St. Louis' College Kids Program Won't Release Funds, Grandfather Says

Joe Miklovic has spent 14 months trying move his grandson's funds to another educational savings account

Aug 7, 2023 at 11:52 am

MIKE FITZGERALD

Joe Miklovic holds copies of the College Kids memorandum of understanding.

Funded by parking revenue collected by the city treasurer’s office, the College Kids Savings Account program aims to help city public- and charter-school families save money for college and learn financial literacy by providing students with savings accounts at Alltru Credit Union and “seeding” each with a $50 deposit.

Since its launch in 2015, the city has spent about $2 million on the College Kids program, which has enrolled more than 23,000 students who live or once lived in the city of St. Louis.

Students automatically enroll in the program in their kindergarten year, but they aren’t supposed to access the money until after they graduate from a city public or charter high school.

Exceptions are made if students leave the district, if there’s a family financial emergency or if their parents and guardians want to move the money into a Missouri 529 Education Savings Plan, also known as MOST.

So far only 31 account holders have successfully moved money out of their College Kids accounts, city treasurer records show.

Joe Miklovic wants his grandson Josef to be the 32nd. But getting to that point has proven a frustratingly slow bureaucratic slog that so far has taken 14 months — and he still has no money to show for it.

Miklovic, a retired certified public accountant who lives in south St. Louis, wants to withdraw the $1,255 in the boy’s account — including $825 that Miklovic personally donated — and invest it into MOST, which he says program rules allow him to do. Miklovic is doing this legwork with the permission of his daughter Leah, the boy’s mother.

But the treasurer’s office still hasn’t released any money from the account. They're fighting Miklovic on turning over the city contributions, saying he is only entitled to the $825 he personally donated. And they haven't remitted even that portion yet.

Miklovic can file an appeal to an undefined Program Committee, but thinks ultimately he and his daughter might have to go the legal route to pry the money loose. “I guess I can always file litigation and ask the courts to force them to do it,” Miklovic says.

Neither city Treasurer Adam Layne nor Christina Bennett, the assistant city treasurer, have responded to RFT’s requests for comment.

In an email sent in May to the RFT, Layne underscored that parents and guardians of College Kids account holders “can move their funds into a MOST 529. I already informed you [that] parents can have both accounts if they wish to. All parents have choices on where to invest their family’s excess cash.”

However, the city has drawn a line with the incentives it provides through the program. As officials explained to the RFT in the spring, account holders can withdraw any monies they personally invest. Money the city provides is a different matter.

And that distinction has led to problems for Miklovic, who says the memorandum of understanding setting up the program in 2015 outlines a different protocol. Under its terms, he says, his grandson should be given his entire account.

Miklovic’s involvement with his grandson’s College Kids account began in 2019, when Josef was a student at Gateway Science Academy South, a charter school in south St. Louis.

Miklovic began donating $25 every month to the account. His donations over the ensuing two and a half years added up to $825, plus $400 in incentives the treasurer’s office provided for good attendance and participation in financial literacy classes.

But then two years ago, Josef’s family moved to Webster Groves. A year passed. Miklovic, acting on instructions from Josef’s parents, attempted to move the $1,255 in the College Kids account to the MOST account set up for the boy.

Another year of frustration ensued, punctuated by long delays in returned phone calls and emails.

Finally, on July 11, Miklovic received an email from Bennett, who shot down the idea of withdrawing the full $1,255 from the boy’s account.

“You are reading an MOU from 2015,” Bennett wrote. “Unfortunately, you are reading only part of the document. Our goal is to provide financial education programming for all SLPS and charter school children from K-12 grade and grant the accrued incentive and family deposits at graduation.

“Since you are requesting a withdrawal of funds and [withdrawal] from our program, you are forfeiting the accrued incentives,” Bennett wrote.

As Miklovic counters, the 2015 MOU that set up College Kids states, “An account beneficiary's parent or legal guardian may transfer all of the account balance, including deposits made by the STLTO (the Treasurer’s office), incentive deposits, deposit adjustments, deposits made by other individuals, and earned growth match to another privately held college savings vehicle each time the account reaches $500 or more.”

To Miklovic, the matter is "pretty cut-and-dried. I have a 529 account that I want him to put the money into. And we have over $500.”

Tishaura Jones set up College Kids while serving as city treasurer. It became one of Jones’ signature achievements, touted during her successful 2021 mayoral run.

The treasurer’s office will likely spend at least another $1.5 million, for a total of $4 million, on the program before the first high school graduates touch any of the money, which won’t be until 2028 at the earliest.

The June 7 RFT story on the program showed that only 15 percent of College Kids accounts have grown past the $50 seed level, and that only 12 percent of parents have signed up for incentives. The RFT also reported that account holders don’t earn interest, while the treasurer’s office will earn hundreds of thousands of dollars off the seed accounts by investing the money into U.S. Treasury notes.

Miklovic dismisses College Kids as little more than an effective public relations tool for Jones, a stepping stone that helped get her elected mayor.

“It was a campaign issue. On the surface it seems great,” Miklovic says. “But why would you advocate that we’re here to educate these families on good banking practices when we are keeping them from earning any interest?”