Texas Republicans look to repeal state DREAM Act, base argument on questionable economics

In 2008, Oklahoma passed HB 1804 (RTF), a law attacking residence and employment of undocumented immigrants in the state. One provision specifically repealed an earlier Oklahoma law (RTF) granting in-state tuition at state colleges to undocumented aliens as long as they held a high school diploma or GED and had lived in the state for at least two years.

That 2003 Oklahoma law was one of several around the country modeled after Texas’ 2001 DREAM Act, for which the failed federal bill that would grant residency to any undocumented alien “of good moral character” who works toward getting a college degree was named. Now, just months after the federal DREAM Act fell apart in the U.S. Senate, the Texas law that started it all 10 years ago may be in danger. No fewer than three bills have been introduced in the Texas legislature that propose to follow Oklahoma’s lead and roll back in-state tuition benefits to undocumented students.

The Texas Independent reported back in December that state Rep. Tim Kleinschmidt (R-Lexington) had filed House Bill 464, which would bar any non-legal resident of the U.S. from seeking in-state tuition at a Texas college or university. The bill has been in the House State Affairs Committee since February. It’s joined in that committee by HB 623, introduced by state Rep. Dennis Bonnen (R-Angleton). Bonnen’s bill, in addition to advocating immigration enforcement by state police and declaring English the state language (More than 31 percent of Texans speak a language other than English at home, according to the U.S. Census), would require all college applicants to provide documentation of legal residence in the U.S. in order to be considered a resident of the state of Texas. And HB 1927, filed by state Rep. Bill Zedler (R-Arlington), would set the tuition rate for undocumented aliens at the highest tuition rate a given college offers. It, too, is in the State Affairs committee.

If any one of those bills passes, Texas would join Oklahoma, Arizona, Colorado, Georgia and South Carolina, which all currently have laws specifically barring undocumented aliens from qualifying for in-state tuition rates. At present, California, New York, Utah, Washington, Illinois, Kansas, New Mexico, Nebraska and Wisconsin all have Texas-inspired laws that grant in-state tuition to undocumented students, and Connecticut’s Democratic-controlled legislature and governor’s office may be set to pass a similar law very soon. Nebraska’s law was recently threatened by a bill similar to the three in Texas, but it was overwhelmingly voted down in committee last month. Nebraska state Sen. Charlie Janssen (R-Fremont) said that the law is in violation of federal regulations; opponents of DREAM Acts in Texas and other states have often instead attacked in-state tuition for undocumented aliens as a misuse of state money.

Texas Rep. Leo Berman (R-Tyler), a major opponent of the Texas DREAM Act, has repeatedly stated that the annual economic impact of the DREAM Act is negative $42 million in state money. This is about one-seventh of 1 percent of Texas’s estimated $27 billion deficit and pales in comparison to, for example, the nearly $10 billion and rising that obesity costs Texas each year.

Though $42 million is still a sizable sum — if it’s accurate. Berman has not provided any information as to where this number comes from, but there are some publicly available statistics that his team might be drawing from. The Texas Higher Education Coordinating Board estimated that in the fall 2009 semester, 12,138 students in the state benefited from the state DREAM Act. Not all of them are illegal immigrants, but presumably all of them would be impacted by the repeal of the law, so any attempt to look at the financial impact of repeal would have to include them.

The Center for Immigration Studies (CIS) estimates that, based on the average breakdown between community college and four-year university enrollment among illegal immigrants and the tuition differences at both types of institutions in Texas, the average undocumented student in Texas gets $3,370 in taxpayer money toward tuition each year. If all 12,138 affected students were to pay the difference following a repeal, Texas would be looking at an additional $40,905,060 in revenue each year — pretty close to Berman’s number. And yet the notion that Texas could earn back more than $40 million in tax dollars each year by repealing its DREAM Act is deeply flawed.

The CIS has also done studies on income among illegal immigrants, and it has found that 65 percent of illegal immigrants in Texas live in or near poverty. Certainly, it is possible that the remaining 35 percent of illegal immigrants not living in or near poverty are overrepresented among those who go to college. But the $8.4 million that undocumented students get in financial aid each year means that they still qualify for financial need at almost twice the rate of the general student population — and may indeed do so at a considerably higher rate, as the figure of $8.4 million dates back to an average from 2004 to 2008, while the total amount of financial aid more than quintupled between 2000 and 2010.

Following a repeal of the DREAM Act, undocumented students would have to either count on a much larger amount of financial aid, which would deeply cut into Berman’s estimated $42 million windfall, or simply give up on higher education. Also throwing a wrench into Berman’s numbers is the fact that Texas does not have state income tax. The biggest state contributor by far to Texas revenue is sales tax, which of course applies equally to all consumers regardless of immigration status. If Berman wants to say that taxpayers shouldn’t have to pay for non-taxpayers’ education, he should limit his argument to the federal income tax the state of Texas receives, accounting for 42.2 percent of its total revenue. His $42 million is therefore funded to the tune of about $17.7 million by payers of income tax in Texas. Given a population of almost 24.8 million people, repealing the DREAM Act would save the average Texan about 72 cents on their tax returns.

On the other hand, if a federal DREAM Act were to eventually pass in U.S. Congress and undocumented immigrants were allowed to legally live and work in Texas or any other state after getting degrees, the presence of thousands more educated members of the workforce in Texas could have some major long-term benefits for the state. The University of Virginia’s Weldon Cooper Center for Public Service estimates that each dollar a state spends on higher education produces more than $13 in job-creating economic activity and an additional $1.39 in tax revenue.