Could a Colorado public university unilaterally create a discounted tuition rate for undocumented students without the legislature's approval?

Opinion 12-04: Discounted tuition for undocumented students is a "public benefit" that required legislative authorization the General Assembly had not given

Plain-English summary

In June 2012, Metropolitan State College of Denver ("Metro State") created a new tuition classification that charged a so-called "unsubsidized" rate to nonresident students who had attended and graduated from a Colorado high school for three years, including students who could not prove lawful presence in the United States. The discount was substantial: roughly $7,157 per year instead of the $15,985 nonresident rate, almost $9,000 in savings. Metro State argued the rate was not a public benefit because the rate covered the state's per-student cost of providing the education.

The legislature had repeatedly considered and declined to authorize this tuition structure. The most recent attempt, the ASSET bill (SB 12-015), was supported by Metro State, the University of Colorado, and the Lieutenant Governor, but again did not pass. Metro State's board acted on its own.

The AG concluded the discount was a public benefit. State law (§ 24-76.5-103, C.R.S.) and federal law (8 U.S.C. § 1621) defined "public benefit" to cover any postsecondary education benefit "for which payments or assistance are provided." The nearly $9,000 annual discount was unmistakably "assistance" — it was the entire point of the program, to make college affordable for students who could not afford the nonresident rate. Federal law allowed states to extend such benefits to people who could not prove lawful presence only if the state legislature affirmatively enacted a law saying so after August 22, 1996. Colorado had not.

Currency note

This opinion was issued in 2012. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

(For research purposes: Colorado later passed the ASSET legislation in 2013, which provided the affirmative authorization the AG identified as missing in 2012. Verify the current statute before relying on the historical conclusion here.)

Background and statutory framework

Colorado's higher education tuition framework has long centered on a binary in-state / nonresident classification. Under § 23-5-130.5(1), C.R.S. (2011), each governing board could annually set tuition for "students with in-state classification" and for "nonresident students." Other statutes carved out narrow exceptions for Canadian military, Chinese and Russian students, and the Colorado National Guard, but the structure was uniform: § 23-7-101, C.R.S. (2011) directed institutions to apply uniform rules in classifying students.

State law in § 24-76.5-103, C.R.S. (2011) required "each agency or political subdivision of the state" to verify the lawful presence of any natural person 18 or older applying for state or local public benefits, and made it "unlawful" to provide a public benefit in violation of that section. Section 24-76.5-102(3) defined "public benefit" by direct cross-reference to 8 U.S.C. § 1621, which covered "any... postsecondary education... benefit for which payments or assistance are provided to an individual... by an agency of a State or local government."

Federal law in 8 U.S.C. § 1621(a) declared that anyone not legally in the United States was not eligible for any state or local public benefit. Section 1621(d) carved out a narrow exception: a state could extend public benefits to such persons only by enacting a state law after August 22, 1996, that affirmatively provided for such eligibility. Federal law in 8 U.S.C. § 1623 separately barred postsecondary education benefits "on the basis of residence within a state" unless U.S. citizens were eligible without regard to residence; programs structured around high-school attendance rather than residence had survived court challenges in California (Martinez v. Regents of the Univ. of Cal., 241 P.3d 855 (Cal. 2010)).

What the AG concluded at the time

The AG concluded Metro State's tuition discount was a public benefit and that the institution lacked authority to grant it without an affirmative act of the General Assembly. Three lines of reasoning supported the conclusion:

First, the statutory text was broad and clear. "Assistance" meant aid or help. A nearly $9,000 annual discount was unambiguously aid; the entire purpose of the program was to make college easier to attend for students who would otherwise be priced out.

Second, the discount was logically identical to a scholarship. If Metro State had left the nonresident rate intact and offered each qualifying student an $8,828.20 annual scholarship, the resulting cash transfer would obviously be a public benefit. The label on the transaction did not change its economic nature.

Third, Metro State's "covers the state's cost" framework was unworkable. Calculating the true subsidy provided to students at a state institution is effectively impossible: tax-exempt status, bonding capacity, capital construction subsidies, and shared facilities (Metro State sits inside the Auraria Higher Education Center) all flowed into the actual cost of educating a student. The ASSET bill itself had used a different "unsubsidized" calculation than Metro State did. Reading the public benefit statute to depend on each institution's accounting choices would gut the law.

The AG noted that federal law expressly required an affirmative state legislative choice to extend benefits to people who could not prove lawful presence. The General Assembly had considered legislation six times in the prior decade and had declined each time. Without that affirmative legislative grant, no state institution could create the benefit unilaterally.

