WASHINGTON, April 25 (UPI) -- The U.S. Supreme Court Monday agreed to decide whether part of Social Security benefits may be withheld to repay student loans older than 10 years.
The government said between 1984 and 1988, four institutions of higher learning issued nine guaranteed student loans to James Lockhart. He failed to repay most of the loans and by March 2002, owed $80,000.
However, Lockhart had been living on $874 in monthly Social Security Disability benefits. When the Education Department told him this income would be set back by 15 percent to repay the loan, he filed suit. The lower courts ruled against him.
The 1991 Higher Education Assistance Act says loan repayments should be enforced without regard to any limitation in other federal law.
However, Social Security law says its benefits are not subject to garnishment or any other such reduction.
In 1996, Congress amended the Debt Collection Act to say Social Security payments may be "offset" to repay a government loan.
Arguments should be heard next winter.
