Two new student debt relief programs from Biden barrel towards imminent release

As the Biden administration approaches its final days, two new student debt relief programs are on the brink of being released after undergoing final review before formal implementation. These programs include a second attempt at providing widespread student loan forgiveness under the Higher Education Act, known informally as “Plan B,” which comes after federal courts deemed the administration’s initial effort at broad-based student loan forgiveness via executive action as unconstitutional. The second program, aimed at individuals facing financial hardships, aims to provide student debt relief to even more borrowers.

Both programs were submitted for review to the Office of Management and Budget as of Tuesday, marking one of the final steps before the policies are officially published in the Federal Register.

Following the Supreme Court’s rejection of the Biden administration’s initial attempt at broad-based student loan forgiveness, the president and his team began working on a new plan. “Plan B” looks to provide relief to around 23 million borrowers, particularly those whose outstanding loan balance has been significantly impacted by accruing interest. Additionally, the second program seeks to offer additional student loan forgiveness for 8 million borrowers experiencing financial difficulties.

If finalized, the new rule would grant student debt forgiveness on a one-time basis for individuals deemed to have at least an 80% chance of defaulting on loans based on a predictive assessment using existing borrower data.

However, not everyone is in favor of these new initiatives. Rep. Virginia Foxx, chair of the House Committee on Education and the Workforce, criticized the Biden administration’s efforts, labeling them as a “Band-Aid” that shifts the burden of paying off someone else’s debt onto taxpayers. She argued that the administration should focus on addressing the root causes of the broken student loan system instead of pushing for widespread loan forgiveness.

On the legal front, Madison Doan, a senior researcher at the Heritage Foundation’s Center for Education Policy, expressed doubts that the Biden administration’s student debt forgiveness efforts would hold up in court, citing recent legal precedents. Two Democratic-appointed judges have indicated that opponents of the rules are likely to succeed in challenging their legality.

In addition to the two pending programs, the Biden administration is also working on a new interim rule to reopen enrollment in an income-driven student debt repayment plan currently tied up in the courts. This new rule includes modifications to the original plan to prevent legal challenges that halted its implementation.

While the Biden administration continues to pursue student loan forgiveness through executive action, some experts believe that a more stable solution would involve working with Congress to hammer out a deal. President-elect Trump has yet to outline his plans regarding the Biden administration’s student loan forgiveness policies, but he has signaled intentions to reform the federal government’s role in U.S. education during his term.

As the Biden administration leverages executive rulemaking to implement policy changes, it has set a new record for the most Federal Register pages filled in a single year. This approach has been a cornerstone of the administration’s efforts to enact reforms, with over 96,000 pages already filled as of December 3rd. The administration is on track to surpass 100,000 pages by the end of its term, showcasing its commitment to making significant policy changes through administrative avenues.