New PSLF Rules Could Impact Thousands of Public Service Workers
President Donald Trump’s administration released new rules on Monday to restrict eligibility for the Public Service Loan Forgiveness program. The public comment period now runs through September 17, allowing anyone to submit feedback on these new regulations to the administration.
Understanding the Public Service Loan Forgiveness Program Changes
PSLF forgives student debt for government and nonprofit workers who make qualifying payments for 10 years. The program has discharged over a billion dollars in student debt for public servants. Trump wants to modify this program — he issued an executive order in March directing the education secretary to redefine “public service” and eliminate PSLF eligibility for employers participating in “anti-American” activities.
Federal Register Outlines New Student Loan Forgiveness Restrictions
The Federal Register published the proposed rule limiting PSLF, stating that “in cases where an employer is deemed to have engaged in activities that breach federal or state law or established public policy, affected borrowers would no longer receive credit toward loan forgiveness for months worked after the effective date of ineligibility.”
“While this may delay or prevent forgiveness for a subset of borrowers, the overall design of the regulations—including advance notice, transparency around determinations, and employer recertification pathways—helps mitigate unexpected harm,” the rule said.
Specific Activities That Could Disqualify PSLF Eligibility
According to the rule, compromising behavior by an employer could include violating the federal disabilities act; breaking federal immigration law; what the department describes as “chemical castration or mutilation,” such as using puberty blockers or hormones to assist a transgender person’s transition; and committing acts of terrorism.
Stakeholder Opposition to PSLF Program Modifications
The Department of Education conducted negotiation sessions with stakeholders in early July, and several committee members voiced concerns about the department’s plan to restrict the program.
“The intent of Congress was not to narrow the eligibility,” Betsy Mayotte, the president of The Institute of Student Loan Advisors and a representative of student-loan borrowers, said during a session. “It was to make it as expansive as possible under the statute that they wrote.”
Department of Education Defends Authority to Change Student Debt Relief
Administration representatives argued that the education secretary possesses the authority to interpret regulations and statutes and can legally refine PSLF.
Student Loan Borrowers Express Concerns About PSLF Changes
Student-loan borrowers who participate in PSLF previously told Business Insider that Trump’s plans to modify a program they depend on for debt relief raise major concerns.
“I’m so close to the finish line,” Jeff Hughes, a government employee with student debt, said. “I really hope that the program continues as is because we need some more good people out there doing good work.”
Administration Justifies New Public Service Loan Forgiveness Rules
Undersecretary of Education Nicholas Kent said in a statement that “the federal government has a vital interest in deterring unlawful conduct, and we’re moving quickly to ensure employers don’t benefit while breaking the law.”
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