NCLA Asks Supreme Court to Block Education Dept.’s Latest Illegal Scheme to Cancel Student Loan Debt
2024年7月17日 - 6:27AM
Today, the New Civil Liberties Alliance filed an amicus curiae
brief in Alaska, South Carolina, and Texas v. Dept. of Education,
urging the Supreme Court to restore a preliminary injunction
against the Department’s illegal “SAVE” plan for transferring $475
billion in student loan debt to taxpayers. The Department’s scheme
rewrites 1993 amendments to the Higher Education Act (HEA),
transforming loan-repayment plans that Congress authorized into
loan-cancellation plans that Congress did not authorize. In an
unreasoned decision, a divided panel of the U.S. Court of Appeals
for the Tenth Circuit stayed the district court’s injunction
blocking the Department’s new plan. Partnering with the Cato
Institute, Mackinac Center for Public Policy, and Defense of
Freedom Institute as amici curiae, NCLA calls for a halt to this
unconstitutional Executive Branch attempt to wield legislative
power.
The district court issued the preliminary
injunction stopping SAVE because the states of Alaska, South
Carolina, and Texas are likely to prevail in their claim that it
exceeds the Secretary of Education’s authority under the 1993 HEA
amendments. The amendments state that “income contingent repayment
shall be based on the [borrower’s] adjusted gross income,” and
would “not … exceed 25 years.” The Department claims this language
allows it to enact SAVE, an income-contingent repayment plan with
monthly payments so low that very little would be repaid by the end
of the repayment period, at which point the substantial remaining
balance would be cancelled.
Nothing in the 1993 amendments’ text or
legislative history suggests Congress granted the Department
discretion to design plans like SAVE that prioritize the
cancellation of loans instead of their repayment. If the 1993 law
did grant such power, it would be an unconstitutional delegation of
legislative power, as it contains no intelligible principle to
guide the Department’s discretion of how generous to make repayment
plans.
To make matters worse, the Department’s scheme
is arbitrary and capricious, as it was promulgated without
addressing comments about the massive amount of debt it attempts to
cancel. The Supreme Court recently granted a stay in Ohio v.
Environmental Protection Agency because EPA offered no “reasonable
response” to comments casting doubt on the cost-benefit analysis of
its final rule. For the same reason, the Justices should restore
the preliminary injunction against the Department of Education.
The Department’s illegal scheme completely
erases the recruitment and employee-retention benefits state
employers hold under the Public Service Loan Forgiveness
program, which allows Americans to have student debt forgiven by
completing ten full years of work for qualified non-profit
employers while making monthly payments. Losing this competitive
advantage in the labor market inflicts direct and immediate
competitive harm on Alaska, South Carolina, Texas, and other
States, as well as NCLA’s amici partners.
NCLA released the following statements:
“The Department claims it has had the power
since 1993 to cancel as much student-loan debt as it wants under
the guise of income-driven repayment (IDR) plans. But if that were
true, why did Congress enact legislation in 2007 and again in 2010
to establish IDR plans with explicit limits that are far less
generous than what the Department now claims it could have
established any time since 1993? The answer, of course, is that
Congress never authorized the Department to design any plan that is
more generous than what Congress has enacted. The Supreme Court
should reinstate the injunction against this unlawful
plan.”— Sheng Li, Litigation Counsel,
NCLA
“The Department of Education is thumbing its
nose at the U.S. Supreme Court’s decision in Biden v. Nebraska last
year. Here’s hoping the Court takes advantage of this opportunity
to enjoin the SAVE plan and prevent further arrogation of
legislative power and even more illegal spending by Biden’s
Department of Education.”
— Mark Chenoweth, President, NCLA
For more information visit the amicus
page here.
ABOUT NCLA
NCLA is a nonpartisan, nonprofit civil rights
group founded by prominent legal scholar Philip Hamburger to
protect constitutional freedoms from violations by the
Administrative State. NCLA’s public-interest litigation and other
pro bono advocacy strive to tame the unlawful power of state and
federal agencies and to foster a new civil liberties movement that
will help restore Americans’ fundamental rights.
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Ruslan Moldovanov
New Civil Liberties Alliance
202-869-5237
ruslan.moldovanov@ncla.legal