Nearly two dozen Democrat-led states and Washington, DC, filed a lawsuit against the Department of Education (DOE) on Monday over a recent rule change to the Public Service Loan Forgiveness (PSLF) student loan debt relief program.
The Trump administration announced last week it had finalized a rule stating that organizations that are engaged in “unlawful activities” will not qualify for the taxpayer-funded PSLF program, which allows government workers or nonprofit employees to receive forgiveness after ten years of payments. The unlawful activities include supporting terrorism, aiding and abetting illegal immigration, engaging in child sex changes in violation of federal or state law, and child trafficking, among other illicit activities.
Democrats are arguing the rule change is unlawful and will be used to target the political opponents of President Donald Trump, the Hill reported.
“Public Service Loan Forgiveness was created as a promise to teachers, nurses, firefighters, and social workers that their service to our communities would be honored,” New York Attorney General Letitia James (D) said.
“Instead, this administration has created a political loyalty test disguised as a regulation. It is unjust and unlawful to cut off loan forgiveness for hardworking Americans based on ideology. I will not let our federal government punish New York’s public servants for doing their jobs or standing up for our values,” James added.
States outlined specific concerns that the rule will be used against “teachers in states with inclusive curricula, health professionals providing gender-affirming care, or legal aid attorneys representing immigrants, could suddenly lose PSLF eligibility through no fault of their own.”
Under Secretary of Education Nicholas Kent told the outlet in a statement that it is “unconscionable that plaintiffs are standing up for criminal activity.”
“This is a commonsense reform that will stop taxpayer dollars from subsidizing organizations involved in terrorism, child trafficking, and transgender procedures that are doing irreversible harm to children,” Kent said.
“The final rule is crystal clear: the Department will enforce it neutrally, without consideration of the employer’s mission, ideology, or the population they serve,” he added.
Two organizations, Protect Borrowers and Democracy Forward, filed a separate lawsuit on Monday, along with other cities and two of the largest teachers unions in the U.S. That lawsuit alleges the rule change is a “blatant violation of the Higher Education Act.”
“This administration has, yet again, unlawfully targeted people who work in the public interest. And so we again are in court,” said Skye Perryman, president and CEO of Democracy Forward. “Politically motivated retaliation, like what the administration has done here, should have no place in America. We are honored to represent this powerful coalition in defense of the people’s rights.”
The Department of Education updated the rule in accordance with President Trump’s March executive order “Restoring Public Service Loan Forgiveness.” That order directed Education Secretary Linda McMahon to propose revisions to the PSLF program to ensure the definition of “public service” excludes organizations that engage in activities that have a substantial illegal purpose.
“The prior administration abused the PSLF Program through a waiver process, using taxpayer funds to pay off loans for employees still years away from the statutorily required number of payments. Moreover, instead of alleviating worker shortages in necessary occupations, the PSLF Program has misdirected tax dollars into activist organizations that not only fail to serve the public interest, but actually harm our national security and American values, sometimes through criminal means,” Trump’s order reads. “The PSLF Program also creates perverse incentives that can increase the cost of tuition, can load students in low-need majors with unsustainable debt, and may push students into organizations that hide under the umbrella of a non-profit designation and degrade our national interest, thus requiring additional Federal funding to correct the negative societal effects caused by these organizations’ federally subsidized wrongdoing.”
“As President of the United States, I have a duty to protect, preserve, and defend the Constitution and our national security, which includes ending the subsidization of illegal activities, including illegal immigration, human smuggling, child trafficking, pervasive damage to public property, and disruption of the public order, which threaten the security and stability of the United States,” the order continues. “Accordingly, it is the policy of my Administration that individuals employed by organizations whose activities have a substantial illegal purpose shall not be eligible for public service loan forgiveness.”
Katherine Hamilton is a political reporter for Breitbart News. You can follow her on X @thekat_hamilton.
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