Updated Sep 29, 2022 - Politics & Policy

7 GOP states sue Biden over student loan forgiveness plan

President Biden with Secretary of Education Miguel Cardona in the White House on August 2022.

President Biden with Secretary of Education Miguel Cardona in the White House on August 2022. Photo: Demetrius Freeman/The Washington Post via Getty Images

Seven Republican-led states have filed lawsuits against President Biden, Secretary of Education Miguel Cardona and the Department of Education over the Biden administration's student loan forgiveness plan.

Why it matters: It's the second lawsuit filed against the Department of Education this week as part of attempts to block the plan, which would alleviate some of the debt burden of 43 million Americans but has drawn opposition from Republicans and Democrats in battleground states.

Six states, Nebraska, Arkansas, Missouri, Iowa, Kansas and South Carolina, were the first to allege the Biden administration overstepped its executive powers in going forward with the program.

  • The states asked a federal court in Missouri to issue a temporary restraining order to pause the program, which was expected to begin in "early October," according to Cardona.
  • Arizona joined state-led litigation efforts with Attorney General Mark Brnovich filing a lawsuit late Thursday.
  • Additional lawsuits could be forthcoming.

What they're saying: “President Biden’s unlawful political play puts the self-wrought college-loan debt on the backs of millions of hardworking Americans who are struggling to pay their utility bills and home loans in the midst of Biden’s inflation,” Arkansas Attorney General Leslie Rutledge said in a statement Thursday.

  • “President Biden does not have the power to arbitrarily erase the college debt of adults who chose to take out those loans," Rutledge added.

The big picture: The libertarian Pacific Legal Foundation on Tuesday filed a separate lawsuit against the Education Department in a federal court in Indiana.

  • It alleges that plaintiff Frank Garrison, a public interest attorney and an employee of Pacific Legal Foundation, "will face immediate tax liability from the state of Indiana because of the automatic cancellation of a portion of his debt," as Indiana is one of at least seven states that will tax student loan forgiveness.
  • "Mr. Garrison and millions of others similarly situated in the six relevant states will receive no additional benefit from the cancellation—just a one-time additional penalty," the lawsuit reads.
  • Pacific Legal Foundation also asked a court to issue a temporary restraining order to prevent the loan cancellation from going into effect.

By the numbers: Under the plan, up to $20,000 in student debt for Pell Grant recipients would be forgiven and up to $10,000 for individual borrowers who make under $125,000 per year.

  • Approximately 20 million Americans could have their debt completely canceled.
  • The nonpartisan Congressional Budget Office estimated earlier this week that the plan could cost $400 billion over 30 years.

Go deeper ... CBO: Biden's student loan forgiveness plan could cost $400 billion

Editor's note: This story has been updated with new details throughout.

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