President Biden’s first attempt to forgive student debt was blocked by the Supreme Court. His administration has since crafted a new plan that they believe will survive legal challenges. Here’s why:
Narrower Scope
This plan targets specific groups of borrowers, such as those in repayment for decades or who attended schools with low financial value. This is in contrast to Biden’s original plan, which aimed to forgive debt for nearly all 40 million federal student loan borrowers.
Different Legal Justification
The administration is now using the Higher Education Act as its legal basis, which grants the education secretary authority to waive or release student debt. This is different from the HEROES Act, which the administration used for its first plan and which the Supreme Court ruled did not grant the president broad power to erase student debt.
Negotiated Rulemaking Process
The administration is using a more involved regulatory process to make it harder for courts to strike down the relief. This process involves seeking input from stakeholders and going through a public comment period. Congress has already authorized the U.S. Department of Education to issue regulations on specific aspects of the law, which gives the administration some legal authority to implement this plan.
Despite these changes, it is still possible that the new plan will face legal challenges. However, the administration believes that the narrower scope, different legal justification, and negotiated rulemaking process will make it more difficult for courts to block the relief.
