Washington- The Supreme Court said Thursday it would initiate a legal battle between the Biden administration and a coalition of six Republican-led states challenging the president’s legality. student loan forgiveness program.
Solicitor General Elizabeth Prelogar asked the Supreme Court last month to lift an injunction from a federal appeals court that blocked the plan’s implementation, but told the court that if he refused relief, he would have to agree to examine the merits of the case instead.
The court said in a brief order that it would hear arguments in February, but would keep the program on hold for the time being. Last week, President Biden extend his break on federal student loan payments until June 30, 2023, to give the court time to consider the dispute.
“We welcome the Supreme Court’s decision to hear the case on our student debt relief plan for middle and working class borrowers in February,” the House press secretary said. Blanche, Karine Jean-Pierre. “This program is needed to help more than 40 million eligible Americans struggling with student debt burdens recover from the pandemic and move forward with their lives. The program is also legal, backed by careful analysis from attorneys administration.”
The High Court order came amid an ongoing legal battle by six Republican-led states challenging Mr Biden’s plan to provide up to $20,000 in student loan relief to millions of borrowers. States that have sued the administration for the program include Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina.
A three-judge federal appeals court panel in St. Louis sided with the states and issued an injunction blocking the plan earlier this month, after which the Biden administration asked the Supreme Court to ‘to intervene.
“The erroneous Eighth Circuit injunction leaves millions of economically vulnerable borrowers in limbo, uncertain about the size of their debt and unable to make financial decisions with an accurate understanding of their future repayment obligations,” said Prelogar, the Solicitor General, to the Supreme Court in a filing.
Mr Biden announcement in August, it planned to cancel up to $10,000 in federal student debt for Americans earning less than $125,000 a year, and an additional $10,000 for recipients of Pell grants, which are awarded to students with the highest great financial needs. More than 26 million people have already applied for forgiveness and 16 million applications have been approved, according to the Ministry of Education.
The White House has estimated that up to 43 million borrowers will receive relief under the administration’s plan, including nearly 20 million people who will have their remaining debt forgiven entirely.
After the debt cancellation plan was announced, the Justice and Education Ministries released memos detailing the legal authority for student debt cancellation, building on a 2003 law called the HEROES Act, enacted after the September 11, 2001, terrorist attacks. The law, the Biden administration argued in memos, gave Education Secretary Miguel Cardona authority to grant aid to federal student loan recipients during national emergencies, such as the COVID-19 pandemic.
But the relief package soon faced legal challenges from states, Wisconsin taxpayers and conservative groups who argued the Biden administration overstepped its authority. In its lawsuit filed in Missouri federal district court, the six-state coalition said the plan would hurt revenue from servicing federal student loans.
The Missouri court dismissed the suit for lack of legal merit, but the United States Court of Appeals for the 8th Circuit granted a request from the States to block the implementation of the plan, prohibiting the Ministry of Education from discharging any student loan debt under the program.
In asking the Supreme Court to lift the 8th Circuit injunction, Prelogar argued that states lack the legal standing to challenge the student loan program because it “confers benefits” to third parties and does no harm. in any way to the States.
She also pointed out that federal law authorizes the secretary to change federal student loan provisions in response to national emergencies, and noted that the Trump and Biden administrations have invoked the HEROES Act to provide relief to borrowers during the pandemic.
“Substantively, the plan falls squarely within the clear text of the secretary’s statutory authority,” Prelogar told the court. “Indeed, the whole purpose of the HEROES Act is to authorize the Secretary to provide student loan relief to subprime borrowers due to a national emergency – precisely what the Secretary has done here.”
But in a filing responding to the Biden administration’s request, the six states argued they had the legal capacity to sue in part because they would be harmed by a loss of tax revenue if the plan were to be reinstated. They also reiterated to the Supreme Court that student debt forgiveness and its scope are beyond the authority of the Secretary of Education.
“The law requires a real connection to a national emergency,” senior state officials wrote. “But the department’s reliance on the COVID-19 pandemic is a pretense to obscure the president’s true goal of delivering on his campaign promise to erase student loan debt.”
The 8th Circuit injunction came just days after a federal district judge in Texas ruled the student loan relief plan was illegal, barring the department from writing off any debt. The Biden administration appealed that decision and asked the United States Court of Appeals for the 5th Circuit to stay the district court’s decision.
In response to the Texas court ruling, the Biden administration announced that it had stopped accepting applications for the debt relief program.
