Earlier this year, the Equal Protection Project (EPP) submitted a complaint and request for investigation urging the U.S. Department of Justice to investigate Colorado’s Advancing Students for a Stronger Tomorrow (ASSET) Act and related financial aid programs. EPP argued that Colorado’s policies violate 8 U.S.C. § 1623(a), which prohibits states from providing postsecondary education benefits to aliens not lawfully present in the United States on the basis of state residence unless the same benefits are available to all U.S. citizens regardless of where they reside.
Yesterday, July 23, 2026, DOJ filed a lawsuit challenging Colorado’s law that grants in-state tuition and other postsecondary education benefits to illegal aliens while denying those same benefits to U.S. citizens from other states, arguing the State’s tuition and financial aid laws are preempted by federal law.
The complaint alleges that Colorado unlawfully extends resident tuition rates and numerous state-funded financial aid programs to illegal aliens while requiring U.S. citizens from other states to pay substantially higher tuition and remain ineligible for the same benefits. In addition to challenging Colorado’s in-state tuition law, the lawsuit targets several financial aid programs that incorporate the same residency-based eligibility criteria, including the Colorado Application for State Financial Aid (CASFA), the College Opportunity Fund, the Colorado Opportunity Scholarship Initiative, and university scholarship programs tied to Colorado’s residency classifications.
According to the Department of Justice, these provisions violate the Supremacy Clause because Congress expressly prohibited states from providing residency-based postsecondary education benefits to aliens not lawfully present in the United States unless those same benefits are made available to all U.S. citizens regardless of residency. The complaint seeks declaratory and injunctive relief preventing Colorado from continuing to enforce the challenged laws.
The complaint explains the legal basis for the lawsuit as follows:
“These statutes constitute blatant unequal treatment favoring illegal aliens over U.S. citizens. Worse, such preferential treatment is squarely prohibited and preempted by Congress. Specifically, federal law mandates 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.” 8 U.S.C. § 1623(a).”
The Department’s lawsuit reflects its broader effort to enforce federal restrictions on state benefits for illegal aliens. Announcing the lawsuit, Associate Attorney General Stanley E. Woodward Jr. stated: “For three decades Congress has made clear that states cannot provide education benefits to illegal aliens unless those same benefits are available to all American citizens.” He added that Colorado is “violating federal law and subsidizing education for illegal aliens at the taxpayers’ expense.”
Earlier this year, the Equal Protection Project urged the Department of Justice to investigate Colorado’s ASSET Act and related financial aid programs, arguing that the State was providing residency-based postsecondary education benefits to illegal aliens in violation of 8 U.S.C. § 1623(a). The Department of Justice has now filed suit seeking to invalidate those policies under the same federal statute.
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