New Civil Liberties Alliance sues Biden admin over student loan plan.
Conservative Groups Sue Biden Administration Over Student Loan Debt Plan
Conservative groups are taking legal action against the Biden administration’s new student loan debt plan, which aims to eliminate payments for hundreds of thousands of Americans.
The New Civil Liberties Alliance filed a lawsuit on Friday, representing the Mackinac Center and the Cato Institute, to challenge President Joe Biden’s Saving on a Valuable Education (SAVE) plan. The groups are seeking to block the program, arguing that it violates federal law by not allowing for public comment or participation in the rulemaking process.
Allegations of Constitutional Breaches
The lawsuit alleges that the plan breaches the Constitution on multiple occasions, including the Appropriations Clause, which grants Congress the authority to determine which debts owed to the Treasury can be canceled.
“When the Department of Education undermines Congress’s enacted program – either through permanent debt forgiveness or extending deferments – PSLF employers have the right to sue to stop it,” stated Mark Chenoweth, president and general counsel of the NCLA. He argued that the plan undermines the Public Service Loan Forgiveness Program established by Congress in 2007.
Attorneys claim that if the new plan allows for forgiveness in less than 10 years, the incentive to use the Public Service Loan Forgiveness (PSLF) program will no longer exist. PSLF enables public sector and nonprofit workers to have their outstanding debt forgiven after 10 years of service.
Click here to read more from the Washington Examiner.
Updated Measure Following Supreme Court Ruling
Just weeks after the Supreme Court struck down Biden’s student loan forgiveness program, which aimed to cancel up to $20,000 of debt for millions of Americans, the administration released an updated measure. The SAVE plan, stemming from the U.S. Department of Education’s efforts to improve repayment paths, could potentially cancel $39 billion in federal student loans for over 804,000 borrowers who have been in a repayment plan for more than 20 years.
“Newsflash for Secretary Cardona and Administrator Cordray: Non-payments are not payments,” Chenoweth emphasized. “No amount of nonsense changes the essential fact that Congress required debtors to make payments before receiving debt relief.”
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