Three GOP-states – South Carolina, Texas and Alaska – have asked the Supreme Court to block President Biden's new Saving on Valuable Education (SAVE) income-driven student loan repayment program, which was set to begin in July.
In the emergency filing, the states are asking the Supreme Court to reverse the recent ruling by the Denver-based appeals court that allowed a key part of the plan designed to lower monthly payments to resume.
Under the SAVE plan, borrowers who originally took out $12,000 or less in loans and have been in repayment for 10 years are eligible to have their remaining student loan debt canceled. More than 8 million borrowers are enrolled in the SAVE plan, and the Education Department was ready to cancel $5.5 billion of debt for 414,000 borrowers.
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Although President Biden has forgiven student debt for millions of borrowers, including public sector workers and those defrauded by for-profit schools, over the last year, the SAVE program was his most ambitious plan to date, which he put in place after the Supreme Court struck down his $10,000 student loan forgiveness plan a year ago.
In the new Supreme Court filing, the states argue the administration's current effort is "every bit as unlawful" as Biden's first attempt to wipe out student loan debt, a move that was struck down by the Supreme Court in 2023. The Supreme Court "must unfortunately step in again," the states' attorneys wrote in their filing.
The states also want the court to use this opportunity to vacate the plan under the 2023 student loan ruling or agree to hear arguments in this case next term.
Their case is clear-cut, the states maintain, since the court already ruled that the Biden administration's prior effort to spend billions of dollars of taxpayer money on loan forgiveness justified intervention.
In separate rulings in June, two federal judges, in Missouri and Kansas, halted parts of President Biden's SAVE plan, which was launched in 2023.
Related: Federal courts block Biden's SAVE student loan repayment plan for 8M borrowers
South Carolina Attorney General Alan Wilson expects the Supreme Court will likely respond to this petition in the coming days.
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Lynn Cavanaugh
Lynn Varacalli Cavanaugh is Senior Editor, Retirement at BenefitsPRO. Prior, she was editor-in-chief of the What's New in Benefits & Compensation newsletter. She has worked for major firms in the employee benefits space, Vanguard and Willis Towers Watson, as well as top media companies, including Condé Nast and American Media.
