Biden DOJ asks Supreme Court to unblock student loan plan

The Biden administration asked the Supreme Court on Tuesday to lift a block on its student loan cancellation plan after an appeals court temporarily enjoined it last week, placing the plan in further legal peril.

Solicitor General Elizabeth Prelogar called on the justices to temporarily lift the hold put in place by the U.S. Court of Appeals for the 8th Circuit, after several states sued to block the implementation of President Joe Biden’s Saving on a Valuable Education Plan.

“The rule is a straightforward exercise of the Department’s express statutory authority to set the parameters of income-contingent repayment plans – just as it has done for three decades,” Prelogar wrote.

If the Supreme Court declines to intervene over the case on its emergency docket, the federal government requested the justices weigh the legality of the SAVE Plan on the merits on an expedited track so that oral arguments can be heard in the fall.

The government’s appeal of the 8th Circuit’s decision harkens back to the last time the Supreme Court intervened in a student loan dispute, when the Biden administration’s plan to forgive up to $20,000 in debt for some low-income borrowers was struck down in a 6-3 vote along ideological lines.

Under the Department of Education’s scheme, the first phase of the SAVE Plan went into effect last fall, which raised the income shielded from payments from 150% to 225% above the federal poverty guidelines. Unpaid interest outside the calculated payments was waived.

However, two separate groups of Republican state attorneys general have filed federal court challenges to the plan, arguing that the estimated cost for the plan, which is roughly $475 billion over 10 years, requires authorization from Congress.

The 8th Circuit on Friday ruled in favor of Missouri, Arkansas, Florida, Georgia, North Dakota, Ohio, and Oklahoma to temporarily block the SAVE Plan from being implemented as the lower court fight plays out.

Meanwhile, the states of Alaska, South Carolina, and Texas have asked the Supreme Court to halt the plan after the U.S. Court of Appeals for the 10th Circuit allowed a broad portion of the plan to go into effect.

The Supreme Court requested a response from the states led by Missouri by Monday at 4 p.m. EST.