2 of the Government Code.

(f) Upon appropriation by the Legislature, the board shall establish one or more accounts and shall make a separately accounted-for seed deposit from the fund into a KIDS Account established within an account in an amount determined by the board. Each seed deposit shall be designated for a particular child for whom the board receives birth data pursuant to subdivision (b), if no parent or legal guardian has opted that child out of the program. Moneys in a KIDS Account designated for a child, including any investment earnings attributed to the amount of the child’s seed deposit since the date of the deposit as calculated by the board, shall be used for the purpose of providing awards for qualified higher education expenses associated with the attendance of the child at an eligible institution of higher education. Each seed deposit shall be at least twenty-five dollars ($25). The board may provide additional seed funding designated for a child into a KIDS Account if the parent or legal guardian of the child engages with the KIDS Account by verifying receipt of information provided pursuant to paragraph (2) of subdivision (b), establishing a separate account pursuant to Article 19 (commencing with Section 69980), or engaging with the KIDS Account by other means approved by the board.

(g) Upon receiving documentation of a child’s enrollment as a student at an institution of higher education, the board shall make a payment to that institution in the amount of the seed deposit designated for the child pursuant to subdivision (f), plus any investment earnings attributed to that amount since the date of that deposit as calculated by the board, for qualified higher education expenses associated with the child’s attendance at that institution.

(h) Subject to available money in the fund, the board may provide additional incentives from the fund for children participating in the program, including, but not limited to, incentives targeting low-income households.

(i) (1) Subject to available funding, a parent or legal guardian, residing in California, of a child who meets the criteria in paragraph (2) may apply to the board to enroll the child into the program. Subject to available funding, the enrollee shall be eligible for any incentives described in subdivision (h), as applicable, but is not eligible for a seed deposit.

(2) The child is a current California resident under 10 years of age who was either of the following:

(A) Born a California resident before July 1, 2020.

(B) Not a California resident at the time of birth.

(j) (1) If a beneficiary does not use any portion, or all, of the funds intended for the beneficiary in a KIDS Account for a qualified higher education expense for any reason, including death or disability of the beneficiary, before the beneficiary turns 26 years of age, all contributions made for the beneficiary into the KIDS Account and any earnings from those funds shall be forfeited and deposited into the fund for the program.

(2) Notwithstanding paragraph (1), subject to available funding, the board may establish an appeal process to allow a beneficiary to use moneys designated for the beneficiary in a KIDS Account after the beneficiary turns 26 years of age.

(3) All contributions made into a KIDS Account for a child who has opted out of the program pursuant to subdivision (b), including any investment earnings attributed to the amount of the child’s seed deposit since the date of the deposit as calculated by the board, shall be forfeited and deposited into the fund for the program in a timely manner.

(k) The board shall encourage each parent and legal guardian of a beneficiary, including each parent and legal guardian of a child who applies to enroll the child into the program as a beneficiary pursuant to subdivision (i), to establish a separate account pursuant to Article 19 (commencing with Section 69980). The board shall provide assistance on how to establish the separate account.

(l) The board may use up to 5 percent of state appropriations provided for purposes of the program for administrative costs.

(Amended by Stats. 2019, Ch. 413, Sec. 12. (AB 114) Effective October 2, 2019.)