Education Department bars loan forgiveness for employees of groups engaged in illegal acts
This marks a shift away from the Biden-era framework, which allowed graduates who volunteered with progressive advocacy groups to qualify for forgiveness through the Public Service Loan Forgiveness program.
Finalized on Oct. 30, the rule bars loan relief for groups engaged in unlawful activity, including aiding illegal immigration or performing medical procedures on minors without parental consent.
The U.S. Department of Education announced new rules on Oct. 31 barring students who supported illegal immigration or gender transitions for minors from Public Student Loan Forgiveness (PSLF) programs.
The policy excludes individuals whose “employment or volunteer activity substantially advanced political or partisan objectives” from qualifying for federal forgiveness initiatives. The regulations prevent misuse of taxpayer funds by denying PSLF benefits to individuals working for organizations with a primarily illegal purpose.
It cites concerns that student loan relief had been extended to “organizations engaged in activities inconsistent with federal or state law,” including those that “aided unlawful immigration” or “facilitated medical interventions on minors without parental consent.”
The move follows months of controversy over the previous administration’s broad definition of “public service” that critics said rewarded partisan activism. The regulations will be effective as of July 1, 2026.
The Department clarified that while general nonprofit or educational work remains eligible, students who “propelled partisan or ideological goals”—such as organizing campus protests or working with activist programs related to immigration or gender transition—will not qualify.
Daniel Rosario, a first-generation American and a graduate student at the University of Pennsylvania in Philadelphia, Pennsylvania, told Campus Reform that the previous policy used taxpayer dollars to fund activism aligned with the Democratic Party.
“The affected activists took for granted that taxpayer-funded loan forgiveness would indefinitely subsidize their partisan causes,” Rosario said. “When voters sent President Trump back to the White House with a clear mandate, defunding those priorities was exactly what they meant.”
This marks a significant shift away from the Biden-era framework, which allowed graduates who volunteered or worked with progressive advocacy groups to qualify for forgiveness through the Public Service Loan Forgiveness (PSLF) program.
The Biden-Harris administration had made “the promise that borrowers working in public service jobs for 10 years will have their loans forgiven through PSLF.”
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However, several left-leaning university groups and advocacy nonprofits have already signaled plans to challenge the decision in court, calling it discriminatory.
Washington Attorney General Nick Brown and 21 other state attorneys general are suing the U.S. Department of Education, alleging it unlawfully limited eligibility for PSLF. Four progressive nonprofits — Robert F. Kennedy Human Rights, the American Immigration Council, The Door, and LULAC — have also filed suit.
Campus Reform reached out to the Department of Education, and the American Association of University Professors for comment. This article will be updated accordingly.
