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Supreme Court Asks to Block Biden’s Student Loan SAVE Plan

WASHINGTON − Three states − Alaska, South Carolina and Texas − are asking the Supreme Court to block President Joe Biden’s new plan to cancel student debt.

In an emergency motion filed Tuesday, the state said the Supreme Court should overturn a recent ruling by the Denver-based 10th U.S. Circuit Court of Appeals that allowed a key part of the plan to proceed.

The states argue the administration’s current actions are “as unlawful” as Biden’s first attempt to forgive the student loan debt of tens of millions of Americans, a move that was ruled invalid by the Supreme Court last year.

“Due to the Administration’s intransigence, the Court must unfortunately intervene again,” attorneys for the states wrote in their motion.

Separate rulings last month by federal judges in Missouri and Kansas blocked parts of the president’s income-driven loan repayment program, known as Savings for an Appreciated Education, or SAVE.

That plan, which the Biden administration has tried to quickly implement, lowered monthly payments to $0 for millions of borrowers. The education secretary often refers to it as “the most affordable repayment plan in history.”

While the district court rulings did not reverse any of the roughly $5.5 billion in student debt relief that the federal Department of Education says it has already provided to more than 400,000 borrowers through the SAVE program, the rulings prevented the agency from fully implementing the program.

However, days later, the 10th U.S. Circuit Court of Appeals stayed the ruling by a district judge in Kansas after the Biden administration appealed the decision.

As a result, the Department of Education announced that it will continue to reduce student loan rates and directed the loan servicers it works with to make changes to the SAVE Plan.

The White House said more than 20 million borrowers could ultimately benefit from the aid.

States challenging the program say the public will lose hundreds of billions of dollars if the Supreme Court does not intervene.

Collaboration: Zachary Schermele and Reuters.