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Saturday, July 1, 2023

SCOTUS Canels Loan Cancelation

 From the syllabus of Biden v. Nebraska:

The text of the HEROES Act does not authorize the Secretary’s loan forgiveness program. The Secretary’s power under the Act to “modify” does not permit “basic and fundamental changes in the scheme” designed by Congress. MCI Telecommunications Corp. v. American Telephone & Telegraph Co., 512 U. S. 218, 225. Instead, “modify” carries “a connotation of increment or limitation,” and must be read to mean “to change moderately or in minor fashion.” Ibid. That is how the word is ordinarily used and defined, and the legal definition is no different.
The authority to “modify” statutes and regulations allows the Secretary to make modest adjustments and additions to existing provisions, not transform them. Prior to the COVID–19 pandemic, “modifications” issued under the Act were minor and had limited effect. But the “modifications” challenged here create a novel and fundamentally different loan forgiveness program. While Congress specified in the Education Act a few narrowly delineated situations that could qualify a borrower for loan discharge, the Secretary has extended such discharge to nearly every borrower in the country. It is “highly unlikely that Congress” authorized such a sweeping loan cancellation program “through such a subtle device as permission to ‘modify.’” Id., at 231.
The Secretary responds that the Act authorizes him to “waive” legal provisions as well as modify them—and that this additional term “grant[s] broader authority” than would “modify” alone. But the Secretary’s invocation of the waiver power here does not remotely resemble how it has been used on prior occasions, where it was simply used to nullify particular legal requirements. The Secretary next argues that the power to “waive or modify” is greater than the sum of its parts: Because waiver allows the Secretary “to eliminate legal obligations in their entirety,” the combination of “waive or modify” must allow him “to reduce them to any extent short of waiver” (even if the power to “modify” ordinarily does not stretch that far). But the challenged loan forgiveness program goes beyond even that. In essence, the Secretary has drafted a new section of the Education Act from scratch by “waiving” provisions root and branch and then filling the empty space withradically new text.