The new suit is one of a growing number of legal challenges against the proposal to cancel up to $20,000 in debt for some borrowers.
, calls the plan an illegal overreach that would increase state tax burdens for some Americans who get their debt forgiven. a local taxpayers group, the Brown County Taxpayers Association, that sought to block the program, ruling that the group didn’t have standing to bring the lawsuit. The group had argued that Biden’s order unlawfully circumvented Congress’ power over spending and said the plan was discriminatory because it sought to give particular help to borrowers of color.
“Behind closed doors, the Department promulgated a new Debt Forgiveness Program that will affect tens of millions of Americans and cost hundreds of billions of dollars,” the lawsuit reads. “Instead of providing notice and seeking comment from the public, the Department hammered out the critical details of the Program in secret and with an eye toward securing debt forgiveness in time for the November election.
The case was assigned to U.S. District Judge Reed O’Connor, who most notably ruled in 2018 that the Affordable Care Act was unconstitutional. The Supreme Court reversed that decision last year. O’Connor, an appointee of former President George W. Bush, also has ruled against other policies pursued by Democratic administrations. Last month, he ruled that an ACA provision that required coverage of an HIV prevention drug violates a Texas employer’s religious beliefs.
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