Lawsuits aimed at blocking some of President Joe Biden’s targeted student debt relief efforts are underway — and a court ruling could have indicated how a case would play out.
In October, the New Civil Liberties Alliance filed a lawsuit on behalf of conservative groups the Cato Institute and the Mackinac Center for Public Policy to block student debt relief through one-time adjustments to the state’s accounts. Ministry of Education.
The adjustments give borrowers on income-driven repayment plans and Public Service Loan Forgiveness an additional opportunity to have their payment amounts assessed, potentially giving them more credit for loan forgiveness.
Conservative groups argued that the adjustments were unconstitutional and, as nonprofits, undermined their recruiting efforts toward PSLF, which cancels student debt for government and nonprofit workers after 10 years of eligible payments.
“When an agency arbitrarily reduces the financial incentive for student loan debtors to seek and retain employment with public service employers, regardless of their wages, the supply of workers willing to accept and retain employment among these employers inevitably declines,” the groups wrote. in an appeal to the Sixth Circuit.
But the Sixth Circuit was not convinced. On May 17, he rejected the groups’ appeal, writing in his decision that the idea that adjusting the accounts would reduce the attractiveness of the PSLF is “unconvincing and illogical.”
“Plaintiffs have not alleged that any of their employees stopped seeking forgiveness from PSLF because of the adjustment,” the court ruling states. “And without supporting facts, this assertion is pure conjecture, not sufficient to demonstrate competitive harm.”
A separate ongoing lawsuit had the same argument – for a different agenda. In March, 11 Republican attorneys general sued to block the income-driven SAVE repayment plan, which the Department of Education implemented last summer to offer borrowers more affordable monthly payments .
Seven other GOP attorneys general filed a lawsuit to block SAVE in April, arguing that the new repayment plan diminishes the value of PSLF and hurts states’ efforts to recruit people into the public sector.
The Biden Department of Education filed a response to the lawsuit Friday, citing the Sixth Circuit’s decision to reject New Civil Society Alliances’ argument that the account adjustments would harm PSLF recruitment efforts of nonprofit organizations non-profit.
“Plaintiffs offer examples of hypothetical current and potential employees and predict, based on the ‘concept of economic incentives,’ how they might act. Economic assumptions alone were not sufficient for the Sixth Circuit , nor, for that matter, for the Supreme Court,” the Department of Education wrote in its legal filing.
“Basically, career-related decisions are complicated and the PSLF is not the only incentive in this economic context,” adds the ministry. “Plaintiffs would like defendants and the court to resolve this complexity on their behalf. But standing is their only burden, and they have not borne it here.”
It’s unclear when the court will rule on the lawsuits seeking to block SAVE, but given the Sixth Circuit’s ruling on the earlier lawsuit seeking to block Biden’s account adjustments, it could indicate how the justices consider the arguments opponents to block targeted student debt relief efforts.
businessinsider
