Misinformation Spreads as Trump Moves to Cut Aid for Some California Students

This story was originally published by CalMatters. Sign up for their newsletters.

Hours after the Trump administration sued California last week, threatening to end key benefits for students without legal status, Michelle was scrolling social media when she saw a video that made her panic.

The Trump administration is challenging California’s policy of providing in-state tuition, scholarships and subsidized loans to immigrants without legal status — including Michelle, an immigrant who is a community college student in San Mateo County. CalMatters has agreed to withhold her full name because she fears drawing attention to her legal status.

On TikTok, rumors swirled. Michelle saw a video of a young man, around her age, asking if the Free Application for Federal Student Aid, or FAFSA, is gone.

In reality, FAFSA is still around, and while the new lawsuit could affect some students’ financial aid, some top legal experts say the Trump administration is unlikely to win. Regardless, the court process may take weeks or much longer to resolve the government’s claims against California.

In the lawsuit, the U.S. Department of Justice alleges that California’s policy of granting in-state tuition and financial aid for some students without legal status is unconstitutional. Federal lawyers also argue that California’s policies violate a 1996 federal law, which bars states from providing benefits to residents without legal status that aren’t also available to U.S. citizens who live anywhere in the U.S. The Justice Department is arguing that California either needs to drop the policy or let all U.S. citizens, including those who are out-of-state, pay the same rate.

In California, over 100,000 college students lack legal status, according to one estimate by an alliance of university leaders who advocate for immigrants. Federal assistance, such as Pell grants and federal student loans, are off-limits to anyone who isn’t a U.S. citizen or does not have permanent legal status. California has its own money for college financial aid, which it distributes according to state law.

As long as individuals meet certain requirements, such as attending three years of high school in California, they’re eligible for in-state tuition, saving as much as $39,000 of dollars each year compared to their out-of-state peers. Once they meet those requirements, students without legal status can also qualify for the state’s cornerstone financial aid program, known as Cal Grant, though only a small fraction of these students actually apply for and receive it.

To Kevin Johnson, a law professor at UC Davis, Trump’s actions may be more about political wins than legal ones. “The Trump administration is engaged in a full-court press on undocumented immigrants and so-called sanctuary jurisdictions, and California and Governor Newsom in particular,” Johnson said. That the U.S. Department of Justice named the suit “United States of America v. Newsom” is another indication that this is political, he added.

Others noted that states have already invested in students without legal status and denying them an affordable path toward a college education is a waste of resources. Economists have pointed out that immigrants without status also are integral to the U.S. workforce and aren’t easily replaceable.

‘We didn’t expect them to go this low’

Even weak lawsuits or outright misinformation can make students nervous during November, when college and financial aid application season is in full swing.

On TikTok, videos of students panicking about the financial aid system surfaced last winter, after the Biden administration delayed and botched the rollout of the new FAFSA. Among its many glitches, the new form prevented students whose parents lacked a Social Security number from submitting their information.

After Trump was elected last November, fears about the total demise of federal financial aid swirled again on TikTok. Over the course of this year, as his administration targets universities and continues to dismantle the U.S. Department of Education, those fears have persisted.

In California, Trump seeks to impose a $1 billion penalty on UCLA for alleged civil rights abuses, though a federal judge recently handed the White House a temporary loss on that front. His administration is also suing California colleges and universities for alleged antisemitism violations and has sought to freeze or curtail billions of dollars in federal research funding.

Much of those freezes have been blocked or reversed by federal judges, but hundreds of millions of dollars still remain cut off to campuses. Much, if not all, of those friction points between California and Trump could be resolved through settlements and negotiations, which are political in nature, said UCLA law professor Hiroshi Motomura in an interview.

Before Trump was elected, state leaders, including Assemblymember David Alvarez, a Chula Vista Democrat, pushed for California to offer additional benefits to students without legal status, such as the opportunity to work campus jobs.

Now, with access to financial aid programs at risk for these students, Alvarez said the focus is shifting. “We didn’t expect it would go this low as to go after students that the president had previously said should be welcomed here.” In 2024, Trump told a podcast host that students should “automatically” receive “a Green Card,” otherwise known as permanent residency, when they get their college diploma.

Legal scholars doubt Trump’s lawsuit will win

The lawsuit against California is the Trump administration’s sixth against states with policies allowing in-state tuition for students without legal status. The White House went after Texas first, in June. Underscoring how much of a bipartisan issue in-state tuition is, Texan lawmakers were the first in the U.S. to enshrine the policy in 2001. In all, more than 20 states passed some in-state tuition policy benefiting some residents without legal status.

