BROWN COUNTY, WI (WTAQ-WLUK) – The Brown County Taxpayers Association is suing President Joe Biden’s administration over the plan to forgive student loan debt.
The BCTA filed its suit in federal court Tuesday. It is working with the Wisconsin Institute for Law and Liberty, a conservative law firm.
The lawsuit alleges Biden’s move violates the constitutional separation of powers because he made it without congressional approval; violates the equal protection doctrine because White House documents say the debt forgiveness is “more likely” to help “borrowers of color;” and violates the Administrative Procedures Act.
“It’s really a dangerous precedent for presidents, regardless of whether it’s a Democrat president or a Republican president,” said Dan Lennington, a lawyer for the Wisconsin Institute for Law and Liberty.
The loan forgiveness program uses the HEROES Act, signed in the wake of the 9/11 attacks as justification for the president’s power to forgive loans, resulting from the COVID-19 emergency. The lawsuit argues the HEROES Act does not cover student loan forgiveness.
“That is not the type of country we live in,” said Lennington. “We don’t let the President just make laws and appropriate money and forgive debts, unless that President has authority under the constitution or under a federal law, and he doesn’t have any authority to do what he’s done.”
The BCTA is asking for a temporary restraining order and preliminary injunction to stop the loan forgiveness while the lawsuit is being decided.
“Once a loan is forgiven, it cannot easily be undone. A narrow temporary restraining order resolves any threat of serious delay,” the suit argues.
No hearings have been scheduled in the case.
FOX 11 reached out to the White House for a response to the lawsuit and received the following statement from a spokesperson:
“Republican officials are standing with special interests to try to keep millions of borrowers under mountains of unmanageable student loan debt. The President and his Administration are lawfully acting to give working and middle class families breathing room as they prepare to resume loan payments in January. The pandemic impacted individuals from all backgrounds and communities — from small towns, rural communities, big cities and everywhere in between. The Administration’s actions will support those most at financial risk of default or delinquency when loan payments resume — with 90% of the benefits going to people earning less than $75,000 per year.”
Under Biden’s plan, borrowers who earn less than $125,000 a year, or families earning less than $250,000, would be eligible for $10,000 of their loans to be forgiven.
Last week, the Congressional Budget Office estimated the plan would cost about $400 billion over the next 30 years.
Also last week, a legal advocacy group in California sued the Biden administration, alleging loan cancellation will harm some people by requiring them to pay taxes on debt they wouldn’t otherwise owe.
Wisconsin is among a handful of states that would tax loan forgiveness under current law.
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