The DC Student Loan Authority Establishment Act of 2026 proposes the creation of the District of Columbia Student Loan Authority, a public lending institution designed to provide student loans and refinance existing education debt for D.C. residents. The Authority will be governed by a 7-member board, with 5 members appointed by the Mayor and approved by the Council. The loan program aims to address the challenges of private student loans by offering no application or origination fees, a 0% interest rate on the first $5,000 of any loan, and a repayment cap of 10% of a borrower's discretionary income. The bill also outlines specific loan terms, including a repayment period that begins six months after program completion and the potential for loan discharge after 10 years of full-time public service work.

Additionally, the bill includes provisions for deferring repayment and interest accrual while borrowers are enrolled in qualifying educational programs, with repayment starting six months after completion or withdrawal. It mandates the Authority to maintain transparency through regular financial reports and prohibits outsourcing student loan servicing, while allowing for necessary contracting for supplies and technology. The Council grants the Authority the power to issue revenue bonds for financing, clarifying that these obligations do not constitute a debt of the District. The legislation also includes conforming amendments to existing laws to integrate the activities of the District of Columbia Student Loan Authority.