Trump’s legal attacks on the policy this year prompted leaders in Kentucky, Oklahoma and Texas to side with the White House to terminate the benefit in those respective states. Some legal groups that want to continue in-state tuition for students lacking legal status are challenging those states’ moves.

Trump has also sued Minnesota and Illinois, states with Democrats as governors and attorneys general who are challenging Trump’s lawsuits.

The U.S. Department of Justice says that the federal law in question bars students without legal status from receiving in-state tuition and financial aid benefits based on their living in the state. This, the federal lawyers argue, violates federal law since public campuses in California require U.S. citizens from other states to pay higher tuition rates.

However, California’s law, Assembly Bill 540, doesn’t extend in-state tuition based on where students live, scholars and a previous court ruling say. Instead, students generally need to prove that they attended three years of high school or community college in California; they also need to earn in California a high school diploma or obtain enough community college credits to be eligible for transfer into a public university.

The Department of Justice says those three-year high school or community college requirements are tantamount to an in-state residency criteria and therefore violate the 1996 federal law.

But the California Supreme Court in 2010 already struck down that interpretation. The high court observed that some students living in areas bordering California are permitted to study at California high schools. High school students from out of state enrolled in private boarding schools also satisfy the requirement; they don’t count as residents of California either. And students who were residents of California during high school but moved to a different state could still enroll in California colleges or universities paying in-state tuition.

All of these scenarios require a student to complete the same AB 540 application as students who lack legal status. The only difference is that students without status must also complete an affidavit that they’ll pursue legal residency as soon as they can.

In fact, the University of California enrolled more students under AB 540 who were legal U.S. residents than those who weren’t, the state high court said then.

“If Congress had intended to prohibit states entirely from making unlawful aliens eligible for in-state tuition, it could easily have done so,” the state Supreme Court wrote in 2010. But Congress didn’t do that, the court noted.

Lawmakers in California who passed AB 540 in 2001 knew what the federal law restricted, said Motomura, and they crafted a state law that wouldn’t contravene what Congress intended. “It was drafted to avoid the residency test, and it was drafted to avoid the exclusion of U.S. citizens,” he said.

What’s likely next

California has already signaled that it will fight the lawsuit. “The Trump Administration has once again missed the mark with its latest attack on California, and we look forward to proving it in court,” wrote Nina Sheridan, a spokesperson for the California Department of Justice.

Both the UC and the community college system said their tuition and financial aid policies have always been legally compliant. The Cal State University system did not respond to a request for comment.

The Trump administration may also seek a preliminary injunction to halt California’s in-state tuition law for nonresidents, which would again expose Californians to a seesaw of temporary court orders, sometimes contradictory in nature, while the full legal merits of the case play out slowly in court.

Thomas A. Saenz, president and general counsel for the Mexican American Legal Defense and Educational Fund, or MALDEF, thinks the U.S. Supreme Court will likely side with California despite its conservative orientation if the case goes that far.

A major legal question underscoring the case against California is when and how federal rules preempt or supersede state laws. The Trump White House is arguing California’s in-state policies are preempted by federal law. But the legal concept of preemption is a pillar in jurisprudence. Liberal and conservative interests benefit similarly from a consistent application of preemption as a legal concept, Saenz said. For example, businesses rely on preemption rules in situations where a state law is more progressive or consumer-friendly than a federal rule and want courts to defend them from following the more demanding state rules.

The U.S. Supreme Court is “going to be very wary of making bad law in the realm of preemption, because it could then come back to bite the right wing in protecting businesses,” Saenz said.

For Michelle and other students without legal status navigating their own financial aid applications — and the misinformation online — a series of temporary court orders could create more panic. Financial aid is top of mind, said Michelle, but she doesn’t have time to track the legal back-and-forth of her eligibility.

In addition to being a full-time student, Michelle works four days a week at a restaurant, saving up money not only to support herself but also her family. She’s the oldest of four kids and said she sends $500 to her parents each month.

College is “an opportunity for me to be someone in life, to make my parents proud,” she said. Asked about the lawsuit at the cafeteria of her college, Michelle made a choking gesture with her hand, as though the threat of losing financial aid next year could kill her. “Trump is taking that opportunity away because he doesn’t like immigrants.”

The deadline to submit financial aid applications for community college is Sept. 2, but Michelle is already working on her application, just in case.

This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.