H.R. 9609
Less Bureaucracy, Better Student Aid Act
Sponsor: Tim Walberg
1 cosponsor
Official summary
Written by the Congressional Research Service.
Less Bureaucracy, Better Student Aid Act
This bill transfers specified functions relating to federal student aid from the Department of Education (ED) to the Department of the Treasury.
Specifically, the bill transfers to Treasury all the functions and authorities exercised by ED related to servicing and collections of defaulted federal student loan debt, servicing of non-defaulted federal student loan debt, and other specified programs (e.g., Federal Pell Grants and Federal Direct Loans). ED and Treasury must jointly determine effective dates for these transfers in accordance with the bill's requirements. (On March 19, 2026, ED announced an interagency agreement with Treasury for Treasury to assume operational responsibility for collecting on defaulted federal student loans, while ED must maintain its statutory responsibilities.)
Additionally, the bill transfers to Treasury all personnel and appropriations related to the functions that are transferred under this bill.
The bill outlines the authority of the Office of Management and Budget (OMB) related to the functions that are transferred under this bill, including that OMB must ensure that this bill does not create a net increase in full-time equivalent employees at Treasury or ED. Further, OMB must certify compliance with the bill to specified congressional committees.
The transfer of these functions does not affect any suits, proceedings, or applications for benefits, services, licenses, permits, certificates, or financial assistance that are pending on the date of this bill's enactment.
The bill also terminates the authority to exempt delinquent or defaulted federal student loans from the Debt Collection Improvement Act.
Text of the bill
(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.