On June 28, the Supreme Court overruled the Chevron doctrine, a 1984 decision that allowed federal agencies to interpret laws as long as they did not violate Congress’s language.

This means that courts will now have the power to decide what a law means rather than defer to federal agencies with expertise on the topic.

It’ll cast a lot of uncertainty over all federal agencies. When it comes to higher education, the ruling will impose more barriers on regulations that are particularly controversial, like efforts to forgive student debt.

Jon Fansmith, senior vice president of government relations and national engagement at the American Council on Education, told Business Insider that Chevron’s overruling places students, institutions, and the government in a “Wild West situation.”

“It’s not a guarantee that every regulation gets thrown out, but what it does is it says the field of what’s open to challenge just got a whole lot bigger,” Fansmith said.

“There are almost no existing regulations that are simply direct implementations of what’s written down in the statute. All of them, to a varying degree, but in some cases, very large degree, rely on the agency’s interpretation,” he said. “So they’re all subject to challenge, and you can’t look at the compliance environment you’re in right now and say with any certainty what that’s going to look like in six months or a year or three years from now.”

While federal agencies typically craft regulations to ensure they’re in accordance with Congress’s language and can withstand legal challenges, the Supreme Court has now made that process a lot more difficult by handing over interpretation power to the courts. Experts told BI that lawmakers could help solve the issue by making the language in laws like the Higher Education Act more clear, but that’s unlikely to happen given the partisanship and slow-moving nature of Congress.

“Having some level of basic certainty for a number of years is far more preferable to trying to constantly stay on top of a shifting environment and not knowing whether you are in compliance or not,” Fansmith said. “It is a difficult situation to be in, and I think for most people, the significant new chaos that’s introduced is going to be really, really hard to work with and operate under.”

‘Huge implications for American life’

Since President Joe Biden announced his first plan to cancel student debt broadly in 2022, conservative groups haven’t stopped trying to block the relief — and some of them succeeded. The Supreme Court struck down Biden’s plan to cancel up to $20,000 in student debt for borrowers last June, and district courts placed preliminary injunctions on the new SAVE income-driven repayment plan just weeks ago.

The Education Department is working on finalizing its second attempt at a broader debt relief plan, which it hopes to implement this fall. It’s highly likely to face legal challenges. But striking down Chevron could pose even more barriers to debt relief and many higher education regulations borrowers rely on.

Those include reforms to the borrower defense to repayment process, which allows debt relief for borrowers who prove they were defrauded by the school they attended, and the gainful employment rule, which ensures borrowers do not graduate from a school with too much debt compared to post-graduation earnings.

All of those rules could be at risk. Neal Hutchens, a professor in the Department of Educational Policy Studies and Evaluation at the University of Kentucky, told BI that the Chevron ruling is “really going to empower individual judges to weigh in and interpret the law in a way that we haven’t seen in 50 years.”

“This means that it’s even harder for an administration to come up with a rule or regulation around student debt relief because now it can be challenged in a way that it couldn’t just a couple of weeks ago,” he said.

That’s good news for some Republican lawmakers. After the Supreme Court’s Chevron ruling, Sen. Bill Cassidy — top Republican on the Senate education committee — sent a letter to Education Sec. Miguel Cardona asking how the Education Department would comply with the ruling.

“For too long, Chevron deference has let agencies make broad decisions governing a diverse country of over 330 million people,” Cassidy wrote.

Fansmith said that Congress could help matters by writing laws with clear, specific language on intent so there’s no room for ambiguity — but typically, big bills have a lot of gray areas, and it’s difficult to get both parties to agree on particulars.

Ultimately, the ruling has opened the door for significant uncertainty, and removing agency authority to make decisions could have “huge implications for American life moving forward,” Hutchens said.

“I think it makes it harder for the average person, the average consumer, to hope that agencies will be able to do things on their behalf,” Hutchens said. “They’re not necessarily going to be winners in this system.”



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