Biden v. Nebraska

Supreme Court of the United States · 2023 · Administrative Law

600 U.S. 477 (2023)

Updated August 1, 2026

Administrative Lawmajor questionsstudent loansHEROES Actstudent loan forgivenesswaive or modifyclear congressional authorizationstanding

Facts

The Higher Education Act authorizes the Secretary of Education to cancel or reduce student loans only in limited, specified circumstances. After the President declared the COVID-19 pandemic a national emergency, the Secretary ultimately announced a plan under the HEROES Act to discharge up to $10,000 in federal student debt for most eligible borrowers below a specified income threshold and up to $20,000 for Pell Grant recipients. The Department estimated that about 43 million borrowers would qualify, and the Congressional Budget Office estimated about $430 billion in debt principal would be canceled. Missouri alleged injury through MOHELA, a state-created public corporation that services federal student loans and would lose servicing fees when loans were discharged.

Issue

Did at least one plaintiff State have Article III standing to challenge the student-loan cancellation program? If so, did the HEROES Act authorize the Secretary of Education to cancel roughly $430 billion in student-loan principal through this mass debt-relief program?

Rule

A State has Article III standing when an injury to a state-created and state-controlled public instrumentality performing a public function directly harms the State itself. Under the HEROES Act, the Secretary may "waive or modify" existing statutory or regulatory provisions applicable to federal student-aid programs, but that authority permits only modest changes and does not authorize the Secretary to rewrite the Education Act or create a fundamentally new loan-forgiveness regime of vast economic and political significance without clear congressional authorization.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Colorado created the Front Range Transit Finance Authority, a nonprofit public corporation to fund and manage regional rail projects. Its board includes two state officials and five gubernatorial appointees, it files annual reports to the state transportation department, and only Colorado may dissolve it. A federal rule would terminate a servicing contract under which the Authority earns substantial annual fees, and Colorado sues to challenge the rule.

Does Colorado most likely have Article III standing?

Explanation. The majority held that a State has standing when a federal action directly harms a state-created instrumentality that is created by the State, supervised by the State, serves a public function, and is answerable to the State. Separate corporate personality does not defeat standing in that setting. Here, the Authority's lost contract fees are a concrete monetary injury to such an instrumentality, so Colorado may sue.