HouseH.R. 9609119th Congress
Less Bureaucracy, Better Student Aid Act
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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 9609 Introduced in House (IH)]
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119th CONGRESS
2d Session
H. R. 9609
To ensure the Department of Treasury will manage all federal student
loans, federal student debt, and policies regarding student aid
eligibility, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 9, 2026
Mr. Walberg introduced the following bill; which was referred to the
Committee on Education and Workforce, and in addition to the Committee
on Energy and Commerce, for a period to be subsequently determined by
the Speaker, in each case for consideration of such provisions as fall
within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To ensure the Department of Treasury will manage all federal student
loans, federal student debt, and policies regarding student aid
eligibility, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Less Bureaucracy, Better Student Aid
Act''.
SEC. 2. TRANSFER OF DEPARTMENT OF EDUCATION FUNCTIONS RELATING TO
FEDERAL STUDENT AID.
(a) In General.--There are transferred, in accordance with the
applicable effective dates in subsection (b), to the Department of the
Treasury--
(1) functions of the Secretary of Education (including the
performance-based organization established pursuant to section
141 of the Higher Education Act of 1965 (20 U.S.C. 1018) and
all related functions of any officer or employee of the
Department of Education) related to the servicing and voluntary
and involuntary collections of defaulted Federal student loan
debt, including certification of debt, due process, borrower
notification, disputes, bankruptcy, rehabilitation,
consolidation, compromise, repayment agreements, and credit
reporting;
(2) functions of the Secretary of Education (including the
performance-based organization established pursuant to section
141 of the Higher Education Act of 1965 (20 U.S.C. 1018) and
all related functions of any officer or employee of the
Department of Education) related to the servicing of non-
defaulted Federal student loan debt, including borrower
notification, processing of payments, repayment plan
administration, consolidation, disputes, and credit reporting;
and
(3) all functions of the Secretary of Education (including
the performance-based organization established pursuant to
section 141 of the Higher Education Act of 1965 (20 U.S.C.
1018) and all related functions of any officer or employee of
the Department of Education) that remain after the transfer of
functions required under paragraphs (1) and (2) with respect to
each of the following:
(A) Administrative Provisions for Delivery of
Student Financial Assistance under part D of title I of
the Higher Education Act of 1965 (20 U.S.C. 1018 et
seq.).
(B) Lender and Institution Requirements Relating to
Education Loans under part E of such title (20 U.S.C.
1019 et seq.).
(C) Federal Pell Grants under subpart 1 of part A
of title IV of the Higher Education Act of 1965 (20
U.S.C. 1070a et seq.).
(D) Federal Supplemental Educational Opportunity
Grants under subpart 3 of such part A (20 U.S.C. 1070b
et seq.).
(E) Federal Family Education Loan program under
part B of title IV of the Higher Education Act of 1965
(20 U.S.C. 1071 et seq.).
(F) Federal Work-study programs under part C of
such title (20 U.S.C. 1087-51 et seq.).
(G) William D. Ford Federal Direct Loan program
under part D of such title (20 U.S.C. 1087a et seq.).
(H) Federal Perkins Loans under part E of such
title (20 U.S.C. 1087aa et seq.).
(I) Need Analysis under part F of such title (20
U.S.C. 1087kk et seq.).
(J) General Provisions Relating to Student
Assistance programs under part G of such title (20
U.S.C. 1088 et seq.).
(K) Eligibility and Certification Procedures under
subpart 3 of part H of such title (20 U.S.C. 1099c et
seq.).
(L) Health Education Assistance Loan program as
provided in part A of title VII of the Public Health
Service Act (42 U.S.C. 292 et seq.).
(b) Effective Dates.--
(1) Effective dates determined.--The Secretary of Education
and the Secretary of the Treasury shall jointly determine
effective dates for the transfers required under subsection
(a), in accordance with paragraph (2) of this subsection.
(2) Applicable effective dates.--The transfers required
under subsection (a) shall take effect as follows:
(A) Paragraph (1).--With respect to the transfers
required under paragraph (1) of subsection (a), on the
effective date determined in accordance with paragraph
(1) that is on or after the date of enactment of this
Act.
