The Lyndon Baines Johnson Building, Washington D.C., headquarters of the U.S. Department of Education (photo via GSA/Dept. of Education)
The Trump-Vance administration is moving forward with plans to restrict federal workers from using the Public Service Loan Forgiveness (PSLF) program if their work involves issues related to LGBTQ individuals, immigrants, or transgender children.
Lawsuits were filed last week in more than 20 cities — including Albuquerque, N.M., Boston, Chicago, and San Francisco — challenging the administration’s efforts to withhold loan forgiveness from organizations that oppose the president and his party’s political agenda.
Created by Congress in 2007 and signed into law by then-President George W. Bush, PSLF cancels the federal student loan debts of borrowers who spend a decade or more working in public service. The program covers teachers, nurses, law enforcement officers (including members of the military), and employees of tax-exempt organizations under Section 501(c)(3). Many of those who work to support LGBTQ rights are employed by such organizations — meaning they stand to lose eligibility under the new policy.
As of 2024, more than 1 million Americans have benefited from PSLF, helping erase an estimated $74 billion in student loan debt, according to a Biden-era estimate.
Under the new rule, which takes effect July 1, 2026, the Department of Education will be able to deny loan forgiveness to workers whose government or nonprofit employers engage in activities deemed to have a “substantial illegal purpose.” The power to define that term will rest not with the courts, but with the education secretary.
The rule grants the secretary authority to exclude groups from the program if they participate in activities such as trafficking, illegal immigration, or what it calls the “chemical castration” of children — defined as the use of hormone therapy or puberty-blocking drugs, a form of gender-affirming care sometimes provided to transgender children and teens.
Under Secretary of Education Nicholas Kent defended the change, arguing that the new rule would better serve the American people, despite every major American physician organization research showing gender-affirming care helps more than it harms.
“It is unconscionable that the plaintiffs are standing up for criminal activity,” Kent said in a statement to NPR. “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.”
The Williams Institute, a leading research center on sexual orientation and gender identity law and public policy, warned that this — along with other restrictions on federal loan forgiveness — would disproportionately harm LGBTQ Americans. The institute found that more than one-third (35%) of LGBTQ adults aged 18 to 40 — an estimated 2.9 million people — hold over $93.2 billion in federal student loans. About half (51%) of transgender adults, 36% of cisgender LBQ women, and 28% of cisgender GBQ men have federal student loans.
“The proposed restrictions on student loans will particularly affect the nearly one-quarter of LGBTQ adults employed in the public or nonprofit sectors, which qualify for the Public Student Loan Forgiveness program,” said Brad Sears, Distinguished Senior Scholar of Law and Policy at the Williams Institute, who authored a brief on how the proposed changes could impact LGBTQ borrowers. “A recent executive order could potentially disqualify anyone working for an organization involved in gender-affirming care, or possibly those serving transgender individuals more broadly, from the PSLF program.”
The National LGBT Media Association represents 13 legacy publications in major markets across the country with a collective readership of more than 400K in print and more than 1 million + online. Learn more here: NationalLGBTMediaAssociation.com.
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