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A North Texas federal judge ruled on Thursday that President Joe Biden’s student loan forgiveness program was “unlawful”, the latest challenge to the policy that has seen several attacks from conservative groups.
U.S. District Judge Mark Pittman said in court filings he declared the loan cancellation plan illegal because Biden failed to follow federal procedures to allow public comment before the policy was announced. .
In October, the Job Creators Network Foundation filed a lawsuit in North Texas court on behalf of two borrowers who do not qualify for the full benefits of the program. These borrowers disagreed with the program’s eligibility criteria and the lawsuit alleged that they could not express their disagreement.
The latest attack on Biden’s loan cancellation programs comes after the United States Court of Appeals for the 8th Circuit temporarily halted the program last month in response to a six-state lawsuit led by the GOP. The lawsuit in Texas joins a growing number of legal challenges to the loan forgiveness plan announced by Biden in August. Borrowers began applying for the program in October.
Since then, Republicans and other advocacy groups have attacked the program as a handout to high-earning professionals. Gov. Greg Abbott signed a letter in September saying forgiveness of student loans would hurt the working class.
But people who earn more than $125,000 are not eligible for the loan relief program. Eligible applicants are limited to $10,000 in aid unless they are recipients of Pell grants for low-income students, in which case they can get up to $20,000 in aid.
In 2021, 56% of students graduating from four-year public universities had student debt of around $25,000, according to the Texas Higher Education Coordinating Board. Biden’s decision to forgive more money for low-income students who have qualified for federal Pell grants will have a particular impact on low-income borrowers and people of color, who are more likely to receive aid. financial institution and having higher student loan debt.
The Texas lawsuit alleges that Biden’s program violated the Administrative Procedure Act by not providing for a public comment period. The lawsuit also argues that the Education Secretary does not have the power to implement the program.
Alexander Taylor, one of the plaintiffs, is not eligible for a $20,000 rebate because he was not awarded a Pell grant, which is only available to low-income students, and therefore will not have entitled to only $10,000 off his student loans.
The other plaintiff, Myra Brown, has private loans that are no longer covered by Biden’s plan. Earlier in the program’s existence, loans held by companies like Brown’s could be consolidated into direct loans, which meet Biden’s program eligibility criteria, but the Department of Education changed that policy after having filed several lawsuits from conservative states.
In response to the lawsuit, the Justice Department argued last month that Biden’s plan required no notice or comment.
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