Conservatives are in a legal battle to stop Biden's student loan forgiveness The legal cases all face the same challenge: finding a plaintiff who will be clearly harmed by debt cancellation.

A look inside the legal battle to stop Biden's student loan relief

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LEILA FADEL, HOST:

The legal fight has begun to stop President Biden from canceling hundreds of billions of dollars in federal student loan debt. Two lawsuits have been filed in recent days, with more likely to follow, all arguing the president doesn't have the authority to cancel debt on this scale. In response, the U.S. Department of Education is subtly shifting its debt relief plan, trying to undercut these legal challenges. Here to walk us through this all is NPR's Cory Turner. Good morning.

CORY TURNER, BYLINE: Good morning, Leila.

FADEL: So, Cory, let's start with the most recent lawsuit that came yesterday filed by six state attorneys general.

TURNER: That's right. They're from Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina. And they make a few arguments, again that Biden doesn't have the authority to do this. But also knowing they have to show actual harm, Leila, they're arguing that mass loan cancellation hurts their states. They say they'll miss out on future state income tax. But they also take issue with the department's plan for old federal student loans that are known as FFEL loans. So many of these loans are managed by banks or even state agencies, not the federal government. And Biden's original plan allowed FFEL borrowers to consolidate these old loans into new federal loans and qualify for cancellation. And these states argue if a lot of these loans go away, it'll hurt the FFEL loan managers financially and the states they're in.

FADEL: OK. So what does the Education Department say about this?

TURNER: Well, first, they say President Biden does have the authority to cancel these debts. And that's thanks to a law that Congress passed after the attacks of 9/11. But this other issue about banks and state agencies suffering financial harm by losing all of these old federal loans, well, it did something really unusual yesterday. It quietly changed the language on its website to suddenly exclude many of these borrowers from debt relief. We know there are about 4 million of them with these kinds of loans. An administration official told me many of them will still qualify but that around 800,000 FFEL borrowers as of yesterday will not now qualify. And the department didn't clearly explain why they'd done it. Though, I spoke with multiple legal experts who all said it's pretty clear the department was worried it was not on solid legal footing here.

FADEL: OK. So let's jump now to the other lawsuit we mentioned earlier this week, this one from an individual borrower claiming harm.

TURNER: Yeah, his name is Frank Garrison. He's an attorney in Indiana. And according to his complaint, he says he should qualify for debt relief automatically. And that's important, Leila, because Indiana is one of the handful of states that has said it will tax this debt relief as income. And Garrison says he doesn't want to pay that tax because he doesn't want this relief now because he's only about four years away from having all of his student loans erased under the public service loan forgiveness program. And that relief would not be taxable. So he's asking the court to block the Ed Department from canceling anyone's debts.

FADEL: OK. So what does the Biden administration say about all this?

TURNER: Well, just a few hours after the suit was filed, White House spokesman emailed me and said anyone who does not want debt relief can choose to opt out.

FADEL: OK.

TURNER: And yesterday, then the judge in the case refused Garrison's request to stop debt relief from proceeding because he wrote this opt out, which appears to be new, means Garrison cannot be irreparably harmed by the plan. I will say, though, Leila, we are all but sure to see more of these legal challenges as these conservative groups and politicians continue to sort of tweak their arguments and the Ed Department keeps gently tweaking its plan.

FADEL: NPR's Cory Turner, who covers education. Thanks, Cory.

TURNER: You're welcome.

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