The Supreme Court has maintained a block on President Joe Biden’s student loan relief program that would extend repayment terms and effectively forgive outstanding debts of $12,000 (£9,100) or less.
It was another blow to Mr Biden’s goal of providing massive relief to millions of Americans after the Supreme Court struck down his attempt to cancel about $400bn of student loans last year.
Earlier this summer, Republican-led states sued to end the latest program, known as Save, saying Mr. Biden overstepped his authority.
Lower courts suspended Save while cases were pending in the courts, and in an emergency decision the Supreme Court upheld one of those laws.
More than 1 in 10 Americans have federal student debt — and it’s become a major election issue for young voters.
So far, Mr Biden has approved almost $150bn in aid for almost five million people – but mostly through executive action, not through Congress.
Mr Biden proposed Save, which stands for “Precious Education Savings”, as “a cost-effective student loan repayment plan”.
More than 400,000 Save participants have seen some or all of their loans canceled, including many low-income borrowers.
The second phase was to further reduce payments from July 1. That included half of the monthly bills for low-income participants.
Republican-led states filed two separate lawsuits this summer, saying only Congress could enact major spending plans and that the relief would be “extraordinarily expensive.”
Federal judges then issued injunctions against Save and indicated that the states would likely prevail in their cases.
In Kansas, US District Judge Daniel Crabtree blocked parts of Save aimed at reducing monthly payments and adjusting payment schedules for borrowers with loans over $12,000.
In Missouri, US District Judge John Ross blocked the education department from forgiving the loan balance.
But since then the cases diverged. The 10th Circuit Court upheld the Kansas order, while the 8th Circuit Court kept the Missouri law in place.
The states and the Biden administration then filed urgent appeals to the Supreme Court, placing the orders in what is often called the “shadow docket”.
On Wednesday, the conservative-majority court upheld the Missouri law.
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