The opinion expressly did not reach the legality of the ASSET bill itself, and noted in passing a separate concern: a single institution probably could not unilaterally create a new tuition classification at all, since § 23-7-101, C.R.S. (2011) directed institutions to apply uniform rules "as prescribed in this article and not otherwise."

Common questions

Did the AG say undocumented students could not attend Colorado public colleges?
No. The opinion was about tuition rates only. The conclusion was narrower: a state institution could not, on its own, create a tuition rate that fell below the nonresident rate for students who could not prove lawful presence, because the discount itself was a public benefit and federal law required affirmative state legislative authorization to extend public benefits to that group.

Was Metro State's "unsubsidized" calculation the issue?
The AG rejected the underlying premise. Even if Metro State could in fact calculate a rate that exactly covered the marginal state cost, the discount from the nonresident rate was a form of "assistance" under the statute. The label "unsubsidized" did not change that.

What about students who graduated from Colorado high schools?
The AG accepted that structuring eligibility around three years of high-school attendance and graduation, rather than residency, could avoid the separate prohibition in 8 U.S.C. § 1623. (California courts had upheld such a program in Martinez.) But that did not address § 1621's separate ban on public benefits without affirmative state legislative authorization.

Did this opinion bind Metro State?
AG opinions are persuasive authority, not binding precedent. As a practical matter, however, the opinion put Metro State on notice that its program created legal exposure under the public benefits statute, and could put federal funding at risk.

What changed after this opinion?
The opinion observes that the General Assembly had repeatedly declined to authorize discounted tuition for undocumented students. Researchers should verify whether subsequent legislation (the ASSET legislation eventually passed in 2013, after this opinion) provided the affirmative authorization the AG identified as missing.

Citations

Statutes (state):

• § 24-76.5-103, C.R.S. (2011) (lawful-presence verification for public benefits)
• § 24-76.5-102(3), C.R.S. (2011) (definition of "public benefit," cross-reference to 8 U.S.C. § 1621)
• § 23-7-101, C.R.S. (2011) (uniform tuition classification rules)
• § 23-5-130.5(1), C.R.S. (2011) (in-state vs nonresident tuition authority)

Statutes (federal):

• 8 U.S.C. § 1621(a), (d) (state and local public benefits prohibition; exception via affirmative state law)
• 8 U.S.C. § 1623 (postsecondary education benefits residency clause)

Cases:

• Martinez v. Regents of the Univ. of Cal., 241 P.3d 855 (Cal. 2010)
• Day v. Bond, 500 F.3d 1127 (10th Cir. 2007)
• Martin v. People, 27 P.3d 846 (Colo. 2001)

Source

• Landing page: https://coag.gov/attorney-general-opinions/
• Original PDF: https://coag.gov/app/uploads/2019/08/No.-12-4-The-Authority-of-State-Institutions-of-Higher-Education-to-Provide-Discounted-Tuition-to-Students-who-Cannot-Prove-they-are-Lawfully-Present-in-the-United-States.pdf

Original opinion text

STATE OF COLORADO
DEPARTMENT OF LAW
Office of the Attorney General

John W. Suthers, Attorney General
Cynthia H. Coffman, Chief Deputy Attorney General
Daniel D. Domenico, Solicitor General

State Services Building
1525 Sherman Street, 7th Floor
Denver, Colorado 80203
Phone (303) 866-4500

FORMAL OPINION OF JOHN W. SUTHERS, Attorney General
No. 12-04
AG Alpha No. HE CO AGBDU
June 19, 2012

This opinion, requested by the Colorado Community College System, addresses the authority of state institutions of higher education in Colorado to provide discounted tuition to students who cannot prove they are lawfully present within the United States.

QUESTION PRESENTED AND ANSWER

Question: Without statutory authorization, do Colorado's state-supported institutions of higher education have the authority to grant discounted tuition rates to students who cannot prove they are lawfully present in the United States?

Answer: No. Discounted tuition is a "public benefit," which under current state law may only be provided to individuals who prove their lawful presence in the United States.

BACKGROUND

Colorado's state-supported institutions of higher education generally charge students one of two rates of tuition: a lower rate for "students with in-state classification" and a higher rate for students statutorily classified as "nonresident students." To qualify for the in-state tuition classification, and thus for the lower rate, students must meet a number of requirements, including that they prove they are lawfully present in the United States.

Six times in the past decade, the General Assembly has considered, and rejected, legislation that would have changed this tuition structure by creating an additional student classification and authorizing higher-education institutions to charge students who cannot prove their lawful presence a tuition rate lower than the typical rate for nonresident students. The most recent effort was Senate Bill 12-015, known as the "ASSET" bill, which was supported by the governing boards of a number of state institutions of higher education, including the Community College System, Metropolitan State College of Denver ("Metro State"), the University of Colorado, and others, including the Lieutenant Governor. Despite this support, the General Assembly declined yet again to alter the basic in-state/nonresident tuition structure.

