Higher Ed Policy Roundup: Vol. 6 - Issue 30

On Monday, the Office of Information and Regulatory Affairs and the Office of Management and Budget received and will review the Education Department’s (ED) draft of regulations creating a new income-driven repayment (IDR) plan. Recall that in August, the Biden-Harris Administration announced plans to create a new IDR plan that would:

• Cap payments for undergraduate loans at five percent of discretionary income;
• Forgive debt after 10 years for those with $12,000 or less in debt;
• Eliminate the accrual and capitalization of any unpaid monthly interest; and
• Define discretionary income as 225 percent of the federal poverty level.

ED is working to implement the new IDR plan in July 2023.

There are several updates on legal challenges to the Biden-Harris Administration’s debt forgiveness plan.Last Friday, the Supreme Court rejected a challenge by the Pacific Legal Foundation to block the loan forgiveness plan from going into effect. This is the second rejection from the Supreme Court who, in late October, declined to take up an emergency appeal by a group of Wisconsin taxpayers who claimed that the debt forgiveness plan violated their constitutional rights.

Yesterday, a U.S. District judge in Texas struck down the student loan forgiveness program in a case brought by the Job Creators Network Foundation. The judge called the program an "unconstitutional exercise of Congress's legislative power." This suit was brought on behalf of a borrower that did not qualify for the full $20,000 in debt relief, as well as a FFELP borrower who is ineligible for forgiveness. The Justice Department has appealed the ruling.

Details regarding the lawsuit that could possibly derail President Biden’s student-debt cancellation plan.

What the latest election results mean for student loan forgiveness – four key takeaways.

There were no relevant student-aid related bills recently introduced for consideration by the 117th Congress (2021-2022).