DOJ Sues New Jersey Over State Law Granting In-State Tuition to Undocumented Immigrants

On April 30, 2026, the U.S. Department of Justice filed a complaint in the U.S. District Court for the District of New Jersey challenging state laws that grant in-state tuition rates and financial aid to undocumented immigrants [1]. The lawsuit names the State of New Jersey, the Higher Education Student Assistance Authority, Acting Secretary of Higher Education Margo Chaly, the Board of Directors of the New Jersey Educational Opportunity Fund, and the New Jersey Commission on Higher Education as defendants [1]. It is the ninth lawsuit the Trump administration has filed targeting state tuition policies for undocumented residents — and it arrives after similar legal actions have already dismantled decades-old programs in Texas, Oklahoma, and Kentucky [2][3].

The Legal Mechanism: What the DOJ Is Arguing

The DOJ's complaint rests primarily on 8 U.S.C. § 1623, a provision of the Illegal Immigration Reform and Immigrant Responsibility Act (IIRIRA) of 1996. That statute states that undocumented immigrants "shall not be eligible on the basis of residence within a State" for any postsecondary education benefit unless U.S. citizens receive the same benefit "without regard to whether the citizen or national is such a resident" [4][5].

In practice, this means: if New Jersey offers in-state tuition to an undocumented student who lives in the state, it must also offer that same rate to a U.S. citizen from, say, Pennsylvania — or else the policy violates federal law. Since New Jersey, like every other state, charges out-of-state U.S. citizens higher tuition than residents, the DOJ contends the state is granting undocumented residents a benefit that out-of-state citizens cannot access [1].

Associate Attorney General Stanley Woodward framed it bluntly: "Imagine being denied the opportunity of education in your own country. By granting illegal aliens in-state tuition, the state of New Jersey is doing just that" [1]. Assistant Attorney General Brett A. Shumate added: "This is a simple matter of federal law: in New Jersey and nationwide, colleges cannot provide benefits to illegal aliens that they do not provide to U.S. citizens" [1].

The DOJ is also invoking the Supremacy Clause of the U.S. Constitution, arguing that federal immigration law preempts New Jersey's state statutes [1]. This is the same legal theory deployed in the administration's suits against Texas, Oklahoma, Kentucky, Illinois, Minnesota, Virginia, Nebraska, and California [2][3].

New Jersey's Law: The Tuition Equality Act and the NJ DREAM Act

New Jersey's policy has two components. The Tuition Equality Act (P.L. 2013, c.170), enacted in 2013, allows undocumented students who attended a New Jersey high school for at least three years and graduated to pay in-state tuition rates at public colleges and universities [6]. A 2018 follow-up law (Senate Bill 699) extended access to state financial aid under the same eligibility criteria [7].

Supporters of the law have long argued that eligibility is based on residency and educational history within New Jersey — not immigration status per se [8]. The law requires students to file an affidavit stating they have applied, or will apply when eligible, to legalize their immigration status [6].

This distinction matters legally. States that have defended similar policies argue they satisfy § 1623 because the benefit is not conferred "on the basis of residence" alone but rather on the basis of attending and graduating from state high schools — a criterion that, in theory, any U.S. citizen who attended a New Jersey high school would also meet [5][9].

The Numbers: Who Benefits and by How Much

Precise enrollment figures for undocumented students in New Jersey's public colleges are difficult to pin down, partly because institutions do not systematically track immigration status. Advocacy estimates from the time the law was debated cited approximately 40,000 undocumented young adults in New Jersey who had entered the country before age sixteen [7]. Early enrollment data from Fall 2015 showed Rutgers University enrolling roughly half of all students using the tuition equity provision, with institutions like NJIT and Montclair State each enrolling approximately 50 students under the policy [10].

The financial stakes are substantial. At the New Jersey Institute of Technology, in-state tuition was $7,824 per semester compared to an out-of-state rate of $14,644 — a difference of nearly $6,800 per semester, or approximately $13,600 per year [10]. Nationally, the gap is even wider: average in-state tuition at public universities runs approximately $9,750 per year, while out-of-state rates average $28,386 [11].

Source: New America / College Board

Data as of Sep 1, 2025CSV

Nationally, an estimated 408,000 undocumented students are enrolled in U.S. higher education institutions, representing roughly 1.9% of all college students. That figure has declined from 427,000 in 2019 [12].

Source: Presidents Alliance / Higher Ed Immigration Portal

Data as of Jan 1, 2024CSV

Why New Jersey, Why Now

Twenty-five states and Washington, D.C. had adopted some form of tuition equity policy before the current administration took office [11]. The DOJ has not sued all of them simultaneously. Instead, it has pursued a state-by-state strategy, beginning with Texas in June 2025 [3][13].

