The Supreme Court is considering the case of Biden’s student loan debt forgiveness

WASHINGTON — The Supreme Court agreed on Thursday to decide whether the Biden administration has exceeded its powers in its plan to pay off billions of dollars in student debt.

Judges put the case on an unusually fast track and said they would hear arguments in February. In the meantime, however, they maintained an injunction that blocked the program.

The summary order of the court contained no reasoning and noted no dissenting opinions.

The court acted after the Justice Department made a request an emergency application Ask the judges to reverse the injunctionissued by the US Court of Appeals for the Eighth Circuit in St. Louis at the request of six Republican states.

The program, which forgives millions of federal borrowers in debt of up to $20,000, has sparked a spate of lawsuits, but the program filed by the six states — Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina — could pose the greatest threat. States have said Mr Biden’s proposal would exceed his executive powers and deprive them of future tax revenues.

Since March 2020, most borrowers have been able to skip payments under a coronavirus relief effort that began under President Donald J. Trump and has been extended multiple times, including under President Biden. Last week, the Biden administration extended the payments pause again, deferring it until September.

Nearly 26 million borrowers have applied for forgiveness of some of their student loan debt. While the government has approved 16 million applications, no debt has yet been forgiven. The Department of Education, which owns and manages the government’s $1.5 trillion student debt portfolio, has stopped accepting applications amid all the legal challenges.

The proposed debt relief would be one of the most costly executive measures in US history; The bipartisan Congressional Budget Office estimated its cost at around $400 billion.

In response to the emergency request, state lawyers argued that the administration should not use the coronavirus pandemic to justify its plan. They found that judges had rejected two previous programs in response to the pandemic: a moratorium on evictions and a plan to require large employers to impose vaccination or testing requirements on their workers.

“Now, as President Biden is publicly declaring the pandemic over,” the states brief reads, “his administration is using Covid-19 to justify mass debt forgiveness — an illegal attempt to save over $400 billion of the $1.6 trillion to be paid to federal students. Loan debt and eliminate all remaining loan balances for approximately 20 million out of 43 million borrowers.”

The Biden administration claims it has the power to grant relief under the Heroes Act of 2003, which allows the Secretary of Education to waive regulations related to student loans in times of war or national emergency. Since the outbreak of the coronavirus pandemic in March 2020, the country has been operating under an emergency declaration imposed by Mr Trump.

The government’s emergency petition to the Supreme Court, filed by Attorney General Elizabeth B. Prelogar, says states have not suffered the type of injury that would entitle them to sue. The Eighth Circuit, she wrote, focused solely on the possibility that a nonprofit servicing federal loans, the Missouri Higher Education Loan Authority, might not make payments to Missouri.

Ms Prelogar said the possibility was not sufficient to establish standing and that even if it had, the Court of Appeal should have done no more than prevent the government from paying off loans serviced by the facility. The Eighth Circuit instead suspended the entire program statewide while the appeal went ahead.

Ms Prelogar also criticized the Eighth Circuit for failing to discuss whether the administration exceeded its powers, notwithstanding that the “merit of the appeal before this court involves substantial points of law which have yet to be resolved”.

“This analysis,” she wrote, “is insufficient to support an injunction — let alone a universal injunction barring the government from implementing an extremely important policy with direct and tangible implications for millions of Americans.”

States argued that the plan is “not remotely tailored to address the impact of the pandemic” and instead aims to meet “the government’s policy agenda on student loans.”

The states lost the first round in her suit Judge Henry E. Autrey of the Federal District Court in St. Louis appointed by President George W. Bush.

“While plaintiffs present important and significant challenges to the debt relief plan,” Judge Autrey wrote, “current plaintiffs are unable to proceed with resolution of those challenges.”

A three-judge panel of the Eighth Circuit blocked that decision. Two of its three members — judges Ralph R Erickson and Leonard S Grasz – were appointed by Mr. Trump. The third, judge Bobby E. Schaeferwas appointed by Mr. Bush.