Two judges block Trump’s student loan overhaul for public sector employees

Federal judges in Massachusetts and Washington, D.C., blocked President Donald Trump on Tuesday from implementing changes to a federal student loan program for people working in the public sector.

The Education Department, at Trump’s direction, recently added a new rule to its Public Service Loan Forgiveness program that was set to take effect Wednesday. The rule sought to bar use of PSLF by people who work for groups accused of operating with “substantial illegal purpose,” including organizations said to be engaged in activities such as aiding illegal immigration, supporting terrorism and trafficking, and facilitating the “chemical and surgical castration or mutilation of children.”

U.S. District Judge Myong Joun in Boston and U.S. District Judge Amir Ali in Washington, D.C., both appointed by former President Joe Biden, struck down the rule this week after it attracted legal challenges from over a dozen Democratic-led states and liberal groups, including transgender activists and immigration rights organizations. Joun expressed concern that the regulation overstepped the agency’s power and threatened to violate the First Amendment when he vacated the Education Department’s changes.

“The Department cannot create new criminal prohibitions through rulemaking,” Joun wrote. “Indeed, the record further demonstrates ‌that the ⁠Final Rule has already chilled protected speech.”

PSLF forgives federal student loans after 10 years if recipients work in qualifying public service jobs in the government or nonprofit sector. More than 1 million Americans have had their loans canceled as a result.

Trump issued an executive order in March 2025 seeking to make changes to the program that narrowed eligibility. At the time, the president expressed concern that PSLF had “misdirected tax dollars into activist organizations that not only fail to serve the public interest, but actually harm our ​national security and American ⁠values.”

The Education Department’s final rule excluded applicants working for nonprofit group employers, said to be engaged in activities such as aiding illegal immigration, supporting terrorism and trafficking, and facilitating sex-change operations for children.

In his ruling, Joun said the change unconstitutionally discriminated on ​the basis of viewpoint in violation of the Constitution’s First Amendment.

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Undersecretary of Education Nicholas Kent said Tuesday that the agency is “evaluating next steps” after the setback in the courts for the Trump administration.

“The Public Service Loan Forgiveness Program is intended to support Americans who serve the public good, not to subsidize organizations that engage in terrorism, facilitate illegal immigration, or support the mutilation of children,” he said. “The Department stands behind this commonsense policy to ensure that taxpayer dollars are never used to subsidize illegal activities and is evaluating next steps.”