Justice Department sues New Mexico over in-state tuition for undocumented students

The U.S. Department of Justice sued New Mexico on Thursday, challenging a state law that allows some undocumented students, including DACA recipients, to qualify for in-state college tuition and financial assistance.

New Mexico was one of four states sued Thursday. The Justice Department also filed complaints against Arizona, Oregon and Washington, bringing the department’s total to 21 lawsuits challenging similar tuition policies nationwide.

The federal government argues New Mexico’s law conflicts with federal law by giving undocumented students benefits that are not available on the same terms to U.S. citizens living outside the state.

“This is a simple matter of federal law: colleges cannot provide benefits to illegal aliens that they do not provide to U.S. citizens,” Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division said in a statement. “This Department of Justice will not tolerate American students being treated like second-class citizens in their own country.”

What New Mexico law allows

Senate Bill 582, passed in 2005, allows eligible undocumented students to pay in-state tuition and receive state financial aid.

To qualify, students must have attended a New Mexico high school for at least one year and either graduated from a New Mexico high school or earned a high school equivalency credential in the state.

KOAT legal expert John Day said New Mexico’s position is that eligibility is tied to where a student attended and completed high school—not citizenship or immigration status.

“The federal government is saying if you’re a U.S. citizen and you’re applying for scholarships that there is somehow a disadvantage,” Day said.

The Justice Department argues that the policy disadvantages U.S. citizens from other states who may be charged substantially higher nonresident tuition. The lawsuit points to the University of New Mexico, where the cost cited for a New Mexico resident is approximately $12,000 for an academic year, compared with nearly $35,000 for a nonresident.

State responds to lawsuit

The New Mexico Higher Education Department said Thursday that it had not received the official lawsuit documents but was aware of the Justice Department’s announcement.

“As we continue to review the information, we remain focused on our long-standing commitment to expanding higher education pathways for New Mexicans,” the department said. “Our colleges and universities play a vital role in strengthening the state’s workforce, building talent pipelines, and ensuring that students have access to opportunities that support both individual and statewide success.”

The department said eligibility requirements for state financial aid programs vary but are based on residency and academic participation in New Mexico.

NM Higher Ed officials cited the Lottery Scholarship, for example, which is available to New Mexico residents who recently graduated from a New Mexico high school, enroll full time at an in-state public institution within the required period and maintain academic progress.

The Opportunity Scholarship supports eligible New Mexico residents enrolled at an in-state public college or university after graduating from high school or earning a high school equivalency credential. It is also intended to help returning students.

“We are committed to ensuring that New Mexicans have reliable, structured pathways to afford and access higher education,” the department said. “We will continue to uphold our mission of supporting students, strengthening our workforce, and advancing educational opportunity across the state.”

What changes for students now?

The Justice Department is asking a federal judge to declare the New Mexico law unconstitutional and permanently block its enforcement. However, the filing does not immediately change eligibility for students.

“Nothing’s happening right away,” Day said. “If you’re a student here and you graduate, you’re still technically eligible. Nothing has changed.”

At UNM, some students defended the policy.

“Not all immigrants are criminals,” student Jessica Johnson said. “They just kind of live their own lives and do the best they can.”

Student Heavenlee Esquirell also expressed support.

“I think immigrants deserve rights,” Esquirell said. “So I think if they get tuition, they get tuition.”

A broader national legal fight

Associate Attorney General Stanley E. Woodward Jr. said the four new cases are part of the Trump administration’s broader effort to prioritize public benefits for U.S. citizens.

“By granting illegal aliens in-state tuition, Washington, Oregon, New Mexico and Arizona are pushing citizens to the side and ignoring federal law,” Woodward said.

According to the Justice Department, similar policies in Texas, Kentucky, Oklahoma, Nebraska and Illinois have already been blocked or declared unconstitutional. Other cases remain pending in Minnesota, Virginia, California, New Jersey, Kansas, Massachusetts, Rhode Island, Maryland, Colorado, New York, Connecticut and Vermont.

In its Arizona complaint, the department cited a report estimating that more than 3,600 undocumented students annually could qualify for in-state tuition under that state’s law in coming years. The department said at least 720 undocumented students received in-state tuition in Arizona during the fall 2025 semester, including 432 at Arizona State University. Its complaint estimates the reduced tuition provided at ASU totaled approximately $10.5 million that year.

Day said the dispute over state tuition policies could ultimately reach the nation’s highest court.

“It’s likely headed to the U.S. Supreme Court for a final decision,” he said.

Our state’s higher education department says they are committed to supporting residents who want to pursue a higher education. Stating, “Eligibility requirements vary across programs, but they are consistently grounded in residency and academic participation within the state.”

While in-state tuition is around $12,000, most residents can get free college tuition in New Mexico through programs like the New Mexico Opportunity and lottery scholarships.