(B) Paragraph (2).--With respect to the transfers
required under paragraph (2) of subsection (a), on the
effective date determined in accordance with paragraph
(1) that is on or after the effective date described in
subparagraph (A).
(C) Paragraph (3).--With respect to the transfers
required under paragraph (3) of subsection (a), on the
effective date determined in accordance with paragraph
(1) that is on or after the effective date described in
subparagraph (B).
SEC. 3. EXERCISE OF AUTHORITIES.
Except as otherwise provided by law, the Secretary of the Treasury
may, for purposes of performing a function transferred under this Act,
exercise all authorities under any other provision of law that were
available with respect to the performance of that function to the
Secretary of Education immediately before the effective date of the
transfer of the function under this Act.
SEC. 4. TRANSFER AND ALLOCATIONS OF APPROPRIATIONS AND PERSONNEL.
Except as otherwise provided in this Act, the personnel employed in
connection with, and the assets, liabilities, contracts, property,
records, and unexpended balances of appropriations, authorizations,
allocations, and other funds employed, used, held, arising from,
available to, or to be made available in connection with the functions
transferred under this Act, subject to section 1531 of title 31, United
States Code, shall be transferred to the Secretary of the Treasury.
Unexpended funds transferred pursuant to this section shall be used
only for the purposes for which the funds were originally authorized
and appropriated.
SEC. 5. AUTHORITY OF DIRECTOR OF THE OFFICE OF MANAGEMENT AND BUDGET
WITH RESPECT TO FUNCTIONS TRANSFERRED.
(a) Personnel Determinations.--The Director of the Office of
Management and Budget shall ensure that this Act does not result in a
net increase in full-time equivalent employees at the Federal agencies
impacted by this Act, based on the number of such employees at such
agencies on the date of enactment of this Act.
(b) Function Determinations.--If necessary, the Director of the
Office of Management and Budget shall make any determination of the
functions that are transferred under this Act.
(c) Incidental Transfers.--The Director of the Office of Management
and Budget, at such time or times as the Director shall provide, may
make such determinations as may be necessary with regard to the
functions transferred by this Act, and to make such additional
incidental dispositions of personnel, assets, liabilities, grants,
contracts, property, records, and unexpended balances of
appropriations, authorizations, allocations, and other funds held,
used, arising from, available to, or to be made available in connection
with such functions, as may be necessary to carry out the provisions of
this Act. The Director shall provide for the termination of the affairs
of all entities terminated by this Act and for such further measures
and dispositions as may be necessary to effectuate the purposes of this
Act.
(d) Certification of Compliance.--On each of the effective dates
under section 3(b), the Director of the Office of Management and Budget
shall certify compliance with the provisions of this Act that take
effect on such date, including the requirement under subsection (a) as
applicable on such date, to the Committee on Education and Workforce of
the House of Representatives and the Committee on Health, Education,
Labor, and Pensions of the Senate.
SEC. 6. DELEGATION AND ASSIGNMENT.
Except as otherwise expressly prohibited by law or otherwise
provided in this Act, the Secretary of the Treasury may delegate any of
the functions so transferred to such officers and employees of the
Department of the Treasury as the Secretary may designate, and may
authorize successive redelegations of such functions as may be
necessary or appropriate. No delegation of functions under this section
or under any other provision of this Act shall relieve the Secretary of
the Treasury of responsibility for the administration of the function.
SEC. 7. REFERENCES.
With regard to functions transferred under section 2, a reference
in any other Federal law, Executive order, rule, regulation, or
delegation of authority, or any document of or relating to--
(1) the Secretary of Education shall be deemed to refer to
the Secretary of the Treasury; and
(2) the Department of Education shall be deemed to refer to
the Department of the Treasury.
SEC. 8. SAVINGS PROVISIONS.
(a) Legal Documents.--All orders, determinations, rules,
regulations, permits, grants, loans, contracts, agreements,
certificates, licenses, and privileges--
(1) that have been issued, made, granted, or allowed to
become effective by the President, any Federal agency or
official thereof, or by a court of competent jurisdiction, in
the performance of any function that is transferred by this
Act; and
(2) that are in effect on the effective date of such
transfer (or become effective after such date pursuant to their
terms as in effect on such effective date),
shall continue in effect according to their terms until modified,
terminated, superseded, set aside, or revoked in accordance with law by
the President, the Secretary of the Treasury, any other authorized
official, a court of competent jurisdiction, or operation of law.
