Legal Challenges Loom for Biden’s Backup Plan to Deliver Student Debt Relief

President Joe Biden’s backup plan for delivering student debt relief is likely to face legal scrutiny, according to experts. The plan, which was announced after the Supreme Court ruled against Biden’s initial proposal, raises questions about the administration’s ability to fulfill its campaign promise without the support of Congress.

The Supreme Court’s ruling stated that Biden exceeded his authority when he used the HEROES Act to forgive up to $20,000 in student debt. In response, Biden announced that he would pursue debt relief under the Higher Education Act of 1965, describing it as “legally sound” but acknowledging that it would take longer to implement.

The HEROES Act allowed the secretary of education to “waive or modify” loan terms, while the Higher Education Act permits the administration to “compromise” loans and forgive them in specific circumstances. However, the “compromise” language has traditionally been understood to give the department the power to reduce loans on a case-by-case basis, rather than as a blanket authority to forgive debt.

Experts have raised concerns about whether a similarly sweeping debt relief program would be supported under the Higher Education Act. They argue that the court is unlikely to reach a different result under language that is very similar to the HEROES Act.

Biden’s new proposal has not provided specific details, but he described it as “the best path that remains to providing for as many borrowers as possible with debt relief.” Some experts suggest that the administration could craft a narrower program to withstand legal scrutiny, although this may draw criticism from liberals within the party.

Supporters of Biden’s latest effort argue that the Higher Education Act clearly outlines the administration’s power to forgive debt. They point out that the provision of the law in question does not include limiting language, and therefore, the administration has the authority to take action.

The Supreme Court’s conservative majority has become increasingly skeptical of significant policies from federal agencies that do not have explicit approval from Congress. In previous cases, the court has ruled against extending an eviction moratorium and invalidated an EPA effort to regulate power plant emissions. The court has emphasized the need for explicit authorization from Congress for such actions.

The Higher Education Act does authorize certain forms of relief in specific situations, such as for borrowers who were defrauded by for-profit colleges. The Biden administration has previously provided debt relief to borrowers in this situation.

It remains to be seen how the administration will proceed with its backup plan for student debt relief and whether it will withstand legal scrutiny.

What is the “compromise provision” in the Higher Education Act, and how has it never been used before to forgive student debt on a large scale?

Se” provision in the Higher Education Act has never been used to forgive student debt on a large scale.

Legal experts believe that Biden’s backup plan to use the “compromise” provision will likely face legal challenges. They argue that the provision was not intended to be a broad authority for the administration to forgive student debt without congressional approval.

Furthermore, critics argue that using the “compromise” provision would set a dangerous precedent, allowing future presidents to unilaterally forgive student debt without going through Congress.

Supporters of Biden’s approach, however, contend that the “compromise” provision gives the administration the necessary authority to provide relief to struggling borrowers. They argue that the provision’s flexibility allows for creative solutions to address the student debt crisis.

Ultimately, the legal scrutiny surrounding Biden’s backup plan highlights the challenges of delivering student debt relief without congressional support. As the administration moves forward with its efforts, it will need to navigate the legal landscape carefully to fulfill its campaign promise while respecting the limits of its authority.