Committee advances bill barring license revocation solely for unpaid student loans

The Senate Public Health, Welfare and Labor Committee on Wednesday voted to advance HB 1296, which would prevent the state from revoking an occupational license solely because a person is delinquent on a student loan or scholarship.

Sponsor Senator Garner told the committee the bill is intended to avoid creating a “downward cycle” in which license revocation prevents people from working and repaying debts. “If you can't go work at the job, that's gonna make it that much more difficult,” Garner said.

Senator Hickey, a former banker, said lenders typically try to work out payment plans and said he worried the bill could let some people "skip out on the debt." Hickey said he struggled with the policy because it could weaken collection tools for unsecured loans. Garner acknowledged the concern but said pulling a license is an “extreme step” that is unnecessary and counterproductive.

There were no public witnesses for or against the measure during the committee hearing. A committee member moved to pass the bill; after a second, the committee voted in favor and the chair announced that HB 1296 passed committee.

Why it matters: The bill would change how licensing boards can respond to debt-related issues by removing license suspension as a sanction tied solely to student debt. Supporters say the measure helps workers keep jobs needed to repay loans; opponents warned it could reduce debt-collection leverage for lenders.

What comes next: The bill advances from committee to the Senate calendar for further consideration.