President Biden’s Student Loan Forgiveness Plan, as announced last August, was set to cancel $10,000 in Federal student debt for those making less than $125,000 or households with less than $250,000 in income per year. Pell Grant recipients would have gotten an additional $10,000 of debt forgiven.

Last week, in its decision in Biden v. Nebraska, the Supreme Court struck down President Biden’s plan, which was premised on the HEROES Act of 2003. The Act states that the  Secretary of the Education Department (ED) can waive or modify student-loan balances in connection with a national emergency such as the COVID-19 pandemic.

Soon after the Court released its decision, Biden announced a new plan to cancel student debt that is based on the Higher Education Act of 1965 (HEA), which doesn’t require a national emergency for relief. The HEA contains a provision concerning student debt that gives the ED Secretary authority to “compromise, waive, or release any right, title, claim, lien, or demand, however acquired, including any equity or any right of redemption.”

Some proponents of student debt relief proposed that the Biden administration invoke the HEA as the basis of the President’s initial debt cancellation program. In 2021, a group of Senate Democrats including Senators Elizabeth Warren of Massachusetts and Chuck Schumer of New York, the majority leader, introduced a resolution urging that step.

As the Covid-19 emergency became more protracted, the Biden administration chose to use the Heroes Act instead of the HEA because it gives the ED Secretary power to “waive or modify” Federal student loan provisions in an emergency. The HEROES Act may have seemed a better choice than the HEA at the time because it shortened the time to implementation by exempting agency actions from notice-and-comment process delays.

On Friday, June 30, President Biden stated that he thought the Supreme Court had interpreted the Heroes Act incorrectly. He asserted that his new approach was “legally sound” and said that he had directed his team to move forward with it as quickly as possible. He said the new plan would move more slowly than the first one, but “In my view, it’s the best path that remains to providing as many borrowers as possible with debt relief.”

Biden v. Nebraska

The case at issue in Biden v. Nebraska was originated by a lawsuit brought by six Republican-controlled states. In its decision, the six conservative justices ruled that the Biden administration had stretched the Heroes Act too far. Should President Biden’s new plan face a similar lawsuit, which seems to be a political certainty, it would ultimately come before the same Supreme Court — raising the question of whether the wording differences between the two statutes will affect the outcome. Reviewing the Biden v. Nebraska decision and dissent may help to assess the odds of success for the second debt reduction plan. 

Biden v. Nebraska: Majority Opinion

Chief Justice John G. Roberts Jr., writing for the majority, said the Heroes Act of  2003, which allows the ED Secretary to “waive or modify” relevant statutes and regulations in emergencies, did not authorize the Biden administration to cancel student debt. “The secretary’s plan has ‘modified’ the cited provisions,” the Chief Justice wrote, “only in the same sense that ‘the French Revolution “modified” the status of the French nobility’ — it has abolished them and supplanted them with a new regime entirely.”

Roberts said the words “waive or modify” could not be legitimately interpreted as conferring the power to cancel debt on such a massive scale. He invoked a recently articulated conservative doctrine that the Court should strike down Executive agency actions that raise “major questions” if Congress did not clearly and unambiguously grant such authority. The majority argued that the Heroes Act was never meant to be used to implement policy with such a “staggering” economic impact.

Biden v. Nebraska: Dissenting Opinion

The legitimacy of the existence of a “major questions doctrine” is disputed.

Justice Elena Kagan wrote a dissent in which she stated “The result here is that the Court substitutes itself for Congress and the Executive Branch in making national policy about student-loan forgiveness. Congress authorized the forgiveness plan (among many other actions); the Secretary put it in place; and the President would have been accountable for its success or failure. But this Court today decides that some 40 million Americans will not receive the benefits the plan provides, because (so says the Court) that assistance is too ‘significant.’” Kagan continued, “From the first page to the last, today’s opinion departs from the demands of judicial restraint. At the behest of a party that has suffered no injury, the majority decides a contested public policy issue properly belonging to the politically accountable branches and the people they represent.”

According to Ankush Khardorim, writing in New York Magazine on June 30, “Lawyers ostensibly deal in rules — their identification, their development, their application — but as the conservative majority on the Supreme Court demonstrated on Friday, the process can easily be manipulated to reach your desired outcome if you create new rules out of whole cloth, or if you contrive an exception so large that the rule is practically meaningless.”


Critics of the decision point out that in the past conservative justices held firm on three legal doctrines that would have made this matter an easy win for the administration. All three of the pre-existing legal doctrines were ignored. They are:

  1. Court conservatives claim to be textualists, focused foremost on what the statutory text says, rather than substituting their own policy judgments.
  1. Court conservatives claim to be guided by the Chevron doctrine, which requires courts to defer to the legal interpretations of Federal agencies regarding the statutory authority delegated to them by Congress.
  1. Court conservatives claim to exercise judicial restraint by recognizing the power afforded the two representative branches of government and by narrowly interpreting rules on who has standing to sue so that politically disgruntled actors cannot prolong policy disagreements under the guise of legal disputes.

Instead of these long-standing doctrines, Roberts’s opinion relied on a legal doctrine that did not exist until the Court used it last year to curtail the EPA’s power to address climate change. Under the new so-called “major questions doctrine,” the Court may disregard the customary rules of statutory interpretation that have governed executive agency action if a majority of justices believe that the “economic and political significance” of the asserted authority exceeds some undefined threshold. It is implied that the agency can only act “pursuant to a clear delegation” from Congress. If a majority of justices believe that the Federal government has overreached in a policy matter, they can apply a harsher standard of review that results in the administration’s policy being superseded by their own.

Additional Plans to Relieve Student Debt

In preparation for a Court finding that a plan based on the HEA is no more permissible than one based on the HEROES Act, the Biden administration is conducting or has proposed other plans to make college more affordable. They are:

Grace Period: The ED will give borrowers a grace period for missed payments when loan payments resume this October after the pause that began in March 2020. Borrowers will be given a 90 day reprieve that could be extended by another 90 days. The ED seeks to ease borrowers back into repayment of their student loans after the long hiatus.

Expanded Access: The ED has erased $66 billion in debt since 2021 for people who work in public service, easing or eliminating the Federal student loan debts of 2.2 million people. More than a million other people have had their debts from for-profit colleges and unaccredited vocational schools eliminated. These less visible measures affect fewer people so they are often viewed as bureaucratic fine-tuning. However, their relief can accumulate in time to more than that available from one large debt forgiveness plan.

Income-Driven Repayment Plan: This improves upon a plan that the ED has had in place to help low-income people pay back, and eventually expunge, their Federal student loans. Under the new proposal, monthly payments will be cut in half, and it will take half the time for people to see their debt expunged. People making under $47,385 a year, which is over 40% of Americans, will be eligible for the plan. They will pay 5% of their disposable income on Federal student loan repayments. After 10 years, the remaining debt will be zeroed out.

Free Community College Tuition: The Biden administration’s $90 billion plan to provide free community college will not be approved by this Congress but will be re-inserted in upcoming budget proposals from the administration. Free community college has been part of Biden’s agenda since the 2020 campaign.

Pell Grant Increase: The administration’s plan to make college more affordable includes an $820 increase in the maximum Pell Grant award and $30 billion for tuition stipends for eligible students at four-year historically Black colleges and universities, tribal colleges, and other minority-serving institutions.