Six states urge U.S. Supreme Court to block Biden’s student debt relief

Nov 23 (Reuters) – Six states on Wednesday asked the U.S. Supreme Court to overrule President Joe Biden’s bid to reinstate his plan to write off billions of dollars in student debt that they said was beyond authority of his administration.

The states — Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina — filed a response to the Biden administration’s request for judges to overrule a lower court ruling. injunction the shutdown of the program while litigation over its legality continues. Five of the six states are governed by Republicans while the other, Kansas, has a Republican Attorney General.

In their filing, the States said the Biden administration was “attempting to assert power far beyond anything Congress could have conceived.” The administration said the Nov. 14 decision to block the plan leaves millions of economically vulnerable borrowers in limbo.

The administration is also challenging a Nov. 10 ruling by a Texas federal judge that found the program illicit. administration stopped accept applications for student debt relief after this decision.

In a policy benefiting millions of Americans, Biden announced in August that the US government would forgive up to $10,000 in student loan debt for borrowers earning less than $125,000 a year, or $250,000 for those earning less than $125,000 a year. married couples. Students who received Pell Grants to benefit low-income students will have up to $20,000 of their debt forgiven.

The policy fulfilled a promise the Democratic president made during the 2020 presidential campaign to help debt-ridden former students. The Congressional Budget Office calculated in September that debt cancellation cost the government around $400 billion.

States challenging the policy argued in their lawsuit that the debt cancellation plan encroaches on the authority of Congress and threatens future state revenues and money earned by state entities that invest in or manage student loans.

A federal judge dismissed their case for lack of legal status, but the St. Louis-based United States Court of Appeals for the 8th Circuit blocked the program while it heard an appeal from the states.

The Biden administration told the Supreme Court that the 8th Circuit’s decision leaves borrowers “uncertain about the size of their debt and unable to make financial decisions with an accurate understanding of their future repayment obligations.”

The administration also suggested judges could bypass the 8th Circuit and hear the dispute itself on an expedited basis, with a decision by the end of June.

Several legal challenges have been filed challenging Biden’s authority to forgive debt under a 2003 law called the Higher Education Relief Opportunities for Students Act, which allows the government to modify or waive federal student loans during the war. or national emergency. The Biden administration says the pandemic represented such an emergency.

States challenging the program on Wednesday denounced its merits. The law aims to prevent borrowers from falling into worse financial straits, while the government is “using it here to put tens of millions of borrowers in a better position by canceling their loans en masse”, they said. in their file.

While expressing confidence in the legality of his plan, Biden on Tuesday extended a pause in student loan repayments — begun during the COVID-19 pandemic — until next June 30. That moment, Biden said, would give the Supreme Court time to decide the case before the recess ends.

Reporting by Andrew Chung in New York; Editing by Will Dunham

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