The U.S. Department of Education has declined to appeal a February decision that found the department acted arbitrarily and capriciously when it changed terms of the Public Service Loan Forgiveness Program and excluded some lawyers from participation.
The department has instead started restoring loan payment credits to some ABA employees who were dropped from the program, according to an ABA press release.
The Public Service Loan Forgiveness Program, established in 2007, offers loan forgiveness for those who make monthly loan payments for 10 years while working full-time in public service. ABA employment was deemed to be public service work until the Education Department changed its interpretation in 2016.
That year, several lawyers who worked for the ABA and other organizations began receiving notices that they would not qualify for the loan forgiveness program. Some of those receiving those notices had previously been told that they did qualify.
Represented by Ropes & Gray, the ABA and four lawyers—including two lawyers who worked for the ABA—sued in 2016. U.S. District Judge Timothy Kelly ruled in February that the department didn’t follow notice standards mandated under the Administrative Procedure Act when it changed its interpretation, and the changes were arbitrary and capricious.
Last week, several current and former ABA employees began receiving notices that the ABA is an eligible employer under the loan forgiveness program, and prior determinations to the contrary were in error, according to the ABA press release. The communications came from FedLoan Servicing, which administers the program.
The ABA and Ropes & Gray are encouraged by the recent developments, according to the press release.
“We are pleased that the Department of Education has decided not to appeal Judge Kelly’s order and has instead started restoring loan payment credits to affected public servants,” Ropes & Gray partner Chong Park said in the press release. “The Department is finally doing the right thing, and the positive impact this has on our individual plaintiffs—and other student loan borrowers in similar positions—is very encouraging.”
ABA Executive Director Jack Rives said he was gratified by the news. “We will continue to work with Ropes & Gray to ensure these and other ABA employees get full credit for their public service work,” Rives said.