Biden wants to 'better support' student-loan borrowers who are returning to repayment. It's further confirmation the payment pause will end this year.

• Biden unveiled his budget for fiscal year 2024 on Thursday.
• It included increased funding for the Federal Student Aid office to help the return to repayment this year.

Student-loan borrowers are set to resume payments this year, and President Joe Biden wants to make sure it goes as smoothly as possible.

On Thursday, Biden unveiled his budget proposal for fiscal year 2024 — essentially a funding wish list for his administration's priorities as it nears the end of its first term. It includes bolstered investments in areas like childcare and healthcare, along with a renewal of the president's tax proposals on the wealthy and corporations.

This budget release also comes in a time of significant uncertainty for student-loan borrowers. Millions of borrowers are waiting to hear whether Biden's plan to cancel up to $20,000 in student debt broadly will be upheld by the Supreme Court, and if they will have to resume student-loan payments this year without relief.

Biden's budget includes a small section specifically for student-loan borrowers, requesting $2.7 billion in funding for the Federal Student Aid (FSA) office — a $620 million increase from the 2023 level.

"This additional funding is needed to provide better support to student loan borrowers, especially as they return to repayment," the budget said. "This increase would allow FSA to implement critical improvements to student loan servicing, continue to modernize its digital infrastructure, and ensure the successful administration of its financial aid programs through a simplified and streamlined process for students and borrowers."

Along with increased funding for FSA, the budget also proposes improving college affordability by increasing the maximum Pell Grant award by $500 and expanding free community college through a $500 million grant program to provide two years of free community college for students enrolled in "high-quality programs" that would lead to a good paying job.

In the budget Congress approved late last year, FSA did not get any increased funding, which administration officials had previously told reporters is problematic given the vast amount of programs — like debt relief and reforms to targeted repayment plans — that are on the Education Department's plate for implementation this year.

In light of the lawsuits that blocked Biden's broad debt relief, he extended the student-loan payment pause through 60 days after June 30, or 60 days after the Supreme Court issues a decision on the legality of its relief, whichever happens first.

The administration has emphasized that it is planning for borrowers to resume payments this year and has not yet commented on whether it will implement additional relief should the Supreme Court strike down Biden's loan forgiveness. To complicate matters further, SoFi Bank — a student-loan refinancing company — recently filed a lawsuit to end the latest payment pause extension, and at the very least, return borrowers ineligible for the broad relief back into repayment.

An Education Department spokesperson told Insider that "the payment pause is legal, as is our plan to provide one-time debt relief to tens of millions of borrowers most at risk of delinquency and default when they return to repayment."

"This lawsuit is an attempt by a multi-billion dollar company to make money while they force 45 million borrowers back into repayment – putting many at serious risk of financial harm," the spokesperson said. "The Department will continue to fight to deliver relief to borrowers, provide a smooth path to repayment, and protect borrowers from industry and special interests."

Still, with Republicans holding a majority over the House, it's likely they will not approve many of the measures Biden is hoping to implement — and student-loan borrowers will continue to wait and find out when, or if, they will get relief.