On August 27, 2026, the Justice Department sued Arizona, New Mexico, Oregon and Washington over laws letting immigrants without legal status pay in-state tuition at public colleges. That brings the Trump administration to 21 states sued over the same kind of law.

Five of those laws are already dead. In four of the five states — Texas, Kentucky, Nebraska and Oklahoma — the state's own lawyers agreed with the federal government that the state's law should be struck down. Illinois was the only one that defended its own statute.

Texas was first, and Texas is the clearest look at how this works.

The law a Republican governor signed

Texas was the first state in the country to let certain undocumented students pay in-state tuition. Lawmakers passed the Texas Dream Act in 2001 with little debate and broad, bipartisan support, and Republican Governor Rick Perry signed it.

It was not a blanket benefit. To qualify, a student had to:

• graduate from a Texas high school or earn an equivalent diploma in Texas,
• have lived in the state for at least three years before graduating, and
• sign an affidavit promising to seek permanent residency as soon as they were eligible.

Lawyers for the groups defending the law told the court it opened higher education to more than 57,000 students. These were kids who had graduated from Texas high schools.

One day is not a legal fight

State lawmakers tried repeatedly to repeal the Texas Dream Act and failed. So in June 2025 the Justice Department sued Texas, arguing the law violated a 1996 federal immigration statute.

What happened next is the part worth sitting with. Ken Paxton's office did not defend the law. It quickly agreed with the Justice Department that the law conflicted with federal law, and asked the judge to block it. U.S. District Judge Reed O'Connor — a George W. Bush appointee in Wichita Falls — approved the agreement and struck the law down the same day.

Plaintiff and defendant wanted the same outcome. There was no adversary. A statute that had survived twenty-four years and multiple repeal attempts in the Texas Legislature was gone in an afternoon, with nobody in the courtroom arguing for it.

Thomas Saenz of the Mexican American Legal Defense and Educational Fund told the 5th Circuit at oral argument in June 2026 that this is the heart of the problem:

It is "important to emphasize here how extraordinary that it all occurred as quickly as it did. The court needs to look at whether this extraordinary situation violated due process rights held by students for affordable tuition and the other students who benefited or would benefit in the future."

Lawyers for the students put it more bluntly in a brief: "The people of Texas are entitled to genuine litigation before a federal court invalidates their democratically enacted statute."

The students were told they couldn't argue either

Because Paxton wouldn't defend the law, the people who relied on it tried to. Students for Affordable Tuition, the immigrant-rights group La Unión del Pueblo Entero, Austin Community College, and Oscar Silva — a University of North Texas graduate student who had qualified under the law — all asked to step into the case.

O'Connor said no. In July 2026 a 5th Circuit panel agreed, 2–1, ruling they could not intervene because the law was preempted anyway. Judge Jerry Smith, a Reagan appointee, wrote the majority; Judge Don Willett, a Trump appointee, joined; Judge Irma Carrillo Ramirez, a Biden appointee, dissented.

The Justice Department's own argument for keeping the students out was that letting them defend the law would be "legally futile." Its lawyer told the appeals court: "We opposed intervention … only on the grounds that it's legally futile because the statutes are preempted."

On August 24, 2026, LUPE asked the full 5th Circuit to reconsider. That petition is pending.

Greg Abbott's reaction to the July ruling, posted on X, was that Texas and the Trump administration's Justice Department "just secured another major victory for the rule of law."

What it has cost so far

The damage was not theoretical and it did not wait for appeals.

Lawyers for LUPE, Austin Community College and Silva told the court the end of the law could cost Texas hundreds of millions of dollars a year in reduced wages, earnings and consumer spending. ACC said it expected lost revenue, administrative burdens, and harm to its programs.

And the rollout was a mess. The Texas Higher Education Coordinating Board told colleges to reclassify students who are not lawfully present as nonresidents, but did not tell them how to identify those students. Students for Affordable Tuition told the 5th Circuit that several Texas colleges then charged DACA recipients out-of-state rates — even though Texas's own lawyers said DACA students should still qualify for in-state tuition.

Luis Castillo Vela of LUPE, as students went back to school this month:

"As college students prepare to start school this week across the state, we are thinking about all of those who are having to put their dream of a higher education on hold because of the financial hurdles resulting from the repeal of the Texas Dream Act."

What the record shows

The Texas Dream Act was signed by a Republican governor in 2001 and survived twenty-four years and repeated repeal attempts in the Legislature. When the Trump administration sued to kill it in June 2025, Ken Paxton's office did not defend it — it agreed the law was illegal and asked the judge to block it, which he did the same day. The students and colleges who relied on it were then told they could not defend it either. Lawyers in the case say the law had opened college to more than 57,000 Texas high school graduates. The Justice Department has now brought the same suit against 21 states, and in three others besides Texas the state's own lawyers agreed to lose.

Source

Shauneen Miranda, US Justice Department challenges 4 more states over in-state tuition for immigrants, States Newsroom / Ohio Capital Journal, August 28, 2026. Texas background and quotes from Eva-Marie Ayala, New hearing sought in fight over Texas law that gave undocumented students in-state tuition, The Texas Tribune / KERA, August 25, 2026. Photo: Antranik Tavitian / The Texas Tribune.