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Trump administration appeals ruling that blocked limits on Public Service Loan Forgiveness program

The Department of Education is seeking to overturn a June court decision that stopped its plan to narrow which employers qualify as public service providers.

Updated Aug 28, 2026 · 16:20 UTC1 reports

The short version

  • The Trump administration appealed a June court ruling that blocked its planned restrictions on the Public Service Loan Forgiveness (PSLF) program.
  • The proposed rule seeks to exclude employers whose missions do not align with the administration's definitions of public service, such as those supporting gender-affirming care or illegal immigration.
  • No immediate changes are occurring for PSLF borrowers as the legal challenge moves to the D.C. Circuit Court of Appeals.

Key facts

  • On August 27, 2026, the Department of Education appealed a June court decision that had blocked its planned rule to restrict the Public Service Loan Forgiveness program.[Business Insider]
  • The proposed rule would disqualify employers that do not align with the administration's definitions of public service, specifically targeting organizations that provide gender-affirming care, support illegal immigration, or advance terrorism.[Business Insider]
  • Under the proposed rule, the education secretary would decide whether an employer engaged in a disqualifying activity, though employers would have an opportunity to rebut the findings.[Business Insider]
  • District Judge Amir Ali blocked the policy in June, ruling that Congress did not grant the education secretary the authority to determine which employers qualify under the program.[Business Insider]
  • The initial lawsuits challenging the rule were filed by several nonprofits and borrower advocacy groups, including Student Defense.[Business Insider]

What remains uncertain

  • The outcome of the appeal in the D.C. Circuit remains to be determined, as does its ultimate impact on the eligibility of future borrowers.[Business Insider]

Sources