Biden administrator asks Supreme Court to let student loan forgiveness program continue

After a significant loss in court earlier this week, the Biden administration on Friday asked the Supreme Court to weigh in on its fight to keep its student loan relief program alive.

The program, which aimed to relieve between $10,000 and $20,000 in student loans for borrowers who earn below a certain income, was blocked by the 8th Circuit Court of Appeals after six conservative states sued in justice against the Ministry of Education, arguing that the policy is an abuse of power.

In an escalating legal fight, the Biden administration has asked judges to overturn that nationwide injunction and let the program continue, arguing that Education Secretary Michael Cardona is entirely under his purview due to a law called HEROES Act, which gives the power to cancel loans during a national state of emergency like the pandemic.

“Substantively, the plan falls squarely within the clear text of the Secretary’s statutory authority,” Solicitor General Elizabeth Prelogar wrote in the Supreme Court filing.

“Indeed, the very 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,” wrote Prelogar.

The United States Supreme Court building is seen in Washington, June 26, 2022.

Elizabeth Frantz/Reuters, FILE

It’s the secretary’s job “to make sure borrowers affected by a national emergency aren’t worse off on their student loans,” Prelogar said, and if the Department of Education doesn’t act , there could be a “spike” in loan defaults when the pause on student loan repayments lifts in January.

That looming Jan. 1 deadline — when the nearly two-year moratorium on payments is set to end — adds further pressure on the administration.

Pressed Friday by ABC News White House correspondent MaryAlice Parks on whether the moratorium on student loan repayments would be extended while the legal battle over loan forgiveness unfolds, the press secretary for White House leader Karine Jean-Pierre said the administration was “examining all options.”

“Listen, we’re looking at, to your question about the, a potential break, we’re looking at all the options to give middle-class families a bit more respite,” Jean-Pierre said.

Officials launched the program in late August with the promise that anyone who applied before mid-November could have their loan canceled before payments resumed.

However, as legal losses interrupted that deadline, the Department for Education has begun to consider extending the moratorium again – although officials warn this is not an ideal plan.

“…The department estimates that if it temporarily extends the current suspension of payments and interest accumulation in the event of the COVID-19 pandemic for holders of federal student loans, it will cost taxpayers several billion dollars a year. months in unrecovered loan income,” said the Undersecretary of the Ministry of Education. James Richard Kvaal said in a recent legal filing.

PHOTO: President Joe Biden speaks in the State Dining Room of the White House in Washington, DC, November 9, 2022.

President Joe Biden speaks in the State Dining Room of the White House in Washington, DC on November 9, 2022.

Susan Walsh/AP

Still, advocacy groups including the Student Debt Protection Center and the NAACP are pushing for the administration to keep the moratorium in place while the courts decide, rather than asking people to start repaying their loans again with fate. from the program. the air.

The groups say it will undermine the Biden administration’s own argument for debt relief if it lifts the moratorium without any loan cancellations, because the reason for the debt cancellation is that the pandemic has left people in a position where they couldn’t get back on their feet if the moratorium was lifted without any help from the government.

The Supreme Court is expected to respond to the Biden administration’s request in the coming weeks.

The court could also be asked to weigh in on another case, developing in a lower court in Texas, which also blocked the loan program.

A federal judge in Texas on Thursday governs the student debt cancellation policy, goes beyond the authority of the Ministry of Education and the power of the executive.

U.S. District Judge Mark T. Pittman was nominated by former President Donald Trump, and the lawsuit was filed in October by the conservative Job Creators Network foundation.

The debt cancellation program was already on hold, unable to meet loan payments due to a temporary stint in a federal appeals court considering a separate lawsuit brought by six conservative states.

A final decision is that the case is pending.

If the Supreme Court decides not to overturn the appeals court’s decision to pause the program, the Justice Department has asked the Supreme Court to prepare the case for expedited oral argument.

ABC News’ Devin Dwyer contributed to this report.

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