The Biden administration announced Friday that an additional $4.28 billion in student loan relief will be granted to 54,900 public service workers nationwide, continuing its efforts to support borrowers in critical professions like teaching, nursing, and first response.
This new relief brings the administration’s total loan forgiveness to approximately $180 billion for nearly 5 million Americans, according to the Department of Education.
Fulfilling a Pledge to Public Servants
Education Secretary Miguel Cardona highlighted the administration’s commitment to fixing the Public Service Loan Forgiveness (PSLF) Program, which has faced significant criticism for its past shortcomings.
“Four years ago, the Biden-Harris Administration made a pledge to America’s teachers, service members, nurses, first responders, and other public servants that we would fix the broken Public Service Loan Forgiveness Program, and I’m proud to say that we delivered,” Cardona said.
Pressure to Act Before the Transition
Some Democrats in Congress are urging the administration to finalize forgiveness for eligible borrowers before President-elect Donald Trump takes office.
Sen. Dick Durbin (D-Ill.) underscored the urgency, stating, “We’ve got to step up and say to Joe Biden, ‘You can’t go back to Delaware until you get this done, buddy.’”
Concerns about the incoming Trump administration’s approach to student loan relief loom large among Democrats. Sen. Ed Markey (D-Mass.) criticized Trump’s first term for neglecting borrower protections, stating that the administration “ignored or denied borrowers’ defense applications for years,” causing harm to Americans across the country.
A History of PSLF Challenges
The PSLF Program, created under President George W. Bush in 2007, was designed to forgive student loans for borrowers who made 10 years of payments while working in qualifying public service jobs. However, the program was plagued by issues from its outset:
- In 2017, when the first borrowers became eligible, the program had a 99% denial rate, according to the Government Accountability Office.
- Common issues included mismanagement by loan servicers, incorrect information provided to borrowers, and rejected credit for qualifying payments.
The program’s mismanagement prompted the American Federation of Teachers to sue then-Education Secretary Betsy DeVos in 2019, alleging that the Trump administration had mishandled the program. The lawsuit accused the administration of rejecting applications arbitrarily and failing to oversee loan servicers. The case was settled in 2021.
Looking Ahead
As the Biden administration nears its conclusion, it faces pressure to ensure all eligible borrowers receive relief under the reformed PSLF Program. The future of the program under the Trump administration remains uncertain, but for now, the latest announcement offers a reprieve to thousands of public servants.
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