A federal appeals court has temporarily blocked the Biden administration from going ahead with its plan to cancel massive amounts of federal student loan debt.
“Apellants’ emergency motion for an administrative stay prohibiting the appellees from discharging any student loan debt under the Cancellation program until this Court rules on the appellants’ motion for an injunction pending appeal is granted,” the order declares.
Six GOP-led states are challenging the president’s controversial plan, which would offer up to $10,000 of debt cancellation for individuals who earn less than $125,000, or less than $250,000 in the case of married couples — people who got Pell Grants would be able to get up to $20,000 of debt cancellation.
Arkansas, Iowa, Kansas, Missouri, Nebraska, and South Carolina are the states involved in waging the legal challenge.
“We are pleased the temporary stay has been granted,” Nebraska Attorney General Doug Peterson noted in a statement, according to the Associated Press. “It’s very important that the legal issues involving presidential power be analyzed by the court before transferring over $400 billion in debt to American taxpayers.”
A district court judge had dismissed the suit for lack of standing on Thursday.
“Because Plaintiff States – Nebraska, Missouri, Arkansas, Iowa, Kansas, and South Carolina – have failed to establish Article III standing, the Court lacks jurisdiction to hear this case,” Judge Henry E. Autrey wrote. “While Plaintiffs present important and significant challenges to the debt relief plan, the current Plaintiffs are unable to proceed to the resolution of these challenges,” he added. “Therefore, the case will be dismissed for lack of jurisdiction.”
White House press secretary Karine Jean-Pierre asserted in a statement that the order on Friday does not block people from applying for the loan cancellation.
“Tonight’s temporary order does not prevent borrowers from applying for student debt relief at studentaid.gov – and we encourage eligible borrowers to join the nearly 22 million Americans whose information the Department of Education already has. It also does not prevent us from reviewing these applications and preparing them for transmission to loan servicers,” she said in the statement.
“It is also important to note that the order does not reverse the trial court’s dismissal of the case, or suggest that the case has merit. It merely prevents debt from being discharged until the court makes a decision,” she added. “We will continue to move full speed ahead in our preparations in compliance with this order. And, the Administration will continue to fight Republican officials suing to block our efforts to provide relief to working families.”