On June 30, U.S. District Judge Myong J. Joun said President Donald Trump and his administration’s plan to limit eligibility for the Public Service Loan Forgiveness policy is “arbitrary and capricious and violates the First Amendment" as he struck down the U.S. Department of Education's plan to rewrite the Public Service Loan Forgiveness program
This was the ruling in a lawsuit, National Council of Nonprofit et al, v. McMahon, which challenged a proposed policy from U.S. Secretary of Education Linda McMahon the judge said would “unlawfully” eliminate the repayment program promised to employees when hired.
Less than 24 hours after the policy was to take effect, Joun temporarily halted the PSLF policy changes that would keep the U.S. Department of Education (ED) from offering loan repayment for public service workers. For some, this financial promise was a key reason why they accepted their public service jobs.
Plaintiffs in the case include attorneys general, lawyers, and nonprofits representing 20 states, including the American Bar Association. Twenty-two attorneys general led the lawsuit in November 2025 on behalf of qualifying California residents who’ve received student loans with the promise of repayment assistance from the policy.
The PSLF program was created during President George W. Bush’s 2007 administration to encourage college students to look for jobs in the public sector. With low salaries being the main deterrent, student loan repayment drew applicants with the promise of being debt-free 10 years post-graduation.
The proposed changes by McMahon and ED would create a pathway to strip organizations assisting with legal services for diversity, equity, and inclusion-centered initiatives, immigration issues, civil protest, and gender-affirming care for minors. Judge Joun stated that his ruling was based on his belief that McMahon’s and the administration’s changes would violate the First Amendment. U.S. District Judge Amir Ali of Washington, D.C., a former civil rights lawyer, also ruled to block the limitations from taking effect. Both were appointed by President Joe Biden.
In a press release from his office, California Attorney General Rob Bonta said, “A court has thrown out the Trump Administration’s illegal attempt to go back on the federal government’s word and rip away public service loan forgiveness from people doing work the President doesn’t like. Millions of Americans shaped their lives and took on deep financial burdens based on the promise that, if they dedicated their lives to public service and made student loan payments for 10 years, their government would support them. … Today’s decision is a strong rebuke of the Trump Administration’s continued efforts to weaponize the federal government. We’ll continue to fight to protect public servants and uphold our democratic institutions.”
Through the policy, teachers are available to gain access to a loophole that will give them additional funding. The future of PSLF is uncertain but for now, repayment promises are still intact.
