The U.S. Department of Education planned for the Treasury Department to take a hand in managing the country’s $1.6 trillion student loan portfolio, recent court documents show.
“The Department had been negotiating a memorandum of understanding with the Treasury Department regarding student loan management,” Rachel Oglesby, the chief of staff at the Education Dept., said in a court declaration filed late on Tuesday.
The agreement involved moving nine Education Dept. employees from the agency’s Federal Student Aid Default Collections Unit to Treasury “to discuss collections activities,” a spokesperson for the Education Department told CNBC.
Education Department plans with the Treasury Department are now on hold after U.S. District Judge Myong Joun in Boston blocked the Trump administration on May 22 from its efforts to dismantle the Education Department.
Joun ordered the department to rehire the more than 1,300 employees affected by mass layoffs in March, and blocked the department from transferring student loans to the Small Business Administration.
