Uncertainty Looms for Public Service Loan Forgiveness Program as Panel Fails to Reach Consensus
WASHINGTON – Just before the Fourth of July holiday, a 10-member panel at the U.S. Department of Education faced a critical decision. After three days of intense negotiations, the group—comprising lobbyists, former students, college administrators, and policy experts—remained deadlocked over the future of the Public Service Loan Forgiveness (PSLF) program. Their inability to reach an agreement leaves thousands of public service workers in limbo, unsure whether their student debt will still be eligible for cancellation.
What is PSLF?
Established in 2007 with bipartisan support and signed into law by President George W. Bush, PSLF allows nurses, firefighters, teachers, and other public service workers to have their federal student loans forgiven after 10 years of on-time payments. The program underwent significant reforms under President Joe Biden, leading to over $50 billion in loan relief for more than a million borrowers.
However, the program has faced criticism over the years, with some Republicans and the Trump administration arguing that it should not benefit organizations they deem controversial. In March, former President Donald Trump signed an executive order seeking to exclude certain employers from PSLF eligibility, particularly those he claimed had a “substantial illegal purpose.” While the order did not specify which employers might be disqualified, advocates feared it could target groups supporting gender-affirming care, undocumented immigrants, or Palestinian rights.
A Divided Panel
In early July, the Education Department convened a rulemaking committee to draft regulations implementing Trump’s order. If the panel had reached a consensus, their recommendations would have likely shaped the program’s future. But deep divisions emerged.
Betsy Mayotte, president of The Institute of Student Loan Advisors, was the sole dissenter in the final vote. She expressed concerns that the proposal would grant the Education Department excessive authority to disqualify employers without clear legal justification.
“I’m really on the fence about whether the Department of Education even has the power to strip PSLF eligibility from government employers or nonprofits,” Mayotte. “That alone was a huge issue for me.”
The panel debated safeguards to limit the scope of Trump’s order, including an appeals process for employers and a “severe and pervasive” standard to prevent politically motivated exclusions. But with no agreement reached, the final decision now rests with the Education Department.
Borrowers Fear the Worst
For borrowers like Tracey Blake, a Maryland researcher with over $240,000 in student debt, the uncertainty is agonizing. She is just two years away from loan forgiveness—assuming her employer remains eligible.
“I am terrified that the rug is going to be pulled out from under me,” Blake said during a public comment session. “Picking and choosing who gets forgiveness is unfair and would leave families like mine in the lurch.”
Alyssa Dobson, a financial aid administrator who served on the panel, argued that any changes should protect current enrollees. “People are making life decisions based on this program,” she said. “To take it away from them isn’t right.”
What Comes Next?
The Education Department has not indicated when final rules will be issued. In a statement, acting Under Secretary James Bergeron said the panel “helped fulfill one of President Trump’s promises to ensure that PSLF does not subsidize organizations breaking the law”—even without full consensus.
For now, public service workers are left waiting, hoping their years of payments and service will still lead to the debt relief they were promised.