Roughly 75,000 Montanans applied for student loan forgiveness before court challenges blocked registration last fall, according to state-level data released by the Biden administration Friday.
The enrollment numbers come one month ahead of the U.S. Supreme Court hearing oral arguments on lawsuits that bottled up applications to the loan forgiveness program after four weeks.
Republican attorneys general from seven states won a stop to program in District Courts, arguing that Biden didn’t the authority to cancel student loan debt and was misinterpreting a law concerning executive powers and student loan debt. One of the lawsuits cited the economic hardship to loan consolidators should the amount of debt in the market diminish.
Conservatives decried loan forgiveness as compounding federal debt, while dismissing the program as a subsidy for society’s elites — college graduates.
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The Biden administration estimates the repayment plan would cost almost $138 billion over the decade, and some critics have put it closer to $200 billion.
“Millions of borrowers could be experiencing relief right now were it not for meritless lawsuits brought on by opponents of the program and elected officials who sued to deny their own constituents from getting much-needed relief,” said Haris Talwar, a White House spokesperson in an email Friday. “The Administration is confident our program is fully legal, and we are continuing to fight to deliver relief to tens of millions of eligible borrowers.”
The loan forgiveness program offered up to $20,000 for debt relief to college loan borrowers earning up to $125,000 a year. The program was rooted in the federal government’s decision to suspend loan payments during the early years of the COVID-19 pandemic. Though the income cutoff for eligibility was $125,000, close to 90% of the applicants approved earned less than $75,000 annually, the White House reported.
Student loans are the norm at Montana universities and colleges. In the past decade roughly 80% of Montana’s first-year, full-time students have borrowed, according to university system data. Among Montana’s university graduates, 61% have borrowed money for college. The average owed is about $27,290 for state residents who received degrees.
The University of Montana recently assured students from families earning $50,000 a year or less that tuition would be completely covered debt-free through financial aid. The announcement came after officials learned that students from lower income households were choosing not to attend college because of debt concerns. The school calls the program the “Grizzly Promise Initiative.”
Friday’s loan forgiveness data scaled back the number of Montanans potentially benefiting from the program. Last September, the U.S. Department of Education indicated that more than 120,000 Montanans would qualify for the program. Friday’s numbers, based on actual applications and automatic eligibility put the number of Montana borrowers potentially benefiting at 75,000 with 46,000 applications approved.
The Supreme Court will hear oral arguments Feb. 28.
According to the National Student Clearinghouse Research Center, there were about 250,000 fewer students enrolled in college in 2019 compared to 2018.
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