Toolkit | Access to Postsecondary Education

SAMPLE STATE FISCAL ANALYSES

FISCAL NOTES GENERATED TO HELP legislatures assess the budgetary impact of tuition equity bills typically focus on immediate costs and do not consider the long-term economic benefits of these measures. These analyses generally conclude, however, that tuition equity policies have minimal or no negative impact on state budgets.

COLORADO

Colorado Legislative Council Staff Fiscal Note on SB 13-033 (Feb. 22, 2013).

This bill will increase revenue from tuition by about $2.0 million in FY 2013–14 and by about $3.0 million in FY 2014–15. Assumes that this money will be spent on instructional costs of a higher education for the new students.
This bill will increase expenses for institutions of higher education and require a General Fund appropriation to the College Opportunity Fund of $930,000 in FY 2013–14 and $1,395,000 in FY 2014–15.

A Sizeable Return on Investment: Costs and Benefits of Colorado’s ASSET Bill (Colorado Fiscal Institute, Feb. 2013).

CONNECTICUT

Fiscal Notes With Respect to HB 6390 (Connecticut Office of Fiscal Analysis).

The Office of Fiscal Analysis (OFA) generated several fiscal notes which the Connecticut General Assembly used in considering whether to extend in-state tuition to undocumented immigrant students. The fiscal notes generally found no fiscal impact resulting from the original bill and its subsequent amendments.

GEORGIA

Georgia’s Workforce Development, Economy Damaged by Barriers to Higher Education for Undocumented Students (Georgia Budget and Policy Institute, August 2015).

Concludes that Georgia could add an estimated $10 million per year to state and local treasuries through higher incomes from better-skilled workers if it allowed all students with work authorization to pay in-state tuition at any public college or university.

HAWAII

Report submitted to the president of the Hawaii Senate by the Committee on Education regarding HB 1457 (Mar. 23, 2012).

In considering whether to provide undocumented students access to in-state tuition, the Committee on Education took note of the University of Hawaii associate vice president for student affairs’ estimate that college graduates earn more than $1,000,000 over their lifespan. Based on the calculations of the associate vice president, allowing students without lawful immigration status to receive higher education in Hawaii would enable them to earn approximately $1,800,000,000 after graduation. Assuming that these graduates pay approximately 20 percent of their earnings in taxes to the state, the amount in taxes these graduates would contribute to the state over the course of their lives would equal approximately $360,000,000. The analysis concludes that failure to pass HB 1457 would result in significant lost revenue for Hawaii.

MARYLAND

Private and Government Fiscal Costs and Benefits of the Maryland Dream Act (T. H. Gindling and Marvin Mandell, Maryland Institute for Policy Analysis and Research, University of Maryland, Baltimore County, Oct. 2012).

For each annual Maryland Dream Act cohort, the net long-term economic benefit to state, local and federal governments would equal $24.6 million as a result of increased tax revenue and decreased incarceration spending. Each Maryland Dream Act cohort would gain $41.6 million in net private benefits as a result of their increased earning potential.
State and local governments could experience an increase of tax revenue (income and sales taxes) of $6.1 million, while spending on incarceration could decrease by $7.3 million. The authors also project an increase in federal tax revenue (income and Medicare taxes) of $18.5 million.
Implementation of the Maryland Dream Act would increase high school graduation rates by an estimated 5 percent.

MASSACHUSETTS

Massachusetts Taxpayers Foundation, “MTF Conference Preview: In-State Tuition & Financial Aid Eligibility” (June 22, 2023).

In an update to its 2006 report, the Foundation estimates that making in-state tuition rates available to undocumented students could generate $2.6 to $3.5 million in new revenue for community colleges, state universities, and the University of Massachusetts in the policy’s first year of implementation.

In-State Tuition Rates and Immigrants (Antoniya Owens, Federal Reserve Bank of Boston, Spring 2007).

Expanding eligibility for in-state tuition could have the positive effect of increasing enrollment. Although undocumented students would comprise “less than half a percent of the state’s 160,000 public college students,” colleges stand to gain net tuition revenues of “$300,000 in 2006 and up to $2.7 million by 2009.” Citing the Massachusetts Taxpayers Foundation.
This article dispels the argument that tuition equity measures attract students from out-of-state. “Eligibility criteria almost always require students to have attended a high school in state for several years. This automatically precludes many out-of-state students from applying and reduces the likelihood of a given state becoming a magnet.”

MISSOURI

Keeping DREAMers Out of College: Missouri Makes a Costly Mistake (Fiscal Policy Institute, April 19, 2016).

Missouri’s appropriations bill for higher education includes instructions that would leave immigrants who have been granted deferred action in the position of having to pay a much higher tuition rate at state colleges. For every student this discourages from going to community college, the student loses $7,000 in potential earnings and the state and local governments lose $630 in potential tax contributions. For those who don’t get a bachelor’s degree, it costs the typical student $21,000 per year in potential earnings and costs the state and localities $1,890 per year in tax revenues.

NEW JERSEY (Tuition Equity & Financial Aid)

Access to Financial Aid Is Essential to Give Undocumented New Jerseyans a Better Shot at a College Education (Erika Nava and Gordon MacInnes, New Jersey Policy Perspectives, July 2016).

Although hundreds of undocumented students who might not otherwise be able to afford college benefit from New Jersey’s tuition equity policy, the overall numbers enrolled in college remain relatively small.
Affordability is the primary reason why undocumented students do not attend college, and even for students with deferred action and work authorization, the lack of access to financial aid creates a significant barrier.
States that have expanded access to financial aid experienced an increase in college attendance among the newly eligible students.
Extending state financial aid to New Jersey’s undocumented students would entail modest costs while delivering a huge benefit to the state’s economy in the long run.

