May 9, 2005
VIA E-MAIL
May 9, 2005
Jonathan G. Katz, Secretary
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549-0609
rule-comments@sec.gov
Re: S7-11-04
Dear Mr. Katz:
I am writing to you today on behalf of the College Savings Foundation CSF. CSF is a 501c6 organization dedicated to the advancement of 529 college savings programs. CSFs mission is to help American families achieve their education savings goals by working with public policy makers, media representatives and financial services industry executives in support of education savings programs. CSFs members include many of the countrys leading financial services firms, and collectively manage approximately 25 billion in savings-type qualified tuition programs, representing about one-half of the dollars in such programs. CSF also includes associate members that are governmental and non-profit agencies and individuals who support CSF and its mission.
CSF serves the education savings industry as a central repository of information and an expert resource for its members and for representatives of state and federal government, institutions of higher education and other related organizations and associations. The primary focus of CSF is building public awareness of and providing public policy support for 529 plans - an increasingly vital college-savings vehicle.
This letter is in response to the recently adopted rule on market timing. Our sole comment is to commend the Commission on its position concerning 529 plans, i.e. that the plans and individuals holding interests in the plans are excluded from the definition of shareholders under the rule. As noted in the adopting release, individuals who invest in 529 plans are severely limited by the Internal Revenue Code with respect to their ability to engage in frequent trading. Our members have not seen any significant levels of frequent trading in the programs that they administer for the states, and do not believe that there is any reason to think that this situation will change in the foreseeable future.
We thank you for the opportunity to present our views. Should you desire further information, please do not hesitate to contact me at Kevin.mcmullen.lnyz@statefarm.com.
Sincerely,
Kevin McMullen
Chairman, Government Affairs Committee