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The Biden administration is changing who qualifies for student loan cancellation

SCOTT SIMON, HOST:

President Biden's efforts to cancel up to $20,000 per person in federal student loan debt was hit by lawsuits this week, one on Tuesday, two more on Thursday. And NPR's Cory Turner says additional lawsuits are likely. Cory, thanks so much for being with us.

CORY TURNER, BYLINE: Thanks for having me, Scott.

SIMON: Who's filing the lawsuits? Why?

TURNER: Yeah, they're coming from a range of conservative politicians, interest groups and attorneys, and they've been pretty clear. They think Biden's loan relief plan is an illegal abuse of power. They say Congress controls government spending, and the president can't simply erase hundreds of billions of dollars in student loans without going through lawmakers. Here's Arizona Attorney General Mark Brnovich, who was behind one of those Thursday lawsuits.

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MARK BRNOVICH: The president isn't a king. He's not an emperor. And if he does something unconstitutional, hell yeah, I'm going to hold him accountable. I'm going to make sure that he does the right thing in the right way.

SIMON: And how does the Biden administration respond?

TURNER: Well, twice this past week, the U.S. Department of Education subtly shifted its debt relief plan, essentially trying to undercut these legal challenges. So first, it announced borrowers could opt out of debt relief. And that was after a lawsuit from a borrower who claimed he would be hurt by automatic debt relief. And then on Thursday, the department quietly changed the rules around borrowers who hold these old FFEL loans. FFEL stands for federal family education loans. And the change came really at the same time as a lawsuit arguing that erasing a lot of these old FFEL loans would actually hurt the private banks and state agencies that manage them 'cause Biden's original debt relief plan allowed these borrowers to consolidate their old loans into new federal loans and qualify for cancellation. But on Thursday, the administration suddenly changed course, saying these borrowers no longer qualify.

SIMON: Which is a big change. What can you tell us about the borrowers here who are suddenly getting excluded?

TURNER: Yeah, I think the most important thing to note here is that these are often really vulnerable borrowers because the FFEL program stopped back in 2010, so 12 years ago. Sarah Turner, a higher ed economist at UVA, tweeted that this kind of old debt is disproportionately held by people attending community colleges, historically Black colleges and universities, and for-profit colleges. And, you know, I've seen a lot of frustration, Scott, on social media and in my email inbox from borrowers who suddenly don't qualify for cancellation that they were told they would.

SIMON: And any idea how many would be excluded by this change?

TURNER: Oh, man, I - this has been a tough one. It's a lot of educated guesswork. We know there are roughly 4 million of these borrowers with old FFEL loans. The administration insists it won't affect nearly that many. An administration official told me on Thursday they think it's closer to 800,000 or so borrowers. Personally, I think the truth is probably somewhere in the middle, but we just don't know yet.

SIMON: And anything else borrowers should know?

TURNER: I mean, I should say the Education Department insists it is still exploring other legal options to help these borrowers. And also some of these borrowers might well qualify for a different kind of loan forgiveness, the limited expansion of public service loan forgiveness, and that is still available until the end of October.

SIMON: Cory, should we expect to see more changes in the coming weeks in response to these legal challenges?

TURNER: You know, Scott, I've been thinking of this process now as a kind of awkward dance. You know, a lawsuit pops up pursuing a specific legal strategy, and then the Ed Department moves to protect itself as best it can. If anything, I think what's surprising at this point is that the department didn't tailor its plan more from the start. You know, I can tell you, I have talked with a lot of higher education experts and lawyers this past week who say, look, the legal arguments we're seeing now should have been obvious long before this plan was ever announced.

SIMON: NPR's Cory Turner, thanks so much.

TURNER: You're welcome. Transcript provided by NPR, Copyright NPR.

Scott Simon is one of America's most admired writers and broadcasters. He is the host of Weekend Edition Saturday and is one of the hosts of NPR's morning news podcast Up First. He has reported from all fifty states, five continents, and ten wars, from El Salvador to Sarajevo to Afghanistan and Iraq. His books have chronicled character and characters, in war and peace, sports and art, tragedy and comedy.
Cory Turner reports and edits for the NPR Ed team. He's helped lead several of the team's signature reporting projects, including "The Truth About America's Graduation Rate" (2015), the groundbreaking "School Money" series (2016), "Raising Kings: A Year Of Love And Struggle At Ron Brown College Prep" (2017), and the NPR Life Kit parenting podcast with Sesame Workshop (2019). His year-long investigation with NPR's Chris Arnold, "The Trouble With TEACH Grants" (2018), led the U.S. Department of Education to change the rules of a troubled federal grant program that had unfairly hurt thousands of teachers.