TOPEKA, Kansas (AP) — Federal judges in Kansas and Missouri on Monday jointly blocked much of a Biden administration student loan repayment plan that would give millions of borrowers a faster path to repayment and lower monthly payments.
The judges’ rulings prevent the U.S. Department of Education from helping many of the designated borrowers ease their loan repayment burdens under a rule set to take effect July 1. But the rulings do not repeal any aid already provided to borrowers.
In Kansas, U.S. District Judge Daniel Crabtree ruled in a lawsuit filed by the state’s Attorney General, Kris Kobach, on behalf of his state and 10 others. In his ruling, Crabtree allowed parts of the program that allows students who borrowed $12,000 or less to have the rest of their loans forgiven if they make payments for 10 years, instead of the usual 25 years.
But Crabtree said the Education Department would not be allowed to implement parts of the program designed to assist students with higher-income loans, which could reduce monthly payments and shorten the required repayment period from 25 to 20 years.
In Missouri, U.S. District Judge John Ross’s order covers different parts of the program than Crabtree’s. His order says the U.S. Department of Education cannot forgive loan balances going forward. He said the department can still lower monthly payments.
Ross issued a ruling in a lawsuit filed by Missouri Attorney General Andrew Bailey on behalf of his state and six others.
Taken together, the two rulings, each handed down by a judge appointed by former Democratic President Barack Obama, appeared to sharply limit the scope of the Biden administration’s efforts to assist borrowers after the U.S. Supreme Court rejected the Democratic president’s first attempt at debt forgiveness last year. Both judges said Education Secretary Miguel Cardona had exceeded the authority granted by Congress in student loan laws.
Bailey and Kobach hailed their state judge’s decision as a major legal victory against the Biden administration, arguing, like many Republicans, that forgiving some student loans would shift the cost of repayment onto taxpayers.
“Only Congress has financial power, not the president,” Bailey said in a statement. “Today’s ruling was a major victory for the rule of law and for every American that Joe Biden sought to force to pay off the debts of others.”
The White House said it strongly disagrees with the judges’ decision, will continue to defend the program, and will apply every available tool to provide relief to students and borrowers.
In a statement, White House press secretary Karine Jean-Pierre said the Biden administration “will never stop fighting for students and borrowers – no matter how many obstacles Republican officials and special interests put in our way.”
In a statement posted on social media platform X, officials at the Student Borrower Protection Center, which campaigns to eliminate student debt, called the decisions a “partisan propaganda tool” and “a recipe for chaos throughout the student loan system.”
“Millions of borrowers are currently in a bind, trying to understand their legal rights and the information provided by the government and their student loan companies,” said the group’s executive director, Mike Pierce.
In both lawsuits, the plaintiff states sought to invalidate the entire program, which the Biden administration first made available to borrowers in July 2023 and at least 150,000 borrowers had their loans canceled. But the judges noted that the lawsuits were not filed until overdue March in Kansas and early April in Missouri.
“The Court therefore fails to see how plaintiffs can complain of irreparable harm they have caused,” Crabtree wrote in his opinion.
Both orders are provisional, meaning the injunctions issued by the judges will remain in effect while each lawsuit is heard. However, to issue a preliminary injunction, each judge had to conclude that the states were likely to prevail in a trial.
Kobach called Biden’s plan “unconstitutional” and an insult to “workers in Kansas who didn’t go to college.”
Crabtree’s decision had a certain irony: Kansas is no longer a party to the lawsuit filed by Kobach. Earlier this month, Crabtree ruled that Kansas and seven other states involved in the lawsuit — Alabama, Idaho, Iowa, Louisiana, Montana, Nebraska and Utah — failed to prove they were harmed by the fresh program and dismissed them as plaintiffs.
That left Alaska, South Carolina and Texas, and Crabtree said they could sue because all of those states have a state agency for managing student loans.
But Crabtree said lowering monthly payments and shortening the repayment period required for debt forgiveness “exceeds any generosity previously authorized by Congress.”
In the Missouri ruling, Ross said repayment plans and rules were “entirely within the purview” of the department, but the “plain language” of U.S. law did not give it the authority to forgive loans before 25 years had passed.
Missouri also has an agency that manages student loans. The other states against which the lawsuit was filed are Arkansas, Florida, Georgia, North Dakota, Ohio and Oklahoma.
___ This story has been updated to clarify that while the judges’ decisions block much of the Biden plan overall, they could still ease loan repayment burdens for some borrowers in the future.
