On Monday, June 24th, federal judges in Kansas and Missouri respectively announced rulings blocking significant portions of the Biden administration’s student loan forgiveness plan. President Biden had originally hoped to use the program to provide relief to millions of borrowers.
In Kansas, U.S. District Judge Daniel Crabtree ruled on a lawsuit brought by 11 states. The ruling allows for some aspects of the plan, specifically granting forgiveness for remaining loans for students borrowing less than $12,000 after 10 years of repayment.
However, Crabtree stated that the Department of Education cannot implement other parts of the plan, which aimed to assist students with higher loan amounts by reducing their monthly payments and shortening their repayment term from 25 years to 20 years.
In Missouri, U.S. District Judge John Ross’s order differed. His order prohibits the Department of Education from forgiving loan balances in the future, although he mentioned that the Department can still lower monthly repayment amounts. Seven states in total jointly filed the lawsuit in Missouri.
Both rulings were made by judges appointed by former Democratic President Barack Obama.
Last year, the U.S. Supreme Court also struck down the Biden administration’s initial student loan forgiveness plan. The two rulings announced on Monday appear to significantly limit the Biden administration’s ability to aid borrowers.
Both judges stated that Secretary of Education Miguel Cardona’s actions exceeded the authority granted by Congress.
Kansas Attorney General Kris Kobach and Missouri Attorney General Andrew Bailey praised the judges’ decisions as a major legal victory against the Biden administration. Like many Republicans, they believe that forgiving some student loans would effectively shift the repayment costs onto taxpayers.
“Only Congress has the power of the purse, not the president,” Bailey said. “Today’s ruling is a significant win for the rule of law.”
Kobach criticized Biden’s plan as “unconstitutional,” calling it an insult to “blue-collar workers in Kansas who didn’t go to college.”
However, the Student Borrower Protection Center, an advocate for loan forgiveness, released a statement on social media platform X, stating that these rulings were driven by partisan positions and could lead to chaos in the entire student loan system, as many borrowers are currently applying for forgiveness programs they qualify for.
In both lawsuits, the suing states sought to strike down the entire program. In July 2023, the Biden administration first offered this forgiveness program to borrowers, leading to at least 150,000 loans being canceled.
Both orders are preliminary injunctions, meaning the injunction only remains effective during the course of the lawsuit. However, issuing temporary injunctions typically indicates that the judges believe the states may prevail in the trial.