Nearly 1.4 million Texans could be impacted by U.S. Supreme Court decision blocking student loan forgiveness The court ruled in favor of the six GOP-led states that alleged President Joe Biden overstepped his authority with his loan forgiveness plan. BYJUNE 30, 2023UPDATED: 3 PM CENTRAL Sign up for The Brief, The Texas Tribune’s daily newsletter that keeps readers up to speed on the most essential Texas news. Nearly 1.4 million Texans poised to have some or all their student debt canceled by the federal government will have to continue paying off their loan balances after the U.S. Supreme Court ruled Friday that the Biden administration’s student loan forgiveness plan is unconstitutional. A student sits by the Littlefield Fountain at the University of Texas. The U.S. Supreme Court on Friday ruled that the Biden administration’s student loan forgiveness program is unconstitutional, which affects more than 1 million Texans.Leila Saidane/The Texas Tribune M EN U DONATEPaxton ImpeachmentTexas HeatProperty Tax ImpasseAffirmative Action CaseTexas Tribune Festival COPY LINK Tuoqer Ahmed Type your text 3The court handed down opinions in two cases challenging President Joe Biden’s authority to issue his loan forgiveness plan under the Higher Education Relief Opportunities for Students Act. In a 6-3 ruling, the court ruled in favor of the six GOP-led states that alleged Biden overstepped his authority as president with his loan forgiveness plan. The court unanimously ruled that the two Texas students who said the federal government did not provide a public comment period for them to register their dissent did not have standing to sue and threw out their case. In Biden v. Nebraska, the court ruled that Biden did not have the authority to issue the forgiveness plan under the HEROES Act, a federal law passed in the wake of the Sept. 11, 2001, terrorist attacks that allows the education secretary to change student loan programs for those affected by the attack. In 2003, Congress extended the law so the federal government could provide loan relief to students impacted by war or a national emergency

1. Nearly 1.4 million Texans could be
impacted by U.S. Supreme Court decision
blocking student loan forgiveness
The court ruled in favor of the six GOP-led states that alleged President Joe
Biden overstepped his authority with his loan forgiveness plan.
BY JUNE 30, 2023 UPDATED: 3 PM CENTRAL
Sign up for The Brief, The Texas Tribune’s daily newsletter that keeps readers up to speed
on the most essential Texas news.
Nearly 1.4 million Texans poised to have some or all their student debt canceled by
the federal government will have to continue paying off their loan balances after the
U.S. Supreme Court ruled Friday that the Biden administration’s student loan
forgiveness plan is unconstitutional.
A student sits by the Littlefield Fountain at the University of Texas. The U.S. Supreme Court on Friday ruled
that the Biden administration’s student loan forgiveness program is unconstitutional, which affects more than
1 million Texans. Leila Saidane/The Texas Tribune
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2. The court handed down opinions in two cases challenging President Joe Biden’s
authority to issue his loan forgiveness plan under the Higher Education Relief
Opportunities for Students Act. In a 6-3 ruling, the court ruled in favor of the six
GOP-led states that alleged Biden overstepped his authority as president with his
loan forgiveness plan.
The court unanimously ruled that the two Texas students who said the federal
government did not provide a public comment period for them to register their
dissent did not have standing to sue and threw out their case.
In Biden v. Nebraska, the court ruled that Biden did not have the authority to issue
the forgiveness plan under the HEROES Act, a federal law passed in the wake of the
Sept. 11, 2001, terrorist attacks that allows the education secretary to change
student loan programs for those affected by the attack. In 2003, Congress extended
the law so the federal government could provide loan relief to students impacted by
war or a national emergency.
When Biden released his plan last August, he said he had the power to provide
student loan relief to students impacted by the COVID-19 pandemic, a national
emergency.
“The HEROES Act allows the Secretary to ‘waive or modify’ existing statutory or
regulatory provisions applicable to financial assistance programs under the
Education Act, but does not allow the Secretary to rewrite that statute to the extent
of canceling $430 billion of student loan principal,” Chief Justice John Roberts wrote
in the majority opinion.
The ruling means all students with debt will need to resume repaying their loans in
October.
It is a major blow for Biden, who promised during his presidential campaign that if
elected he would address student debt.

3. On Friday afternoon, Biden announced that the administration started a new
regulatory process to provide student debt relief under the Higher Education Act,
which would give Education Secretary Miguel Cardona the ability to "compromise,
waive or release loans under certain circumstances," the president said, adding that
it is a longer process that allows for public comment.
Biden also announced a 12-month "on-ramp" repayment plan where lenders would
not refer a borrower who misses a payment to credit agencies, allowing them to
avoid default on their loans, which can have a long-term impact on someone's credit
score.
Former President Donald Trump initially paused student debt payments at the start
of the COVID-19 pandemic, and Trump and Biden have since extended the pause
nine times. But earlier this month, the federal government announced that interest
would start accruing again in September with payments resuming in October.
Under Biden’s plan, individuals earning $125,000 or less annually would see $20,000
in student loan debt erased if they received a federal Pell Grant to help pay for
college. Those who took out loans but did not qualify for those federal grants would
have $10,000 eliminated from their student loan debt. The loan forgiveness program,
which applies to borrowers regardless of whether they earned degrees, was halted in
November as the cases made their way through the courts.
In the dissenting opinion, Justice Elena Kagan wrote that the court’s decision
overstepped the authority Congress granted to the U.S. Secretary of Education under
the HEROES Act.
“In establishing the loan forgiveness plan, the current Secretary scratched the pre-
existing conditions for loan discharge, and specified different conditions, opening
loan forgiveness to more borrowers,” she wrote. “That may have been a good idea, or
it may have been a bad idea. Either way, the Secretary did only what Congress had

