A divided Fifth Circuit panel ruled Wednesday that federal law preempts Texas’s in-state tuition policy for undocumented students. Maryland has an almost identical law — but it survived a statewide referendum, and its real vulnerability isn’t Washington. It’s the tax return.
By Michael Phillips | MDBayNews
In a 2-1 ruling handed down July 9, the U.S. Court of Appeals for the Fifth Circuit held that federal law preempts the Texas Dream Act, the state’s 2001 law allowing undocumented students who graduated from Texas high schools to pay in-state college tuition. The panel — Judge Jerry Smith writing, joined by Judge Don Willett, with Judge Irma Ramirez dissenting — sided with the Trump administration’s Justice Department, which sued Texas last year, arguing the tuition break violated federal restrictions on state benefits for people in the country illegally.
Texas didn’t put up much of a fight. When DOJ filed suit, the state’s own attorney general declined to defend the 24-year-old law, and a federal district judge struck it down within hours in June 2025 — the same kind of consent-judgment maneuver the administration has used against several blue-state tuition laws. Advocacy groups and Austin Community College tried to intervene and appeal on their own. The Fifth Circuit just told them no.
Maryland has never faced that fight. But it has the exact same law on the books.
The Maryland Version
The Maryland Dream Act — Senate Bill 167, passed by the General Assembly in 2011 — lets undocumented students who attended a Maryland high school for at least three years and graduated from one pay the in-county or out-of-county community college rate, and eventually in-state university tuition, instead of the full out-of-state rate. It’s codified at § 15-106.8 of the Education Article. In 2018, lawmakers extended eligibility for state financial aid to the same students under SB 532 and HB 262.
The requirements aren’t casual. A student or their parent has to file Maryland income tax returns for three consecutive years, submit an affidavit promising to pursue permanent residency, and register for Selective Service if applicable. Roughly 11,700 undocumented students are currently enrolled in Maryland colleges, and the state graduates an estimated 2,000 undocumented high schoolers a year, according to the Higher Ed Immigration Portal and reporting from the Baltimore Banner.
“States control education, so they have a right to enact these policies.” — Elizabeth Keyes, immigration law professor, University of Baltimore
Why Maryland’s Law Is Harder to Kill
Federal law doesn’t actually ban states from offering in-state tuition to undocumented residents.
Federal preemption law — specifically Section 505 of the 1996 Illegal Immigration Reform and Immigrant Responsibility Act — doesn’t actually ban states from offering in-state tuition to undocumented residents. It bans states from offering any residency-based higher education benefit to undocumented immigrants without offering the identical benefit to out-of-state U.S. citizens who meet the same criteria. Maryland’s law, like most of the roughly twenty state tuition-equity laws still standing, is written to clear that bar: it turns on high school attendance and graduation, not immigration status alone.
Texas’s law had the same structure. What Texas lacked was a defender. When DOJ sued, the state simply didn’t show up.
Maryland’s law has a defender built in: the voters.
Maryland’s law has a defender built in: the voters. Opponents of SB 167 gathered enough signatures to force it onto the November 2012 ballot as Question 4, and it passed with roughly 58 percent support — making it one of the few state Dream Act laws in the country to survive direct popular referendum rather than surviving only in a legislature or a courtroom. If the Trump Justice Department eventually pointed the same preemption theory at Annapolis, the political optics of unwinding a voter-ratified law are considerably worse than nullifying an unopposed consent judgment out of Austin.
The Real Pressure Point Isn’t the Fifth Circuit — It’s the IRS
Maryland’s law survives a legal challenge that Texas never got to test. But it has a structural weakness Texas’s law didn’t carry in the same way: eligibility depends on the student’s family filing Maryland income tax returns for three straight years, and, since earlier this year, the IRS and Immigration and Customs Enforcement have operated under a data-sharing agreement that lets ICE access taxpayer information to help locate people in the country illegally.
That collision is already showing up in Maryland classrooms. Families who would otherwise qualify their children for the reduced tuition rate are increasingly reluctant to file the very tax returns the law requires, according to reporting from the Baltimore Banner — worried that establishing a paper trail with the IRS now doubles as establishing one with ICE. Advocates have spent three years lobbying Annapolis to drop the tax filing requirement; that effort has gone nowhere in the General Assembly.
It’s the kind of quiet contradiction this outlet has tracked across Maryland’s broader ICE-cooperation fight.
It’s the kind of quiet contradiction this outlet has tracked across Maryland’s broader ICE-cooperation fight, from the Community Trust Act to the state’s license plate reader data-sharing protections: a state law built to extend a benefit to undocumented residents, conditioned on paperwork that a separate piece of federal machinery can now use against the same population it was meant to help. Nobody has to sue Maryland to make the Dream Act less useful. The IRS-ICE agreement is already doing it.
Nobody has to sue Maryland to make the Dream Act less useful. The IRS-ICE agreement is already doing it.
Sources U.S. Court of Appeals for the Fifth Circuit, No. 25-10898, United States v. Texas, filed July 9, 2026 · Maryland Education Article § 15-106.8 · Maryland Higher Education Commission · Higher Ed Immigration Portal (Presidents’ Alliance on Higher Education and Immigration) · The Baltimore Banner · National Immigration Law Center, “Basic Facts About In-State Tuition”
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