AG Rayfield Announces Key Victory Protecting Public Service Loan Forgiveness

Today, Attorney General Dan Rayfield has announced a critical victory in the fight to protect the federal Public Service Loan Forgiveness (PSLF) program. The Trump Administration has given up its fight to strip loan forgiveness from teachers, nurses, and other public servants, abandoning its appeal in a case brought by Attorney General Rayfield.

"Teachers, nurses, firefighters, social workers, and nonprofit staff made a deal when they chose public service: do work that serves the community, make your payments, and after 10 years, your loans will be forgiven," said Attorney General Rayfield. "This federal administration tried to change that deal based on politics, by deciding which kinds of public service work it didn't like. Today's news is a win for every Oregonian who chose a career serving their community."

PSLF forgives the remaining federal student loans of people who work in public service and make 10 years of qualifying payments. The federal administration's rule would have cut off PSLF for anyone working at a government agency or nonprofit organization that it decided had a "substantial illegal purpose."

Oregon sued over the U.S. Department of Education rule in November 2025 as part of a coalition of 22 attorneys general. In June 2026, the U.S. District Court for the District of Massachusetts ruled against the Trump Administration. Today, by walking away from its appeal, the administration is conceding the case. The court's ruling stands, and the matter is resolved in Oregon's favor.

Congress created PSLF in 2007 with bipartisan support to encourage college graduates to take public-sector jobs, which often pay less than private-sector work. The program helps nonprofits, the military, and federal, state, and local governments recruit and keep skilled people who might otherwise leave public service to afford their student loan payments.

The administration's rule relied on a vague standard aimed at lawful activities it disfavored, including providing legal services to immigrants, providing gender-affirming care to minors, taking part in diversity, equity, and inclusion programs, and engaging in civil protest and assembly. In its June ruling, the court found the rule was contrary to law, arbitrary and capricious, beyond the Department of Education's authority, and a violation of the First Amendment.