The Department of Education is no longer accepting applications for its student debt relief program after a Texas judge blocked the program from continuing Thursday night.
“Student loan debt relief is blocked,” says the government’s student debt relief website. “Courts have issued injunctions blocking our student debt relief program. For this reason, we are currently not accepting applications.”
“We are seeking to overturn these orders,” the website reads, referring to an appeal filed by the Justice Department late Thursday.
The program, announced in late August, would award borrowers earning less than $125,000 per year, or $250,000 as a married couple, and $20,000 to borrowers who meet the same salary standards and also receive Pell Grants for college, $10,000 in relief are federal grants for low-income families.
The Biden administration had pledged to begin debt relief before Dec. 31 when the moratorium on student debt payments is lifted after a two-year hiatus because of the COVID-19 pandemic.
However, this is the first time a lawsuit has prompted the Department of Education to drop its request, clouding the question of whether borrowers will see relief before they have to start paying back their loans again at the start of the new year.
The program has faced a handful of lawsuits in recent months. Two of those lawsuits were dismissed by courts, which found that the Conservative groups that filed the complaints failed to gain traction, while another lawsuit, heard recently in the Eighth Circuit Court of Appeals, temporarily paused the program while the arguments were played.
That lawsuit, filed by six Conservative states that opposed the program, allowed borrowers to continue applying for the program but prevented the Department of Education from paying debt forgiveness until the court issued its decision.
But Thursday night’s ruling in Texas brought another, more complicated roadblock to the program.
The lawsuit, filed by a conservative group called the Job Creators Network Foundation, argued that the policy unfairly excludes people and should have been created with more public participation.
U.S. District Judge Mark T. Pittman, who was appointed by former President Donald Trump, wrote in his ruling that this court’s job is not to determine whether the credit easing “constitutes good public policy,” but to focus on the government’s hyperbole to concentrate. “No one can plausibly deny that this is either one of the largest delegations of legislative power to the Executive Branch or one of the largest exercises of legislative power without congressional authority in the history of the United States,” he wrote.
Pittman wrote that there was no clear justification for the Biden administration to exercise such influence.
“The court is not blind to the current political divisions in our country. But it is fundamental to the survival of our republic that the separation of powers as enshrined in our constitution be preserved,” he wrote.
The Biden administration and Secretary of Education Miguel Cardona were quick to respond Thursday night.
White House press secretary Karine Jean-Pierre said they “totally disagree” with the Texas court’s ruling and that the Justice Department has appealed.
Cardona reiterated the White House’s commitment to fighting the ruling and said the Department of Education “will not resign.”
“We are disappointed with the Texas court’s decision to block further forgiveness. Amid efforts to block our debt relief program, we are not resigning. The Department of Justice has appealed today’s decision on our behalf, and we will continue to keep borrowers informed of our targeted relief efforts,” Cardona said.
The government remains confident that the program is “legal and necessary,” Cardona said.
As of last Thursday, around 26 million people had submitted applications for the program. The Biden administration said it approved 16 million of those aid requests once they were legally able to start sending payments.
But recent court troubles mean about 17 million eligible Americans are sidelined from the program for now. The application should be live by December 2023, giving borrowers 12 more months to learn about and apply to the program.
Meanwhile, while the lawsuits are being played out in court, the Department of Education encouraged borrowers to sign up for its newsletter for the most up-to-date information on next steps for the program.