Two conservative groups are asking a federal court to block the Biden administration’s plan to cancel $39 billion in student loans for more than 800,000 borrowers.

In a lawsuit filed Friday in Michigan, the groups argue that the administration overstepped its power when it announced the forgiveness in July, just weeks after the Supreme Court struck down a broader cancellation plan pushed by President Joe Biden.

It asks a judge to rule the cancellation illegal and stop the Education Department from carrying it out while the case is decided. The suit was filed by the New Civil Liberties Alliance on behalf of the Mackinac Center for Public Policy and the Cato Institute.

The Education Department called the suit “a desperate attempt from right wing special interests to keep hundreds of thousands of borrowers in debt.”

“We are not going to back down or give an inch when it comes to defending working families,” the department said in a statement.

It’s part of a wave of legal challenges Republicans have leveled at the Biden administration’s efforts to reduce or eliminate student debt for millions of Americans. Biden has said he will pursue a different cancellation plan after the Supreme Court decision, and his administration is separately unrolling a more generous repayment plan that opponents call a “backdoor attempt” at cancellation.

The Biden administration announced July 14 that it would soon forgive loans for 804,000 borrowers enrolled in income-driven repayment plans. The plans have long offered cancellation after borrowers make 20 or 25 years of payments, but “past administrative failures” resulted in inaccurate payments counts that set borrowers back on their progress toward forgiveness, the department said.

The new action was announced as a “one-time adjustment” that would count certain periods of past nonpayment as if borrowers had been making payments during that time. It moved 804,000 borrowers across the 20- or 25-year mark needed for cancellation, and it moved millions of others closer to that threshold.

It’s meant to address a practice known as forbearance steering, in which student loan servicers hired by the government wrongly pushed borrowers to go into forbearance — a temporary pause on payments because of hardship — even if they would have been better served by enrolling in one of the income-driven repayment plans.

Under the one-time fix, past periods in forbearance were also counted as progress toward Public Service Loan Forgiveness, a program that offers cancellation after 10 years of payments while working in a government or nonprofit job.

Biden’s action was illegal, the lawsuit says, because it wasn’t authorized by Congress and didn’t go through a federal rulemaking process that invites public feedback.

“No authority allows the Department to count non-payments as payments,” the lawsuit says. It adds that the action came in “a press release that neither identified the policy’s legal authority nor considered its exorbitant price tag.”

The conservative groups say Biden’s plan undercuts Public Service Loan Forgiveness. The Mackinac Center and Cato Institute say they employ borrowers who are working toward student loan cancellation through the program. They say Biden’s action illegally accelerates progress toward relief, diminishing the benefit for nonprofit employers.

“This unlawful reduction in the PSLF service requirement injures public service employers that rely on PSLF to recruit and retain college-educated employees,” the suit alleges.

The Cato Institute previously sued the administration over the cancellation plan that was struck down by the Supreme Court. The Mackinac Center is separately challenging Biden’s pause on student loan payments, which is scheduled to end this fall with payments resuming Oct. 1.

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WASHINGTON (AP) — The Biden administration calls it a “student loan safety net.” Opponents call it a backdoor attempt to make college free. And it could be the next battleground in the legal fight over student loan relief.

Starting this summer, millions of Americans with student loans will be able to enroll in a new repayment plan that offers some of the most lenient terms ever. Interest won’t pile up as long as borrowers make regular payments. Millions of people will have monthly payments reduced to $0. And in as little as 10 years, any remaining debt will be canceled.

It’s known as the SAVE Plan, and although it was announced last year, it has mostly been overshadowed by President Joe Biden’s proposal for mass student loan cancellation. But now, after the Supreme Court struck down Biden’s forgiveness plan, the repayment option is taking center stage.

Since the ruling Biden has proposed an alternate approach to cancel debt and also shifted attention to the lesser-known initiative, calling it “the most affordable repayment plan ever.” The typical borrower who enrolls in the plan will save $1,000 a month, he said.

Republicans have fought against the plan, saying it oversteps the president’s authority. Sen. Bill Cassidy, the ranking Republican on the Health, Education, Labor, and Pensions Committee, called it “deeply unfair” to the 87% of Americans who don’t have student loans.

The Congressional Budget Office previously estimated over the next decade the plan would cost $230 billion, which would be even higher now that the forgiveness plan has been struck down. Estimates from researchers at the University of Pennsylvania put the cost at up to $361 billion.

Emboldened by the Supreme Court’s decision on cancellation, some opponents say it’s a matter of time before the repayment plan also faces a legal challenge.