Source: NILC / Inside Higher Ed

Data as of Apr 30, 2026CSV

The pattern reveals a mix of political opportunity and legal strategy. In Texas, the state attorney general sided with the federal government, and U.S. District Judge Reed O'Connor issued a permanent injunction within hours of the suit being filed — ending a 24-year-old policy in a single day [13]. Oklahoma's attorney general similarly cooperated, and the state ended its in-state tuition policy in August 2025 [3]. Virginia's attorney general entered a consent agreement with the DOJ in early 2026 [4].

New Jersey represents a different political environment. Governor Mikie Sherrill and Attorney General Jennifer Davenport — both Democrats — are expected to contest the suit [2]. The state has already clashed with the Trump administration on multiple fronts; just one day before the tuition lawsuit, the DOJ sued New Jersey over a separate law restricting law enforcement officers, including ICE agents, from wearing masks [2].

The timing also reflects an escalating enforcement posture. Since January 2025, the administration has expanded its targets from states with cooperative attorneys general to states expected to fight back [3][11].

The 'Second-Class Citizens' Argument: Real Harm or Theoretical Injury?

The DOJ's central policy argument is that out-of-state U.S. citizens are treated as "second-class" when undocumented state residents receive lower tuition rates than they do [1]. Heritage Foundation scholars Hans von Spakovsky and Caleb Morrison have articulated this position in detail, arguing that "an American student from Oklahoma cannot attend a Texas university and pay in-state tuition, yet someone residing in the U.S. illegally could receive that benefit" [5].

The Federation for American Immigration Reform (FAIR) has extended this argument to focus on low-income domestic students, contending that "in an age when some lower- and middle-income students have to defer their dreams of college due to rising tuition prices," scarce state resources should not subsidize education for people in the country without authorization [14].

However, defenders of the policy note a structural problem with the "second-class" framing. Out-of-state U.S. citizens pay higher tuition at every state university in the country — that is how residency-based public education has always worked. An out-of-state student from Pennsylvania pays more than a New Jersey resident at Rutgers regardless of anyone's immigration status [9]. The undocumented student who qualifies under the Tuition Equality Act has lived in New Jersey for years, attended and graduated from a New Jersey high school, and — supporters argue — has an equivalent claim to being a state resident as any other long-term New Jersey inhabitant [8].

There are no publicly documented cases in which an individual U.S. citizen was denied an in-state tuition slot at a New Jersey institution specifically because the seat was occupied by an undocumented student. The DOJ's injury theory rests on the tuition rate differential itself rather than on displacement from enrollment [1][5].

Legal Precedent: How Courts Have Ruled

The legal track record on § 1623 challenges is limited but evolving rapidly.

Day v. Sebelius (2007): The Tenth Circuit dismissed a private challenge to Kansas's in-state tuition law for undocumented students, ruling that the plaintiffs — out-of-state students — lacked standing to sue because they could not demonstrate a concrete injury traceable to the Kansas policy [4][15].

Martinez v. Regents of the University of California (2010): The California Supreme Court upheld California's in-state tuition law (AB 540), finding that the benefit was tied to high school attendance rather than residency, and therefore did not violate § 1623 [9][15].

Young Conservatives of Texas Foundation v. Smatresk: The Fifth Circuit declared that § 1623(a) "expressly preempts state rules that grant illegal aliens benefits when U.S. citizens haven't received the same" [4]. This ruling provided the legal foundation for the DOJ's June 2025 lawsuit against Texas.

Texas (2025): U.S. District Judge Reed O'Connor issued a permanent injunction ending Texas's 24-year-old Dream Act, with the state attorney general's consent [13].

Kentucky (2025-2026): A district court ruled in favor of ending Kentucky's tuition equity policy. The Mexican American Legal Defense and Educational Fund (MALDEF) filed an appeal to the Sixth Circuit in April 2026, arguing the ruling was entered without a hearing and without allowing affected students to intervene [16].

The precedent is mixed. Pre-2025 rulings largely favored states, either on standing grounds or on the theory that attendance-based criteria differed from residency-based criteria. The Trump administration's DOJ suits, however, have achieved rapid victories in jurisdictions with cooperative state officials. New Jersey will be among the first contested cases to produce a fully litigated ruling on the merits [3][4].

What Legal Scholars Say About the Preemption Argument

Critics of the DOJ's position focus on the specific language of § 1623. The statute bars benefits granted "on the basis of residence within a State." States like New Jersey and California have structured their laws to condition eligibility on high school attendance and graduation — not on residency alone [9]. The argument is that a student who attended and graduated from a New Jersey high school is receiving a benefit based on educational history, not residential status.

A Fordham Law Review analysis has noted the "unclear authority" in § 1623 cases, arguing that the statute's text creates ambiguity about whether attendance-based criteria satisfy the "not on the basis of residence" requirement [15].

The second federal statute in play, the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996, further complicates the picture. PRWORA bars undocumented immigrants from federal public benefits but explicitly allows states to affirmatively extend certain benefits through state legislation — which is precisely what New Jersey did [11].

