Two lawsuits challenging the Trump administration’s changes to a student loan forgiveness program for public servants were filed on Monday, seeking to preserve the program’s current scope and purpose.
The administration announced last week a rule that would curtail the Public Service Loan Forgiveness program and restrict the types of workers and fields eligible for the benefit. The program has historically allowed government and nonprofit workers to apply to have their remaining federal student loans canceled after 10 years of service and monthly loan payments.
A coalition of nonprofits and city and county governments, including a variety of teachers unions and legal aid and immigration rights groups, filed suit in Massachusetts seeking to block the rule. A second lawsuit, also filed in Massachusetts federal court, was brought by 21 state attorneys general and the District of Columbia.
The Trump administration said the rule finalized last week would exclude employers that “engage in unlawful activities such that they have a substantial illegal purpose, including supporting terrorism and aiding and abetting illegal immigration.”
Critics warned that the rule could give the administration the power to exclude nonprofits and government agencies that back policies at odds with the administration’s agenda. Groups that aid undocumented immigrants or support diversity initiatives or gender-affirming care for children could potentially be at risk.
The city of Chicago — a frequent target of President Trump — said it feared it would be penalized because of its inclusion on a Justice Department list of so-called sanctuary cities that the department claimed impeded enforcement of federal immigration laws. Albuquerque, Boston and San Francisco, which also appear on that list, are also plaintiffs in the suit filed by cities and nonprofits.
The states’ lawsuit said the new rule would “empower the Department of Education to serve as a roving enforcer of the administration’s animus” by stripping the loan forgiveness eligibility from workers whose employers are disliked by the administration.
Both lawsuits claim that the new rule violates the Administrative Procedure Act and exceeds the Education Department’s authority.
“It is unconscionable that the plaintiffs are standing up for criminal activity,” Nicholas Kent, the under secretary of education, said Monday in response to the lawsuits. “This is a common-sense reform that will stop taxpayer dollars from subsidizing organizations involved in terrorism, child trafficking and transgender procedures that are doing irreversible harm to children.”
Zach Montague is a Times reporter covering the federal courts, including the legal disputes over the Trump administration’s agenda.
Stacy Cowley is a Times business reporter who writes about a broad array of topics related to consumer finance, including student debt, the banking industry and small business.
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