§1904 National Security Education Trust Fund

Summary

Creates a trust fund in the U.S. Treasury called the National Security Education Trust Fund. Money in the Fund comes from amounts Congress puts in it and from other money added under the rules below. Congress must approve spending from the Fund. The money can be used for scholarships, fellowships, and grants under this program and to pay the government’s proper costs to run the program. The Treasury Secretary must invest any Fund money not needed right away. Investments can only be in U.S. government bonds or bonds the U.S. guarantees. The Treasury may also issue special securities just for the Fund at face value. Those special securities earn interest equal to the average interest rate on marketable U.S. government bonds at the end of the previous month, rounded down to the nearest 1/8 of 1 percent, and are used only if the Treasury decides other purchases are not in the public interest. Bonds the Fund buys (except special ones) can be sold at market price, and special securities can be redeemed at face value plus accrued interest. Interest, sale or redemption proceeds, required program payments to the United States, and gifts all go into the Fund.