A U.S. Department of Education regulation slated to take effect in July 2026 would give the secretary broad discretion to decide which organizations qualify for a program to forgive student loans for borrowers that enter public service. (Getty Images)

WASHINGTON — A new U.S. Department of Education regulation to narrow eligibility for a key student debt relief program for public service workers has drawn strong opposition from advocates who argue the regulation is an attempt to target organizations whose missions do not align with President Donald Trump’s agenda. 

Under a final rule slated to take effect in July, employers that participate in “unlawful activities such that they have a substantial illegal purpose” would be excluded from the Public Service Loan Forgiveness program, which is meant to encourage college graduates to pursue careers in public service.

The language of the final rule, which focuses on issues such as gender-affirming care and illegal immigration, has also raised concerns it meant to enforce the Trump administration’s priorities.

At least three lawsuits from Democratic attorneys general, cities, labor unions and nonprofit advocacy groups argue that the regulation is overly vague and exceeds the department’s authority. 

The rule would hurt not only the institutions that benefit from the program, but the public service workers themselves, Winston Berkman-Breen, legal director at the advocacy group Protect Borrowers, told States Newsroom.

“It’s not just about the macro effect of whether these organizations, including governments, will be able to do the work they do,” he said. “It’s also the individual financial health and security of borrowers and their households that will be really, really detrimentally affected by this rule, and we’re already sort of seeing that happen.” 

The organization is representing a coalition of cities, nonprofit advocacy groups and labor unions in one of the lawsuits over the regulation. 

Here’s a closer look at the policy and what it would mean for borrowers and employers: 

What is Public Service Loan Forgiveness?

Congress created the Public Service Loan Forgiveness program, or PSLF, in 2007 via the College Cost Reduction and Access Act to incentivize people to take on public service careers. 

PSLF forgives the remaining student debt for borrowers after they make 120 qualifying monthly payments while working for an eligible employer. 

How will the regulation work? 

The department’s final rule — which stems from a March executive order — is only forward-looking, meaning workers would not lose any credit earned prior to the July 1, 2026, effective date. 

Under the policy, the Education secretary can determine “by a preponderance of the evidence” that an employer has taken part in “illegal activities such that the organization has a substantial illegal purpose.” 

Affected employers can either reapply to serve as a qualifying employer after 10 years or try to regain eligibility in a quicker timeframe if they enter into a “corrective action plan” that needs the secretary’s approval. 

The activities that could disqualify employers, according to the department, include: 

• “Aiding and abetting” illegal immigration or “illegal discrimination”
• Providing gender-affirming care
• Supporting terrorism or “engaging in violence for the purpose of obstructing or influencing” federal government policy
• Trafficking children across states “for purposes of emancipation from their lawful parents”
• Violating state laws

What’s the debate about?

Though the administration has framed the rule as an effort to punish “criminal activity,” advocates and Democratic officials see it as a way to target organizations that are not aligned with the administration’s goals.

“The bases for the disqualification that are in the final rule for the secretary of Education are pretty clearly just proxies for being engaged in activities that this administration doesn’t agree with or that don’t align with its agenda,” Berkman-Breen said.

He pointed to supporting immigrant communities, gender-affirming care, transgender rights, diverse hiring, teaching an accurate portrayal of racial history in this country and the right to peaceful protest as examples. 

Berkman-Breen said these activities are “very clearly things that this administration in other parts of the government has already attacked in civil society and in the states and local communities, but they’re now bringing that sort of attack into the Public Service Loan Forgiveness program.”

In response to a request for comment, the department shared a statement from Under Secretary of Education Nicholas Kent, who said “it is unconscionable that the plaintiffs are standing up for” what he describes as “criminal activity.” 

“This is a commonsense reform that will stop taxpayer dollars from subsidizing organizations involved in terrorism, child trafficking, and transgender procedures that are doing irreversible harm to children,” he said. “The final rule is crystal clear: the Department will enforce it neutrally, without consideration of the employer’s mission, ideology, or the population they serve.”

How will employers be affected? 

Michele Zampini, associate vice president for federal policy and advocacy at the Institute for College Access & Success, said the final rule will divert nonprofits’ ability to focus on their mission and impede their ability to keep staff on and attract new workers.

The final rule “will have the effect of putting a lot of nonprofits doing a lot of really important work in their communities in a defensive position, whether they’re being preemptively defensive to try and avoid running afoul of the administration, or whether they’re already kind of in a position where the administration has identified them as a target,” she said. 

