The Department of Education has Opened Public Comment on a New Rulemaking process for PSLF, PAYE, and ICR. The Rulemaking is required under the Higher Education Act, and will involve Public Hearings and Negotiated Committee Input. Rules cannot be Retroactive or Conflict with Federal Law.
The Rulemaking could lead to Major Regulatory Changes in Three Key Federal Student Loan Programs: Public Service Loan Forgiveness (PSLF), Pay As You Earn (PAYE), and Income-Contingent Repayment (ICR). The Announcement marks the Beginning of the Formal Process to gather Feedback and Propose Regulatory Changes, a Process required under the Higher Education Act of 1965. This Rulemaking was expected both because of the Executive Orders that Trump (R) signed, along with the Ruling of the 8th Circuit Court, in Regards to SAVE.
Public Comments will be Accepted through the Portal, and Two Public Hearings will be Held: One in Person on April 29th, and One Virtual Session on May 1st. Anyone can Sign-Up to Speak at the Public Hearings. This latest Rulemaking Initiative, is the Department’s response to Changing Legal and Policy Circumstances, including Court Decisions and Executive Orders that have altered the Trajectory of Federal Student Loan Repayment Programs. The Department says it will use the Pprocess to assess existing Regulations and determine whether Revisions are needed to better Align with both Statutory Requirements and Operational Realities.
The Department has Signaled that this Process will include: Revisiting Definitions of a Qualifying Employer under PSLF, potentially aligning Future Regulations more closely with Arecent Executive Order issued by Trump that sought to Narrow Eligibility based on Employer Type rather than the Nature of Work Performed. In addition, the Department will consider Updates to PAYE and ICR Repayment Plans, especially in light of the Broad Injunction that called them both into Question. PAYE, enacted during the Obama (D) Administration, and ICR remains One of the Oldest IDR Options available. Both Programs could be Rewritten to Address implementation Inefficiencies or concerns about Outdated Provisions.
While the Department of Education can propose Regulatory Changes through this Rulemaking process, it Cannot Rewrite the Law. Regulations must Fall within the Statutory Framework of the Higher Education Act, and Cannot be applied Retroactively. That means Changes made through this Process would Not Alter existing Repayment Terms for Current Borrowers already enrolled in One of the Programs. For example, any effort to Change Eligibility Rules for PSLF must Comply with Existing Statutory Definitions, including Protections written into Loan Promissory Notes. Similarly, attempts to Eliminate or Overhaul PAYE or ICR, must be Justified within the Legal scope provided by Congress.
Furthermore, Congress can Override anything within 60 days of Implementation using the Congressional Review Act. While it's unlikely given the current Congress, it is something that Congress can do, and they recently did it with the CFPB's Overdraft Rule. Written Comments must be submitted through Regulations.gov within 30 days of Publication in the Federal Register. Oral Comments can be given during the Public Hearings, which require prior Registration.
Negotiated Rulemaking Committees will be formed after the Comment Period Closes. These Committees will include Representatives from various affected Groups and will work directly with Department Officials to draft Proposed Regulations. This is the Formal First Step. Once Rules are Proposed, there will be a Second Opportunity for Public Input, before any Final Rules are Adopted. Changes from this Process would Not take Effect until at least July 2026, so Borrowers would have time toAadapt to any Outcomes.

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