Overview
- Two federal judges in Massachusetts and Washington, D.C. issued separate orders on Tuesday that vacated and blocked the Education Department’s new PSLF rule and prevented it from taking effect on July 1, 2026.
- The October 2025 rule would have let the secretary disqualify employers that the agency said had a “substantial illegal purpose,” a phrase the rule tied to actions such as aiding illegal immigration, supporting terrorism, illegal discrimination, and certain gender‑affirming care for minors.
- Judges concluded the department exceeded its statutory authority, acted in an arbitrary and capricious way under the Administrative Procedure Act, and risked violating the First Amendment by deterring lawful advocacy and services.
- The legal challenge was brought by a broad coalition of more than 20 states, cities, counties, nonprofits and employee groups that said the rule would create a political loyalty test and deter people from public‑service careers.
- The Education Department says it stands by the policy and is reviewing options that could include an appeal, so the rulings preserve current PSLF access for now but may not be the final word in the courts.