Zampini, whose group aims to advance affordability, accountability and equity in higher education, added that the program was crucial in attracting talent to service-oriented work. 

“PSLF is a big part of what … enables people to take on what may be lower-paying jobs in exchange for being able to manage their debt over time,” she said. “If people don’t have that option, or even if they feel like they don’t have that option or are afraid they won’t have that option, it becomes a lot harder to kind of attract people to those roles.” 

What legal challenges have come out against the policy? 

The administration is already facing a handful of lawsuits over the final rule, with critics urging federal courts to vacate the policy and deem it “unlawful.”

The challengers include a slew of cities, labor unions and nonprofit advocacy groups who filed suit in a Massachusetts federal court Nov. 3. 

Another lawsuit was brought the same day in the same federal court from Democratic attorneys general in Arizona, California, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont, Washington state and Wisconsin. 

Four nonprofit advocacy groups also filed a suit in the U.S. District Court for the District of Columbia on Nov. 4 against the administration over the rule.

Gov. Tony Evers speaks to reporters in March 2025. Evers has written the Department of Energy urging officials not to cancel $1.5 billion in funds for Wisconsin projects. (Photo by Baylor Spears/Wisconsin Examiner)

With more than $1.5 billion in federal energy investments in Wisconsin at risk, Gov. Tony Evers is urging the Trump administration not to roll back previously awarded funds in the face of rising energy costs.

Evers’ response, in a letter to U.S. Department of Energy Secretary Chris Wright, followed multiple news reports in the last week about energy projects on target lists for cancellation.

The governor’s office has compiled a list of 22 projects for which federal Energy Department funding totaling $1.56 billion has been marked for cancellation.

“Federal support plays a critical role in advancing the Wisconsin Idea and American innovation, lowering energy bills for families across America, supporting clean energy development to improve energy independence and resilience, creating good-paying jobs in innovative industries and sectors, and maintaining our nation’s leadership in science and technology,” Evers wrote Tuesday in his letter to Wright.  

“Given these clear benefits and the importance of these investments to Wisconsin’s and our nation’s economy, I was deeply concerned to see reporting last week containing a list of over 600 DOE funding awards that are potentially going to be targeted for termination with no clear reasoning or justification.”

Evers’ letter mentions several Wisconsin projects and companies on the target list, including several that the Wisconsin Examiner reported on this week.

The letter also notes forecasts of rising costs for electric power that the energy policy think tank Energy Innovation attributes to the tax and spending cut megabill that President Donald Trump signed July 4.

“Terminating these funding awards at a time of record-high energy demand and rising costs would be counterintuitive, reckless and ill-advised,” Evers concludes in his letter to Wright. “I urge you to reaffirm DOE’s commitment to honoring these funding awards and to continue supporting these investments that drive Wisconsin’s and the nation’s energy landscape forward.”

Sen. Dianne Hesselbein (D-Middleton) speaks at a press conference Wednesday morning about the Senate Democrats' "Affordable Wisconsin Agenda." (Photo by Erik Gunn/Wisconsin Examiner)

If there’s one word at the top of Democratic Party political discourse this year, it’s “affordability.”

Whether focused on a particular issue — child care, health care and housing are the most frequent examples — or on the cost of just about everything, making goods and services and life “affordable” figures high in the opening pitches of candidates across the state.

“I think the No. 1  issue that we need to focus on is affordability,” said Mitchell Berman, a Racine County nurse, when he announced in August he would seek the  Democratic nomination to challenge Republican U.S. Rep. Bryan Steil in Wisconsin’s 1st Congressional District.

Trevor Jung in Racine launched his state Senate campaign in September with a focus on “affordability” and “good-paying jobs.” Corrine Hendrickson, a former child care proprietor in New Glarus, said “affordability” is the top issue for her state Senate bid — and she wasn’t just talking about child care.

Democrats campaigning to be the party’s nominee for governor as diverse as David Crowley, Missy Hughes, and Francesca Hong have all uttered the word in introducing themselves to the public.

On Wednesday, the State Senate Democratic Committee had a press conference outside the Capitol to announce the Democrats’ focus on affordability, both for their upcoming legislative agenda and with an eye on the 2026 elections.

“Right now in Wisconsin, 65% of families are saying they are just getting by or they are struggling,” said Sen. Dianne Hesselbein (D-Middleton), the Senate minority leader. A spokesperson said the July Marquette University Law School poll was the source for the survey finding.

