The Supreme Court on Wednesday temporarily halted the Biden administration’s latest student debt relief initiative, known as the SAVE Plan, which aims to ease the burden for lower-income borrowers. In a brief unsigned order, the justices refused the Department of Education’s request to implement the plan while legal challenges continue in lower courts. Notably, no dissents were recorded regarding the order, which urged the U.S. Court of Appeals for the 8th Circuit to expedite its review.
The Supreme Court’s decision also included a second order rejecting another states’ request to block the SAVE Plan. This decision was influenced by a letter from state lawyers indicating that they did not need the Supreme Court’s intervention as long as a related 8th Circuit order remained in effect.
The SAVE Plan was introduced in July 2023 following an earlier Supreme Court ruling in Biden v. Nebraska, which invalidated a different effort by the Biden administration to cancel up to $400 billion in student loans. In that case, Chief Justice John Roberts asserted that the administration overstepped its authority under the HEROES Act, a post-9/11 statute designed to provide relief during national emergencies.
The SAVE Plan seeks to adjust repayment strategies to better suit low-income borrowers by modifying how discretionary income is calculated and reducing the repayment rate from 10% to 5% for undergraduate loans. The plan has faced two primary challenges from Republican-led states. The first, with plaintiffs from Alaska, South Carolina, and Texas, was initially allowed to proceed by a Kansas district court, but key provisions were blocked. Another challenge led by seven states in Missouri also succeeded in temporarily halting the plan, as the U.S. Court of Appeals for the 8th Circuit put most of the plan on hold pending further review.
As these cases make their way through the legal system, the Biden administration sought emergency relief from the Supreme Court to allow implementation of the SAVE Plan. U.S. Solicitor General Elizabeth Prelogar described the initiative as a “straightforward exercise” of the Department of Education’s authority. However, the justices denied the request, emphasizing that the Court of Appeals should make a swift ruling.
For further details, the Supreme Court’s full brief and orders are available on SCOTUSblog.