States Sue to End Biden’s SAVE Repayment Plan

By Hugh T. Ferguson, NASFAA Senior Staff Reporter

A pair of new lawsuits are seeking to prevent President Joe Biden from fully implementing the Saving on a Valuable Education (SAVE) student loan repayment plan.

Both challenges, led by Republican attorneys general in Kansas and Missouri, attempt to build on previous lawsuits that successfully blocked the Biden administration’s student loan debt cancellation program.

The new income-driven repayment plan was finalized through a negotiated rulemaking conducted in the fall of 2021, with some provisions available for early implementation. Full implementation of the final rules is slated to occur July 1, 2024.

The first challenge, led by Kansas, claims that the program is an attempt by the Department of Education (ED) to implement a debt cancellation program.

“Last time Defendants tried this the Supreme Court said that this action was illegal. Nothing since then has changed, other than introducing more legal errors into this Rule’s underlying analysis,” the legal challenge reads.

The states, 11 in total, specifically take issue with the program’s cost estimates, argue that the administration does not have the authority to carry out the program, and claim that the administration is advertising the program as an effort to “buy votes with federal funds.”

“A major round of this ‘forgiveness’ occurred on February 21, 2024, when the Department of Education unilaterally erased the debt of 153,000 borrowers. Defendant Biden openly boasted about his defiance of the Supreme Court with this move, stating in Jacksonian fashion: ‘the Supreme Court blocked it. They blocked it. But that didn’t stop me,’” the challenge reads. “This lawsuit is now necessary to prevent Defendants from continuing to flout the law, which includes ignoring Supreme Court decisions.”

The second challenge, led by Missouri’s attorney general, is expected to be formally filed in the coming days. This challenge argues that the administration lacks the authority to carry out the repayment plan.

“Between our two coalitions of states, we will get this matter in front of a judge even more quickly to deliver a win for the American people,” writes Missouri Attorney General Andrew Bailey. “The Supreme Court sided with Missouri on this matter the first time. I look forward to bringing home yet another win for the Constitution and the rule of law.”

While the challenge plays out in the courts, Senate Democrats have moved to codify the program through new legislation, but it is unclear if the bill can overcome a potential filibuster. The bill is also unlikely to be taken up by the Republican-led House.


Publication Date: 4/2/2024

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