WASHINGTON — The Supreme Court on Thursday announced it will expedite review of the legality of President Biden’s plan to cancel federal student loan debt for millions of borrowers and hold oral arguments in February.
Lower courts have put the program, which the administration said was justified by repayment problems amplified by the pandemic, on hold. The Biden administration asked the justices to either allow it to go forward while legal challenges continue or to take up the issue themselves. It recently extended the pause on federal loan repayment, which was scheduled to expire at the end of the year, to give the high court time to act.
The Biden plan would cancel up to $20,000 in federal student loan debt for more than 40 million borrowers. The U.S. Court of Appeals for the 8th Circuit had granted the request of a coalition of six Republican-led states to impose a nationwide injunction on the plan amid ongoing litigation.
In a separate case, a federal judge in Texas on Nov. 10 declared the forgiveness plan unlawful. The U.S. Court of Appeals for the 5th Circuit on Wednesday denied a request by the Justice Department to put a hold on that ruling while the court considers the merits of the administration’s appeal.
The legal battles have left millions of student loan borrowers in limbo. More than half of eligible people had applied for the forgiveness program before it was halted by the courts, with the Education Department approving some 16 million applications. Despite the hold on the program, the department recently notified people that their applications were approved, assuring them that the administration will discharge the debt if it prevails in court.
The loan relief plan would cancel up to $10,000 in federal student debt for borrowers earning up to $125,000 annually, or up to $250,000 for married couples. Those who received Pell Grants are eligible for an additional $10,000 in forgiveness.
The issue comes before a court skeptical of the administration’s authority to impose pandemic-related relief without express approval from Congress.
In 2021, the court revoked a national moratorium on evictions imposed by the Centers for Disease Control and Prevention that started during the Trump administration and was extended by Biden. In January of this year, it halted the administration’s vaccination-or-testing requirement for the nation’s largest employers, saying such a command exceeded the authority of the Occupational Safety and Health Administration.
Republican attorneys general of Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina said this was another case of overreach.
“While President Biden publicly declares the pandemic over, the Secretary and Department of Education are using COVID-19 to justify the Mass Debt Cancellation – an unlawful attempt to erase over $400 billion of the $1.6 trillion in federal student-loan debt and eliminate all remaining loan balances for roughly 20 million of 43 million borrowers,” the states said in their filing to the Supreme Court.
Solicitor General Elizabeth B. Prelogar said the states did not have the legal standing to challenge the administration’s actions and that federal law gives the education secretary broad authority to make changes in the student loan program. The Trump and Biden administrations both invoked the law to suspend loan repayments during the pandemic.
“Congress authorized the Secretary of Education to respond to national emergencies by providing relief to affected student loan borrowers,” Prelogar wrote in a filing to the court. “Without making any finding that the Secretary exceeded that express statutory authority, the Eighth Circuit issued a nationwide injunction preventing the Secretary from granting critical relief to millions of Americans suffering the continuing economic effects of a global pandemic.”
The Biden administration on Nov. 23 extended the student loan repayment pause into the new year. “It isn’t fair to ask tens of millions of borrowers eligible for relief to resume their student debt payments while the courts consider the lawsuit,” Biden said.
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