Summary
Cities like Albuquerque, Boston, Chicago, and San Francisco are suing the Trump administration over changes to the Public Service Loan Forgiveness (PSLF) program. The new rule could deny loan forgiveness to public workers whose employers are deemed to engage in activities with a "substantial illegal purpose," a term defined by the education secretary. The lawsuit argues this could unfairly target cities that oppose administration policies.
Key Facts
- The Public Service Loan Forgiveness program was started in 2007 to forgive student loans for workers in public service after ten years.
- Changes to the PSLF program rules will take effect on July 1, 2026.
- The rule change could deny loan forgiveness to workers whose employers are seen as engaging in illegal activities.
- The definition of "substantial illegal purpose" will be determined by the education secretary.
- Cities like Boston and San Francisco, along with major teachers unions, are part of the lawsuit.
- The lawsuit argues the changes could unfairly impact workers where local governments oppose certain federal policies.
- The rule aims to ensure that taxpayer money does not support illegal activities.
- The Education Department has yet to comment on the lawsuit but defends the rule as legally grounded.