The DOJ's position relies on reading § 1623 as a flat prohibition that attendance-based workarounds cannot overcome. The Heritage Foundation has endorsed this interpretation, arguing that "regardless of how states word their tuition policies, the effect is the same: illegal aliens receive benefits that U.S. citizens from other states do not" [5].

The Texas Precedent: What Happens When Students Lose Access

The consequences of ending in-state tuition are no longer hypothetical. Texas's experience since June 2025 offers a direct preview.

After Judge O'Connor's ruling, nearly 20,000 Texas students faced immediate tuition increases [11]. Individual cases illustrate the impact: one 18-year-old student from Houston who had $10,000 in annual scholarships to UT Tyler withdrew from the university when her tuition jumped from $9,736 to over $25,000 annually. She enrolled instead at Houston Community College, where out-of-district rates are nearly triple the in-district rate, abandoning the advanced chemistry coursework she needed for her planned doctorate [17].

Immigration advocates reported widespread administrative confusion at Texas colleges, with university personnel lacking clear guidelines on how to determine eligibility. Austin Community College trustees decided against requesting sensitive immigration information from students, fearing the approach would drive students away entirely [17]. As trustee Manuel Gonzalez stated: "This confusion will inevitably harm students because what we find is that in the absence of information and in the presence of fear and anxiety, students will opt to not continue higher education" [17].

Research on in-state tuition policies suggests these effects are predictable. Hispanic and Latino non-citizens in states with tuition equity policies are 31% to 54% more likely to enroll in higher education than peers in states without such policies [12]. The policies also reduce high school dropout rates by as much as 14%, as the prospect of affordable college creates incentives to complete secondary education [12].

Fiscal and Workforce Consequences for New Jersey

If New Jersey loses this case, the downstream effects extend beyond individual students. Policy analysts estimate the U.S. could lose over 450,000 workers with high school diplomas and 300,000 with college degrees if access to higher education for undocumented youth is broadly curtailed [12].

In New Jersey specifically, undocumented workers are concentrated in healthcare, construction, food services, and education — industries already facing labor shortages [11][12]. Former University of Texas law professor Barbara Hines, who helped draft the original Texas Dream Act, characterized that state's reversal as "so short-sighted in terms of the welfare of the state of Texas" [17]. The same logic applies to New Jersey, where affected students who cannot afford continued enrollment would likely shift to lower-paying jobs outside the formal economy rather than leave the state.

New Jersey taxpayers have already invested in these students' K-12 education. Supporters of tuition equity argue that blocking affordable college access wastes that investment and reduces the lifetime tax contributions these residents would otherwise make. A New America analysis found that nationally, undocumented Texans alone paid approximately $4.9 billion in state and local taxes in 2022 [11].

Judicial Watch has estimated the national cost of in-state tuition subsidies for undocumented students at over $1 billion annually, arguing that these funds could be redirected to domestic students [18]. Whether the net fiscal impact is positive or negative depends on assumptions about graduation rates, future earnings, tax contributions, and the counterfactual — what these students would do without access to affordable higher education.

The Steelman for the DOJ's Case

Beyond partisan framing, the DOJ's position has a structural argument worth examining on its merits. The federal government sets immigration policy. States do not have the authority to confer immigration-adjacent benefits in ways that conflict with federal statutes. If § 1623 means what it says — and the Fifth Circuit has ruled it does — then states cannot provide residency-based tuition benefits to undocumented immigrants without also extending those rates to every U.S. citizen nationwide [4][5].

The equity concern for domestic low-income students is also real, even if the mechanism of harm is indirect. A low-income U.S. citizen from a neighboring state who cannot afford out-of-state tuition at Rutgers faces a genuine barrier — one that an undocumented New Jersey resident does not face under the current law. The complaint is not that undocumented students are taking seats from citizens, but that the tuition pricing structure creates an asymmetry that federal law was specifically designed to prevent [5][14].

Whether this structural argument prevails in a contested courtroom — rather than through consent decrees with cooperative state officials — remains the central unanswered question. New Jersey's case may be the one that produces a definitive answer.

What Comes Next

The lawsuit is now before the U.S. District Court for the District of New Jersey. Unlike Texas, Oklahoma, and Kentucky, New Jersey is expected to mount a full defense. The state's legal team will likely argue that the Tuition Equality Act's attendance-based criteria distinguish it from the kind of residency-based benefit § 1623 prohibits — the same argument that succeeded before the California Supreme Court in 2010 [9].

MALDEF's appeal in the Kentucky case before the Sixth Circuit, filed in April 2026, could also shape the legal landscape. If the appellate court rules that students should have been allowed to intervene and defend the policy, it could slow the DOJ's strategy of seeking rapid, uncontested injunctions [16].

The outcome will affect not just New Jersey but the 22 states that still maintain some form of tuition equity policy [3]. A ruling on the merits — rather than a negotiated settlement — would establish binding precedent on whether § 1623 truly prohibits what these states have been doing for decades, or whether the attendance-based workaround passes legal muster.