State Senate Democrats plan to spend the next few weeks traveling Wisconsin and hearing from state residents. Hesselbein said those conversations will become fodder for “tangible policy solutions that will help working families keep more of their hard-earned money, and we’re calling it the Affordable Wisconsin Agenda.”

Nathan Kalmoe, a University of Wisconsin political scientist, said via email that emphasizing poor economic conditions could be risky for Wisconsin Democrats running in state elections. While Republican lawmakers “may take some blame, the governor is a Democrat,” and voters tend to hold the chief executive responsible for economic conditions, he said. 

Kalmoe added that focusing on the economy exclusively at the expense of concerns for the most marginalized or concerns about Trump administration actions that threaten democracy would be “disturbing, and dangerous.”

Nevertheless, polling trends in the last several months suggest why Democrats nationwide have been focusing on inflation and the economy, said John D. Johnson, a research fellow and political analyst at Marquette University.

In Marquette polls shortly after President Donald Trump was elected to a second term in November, and again before he took office in January, 41% of adults nationally said they believed his policies would reduce inflation.

In Marquette’s most recent national poll, conducted in mid-September and released Oct. 2, “that had fallen to 25%,” Johnson said in an email to the Wisconsin Examiner. “Meanwhile, the share believing Trump’s policies would increase inflation grew from 45% to 60%.”

In the September poll, 40% of adults named “inflation and the cost of living” as the top issue in the U.S. “Another 19% chose ‘the economy’ more generally,” Johnson said.

“Overall, 29% of adults approved of Trump’s handling of ‘inflation and the cost of living’ while 71% disapproved,” Johnson said. (On “border security,” meanwhile, 55% of those polled approved Trump while 45% disapproved.)

In May, 68% of Republicans and 23% of independent voters told the Marquette pollsters they approved of how Trump was handling “inflation and the cost of living.” By September, Republican support had slipped to 57%, but among independents, support had plummeted to 14%.

“In other words, this is (1) an issue where there is a lot of daylight between how Republicans and Independents rate Trump, and (2) an issue where Trump is falling with both Democrats and Independents,” Johnson said.

At the Senate Democrats’ news conference Wednesday, a succession of senators — along with one state representative who is a Senate hopeful — spoke of how the issue of affordability cuts across a wide range of topics. And each laid blame for inaction on their Republican rivals.

“Senate Democrats have already been leading the fight to lower the cost of housing, whether trying to expand the homestead tax credit or preventing hedge funds from buying up available housing stocks, but undoubtedly more needs to be done,” said Sen. Jeff Smith (D-Brunswick).

Rep. Jenna Jacobson (D-Oregon), who has the endorsement of the Senate Democrats as she seeks the party’s nomination in the 17th Senate District next year, pointed to “reckless federal policies” hitting farmers and hiking grocery bills.

Democratic state lawmakers have proposed a free school meal bill along with grants for farmers who provide food to food pantries, replacing a federal program cut by the Trump administration, she said; both are “examples of some of the kinds of policies that we can advance to lower everyday costs.”

Sen. Kristin Dassler-Alfheim (D-Appleton) warned of coming spikes both in health insurance costs and in the rates of people without health insurance because of the expiring Affordable Care Act premium subsidies at the center of the federal shutdown fight in Congress. “We need Congress to get to work and renew these ACA subsidies,” she said.

Meanwhile, bills in the state Legislature to lower prescription drug costs and cap the price of asthma medication “haven’t even gotten a public hearing,” Dassler-Alfheim said. “We could be doing more here in Wisconsin to make life a little bit more affordable for everyone.”

Sen. Sarah Keyeski (D-Lodi) said Wisconsin continues to face “a child care crisis,” with too few options for working families. Care is increasingly costly, “not because child care providers are making huge profits,” she said. “It’s because we can no longer underpay those doing the child care work, mostly women.”

Democrats have been pushing for expanding child care support, “yet Republicans in Madison stand in the way every single time,” Keyeski said.

Hesselbein said that the Senate Democrats hope that they can follow up on their conversations with voters across the state by “bringing those ideas back to the state Legislature, working on them and hopefully being able to pass them in a bipartisan manner.”

At the same time, however, she blamed inaction on Republican lawmakers who “are mired in internal conflict, unwilling to cross the aisle and get stuff done for Wisconsinites.” The  2026 election will enable voters to “turn the page,” she said, “and vote for a vision that puts Wisconsinites first, that puts you and your families first.”