Copyright Anchorage Daily News
Employees of nonprofit organizations that work with undocumented immigrants, provide gender transition care for minors or engage in public protests will have a hard time getting their federal student loans forgiven under regulations advanced Thursday by the Education Department. The 185-page rule revises eligibility requirements for Public Service Loan Forgiveness, which cancels the education debt of government and nonprofit employees after 10 years of service and 120 monthly loan payments. It will allow the education secretary to disqualify employers - not individuals - who engage in activities the department deems to have a “substantial illegal purpose” on or after July 1 - when the rule takes effect. Nonprofit employees are for now eligible for student loan forgiveness if they focus on areas that serve the public good, such as education, public health or public interest law. If the rule survives expected legal challenges, it could upend a popular federal program that has provided debt relief to more than 1 million student loan borrowers across more than 20 sectors of the economy. Any payments a borrower makes on student loans after that person’s employer is kicked out of the program will not count toward forgiveness. Employers would have the right to appeal if they are removed from the program. While the change does not disqualify student loan payments that a borrower has already made, it could derail borrowers who are close to reaching the loan forgiveness threshold if the administration says their employer violates the new rule. The changes deliver on the executive order President Donald Trump signed in March to exclude organizations that he said support “illegal immigration, child trafficking, pervasive damage to public property and disruption of the public order.” The order focused on nonprofits that help transgender children, engage in public protests that include blocking highways or support groups that are designated as foreign terrorist organizations, such as Hamas. Undersecretary of Education Nicholas Kent said the new rule “is refocusing the PSLF program to ensure federal benefits go to our nation’s teachers, first responders, and civil servants who tirelessly serve their communities.” “The Public Service Loan Forgiveness program was meant to support Americans who dedicate their careers to public service - not to subsidize organizations that violate the law, whether by harboring illegal immigrants or performing prohibited medical procedures that attempt to transition children away from their biological sex,” Kent said in a statement Thursday. By law, the Education Department was required to convene a committee of experts for a negotiated rulemaking to revise the criteria for qualifying employers. That advisory committee failed to reach a consensus over the summer, clearing the way for the department to publish a rule of its own making. Still, the agency made changes to its initial proposal during negotiations and after receiving public comments, mainly fleshing out a process for employers to challenge expulsions. Under the rule, the Education Department considers illegal activities to include: -Aiding and abetting violations of federal immigration laws. -Supporting terrorism or engaging in violence for the purpose of obstructing or influencing federal government policy. -Engaging in the chemical and surgical castration or mutilation of children in violation of federal or state law. -Engaging in the trafficking of children to another state for purposes of emancipation from their lawful parents in violation of federal or state law. -Engaging in a pattern of aiding and abetting illegal discrimination. Student advocacy groups and liberal lawmakers worry the rule politicizes PSLF and introduces unnecessary complexity into a program that is already notorious for its complex rules. They say there is a lot of ambiguity in the new rule that would allow the administration to arbitrarily disqualify employers. Rep. Robert C. “Bobby” Scott (Virginia), the top Democrat on the House Education Committee, said the new rule could impact organizations that serve marginalized communities, such as those advocating for civil rights or immigrant and refugee families amid Immigration and Customs Enforcement raids, and health providers that serve LGBTQ+ youth. “This rule follows the Trump Administration’s disturbing pattern of making repayment less affordable and taking money out of the pockets of hardworking families, all while attempting to police political speech,” Scott said. Congress created Public Service Loan Forgiveness in 2007, during President George W. Bush’s administration, to entice college graduates to enter fields such as teaching and social work that served the public good but were not as lucrative as private sector jobs. In a joint statement, Democracy Forward and Protect Borrowers, left-leaning nonprofit groups, called the rule “a craven attempt to usurp the legislature’s authority in an unconstitutional power grab aimed at punishing people with political views different than the administration’s. In our democracy, the president does not have the authority to overrule Congress.” Conservative groups and lawmakers say the rule brings much-needed guardrails to the program. “The open-ended nature of PSLF has forced taxpayers - many of whom never went to college, to foot the bill for employees at radical organizations that violate state and federal laws,” House Education Committee Chairman Tim Walberg (R-Michigan) said in a statement. “Aiding illegal immigration, supporting terrorism, or promoting child abuse through gender transitions is not ‘public service.’”
