- One day after signing an executive order, President Donald Trump announced student loans will be moved to the SBA, while special needs services and nutrition programs will be transferred to HHS. He described the shift as a positive change.
- The SBA will cut 40% of its workforce, a move projected to save the government $435 million by the next fiscal year.
- Legal challenges are expected, with teachers’ unions already preparing lawsuits against the administration’s plan to dismantle the Department of Education.
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One day after signing an executive order aimed at dismantling the Department of Education, President Donald Trump announced Friday, March 21, that the responsibility for handling student loans will be transferred to the Small Business Administration (SBA).
Special needs services and nutrition programs will be moved to the Department of Health and Human Services (HHS), marking an early step in reducing the role of the Department of Education.
SBA and HHS take on some education responsibilities
Speaking from the Oval Office on Friday, Trump made the announcement, telling reporters that SBA Administrator Kelly Loeffler will oversee the distribution of student loans. Robert F. Kennedy Jr., Trump’s pick to head HHS, will take over special needs and nutrition programs in schools.
“It’s going to be a great situation. I guarantee in a few years from now, I think we’re going to see a lot of it. I think you’re going to have tremendous results,” Trump said.
The move comes just a day after Trump signed an executive order instructing Education Secretary Linda McMahon to dismantle the department as much as legally possible. The administration said it will eliminate non-statutory programs and reassign essential functions to other agencies.
SBA to cut workforce by 40%
Also announced Friday, the SBA plans to cut more than 40% of its staff, stating that the cuts will save the government $435 million by the next fiscal year.
Change is coming to the SBA. pic.twitter.com/rHXSfk168M
— Kelly Loeffler (@SBA_Kelly) March 21, 2025
“The waste, inefficiency, and mismanagement go much deeper,” the administration said. “Since the pandemic, the SBA has doubled its workforce, expanding in size, scope and spending, with miserable results.”
The SBA also announced it is ready to take on the task of overseeing student loans.
.@SBAGov is prepared to work with Congress and the Administration to bring accountability back to America’s student loan program.
— Kelly Loeffler (@SBA_Kelly) March 21, 2025
As the government’s largest guarantor of business loans, the SBA stands ready to deploy its resources and expertise on behalf of America’s taxpayers…
Legal challenges are expected
The Trump administration is expected to face legal challenges over its decision to reduce the size of the Department of Education, with some teachers’ unions already promising to sue.
