President Joe Biden’s student loan forgiveness initiative can move forward following a judge’s decision on Wednesday to allow the expiration of a temporary restraining order that had been placed on the plan.
This ruling marks a modest success for the Biden administration just weeks before the presidential election. The lawsuit was initiated in September by seven states led by the GOP: Alabama, Arkansas, Florida, Georgia, Missouri, North Dakota, and Ohio, targeting both Biden and Education Secretary Miguel Cardona.
U.S. District Judge Randall Hall issued the order in the Southern District of Georgia, stating that Georgia lacks the standing to contest the plan since it did not demonstrate a sufficient injury that is concrete or imminent.
The judge asserted, “Without standing, the Court finds it proper to dismiss Georgia as a party to the suit for lack of subject matter jurisdiction and proceeds to the arguments regarding venue.” He agreed with the federal government that the venue was inappropriate, noting that a party without standing cannot establish a venue where one does not naturally exist.
Hall determined that the “most equitable result” would be to transfer the case to a district where proper venue exists, specifically the U.S. District Court for the Eastern District of Missouri.
The states involved in the lawsuit contended that the administration’s initiative for mass student debt cancellation could negatively impact income tax revenue. Last month, Judge Hall had extended a temporary restraining order on the plan for an additional 14 days.
This development occurs as the Biden administration is set to release its final rule on the student loan forgiveness plan this month, which could potentially forgive student debt for over 25 million borrowers.
In April, Biden unveiled an updated plan after the Supreme Court invalidated the administration’s original forgiveness program in 2023, which aimed to assist 43 million borrowers by eliminating up to $20,000 in debt, at an estimated cost exceeding $400 billion.
The states filed their lawsuit after the administration announced it would begin reaching out to borrowers with federally held student loans regarding their debt relief options. Should the proposed regulations be finalized this fall, the total number of individuals receiving student debt relief during Biden’s presidency is expected to reach 30 million, according to the Department of Education’s statements in August.