(CBrief) – President Joe Biden just got a tough break from a federal court regarding his plans to cancel student loans.
The U.S. Court of Appeals for the 8th Circuit on Friday ordered the administration not to begin processing any student loan debt forgiveness applications after millions of people applied, The Washington Post reported.
The lawsuit was brought by six conservative states and the judge has agreed to expedited the case.
“We are pleased the temporary stay has been granted,” Nebraska Attorney General Doug Peterson said. “It’s very important that the legal issues involving presidential power be analyzed by the court before transferring over $400 billion in debt to American taxpayers.”
The decision arrives a day after U.S. District Judge Henry E. Autrey, a George W. Bush appointee, dismissed the states’ lawsuit for lack of standing. Earlier Thursday, U.S. Supreme Court Justice Amy Coney Barrett denied a separate request by the Wisconsin Institute for Law and Liberty, working on behalf of a taxpayer’s association, to pause the program.
Biden’s loan relief plan would cancel up to $10,000 in federal student debt for borrowers who earn up to $125,000 annually, or up to $250,000 for married couples. Borrowers who received Pell Grants are eligible for an additional $10,000 in forgiveness. People have until the end of 2023 to apply, but the administration has encouraged borrowers to do so by Nov. 15 in hopes of it being processed before a pause on student loan payments ends Dec. 31.
White House press secretary Karine Jean-Pierre said in a statement that the appellate court’s order does not prevent people from applying for debt relief, and the administration encourages eligible borrowers to continue to do so. It also does not prevent the Education Department from reviewing applications, she said.
She said that “the order does not reverse the trial court’s dismissal of the case, or suggest that the case has merit. We will continue to move full speed ahead in our preparations in compliance with this order.”
“Our student loan plan lowers costs for Americans as they recover from the pandemic to give everybody a little more breathing room,” President Biden said before the decision. “Republican members of Congress, Republican governors are doing everything they can to deny this relief. Their outrage is wrong and it’s hypocritical.”
“Tens of millions of Americans have already rushed to apply for debt cancellation, an indication that borrowers are struggling, anxious and eager to see this burden lifted,” Natalia Abrams, founder of the Student Debt Crisis Center, said. “The President’s student debt cancellation plan is a bold solution to these challenges and frivolous lawsuits will not stand in the way.”
“Conservative Justice Amy Coney Barrett rejected the motion from a Wisconsin group without offering an explanation. The Brown County Taxpayers Association filed the motion Wednesday, asking the court to immediately pause the loan relief program while it moves forward with litigation against the Biden Administration,” Forbes reported.
“A federal district court tossed a lawsuit from the group aiming to stop the program, which they have since appealed to the 7th Circuit Court of Appeals. The motion to the Supreme Court argued the program should be halted immediately because Biden overstepped his authority by authorizing loan forgiveness, which they claimed will lead to a gargantuan increase in the national debt,” the outlet added.
The student-loan forgiveness application site officially went live on Monday.
“After conducting beta testing over the weekend, President Joe Biden — alongside Education Secretary Miguel Cardona — announced that the application website is officially live, and borrowers can apply for up to $20,000 in debt relief that will start being processed by the Education Department. During his remarks, Biden noted that over 8 million borrowers applied over the weekend without a glitch or any difficulty,” Business Insider reported.
“It means more than 8 million Americans are starting this week on their way to receiving life-changing relief,” Biden said. “Millions more are going to have the opportunity to do it as well. As millions of people fill out the application, we’re going to make sure the system continues to work as smoothly as possible.”
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