Here’s what to know about the SAVE Plan:

WHAT IS AN INCOME-DRIVEN REPAYMENT PLAN?

The U.S. Education Department offers several plans for repaying federal student loans. Under the standard plan, borrowers are charged a fixed monthly amount that ensures all their debt will be repaid after 10 years. But if borrowers have difficulty paying that amount, they can enroll in one of four plans that offer lower monthly payments based on income and family size. Those are known as income-driven repayment plans.

Income-driven options have been offered for years and generally cap monthly payments at 10% of a borrower’s discretionary income. If a borrower’s earnings are low enough, their bill is reduced to $0. And after 20 or 25 years, any remaining debt gets erased.

HOW IS BIDEN’S PLAN DIFFERENT?

As part of his debt relief plan announced last year, Biden said his Education Department would create a new income-driven repayment plan that lowers payments even further. It became known as the SAVE Plan, and it’s generally intended to replace existing income-driven plans.

Borrowers will be able to apply later this summer, but some of the changes will be phased in over time.

Right away, more people will be eligible for $0 payments. The new plan won’t require borrowers to make payments if they earn less than 225% of the federal poverty line — $32,800 a year for a single person. The cutoff for current plans, by contrast, is 150% of the poverty line, or $22,000 a year for a single person.

Another immediate change aims to prevent interest from snowballing.

As long as borrowers make their monthly payments, their overall balance won’t increase. Once they cover their adjusted monthly payment — even if it’s $0 — any remaining interest will be waived.

Other major changes will take effect in July 2024.

Most notably, payments on undergraduate loans will be capped at 5% of discretionary income, down from 10% now. Those with graduate and undergraduate loans will pay between 5% and 10%, depending on their original loan balance. For millions of Americans, monthly payments could be reduced by half.

Next July will also bring a quicker road to loan forgiveness. Starting then, borrowers with initial balances of $12,000 or less will get the remainder of their loans canceled after 10 years of payments. For each $1,000 borrowed beyond that, the cancellation will come after an additional year of payments.

For example, a borrower with an original balance of $14,000 would get all remaining debt cleared after 12 years. Payments made before 2024 will count toward forgiveness.

HOW DO I APPLY?

The Education Department says it will notify borrowers when the new application process launches this summer. Those enrolled in an existing plan known as REPAYE will automatically be moved into the SAVE plan. Borrowers will also be able to sign up by contacting their loan servicers directly.

It will be available to all borrowers in the Direct Loan Program who are in good standing on their loans.

WHAT ARE THE PROS AND CONS?

Supporters say Biden’s plan will simplify repayment options and offer relief to millions of borrowers. The Biden administration has argued that ballooning student debt puts college out of reach for too many Americans and holds borrowers back financially.

Opponents call it an unfair perk for those who don’t need it, saying it passes a heavy cost onto taxpayers who already repaid student loans or didn’t go to college. Some worry that it will give colleges incentive to raise tuition prices higher since they know many students will get their loans canceled later.

Voices across the political spectrum have said it amounts to a form of free college. Biden campaigned on a promise to make community college free, but it failed to gain support from Congress. Critics say the new plan is an attempt to do something similar without Congress’ approval.

IS IT LEGAL?

That depends on who you ask, but the question hasn’t been taken up by a federal court.

Instead of creating a new payment plan from scratch, the Biden administration proposed changes to an existing plan. It cemented those changes by going through a negotiated rulemaking process that allows the Education Department to develop federal regulations without Congress.

It’s a process that’s commonly used by administrations from both political parties. But critics question whether the new plan goes further than the law allows.

More than 60 Republicans lawmakers urged Education Secretary Miguel Cardona to withdraw the plan in February, calling it “reckless, fiscally irresponsible, and blatantly illegal.”

Supporters argue that the Obama administration similarly used its authority to create a repayment plan that was more generous than any others at the time.

The Biden administration formally finalized the rule this month. Conservatives believe it’s vulnerable to a legal challenge, and some say it’s just a matter of finding a plaintiff with the legal right — or standing — to sue.

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WASHINGTON (AP) — Millions of Americans were waiting to learn the fate of their federal student debt on Wednesday as President Joe Biden prepared to deliver on his campaign promise to provide up to $10,000 in debt cancellation.

Details of the plan have been kept closely guarded, but borrowers who earn less than $125,000 a year would be eligible for the loan forgiveness, according to three people familiar with the decision. Biden is also set to extend a pause on federal student loan payments through January.

If it survives legal challenges that are almost certain to come, Biden’s plan could offer a windfall to a swath of the nation in the run-up to this fall’s midterm elections. More than 43 million owe a combined $1.6 trillion in federal student debt, with almost a third owing less than $10,000, according to federal data.

