Librarian Sues After Education Department Refuses To Count 9 Years Toward PSLF

Melissa Scheeren worked at the Fairfax Bar Association’s public law library and pro bono center from March 2008 to February 2017. She later worked for Arlington County, the Library of Congress and the University of Virginia, all government employers. She consolidated her older FFEL loans into a Direct Consolidation Loan in November 2021 using the Biden Limited PSLF Waiver, and ED now credits 210 eligible payments on that loan.

In May 2026, she sued the Department of Education and MOHELA (PDF File) arguing she was owed Public Service Loan Forgiveness when she applied in September 2022.

One of the first issues is that a 501(c)(3) nonprofit qualifies automatically. Other nonprofits, like the bar association, which is a 501(c)(6), have to show that they provide a listed public service. While Scheeren’s employment does meet this and the DOJ agrees, it appears to be one of the first holdups.

The second issue appears to be related to the limited PSLF waiver, consolidation, and payment counts. A July 2025 ED letter in the court record shows 210 eligible payments on her loans and 81 qualifying payments. Regardless of the reasons for the error, it appears she is entitled to have her loans forgiven.

Scheeren says she has paid $16,140.71 on loans that should have been discharged, and about $40,000 remains on her account. She is asking the court to reverse the denial and process the forgiveness she says she’s owed.

Why It Matters

The government’s defense rests on a reading of PSLF that ED itself has rejected. In an August 19, 2026 motion for summary judgment (PDF File), the Justice Department wrote that Scheeren “was required to prove that most of her employment with the FBA was in one of the enumerated fields.”

PSLF has never measured the borrower’s job. That’s why a career in public service can lead to forgiveness for any full-time worker at a qualifying employer, whatever the role.

The government’s own exhibits say the same thing. In a letter to Sen. Tim Kaine (PDF File) about Scheeren’s case, Federal Student Aid wrote that eligibility “is not about the work a borrower does but is based on who their employer is.”

DOJ filed that letter with its own motion, and it matches how Public Service Loan Forgiveness has worked since 2008.

How Did ED Handle Her PSLF Applications?

ED and MOHELA denied two applications with reasons that contradict, and the third has never been decided. She also followed the PSLF paperwork steps borrowers are told to take, including reconsideration requests, complaints and an ombudsman escalation.

MOHELA was ED’s dedicated PSLF servicer from July 2022 to July 2024. In its July 2026 answer (PDF File), MOHELA denied that it made the decision to deny her application. The servicer also faces an AFT lawsuit over its PSLF processing.

Why Doesn’t DOJ’s Argument Match The PSLF Rules?

DOJ’s argument relies on a rule that took effect after Scheeren applied, and it misreads that rule. The provision it quotes comes from ED’s 2022 final rule (PDF File), which took effect July 1, 2023. The rule in force when she applied covered any private nonprofit providing a listed service, such as public library services. Those categories still decide which nonprofit jobs count toward PSLF.

The 2023 rule’s majority test applies to the employer, which must devote a majority of its full-time staff to qualifying work. The same rulemaking says PSLF eligibility has always turned on “whether the borrower works for a qualifying employer, not their specific job.” ED tried to narrow employer eligibility again in 2025, and a federal judge struck down that rule in June 2026.

The filings also concede the facts that decide the case under the earlier rule. DOJ’s brief acknowledges the bar association is a nonprofit. ED’s declarant, Nikki Harris Bowman, wrote in her declaration (PDF File) that operating a public law library “meets the criteria” of the regulation. The brief even describes the denial as resting on “an incorrect finding,” though it still argues the PSLF denial should stand.

Scheeren’s attorney, Austin Hinkle of Public Goods Practice, called the declaration an after-the-fact rationale in a September 9 opposition and cross-motion (PDF File). On LinkedIn, he wrote that ED “apparently just made up some new interpretation of a decades old law for this case.” He says DOJ’s reply “conceded that it was entirely wrong about the law” but still asked to win and hasn’t discharged her PSLF-eligible loans. That reply is sealed, and The College Investor has not reviewed it.

What Should Borrowers At Non-501(c)(3) Nonprofits Know?

A nonprofit outside 501(c)(3), such as a bar association, can still be a qualifying PSLF employer. Under the current rule, it must devote a majority of its full-time staff to a listed public service and can’t be a labor union or partisan political group. The test looks at the employer, so a librarian and an accountant there earn PSLF credit the same way.

If ED rejects your employer, its letter to Sen. Kaine says reconsideration isn’t the fix. You submit a new PSLF form through the PSLF Help Tool and upload proof, such as bylaws. Keep copies of every form and denial letter, since Scheeren’s saved records became the administrative record ED certified in court.

How This Connects

ED’s broader efforts to limit PSLF employers haven’t held up in court. The department appealed the rulings against its 2025 employer rule in August, but then dropped appeals in October.

The PSLF process is also currently mired in a technical glitch that has left borrowers unable to see their most current PSLF qualifying counts since July of 2026.

Long waits are common too. ED reported 86,520 PSLF Buyback applications pending at the end of January 2026, a backlog that would take about three years to clear at January’s pace. Scheeren’s third application has waited nearly four years without any decision.

While buyback and “normal” PSLF are two different processes, these delays are frustrating for borrowers expecting loan forgiveness.

What’s Next

Judge Christopher Cooper now has to decide on whether ED followed its own PSLF employer rules. Scheeren’s proposed order (PDF File) asks him to vacate the denials and declare the bar association a qualifying employer. It would also give ED 30 days to process her loan forgiveness, with any discharge effective as of November 2021.

DOJ has offered a stay so ED can review more documents, and Scheeren asked the court to decline it.

We’re also tracking court filings on student loan processing delays for signs ED is clearing older PSLF forms.

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Robert Farrington

Robert Farrington is the founder of The College Investor and is widely recognized as one of the nation’s leading voices on student loan debt and saving for college. He holds an MBA from UC San Diego Rady School of Management and has spent over 15 years researching, writing, and advising on student loans, 529 plans, financial aid programs, and saving and investing for young professionals.

Robert has been featured in the The New York Times, The Wall Street Journal, The Washington Post, NBC News, and Forbes, where he has been a regular personal finance contributor for over a decade. His work combines both professional expertise and personal experience – he successfully navigated his own student loan repayment journey and has helped thousands of readers do the same.

He is committed to making the intersection of personal finance and education transparent and accessible. You can learn more about Robert on the About Page or on his personal site RobertFarrington.com.