Nevertheless, on June 7, Metro State created a new tuition classification similar, but not identical to, that contemplated by the bill. Metro State's new tuition classification charges a so-called "unsubsidized" tuition rate to nonresident students who have graduated from and attended a Colorado high school for three years, including students who cannot prove their lawful presence in the United States. Metro State calculated the rate for this new classification by adding to the in-state rate of $6,164.40 (which includes the per-student amount from the state College Opportunity Fund ("COF") given to in-state students) a fee-for-service charge and a charge designed to cover a share of the institution's capital construction costs. The total to be charged for full-time students in this new tuition classification rate is $7,157.00 per school year at 15 credit hours per semester. This is a significant discount, nearly $9,000, from the tuition classification rate which such students (and other nonresidents) would otherwise be required to pay: $15,985.20.

The debate over the ASSET bill was intense because it had generally been considered a necessary step to creating a new, discounted tuition classification rate for undocumented students. In light of this general understanding, certain state-supported institutions of higher education, elected officials, and members of the public have asked this office to give its opinion as to whether the current statutory regime prohibits state institutions of higher education from unilaterally creating a discounted tuition classification rate for undocumented students, or whether those institutions have had the discretion all along to do what the ASSET bill was designed to do.

ANALYSIS

The thicket of law and regulation surrounding the issue of higher education and tuition rates for undocumented students is dense. The precise question here, however, arises from a fairly narrow disagreement. Supporters of Metro State's approach do not dispute that a subsidized tuition rate is a "public benefit" — indeed, Metro State has taken pains to set the new special tuition rate at a level it argues would precisely match the cost to the state of providing an education. In doing so, Metro State argues that it has eliminated any state benefit. The contrary argument is that providing a discount of nearly $9,000 per year compared to the rate these students would otherwise pay is a "public benefit," even if the state's costs are covered. I am persuaded that the latter view is correct.

State law requires that "each agency or political subdivision of the state shall verify the lawful presence in the United States of each natural person eighteen years of age or older who applies for state or local public benefits." It is "unlawful for an agency or a political subdivision of the state to provide a federal public benefit or a state or local public benefit in violation of this section." Under this law, every year "each state agency or department that administers a program that provides state or local public benefits shall provide a report with respect to its compliance . . . to the state, veterans, and military affairs committees of the senate and house."

Federal law likewise declares that anyone not legally in the country "is not eligible for any State or local public benefit." If a state wishes to offer "public benefits" to those who cannot establish lawful presence in the United States, it may do so only if it "enact[s] . . . a State law after August 22, 1996, which affirmatively provides for such eligibility."

State and federal law define "public benefit" identically, covering "any retirement, welfare, health, disability, public or assisted housing, postsecondary education, food assistance, unemployment benefit, or any other similar benefit for which payments or assistance are provided to an individual, household, or family eligibility unit by an agency of a State or local government or by appropriated funds of a State or local government." By their plain terms, these provisions undisputedly apply to any "postsecondary education... benefit" Metro State or any other state institution of higher education might provide. Thus, the question is whether nearly $9,000 in discounted tuition is a "benefit" for purposes of these laws.

There is little case law on this question to guide us. There have been a number of lawsuits over state programs similar to what would have been authorized by the ASSET bill. But none of them addresses whether a state-supported educational institution may, without legislative approval, create a lower rate of tuition for unlawful residents than that which would otherwise apply. Moreover, the case law does not involve disputes about whether there is any "benefit" in these situations; the disputes center instead on whether the provision of these benefits violates the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 ("IIRIRA"), a federal law providing that "an alien who is not lawfully present in the United States shall not be eligible on the basis of residence within a state ... for any postsecondary education benefit unless a citizen or national of the United States is eligible for such a benefit without regard to whether the citizen or national is such a resident." Metro State's proposal, like the ASSET bill, seeks to avoid IIRIRA's specific prohibition by administering the tuition discount not on the basis of residence in Colorado, but instead upon three years' attendance and graduation from high school here. This approach was upheld in California, and it is not necessary to question it in this Opinion.

I am guided by three considerations, however, that all support the conclusion that discounted tuition is a "public benefit," and, without specific statutory authorization, may only be given to those who can verify their lawful presence in Colorado.

First, the language of the statutes defining "public benefit" is broad and clear. It applies to a wide range of possible forms of government benefits or aid, including any postsecondary education benefit "for which payments or assistance are provided." Metro State's new tuition rate does not involve a direct "payment," so the question becomes whether the $8,828.20 per-year discount is a form of "assistance." There can be little doubt it is.

