Transfers management of federal student loans, defaulted student debt, and related student aid programs from the Department of Education to the Department of the Treasury.

Official title: Less Bureaucracy, Better Student Aid Act

Next stop House floor: awaiting a vote

Timeline each lane is a chamber; dates pull from congress.gov actions

House

Introduced 09-JUL-2026

Referred 09-JUL-2026

Approved by committee 15-JUL-2026

Key points

Transfers Education Department functions for servicing and collecting defaulted and non-defaulted federal student loans to the Treasury Department, in phases set by the two Secretaries.
Moves Pell Grants, Federal Work-Study, Direct Loans, Perkins Loans, and other federal student aid programs to Treasury once the transfers take effect.
Directs the Office of Management and Budget to ensure no net increase in full-time employees at affected agencies and to certify compliance with the transfers.
Exempts student loan debt from the exemption under the Debt Collection Improvement Act, so defaulted student loans must follow that act's collection rules.

AI-generated from the Introduced in House text of 09-JUL-2026 · verify · report an error

Official CRS summary

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Committee referrals (2)

Policy area

Education

Sponsor Tim Walberg (R-MI) Cosponsors · 1

■ 1 R

1 Republican

congress.gov page Introduced in House (09-JUL-2026)