Two federal judges ruled last month to reject a new rule proposed by the Department of Education, protecting Public Service Loan Forgiveness (PSLF) from partisan efforts to restrict it. The rule, which was initially proposed early last year, empowered ED to target non-profit organizations that it deemed to have a “substantial illegal purpose” and block their employees from qualifying for PSLF. Advocates argued, however, that the rule gave the Dept. of Ed. broad and subjective power to target politically sensitive organizations. It also side-stepped both the IRS and the Department of Justice, which would be the more conventional avenues to target illegal practices. Although a Congressional effort to block the rule was unsuccessful, two independent lawsuits have succeeded in stopping it before it was set to take effect on July 1st. The federal judges presiding over the two lawsuits said that the rule exceeds the power given to the Secretary of Education by the Higher Education Act and violates the First Amendment. The Department of Education has yet to comment on whether it will challenge the decision.
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