Assistance is defined as "aid" or "help." It is quite clear that Metro State's new discounted tuition would be a significant aid or help to students who qualify. After all, the very purpose of Metro State's plan, and indeed the ASSET bill, is to make attending college easier for certain students (that is, to "help" them attend college) by discounting currently applicable tuition rates. Metro State estimated that its plan would result in the enrollment of 300 new students, who otherwise would not enroll at the University. Discounted tuition to a state-supported university therefore falls within the plain meaning of the term "public benefit."

As explained above, federal law permits states to offer benefits to individuals who cannot prove their lawful presence, but a state can do so only by "enact[ing] . . . a State law after August 22, 1996, which affirmatively provides for such eligibility." Federal law therefore requires an affirmative choice by the state legislature to provide benefits to individuals who cannot prove their lawful presence in the United States. The ASSET bill was one of many efforts by the Colorado legislature to satisfy this federal mandate. But the General Assembly has consistently refused to make the affirmative choice required by federal law to grant discounted tuition to undocumented students.

Second, as a matter of logic, discounting tuition in this way is identical to providing a cash payment or scholarship, either of which would constitute a public benefit. Metro State could have achieved the same result by leaving the tuition rate as it is, but offering a scholarship of $8,828.20 per year to students meeting the same criteria as those in the new program. No one could reasonably argue that this "payment" would not qualify as a public benefit, and the statutes bring within them multiple forms of "assistance" that would have the same effect. So, from the perspective of both the institution and the prospective student, the effect of this assistance is the same, whatever form it takes — as a result of Metro State's new policy, attending college costs far less for a certain class of students than it otherwise would. Metro State, for example, suggests that approximately 120 students currently attending the University will be eligible for the discounted tuition rate. For these 120 students, the program is identical to a scholarship of $8,828.20. And the benefit to these students alone translates to a total of over $1 million the students would otherwise have been required to pay.

Third, Metro State's proposed analytical framework — that "assistance" or "benefits" exist only when the tuition rate falls below the total cost to the state — is unworkable and cannot have been what the state and federal legislatures intended when enacting provisions prohibiting "public benefits" to those who are unable to verify their lawful presence. Calculating the actual subsidy provided to students attending state institutions of higher education is difficult, if not impossible. Metro State's proposal takes the in-state tuition rate (including the COF stipend) and adds to it an estimate of a fee-for-service per full-time employee and an estimate of the student's annual share of the state's capital contributions to Metro State. This, it says, creates an "unsubsidized" rate. Yet the ASSET bill sought to do the same thing — create an "unsubsidized" tuition rate — but it arrived at a different number. And both of these calculations are open to serious attack as underestimating the cost of the state's contributions to these institutions.

The state subsidizes higher education institutions in ways that are effectively impossible to calculate. State institutions receive, for example, state and federal tax benefits, the ability to participate in state financial bonding, and other benefits that are not cost-neutral. Metro State itself is part of the Auraria Higher Education Center, which consumes state resources in the form of administration, maintenance, and other costs. Although an institution might attempt to account for these costs in its version of an "unsubsidized" tuition rate, there is no legal basis for the assertion that the statutory definition of a "benefit" depends on such differences in calculation.

As a final matter, Metro State's proposal raises another issue: whether a state-supported higher-education institution can, without approval from the General Assembly, create an entirely new tuition classification applicable to Colorado students. As a general matter, the General Assembly creates the categories of tuition that may be charged to students of state-supported institutions. This includes in-state tuition, nonresident tuition, and a host of other special tuition categories, such as those for Canadian military personnel, certain Chinese and Russian students, and members of the Colorado National Guard. By statute, the General Assembly has stated its intention that "the state institutions of higher education shall apply uniform rules, as prescribed in this article and not otherwise, in determining whether students are classified as in-state students or out-of-state students for tuition purposes." Only under limited, statutorily recognized circumstances may a student qualify for a full or partial waiver of nonresident tuition. These provisions suggest that a single institution, such as Metro State, cannot unilaterally create a new tuition classification (as opposed to setting rates within an existing tuition classification) without legislative approval. Even so, we need not reach a conclusion on this additional requirement, because the question posed in this Opinion may be fully answered by the determination that a reduced tuition rate is a "public benefit" under federal and state law.

CONCLUSION

Reasonable people of good intentions and good faith can disagree about the wisdom of granting discounted tuition to undocumented students. But that decision is one that under existing law must be made by the legislature, not individual institutions of higher education.

Issued this 19th day of June, 2012.

JOHN W. SUTHERS
Attorney General