U.S. Department of Education Secretary Betsy DeVos proposed establishing a new independent federal agency to manage the federal student loan program. DeVos argued that the U.S. Department of Education’s Office of Federal Student Aid (FSA), which manages the federal government’s $1.5 trillion student loan portfolio, was not created to function as an apolitical bank, despite congressional policy expectations.
“FSA’s mission is to serve students and families, but its structure is set up to serve politicians and their policies,” DeVos told attendees at the department’s annual conference.
The proposal would move the student loan management responsibilities of the FSA to a new, independent federal agency “run by a professional, expert and apolitical board of governors,” according to DeVos.
Congressional action would be required to implement DeVos’ proposal. House Education and Labor Chairman Bobby Scott (D-Va.) issued a statement arguing that the FSA should be able to operate apolitically as it is currently structured.
An independent federal agency is an administrative agency that operates with some degree of autonomy from the executive branch. These agencies may be established outside of the Executive Office of the President or the 15 executive departments. Top officials at independent federal agencies may also have cause removal protections, which aim to insulate agencies from political interference by the president or other elected officials.
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