Still, the action is unlikely to thrill any of the factions that have been jostling for influence as Biden weighs how much to cancel and for whom.

Biden has faced pressure from liberals to provide broader relief to hard-hit borrowers, and from moderates and Republicans questioning the fairness of any widespread forgiveness. The delay in Biden’s decision has only heightened the anticipation for what his own aides acknowledge represents a political no-win situation. The people spoke on the condition of anonymity to discuss Biden’s intended announcement ahead of time.

The continuation of the pandemic-era payment freeze comes just days before millions of Americans were set to find out when their next student loan bills will be due. This is the closest the administration has come to hitting the end of the payment freeze extension, with the current pause set to end Aug. 31.

Wednesday’s announcement was set for the White House after Biden returns from vacation in Rehoboth Beach, Delaware. The administration had briefly considered higher education schools in the president’s home state for a larger reveal, but scaled back their plans.

During the 2020 presidential campaign, Biden was initially skeptical of student loan debt cancellation as he faced off against more progressive candidates for the Democratic nomination. Sens. Elizabeth Warren, D-Mass., and Bernie Sanders, I-Vt., had proposed cancellations of $50,000 or more.

As he tried to shore up support among younger voters and prepare for a general election battle against President Donald Trump, Biden unveiled his initial proposal for debt cancellation of $10,000 per borrower, with no mention of an income cap.

Biden narrowed his campaign promise in recent months by embracing the income limit as soaring inflation took a political toll and as he aimed to head off political attacks that the cancellation would benefit those with higher take-home pay. But Democrats, from members of congressional leadership to those facing tough reelection bids this November, have pushed the administration to go as broad as possible on debt relief, seeing it in part as a galvanizing issue, particularly for Black and young voters this fall.

The frenzied last-minute lobbying continued Tuesday even as Biden remained on his summer vacation. Senate Majority Leader Chuck Schumer, D-N.Y., one of the loudest advocates in recent years for canceling student loan debt, spoke privately on the phone with Biden, imploring the president to forgive as much debt as the administration can, according to a Democrat with knowledge of the call.

In his pitch, Schumer argued to Biden that doing so was the right thing morally and economically, said the Democrat, who asked for anonymity to describe a private conversation.

Inside the administration, officials have discussed since at least early summer forgiving more than $10,000 of student debt for certain categories of borrowers, such as Pell Grant recipients, according to three people with knowledge of the deliberations. That remained one of the final variables being considered by Biden heading into Wednesday’s announcement.

Democrats are betting that Biden, who has seen his public approval rating tumble over the last year, can help motivate younger voters to the polls in November with the announcement.

Although Biden’s plan is narrower than what he initially proposed during the campaign, “he’ll get a lot of credit for following through on something that he was committed to,” said Celinda Lake, a Democratic pollster who worked with Biden during the 2020 election.

She described student debt as a “gateway issue” for younger voters, meaning it affects their views and decisions on housing affordability and career choices. A survey of 18- to 29-year-olds conducted by the Harvard Institute of Politics in March found that 59% of those polled favored debt cancellation of some sort — whether for all borrowers or those most in need — although student loans did not rank high among issues that most concerned people in that age group.

Some advocates were already bracing for disappointment.

“If the rumors are true, we’ve got a problem,” Derrick Johnson, the president of the NAACP, which has aggressively lobbied Biden to take bolder action, said Tuesday. He emphasized that Black students face higher debut burdens than white students.

“President Biden’s decision on student debt cannot become the latest example of a policy that has left Black people — especially Black women — behind,” he said. “This is not how you treat Black voters who turned out in record numbers and provided 90% of their vote to once again save democracy in 2020.”

John Della Volpe, who worked as a consultant on Biden’s campaign and is the director of polling at the Harvard Kennedy School Institute of Politics, said the particulars of Biden’s announcement were less important than the decision itself.

“It’s about trust in politics, in government, in our system. It’s also about trust in the individual, which in this case is President Biden,” Della Volpe said.

Combined with fears about expanding abortion restrictions and Trump’s reemergence on the political scene, Della Volpe said student debt forgiveness “adds an additional tailwind to an already improving position with young people.”

Republicans, meanwhile, see only political upside if Biden pursues a large-scale cancellation of student debt ahead of the November midterms, anticipating backlash for Democrats — particularly in states where there are large numbers of working-class voters without college degrees. Critics of broad student debt forgiveness also believe it will open the White House to lawsuits, on the grounds that Congress has never given the president the explicit authority to cancel debt on his own.

