July 19 (UPI) — A federal appeals court has temporary blocked President Joe Biden‘s student loan relief plan from going into effect amid further litigation.
President Joe Biden has made it a key initiative of his administration to offer student debt relief to Americans struggling under the weight of monthly payments, but he has been met with staunch Republican opposition and many lawsuits.
Last August, the Biden administration launched the Saving on a Valuable Education plan, an income-driven repayment structure that calculates payments based on a student borrower’s household income and forgives the remaining balance after a certain number of years.
The order from the U.S. Court of Appeals for the Eight Circuit on Thursday puts a temporary stay on the Biden administration implementing the SAVE plan amid litigation, granting the request from a coalition of GOP-led states.
The Republican-led states are arguing that Biden illegally circumvented Congress to force American taxpayers to pay off the debts of others.
“He can’t go around Congress and unilaterally cancel student loans,” Arkansas Attorney General Tim Griffin, a Republican, said in a statement. “And whenever he ignores that lesson, I will be there on behalf of Arkansans to remind him.”
Education Secretary Miguel Cardona railed against the ruling, saying it would have “devastating consequences” on millions of student loan borrowers who are currently “crushed” by unaffordable payments and limits their potential as consumers.
He called the ruling political while hinting that the White House would appeal to the U.S. Supreme Court.
“It’s shameful that politically motivated lawsuits waged by Republican elected officials are once again standing in the way of lower payments for millions of borrowers,” Cardona said. “Borrowers enrolled in the SAVE Plan will be placed in an interest-free forbearance while our administration continues to vigorously defend the SAVE Plan in court.”
The decision comes as two coalitions of Republican-led states have filed lawsuits against the SAVE plan. Late last month, a pair of federal judges had halted parts of SAVE that aimed at lowering monthly repayments as well also shortening the term during which they needed to be repaid.
According to the Department of Education, the Biden administration approved $5.5 billion in relief for 414,000 borrowers.
The Student Borrower Protection Center nonprofit organization criticized the court’s decision Thursday, which warned it would send the student loan system into chaos while putting tens of millions of borrowers at economic risk.
“Make no mistake: these lawsuits are shameful political gamesmanship designed to hurt President Biden at all costs, and borrowers are merely collateral damage,” Persis Yu, deputy executive director of SBPC, said in a statement.
“Unfortunately, today, the special interests have prevailed, imperiling the financial security of millions and throwing the student loan system into an untenable chaos.”
The announcement came hours after the Department of Education unveiled $1.2 billion in student loan relief for 35,000 borrowers through its Public Service Loan Forgiveness Program, which is another of Biden’s programs to offer student debt relief.
The department of Education states that its total loan forgiveness program has approved $168.5 billion for 4.76 million Americas.