4. told him he could.”
Data from the office of Federal Student Aid shows that as of March, Texas has 3.8
million residents with student loan debt totaling $127.3 billion. Texas has the
second-highest amount of borrowers and debt, behind California, where nearly 4
million students owe $149.7 billion.
In 2021, 56% of students who graduated from four-year public universities in Texas
had approximately $25,000 in student debt, according to the Texas Higher Education
Coordinating Board. Biden’s decision to forgive more money for low-income
students who qualified for federal Pell Grants would have especially impacted low-
income borrowers and people of color, who are more likely to qualify for federal
financial aid and carry higher amounts of student loan debt.
In a statement, the Texas chapter of Democrats for Education Reform slammed the
court’s back-to-back decisions to strike down the loan forgiveness plan and
Thursday’s decision to end the use of race in college admissions.
While first-generation college students, students from low-income families and
students of color begin to navigate back-to-back Supreme Court decisions designed
to undermine their ability to access the transformative power of higher education,
advocates and policymakers must redouble our efforts to create effective and
affordable pathways to higher education and career training for ALL students,” said
Garry Jones, the group’s executive director.
Meanwhile, more right-leaning groups praised the ruling as victory for "separation of
powers and the rule of law."
The Court correctly held that when Congress gave the executive branch the power to
“waive or modify” certain provisions of law, it did not grant the power to make basic
and fundamental changes that transform federal student-loan policy," said Thomas
Berry, a research fellow at the Cato Institute, a libertarian think tank. "The Framers
designed our system so that such fundamental questions would be debated and
decided in Congress, and that is where such decisions must be made."

5. The Supreme Court heard two cases challenging Biden’s plan earlier this year. One
was filed by six GOP-led states, not including Texas. In that lawsuit, the states
argued that Biden used the pandemic as a pretext to deliver on a campaign promise,
exceeding his authority as president. During oral arguments, the federal government
argued that the states do not have standing to argue their case.
In his opinion Friday, Roberts said that Missouri, one of the states that sued, did
have standing because the forgiveness plan would've cost a nonprofit student loan
servicer set up by the state called $44 million annually in fees.
"[W]here a State has been harmed in carrying out its responsibilities, the fact that it
chose to exercise its authority through a public corporation it created and controls
does not bar the State from suing to remedy that harm itself," Roberts wrote.
The second lawsuit was filed by the Job Creators Network Foundation on behalf of
two Texas students who argued the program was illegal because it didn’t allow for a
public comment period. In November, a federal judge in Texas agreed with the
plaintiffs and struck down the plan. The Justice Department has argued it did not
have to ask for public comment.
The Job Creators Network Foundation is a conservative advocacy group bankrolled
by Home Depot co-founder Bernie Marcus. In the lawsuit, those borrowers alleged
they were not given an opportunity to voice their disagreement with the program’s
eligibility criteria.
Alexander Taylor, one of the plaintiffs who graduated from the University of Texas at
Dallas, is not eligible for $20,000 in forgiveness because he did not receive a Pell

6. Grant, which is only available to low-income students, and therefore would have
been entitled to $10,000 off his student loans.
The other plaintiff, Myra Brown, has privately held loans that are no longer covered
by Biden’s plan. Earlier in the program’s existence, commercially held loans like
Brown’s could be consolidated into loans borrowed directly from the federal
government rather than a lender, which meet the eligibility requirements of Biden’s
program, but the Education Department changed this policy after fielding multiple
lawsuits from conservative states.
Brown graduated from the University of Texas at El Paso and the Cox School of
Business at Southern Methodist University in Dallas.
Student loan forgiveness has long been a major policy objective among Democrats.
Its backers say student debt is holding back graduates from economic mobility and
discouraging potential students from pursuing levels of education that could
improve their financial prospects.
But Republicans have argued that loan forgiveness is unfair to students who have
paid off their loans and that it could pour more cash into the economy and
exacerbate inflation. They also protest against using tax dollars from Americans who
never went to college to help those who did. Texas Gov. Greg Abbott wrote in a letter
in September that student loan forgiveness would harm the working class.
In a statement, U.S. Rep Lloyd Doggett, who represents Austin, said the ruling gives
more urgency to national efforts to make higher education more affordable for
students and families.
“Crushing debt is crushing the future of those trying to buy a home, start a family or
save for retirement," he said. "This decision will not deter our efforts to overcome
GOP obstruction and make higher education more affordable while providing relief
to Americans as they continue to bounce back from the pandemic.”