Executive Order Restricts Eligibility for PSLF

Last week, the Trump Administration issued an executive order (EO) to restrict eligibility for the Public Service Loan Forgiveness (PSLF) program. Borrowers who are employed at organizations that have a “substantial illegal purpose” may be excluded from participation in the program. The EO defines such organizations as those that, among other things, violate federal immigration laws, support terrorism or child abuse, or engage in a pattern of illegal discrimination.

Taken at face value, these restrictions would seem like valid prohibitions, but given the administration’s recent history, this EO appears to signal that PSLF will be brought into the broader political debate over some of the administration’s current hot-button social issues. Organizations that focus on immigration rights, climate change, free speech and civil disobedience advocacy, and those that utilize diversity, equity, and inclusion practices, could be targeted to have their eligibility for the program revoked.

It is unclear how these changes would impact currently certified PSLF enrollees or if the changes are even legal. Since the current regulations had gone through the formal negotiated rulemaking process, the Department of Education should also be required to go through the negotiated rulemaking process to issue new rules.

For more information, please contact:
Justin Monk