Lawsuit Seeks to Stop Changes to Public Service Loan Forgiveness Program

A group of 22 states has sued the U.S. Department of Education over changes to a student loan forgiveness program designed for public workers.

The states—led by California, Colorado, Massachusetts and New York—has asked a federal judge to invalidate a rule the Department of Education made for the Public Service Loan Forgiveness (PSLF) program, established by Congress in 2007 to cancel federal student loan debts of borrowers with at least 10 years in public service.

As reported by National Public Radio (NPR), the lawsuit also includes the nation’s two largest teachers’ unions and the American Federation of State, County and Municipal Employees, and was filed less than one week after the Department of Education published a rule change to PSLF.

With the new regulations, the department will be able to deny loan forgiveness to workers whose government or non-profit employees engage in activities with a “substantial illegal purpose.” The job of defining “substantial illegal purpose” will fall to the education secretary, as opposed to the courts, wrote NPR’s Cory Turner.

According to the lawsuit, filed in the U.S. District Court for the District of Massachusetts, the plaintiffs fear that a city or county government’s resistance to, say, the administration’s immigration actions could lead the secretary to exclude that government’s public workers from loan forgiveness. For instance, a local nurse or first responder could be denied loan forgiveness “because their local leaders defied the Trump administration,” Turner wrote.

The suit contends that the rule is “an attempt to target organizations and jurisdictions whose missions and policies do not align with [the Trump administration’s] political positions on immigration, race, gender, free speech, and public protest.”

In a statement issued on the heels of the suit’s filing, California Attorney General Rob Bonta said the rule’s vagueness could “empower the Trump administration to target politically disfavored conduct” and could threaten PSLF eligibility for organizations that are engaged in longstanding and legal activities.

“Millions of Americans shaped their lives, made long-term career decisions and took on deep financial burdens based on the promise that, if they dedicated their lives to public service and made student loan payments for 10 years, their government would support them,” Bonta said. “Now, the Trump Administration is pulling the rug from under hardworking Americans who absolutely deserve what they were promised.”