Committee Discusses Bills that Would Shield Some Funds from Debt Collectors

HELENA — Two bills in the Montana State House of Representatives would shield a person’s student loan money or government assistance funds from being taken by debt collectors.

Rep. Robert Farris Olsen, D-Helena is sponsoring both bills.

Sarah Piper spoke on behalf of the Montana Federation of Public Employees in support of House Bill 262, which would protect student loan funds.

“Money that has been granted for higher education should go to higher education costs, not be sent to debt collectors,” Piper said.

Student loan money is already protected from collectors by federal law, but Farris Olsen said he wanted to add it to state protection to raise awareness that collectors aren’t allowed to take that money. 

Farris Olsen’s other bill, House Bill 263, adds federal, state and tribal benefit money to the list of protected assets. He said the bill would help ensure assistance money — like pandemic relief funds in the CARES Act — is there when it is needed. He said sometimes, the federal government forgets to protect the money they send, meaning it never reaches the pockets of Montanans in debt. 

“That money was not protected in the CARES Act, so a debt collector or creditor could levy that from your bank account,” Farris Olsen said.

The bills face a vote by the House Judiciary Committee before they move to the full House for debate.

James Bradley is a reporter with the UM Legislative News Service, a partnership of the University of Montana School of Journalism, the Montana Broadcasters Association, the Montana Newspaper Association and the Greater Mo

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