SEED for Oklahoma Kids: Demonstrating Child Development Accounts for All Newborns

A goal of the Center for Social Development (CSD) at the George Warren Brown School of Social Work at Washington University in St. Louis is to inform and influence a universal, progressive Child Development Account (CDA) policy in the United States. To reach this goal, CSD and partner organizations conceived and designed the project known as SEED for Oklahoma Kids or “SEED OK”.

What is SEED OK?

SEED OK is among the most important policy tests in the United States. SEED OK will use a 529 College Savings Plan to test the concept of giving every child an account at birth. SEED OK grows out of groundwork laid by CSD to test a universal model that is scalable in the form that it is demonstrated — specifically, as a policy that does not depend upon community organizations to implement and administer.

In a competitive process, Oklahoma has been selected as the state to implement this path-breaking project. SEED OK is a partnership among the State of Oklahoma (Treasurer’s Office, Department of Health, and Oklahoma College Savings Plan), CSD, and RTI International. SEED OK is funded by the Ford Foundation, the Charles Stewart Mott Foundation, and the Lumina Foundation for Education.

The SEED OK Experiment

In Oklahoma, approximately 2,700 parents of infants from a random sample of Oklahoma birth records will be interviewed over the course of the study. The study includes oversamples of American Indians, African Americans, and Latinos. In December 2007 and May 2008, 1,360 randomly-selected SEED OK families received a deposit of $1,000 into an Oklahoma College Savings Plan (OCSP) 529 account for the child. In addition, income-eligible families will have their OCSP account savings matched up to $250 each year over a four-year period. At the same time, about 1,360 families will not receive a SEED OK account, and all will be followed as the children grow up. OCSP accounts for the SEED infants and other savings for both SEED OK and control families will be carefully tracked. We anticipate, and will measure, whether participation in SEED OK has an impact on: (1) 529 savings for children; (2) total savings in household; (3) parents’ attitudes and aspirations for children’s education; (4) parents behaviors regarding education, e.g., reading more to young children; (5) children’s aspirations for education; (6) children’s early schooling performance; and (7) children’s knowledge, cognitive, and behavioral development.

We would certainly not claim that a universal CDA is a complete and sufficient solution for positive child development and educational attainment. We do think, however, that asset accumulation is a key pathway for individuals, families, and communities to formulate goals and reach their potential. We think that families and children in the SEED OK group will do better than families and children in the control group, and we will carefully test this.

SEED OK is a social experiment in a total (unselected) population. It has an initial seven-year design. RTI International has conducted baseline interviews and will conduct two more interview waves in the next years. We anticipate that researchers will continue to follow SEED OK participants into young adulthood. RTI International and CSD will analyze experimental data following each wave.

In-depth interviews will also be carried out by CSD during the experiment. Interviews will provide detail and insight into how families think and act in relation to the CDA, contributing to interpretation of quantitative findings.

Policy Implications

SEED OK aims not only to demonstrate that a universal asset-building policy is feasible, but also to document outcomes for children and families. Outcomes are expected to lead to policy change. Working with policy partners New America Foundation and CFED, our aim is to inform and put in place a universal child development account.

In policy design, we are especially interested in certain characteristics of the best 529 plans—such as public oversight, centralized accounting, low annual fees, low deposit minimums, and matching provisions that can become building blocks for an inclusive CDA policy. SEED OK builds on an existing policy structure that is centralized, efficient, and could potentially be rolled out to all children across the United States.