Two federal judges in Missouri and Kansas have blocked parts of the Biden administration’s efforts aimed at reducing student loan payments, raising doubts for millions of Americans affected by the program.
In Kansas, Judge Michael Crabtree ruled that the Department of Education could not implement the full scope of the Savings for a Valuable Education (SAVE) program. Participants with undergraduate student loan debt were scheduled to have their repayments cut in half next month, or from 10% to 5% of income above 225% of the poverty line.
Crabtree, an appointee of President Obama, said the Defense Department did not receive explicit authorization from Congress for that part of the program.
The challenge was led by Kansas Attorney General Kris Kobach (R), and was joined by 11 other Republican states. Domination Earlier this month, eight of the 12 states had no standing to file, leaving just three: Alaska, Texas and South Carolina.
In Missouri, Judge John Ross, also an Obama appointee, ruled that the Department of Education could not forgive any loans under SAVE because forgiving federal loans would illegally deprive state lenders of revenue.
Five other states joined the challenge filed by Missouri Attorney General Andrew Bailey, a Republican, making the same arguments the Supreme Court supported when it ruled against President Biden’s initial attempt at large-scale student loan forgiveness.
“Congress never gave Biden the authority to saddle working Americans with $500 billion in someone else’s debt — a major victory for the Constitution,” Bailey wrote. Social media posts about X.
Ross also said SAVE may be too broad to fall under Congress’ authority and that the legality of the entire program could be challenged in the future.
Since its inception, SAVE has forgiven more than $5.5 billion in debt for more than 400,000 borrowers, with more than 8 million enrolled, as Biden seeks to avoid a Supreme Court block on a larger debt forgiveness plan.
The program is Biden’s signature student loan forgiveness initiative, but it is separate from efforts to wipe out the debts of people who were defrauded by public officials and for-profit schools.
SAVE will continue to operate while the two lawsuits continue, but Monday’s ruling effectively puts the scope of the program on hold and suspends all future loan forgiveness.
The Hill has reached out to the Department of Education for comment.