In-State Tuition for Immigrant Students (pp. 22-35 of appendix to Report to [New Jersey] Governor Jon S. Corzine Submitted by the Governor’s Blue Ribbon Advisory Panel on Immigrant Policy).

Of the estimated 28,000 high school–age students who were undocumented in New Jersey, only about 2,000 would be eligible for in-state tuition.
“Higher education is a necessary precursor to accessing higher paying jobs: according to the New Jersey Department of Labor and Workforce Development, householders with only a high school diploma have a median income of $51,359 annually while those with a bachelor’s degree or higher earn a median income of $106,467.”
“New Jersey has the highest rate of out-migration of high school graduates entering postsecondary institutions in the nation. In this sense, expanding the total pool of eligible residents can increase total school revenues and keep talented high school graduates in New Jersey at state institutions. By helping reverse the trend of out-migration of New Jersey high school graduates, this initiative can lessen an estimated $1.5 billion revenue loss to New Jersey residents who attend college in other states.”

Tuition Equality Act Is a Half-Measure Without Access to Financial Aid (Erika J. Nava, New Jersey Policy Perspective, April 2015).

More than 300 undocumented students are paying in-state tuition to attend New Jersey’s four-year colleges under the state’s new Tuition Equality law, but without financial aid, higher education remains out of reach for many. The report cites an estimate by the Office of Legislative Services, finding that providing access to financial aid for these students would cost New Jersey less than 1.5 percent of the financial aid program’s total cost in the 2015 budget.

Issue Brief: To Put the “Equity” in Tuition Equity, Access to State Aid Is Essential (Erika Nava, New Jersey Policy Perspective, Nov. 14, 2013).

The main headings in this issue brief are “The Context of Tuition Equity in New Jersey,” “High Costs Shut the Door to Higher Education,” “Lack of Access to Aid Limits Options,” and “The Cost of Tuition Equity vs. The Cost of Inaction.” The issue brief also includes an appendix titled “How Tuition Equity With Access to Aid Would Work.”
The issue brief includes tables titled “New Jersey Has Invested Heavily in Public Education in Districts with High Numbers of Foreign-Born Students,” “Two Years of Out-of-State Tuition at Community Colleges Remains Out of Reach for Many Families,” and “Out-of-State Tuition at Community Colleges Eats Up Large Share of Average Annual Household Income.”

NEW YORK (Financial Aid)

The New York State DREAM Act (Office of the State Comptroller, May 2013).

“The Office of the State Comptroller (OSC) estimates that the cost of extending eligibility for the Tuition Assistance Program (which accounts for nearly all State financial aid) to undocumented students at public institutions of higher education in New York State would have been less than $20 million in the current school year based on actual enrollment — less than 2 percent of TAP aid.”

The New York State DREAM Legislation: A Strong Return on Investment (Fiscal Policy Institute, February 27, 2013).

The New York State DREAM Act: A Preliminary Estimate of Costs and Benefits (Fiscal Policy Institute, March 9, 2012).

During the 2011–12 session, the New York legislature considered a bill allowing students who meet in-state tuition requirements to qualify for financial aid through New York’s Tuition Assistance Program (TAP). This report concludes that, if enacted, this bill would increase TAP expenditures by $17 million, or just two percent of total spending.
FPI’s analysis expressly recognizes the economic benefits to the state of investing in access to education for these students. TAP aid of $20,000 ($5,000 per year for four-year colleges) allows a worker with a bachelor’s degree to earn $25,000 more in median income than a worker with only a high school degree. TAP aid of $8,000 ($4,000 per year for two-year colleges) leading to a two-year college degree yields $10,000 more in median income than that of a worker with only a high school degree.
The analysis finds that increasing the education level of a state’s workers increases their productivity and that states with a more highly educated labor force are more attractive as a place to locate businesses.

TEXAS

SB 1819 by Campbell: Senate Committee on Veteran Affairs & Military Installations, Sub-Committee on Border Security (Center for Public Policy Priorities Testimony, April 6, 2015).

Highlights the economic value of ensuring that all Texas students can pay in-state tuition rates and complete college.

VIRGINIA

In-State Tuition Is a Common Sense, Low-Cost Investment for Virginia (Laura Goren and Chad Stewart, Commonwealth Institute, January 2018).

Allowing students with Deferred Action for Childhood Arrivals (DACA) to pay in-state tuition rates benefits the state. The expected lifetime earnings of a Virginian with a bachelor’s degree is $2.7 million, almost twice that of a Virginian who has a high school diploma but never attended college.

WASHINGTON

The Washington State Dream Act: An Investment for All Washingtonians (Elena Hernandez, Washington State Budget and Policy Center, February 2014).

“For every Dreamer that receives the [state needs grant, or SNG,] and earns a bachelor’s degree, the tax revenue return to the state and localities could be as much as $43,000 over the course of a 40-year working life . . . . For a recipient of the SNG that graduates from a community and technical college (CTC), the revenue return could be up to $22,000 over a 40-year working life.” (Citations omitted.)
“Every $1 invested through the SNG in a Dreamer who graduates from a four-year university could produce up to $2 in increased state and local tax revenue over time. . . . [E]very $1 invested through the SNG in a Dreamer who graduates from a community and technical college (CTC) could produce up to $4 in increased state and local tax revenue.” (Citations omitted.)
“Over 40 years, the net return of this investment for the state could be as much as $43,000 per graduate at a four-year public university and $22,000 per graduate at a public CTC.” (Citations omitted.)