Administration Drops Appeal in Public Service Loan Forgiveness Case

The Trump administration dropped its appeal of a court decision that vacated its public service loan forgiveness rule, California Attorney General Rob Bonta's office said Thursday. Bonta joined a coalition of 22 attorneys general that sued over the rule in November 2025 and secured the decision, his office said.

The U.S. Department of Education rule would have let the administration remove Public Service Loan Forgiveness eligibility from employees of government and nonprofit organizations it found to have a substantial illegal purpose, according to Bonta's office. The U.S. District Court for the District of Massachusetts vacated the rule in June 2026. Bonta's office says dropping the appeal leaves that ruling in place and resolves the case in favor of California and the other plaintiff states.

Bonta's office says the rule would have used an ambiguous standard to target conduct it describes as legal but politically disfavored, including legal services for immigrants, gender-affirming care for minors, diversity, equity and inclusion programs, and civil protest.

Congress created the program in 2007 with bipartisan support, the office says. It forgives the remaining federal student loans of borrowers who work in public service and make 10 years of qualifying payments. Bonta said in a statement that educators, health care workers and first responders take on financial sacrifice to serve their communities, and that his office will keep fighting for them.