Biden administration extends pause on federal student-loan payments as SCOTUS review is sought
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The Biden administration on Tuesday extended the pause on federal student-loan payments, interest and collections to allow time for the courts to resolve litigation over plans to forgive some loans.
“We’re extending the payment pause because it would be deeply unfair to ask borrowers to pay a debt that they wouldn’t have to pay, were it not for the baseless lawsuits brought by Republican officials and special interests,” said U.S. Secretary of Education Miguel Cardona in a press release.
The federal government is asking the U.S. Supreme Court to lift a federal appeals court injunction that temporarily blocks the federal student-loan forgiveness program, according to past coverage by SCOTUSblog.
Before the latest extension, the repayment pause was set to end at the end of the year.
The debt-relief program offers loan forgiveness of $20,000 on college Pell Grants and $10,000 for other student debt if the loans are held by the U.S. Department of Education. Borrowers aren’t eligible unless their income in either 2020 or 2021 was less than $125,000 per year as an individual or less than $250,000 per year per household.
Under the new extension, payments won’t restart until 60 days after the DOE is permitted to implement the loan-forgiveness program or litigation challenging the program is resolved, according to the press release. If there is no resolution by June 30, 2023, payments will resume 60 days later.
The government is claiming authority to implement its program under the Higher Education Relief Opportunities for Students Act, or the HEROES Act. The 2003 law allows waiver of student-aid program rules in times of war or national emergency. The secretary of education has concluded that the government can act because of the COVID-19 pandemic.
The 8th U.S. Circuit Court of Appeals at St. Louis temporarily paused the loan-forgiveness program in October in a lawsuit by six Republican-led states. A federal judge in Texas ruled in a separate lawsuit in November that the plan was an unconstitutional exercise of legislative power by the executive branch.
In October, Supreme Court Justice Amy Coney Barrett denied an emergency request to block President Joe Biden’s loan-forgiveness program without referring the matter to the full court.
ABAJournal.com: “Biden administration announces PSLF plans, and ABA suggests extension of student-loan payment pause”