The Republican National Committee on Tuesday blasted Biden’s expected announcement as a “handout to the rich,” claiming it would unfairly burden lower-income taxpayers and those who have already paid off their student loans with covering the costs of higher education for the wealthy.

“My neighbor, a detective, worked 3 jobs (including selling carpet) & his wife worked to make sure their daughter got quality college degree w/no student debt,” Rep. Kevin Brady, R-Texas, the top Republican on the House Ways and Means Committee, tweeted Tuesday. “Big sacrifice. Now their taxes must pay off someone else’s student debt?”

Biden’s elongated deliberations have sent federal loan servicers, who have been instructed to hold back billing statements while Biden weighed a decision, grumbling.

Industry groups had complained that the delayed decision left them with just days to notify borrowers, retrain customer service workers and update websites and digital payment systems, said Scott Buchanan, executive director of the Student Loan Servicing Alliance.

It increases the risk that some borrowers will inadvertently be told they need to make payments, he said.

“At this late stage I think that’s the risk we’re running,” he said. “You can’t just turn on a dime with 35 million borrowers who all have different loan types and statuses.”

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WASHINGTON (AP) — Seven major offshore wind farms would be developed on the East and West coasts and in the Gulf of Mexico under a plan announced Wednesday by the Biden administration.

The projects are part of President Joe Biden’s plan to deploy 30 gigawatts of offshore wind energy by 2030, generating enough electricity to power more than 10 million homes.

Interior Secretary Deb Haaland said her department hopes to hold lease sales by 2025 off the coasts of Maine, New York and the mid-Atlantic, as well as the Carolinas, California, Oregon and the Gulf of Mexico. The projects are part of Biden’s plan to address global warming and could avoid about 78 million metric tons of planet-warming carbon dioxide emissions, while creating up to 77,000 jobs, officials said.

“The Interior Department is laying out an ambitious road map as we advance the administration’s plans to confront climate change, create good-paying jobs and accelerate the nation’s transition to a cleaner energy future,” Haaland said. “We have big goals to achieve a clean energy economy and Interior is meeting the moment.”

In addition to offshore wind, the Interior Department is working with other federal agencies to increase renewable energy production on public lands, Haaland said, with a goal of at least 25 gigawatts of onshore renewable energy from wind and solar power by 2025.

Haaland and Amanda Lefton, director of department’s Bureau of Ocean Energy Management, said officials hope to reduce potential conflicts with fishing groups and other ocean users as much as possible. “This means we will engage early and often with all stakeholders prior to identifying any new wind energy areas,” Lefton said in a statement.

Commercial fishing businesses have said planned offshore wind projects off the East Coast would make it difficult to harvest valuable seafood species such as scallops and lobsters. Some conservation groups also fear that big turbines will kill thousands of birds

Biden has set a goal to deploy 30 gigawatts, or 30,000 megawatts, of offshore wind power in the United States by 2030. Meeting the target could mean jobs for more than 44,000 workers and for 33,000 others in related employment, the White House said.

The bureau completed its review of a construction and operations plan for the Vineyard Wind project 15 miles off the Massachusetts coast earlier this year. The agency is reviewing nine additional projects, including the South Fork wind farm near New York’s Long Island and the Ocean Wind project off New Jersey.

Vineyard Wind is expected to produce about 800 megawatts of power and South Fork about 132 megawatts. Ocean Wind, the largest project, has a total capacity of 1,100 megawatts, enough energy to power 500,000 homes across New Jersey.

The administration has committed to processing the 13 other projects currently under federal review by 2025.

The ocean energy agency has said it is targeting offshore wind projects in shallow waters near Long Island and New Jersey. A recent study shows the area can support up to 25,000 development and construction jobs by 2030, the Interior Department said.

Heather Zichal, a former climate adviser to President Barack Obama who now leads the American Clean Power Association, a renewable energy group, said Biden’s goal for offshore wind was “ambitious but achievable.″ Wind power is an essential part of the goal to reach 100 percent carbon pollution-free electricity by 2035, she said.

In a related announcement, the Energy Department said it is spending $11.5 million to study risks that offshore wind development may pose to birds, bats and marine mammals, and survey changes in commercial fish and marine invertebrate populations at an offshore wind site on the East Coast.

The department will spend $2 million on visual surveys and acoustic monitoring of marine mammals and seabirds at potential wind sites on the West Coast.

“In order for Americans living in coastal areas to see the benefits of offshore wind, we must ensure that it’s done with care for the surrounding ecosystem by coexisting with fisheries and marine life – and that’s exactly what this investment will do,” Energy Secretary Jennifer Granholm said in a news release.

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