A 24-Hour Judicial Whiplash Leaves the Biden Administration’s Debt Cancellation Plans Frozen in their Tracks
By Hugh T. Ferguson, NASFAA Managing Editor
President Joe Biden’s student loan forgiveness efforts were once again blocked by a federal judge on Thursday following another court’s early morning decision that would have enabled the administration to move forward with its plans.
Initially a judge in Georgia determined that the restraining order placed on the Department of Education (ED) that prohibited the administration from fully implementing its student loan debt relief plan – whose rules have not yet been finalized – should lapse, since the judge determined that the state of Georgia lacked standing in the legal challenge to the program.
However, another judge in Missouri issued a preliminary injunction against the administration's program shortly after the decision from Georgia.
The Missouri judge determined that ED’s ability to carry out the program “would prevent this Court, the U.S. Court of Appeals, and the Supreme Court from reviewing this matter on the backend, allowing Defendants’ actions to evade review.”
As a result the program is once temporarily blocked.
Back in April, ED published its first set of draft rules, done through the negotiated rulemaking process, to provide targeted student debt relief to borrowers. According to the Office of Information and Regulatory Affairs, ED plans on these draft rules to be finalized in October this year.
The draft rules however did not include the issue of “hardship,” which the negotiated rulemaking committee reached consensus on in February 2024. In April, ED said it would publish another draft rule focused on providing relief for borrowers experiencing “hardship” in the coming months.
This new preliminary injunction means that it is unclear when the court will next weigh in on the program, leaving it once again in limbo.
"While these legal challenges continue, many borrowers will likely be left confused as to whether or not they are eligible for some form of student loan debt forgiveness and which repayment options are available to them," Megan Walter, NASFAA’s senior policy analyst said. "As the court challenges play out, NASFAA has stressed the importance of ED providing borrowers with clear communications during the wind-down of key safeguards for student-loan borrowers."
NASFAA recently published a deep dive article looking at the Biden Administration's Efforts and Obstacles to implement student loan debt relief and also created a timeline graphic, which will be updated periodically, to provide members with a resource to keep track of the many different moving parts on these issues.
Stay tuned to Today’s News for more updates on this lawsuit.
Publication Date: 10/7/2024
Gabriela G | 10/7/2024 1:42:29 PM
Matthew Schelp, an appointee of Republican former President Donald Trump...not surprised.
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