(b) Proceedings.--This Act shall not affect any proceedings or any
application for any benefits, service, license, permit, certificate, or
financial assistance pending on the date of the enactment of this Act
before the Department of Education (with respect to functions
transferred by this Act). Such proceedings and applications shall
continue, orders shall be issued in such proceedings, appeals shall be
taken therefrom, and payments shall be made pursuant to such orders, as
if this Act had not been enacted, and orders issued in any such
proceeding shall continue in effect until modified, terminated,
superseded, or revoked by a duly authorized official, by a court of
competent jurisdiction, or by operation of law. Nothing in this
subsection shall be considered to prohibit the discontinuance or
modification of any such proceeding under the same terms and conditions
and to the same extent that such proceeding could have been
discontinued or modified if this Act had not been enacted.
(c) Suits.--Except as provided in subsection (e)--
(1) this Act shall not affect suits commenced before the
date of enactment of this Act; and
(2) in all such suits, proceeding shall be had, appeals
taken, and judgments rendered in the same manner and with the
same effect as if this Act had not been enacted.
(d) Nonabatement of Actions.--No suit, action, or other proceeding
commenced by or against the Department of Education (with respect to
the functions transferred by this Act), or by or against any individual
in the official capacity of such individual as an officer or employee
of the Department of Education (with regard to functions transferred by
this Act), shall abate by reason of the enactment of this Act.
(e) Continuance of Suits.--If, before the date on which a transfer
of a function under this Act takes effect, the Secretary of Education
or any officer or employee of the Department of Education in the
official capacity as such an officer or employee is party to a suit
relating to the function, then such suit shall be continued and the
Secretary of the Treasury, or other appropriate official of the
Department of the Treasury, shall be substituted or added as a party.
(f) Administrative Procedure and Judicial Review.--Except as
otherwise provided by this Act, any statutory requirements relating to
notice, hearings, action upon the record, or administrative or judicial
review that apply to any function transferred by this Act shall apply
to the exercise of such function by the Secretary of the Treasury, and
other officers of the Department of the Treasury, to which such
function is transferred by this Act.
SEC. 9. TERMINATING EXEMPTION FROM DEBT COLLECTION IMPROVEMENT ACT.
(a) Termination of Authority To Exempt Student Loans From the Debt
Collection Improvement Act.--Beginning on the effective date of the
transfers required under paragraph (1) of section 2(a) (as determined
in accordance with section 2(b)), delinquent or defaulted Federal
student loan debt may not be subject to an exemption under paragraph
(2)(B) of section 3711(g) of title 31, United States Code, from the
requirement under paragraph (1) of such section.
(b) Definitions.--In this Act:
(1) Delinquent or defaulted.--The term ``delinquent or
defaulted'', when used with respect to student loan debt, means
debt that is considered delinquent or in default in accordance
with the Higher Education Act of 1965 (20 U.S.C. 1001 et seq.).
(2) Student loan debt.--The term ``student loan debt''
means any debt under part B, D, or E of title IV of the Higher
Education Act of 1965 (20 U.S.C. 1070 et seq.), or any debt
that arises from a Health Education Assistance Loan as provided
in part A of title VII of the Public Health Service Act (42
U.S.C. 292 et seq.), that is assigned to or otherwise held by
the Secretary of Education.
SEC. 10. TRANSITION.
The Secretary of the Treasury is authorized to use, for such period
of time as may reasonably be needed to facilitate the orderly
implementation of this Act--
(1) the services of officers, employees, and other
personnel of the Department of Education with regard to
functions transferred under this Act;
(2) assets of the Department of Education with regard to
such functions; and
(3) funds appropriated to such functions.
SEC. 11. DEFINITION OF FUNCTION.
For purposes of this Act, the term ``function'' includes any duty,
obligation, power, authority, responsibility, right, privilege,
activity, or program.
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