IN STATE Act of 2014

Summary: Investing in States to Achieve Tuition Equality for Dreamers Act of 2014 or the IN STATE Act of 2014 - Amends title IV (Student Assistance) of the Higher Education Act of 1965 to direct the Secretary of Education to allot grants to states to offer Dreamer students in-state tuition and expand their access to in-state financial aid. Defines a &quot;Dreamer student&quot; as an individual who:  was under age 16 upon entering this country, has provided a list of each secondary school the individual attended in this country, and has earned a high school diploma or certain similar credentials or is scheduled to complete the requirements for such a credential before the next academic year begins, has acquired a degree from an institution of higher education or has successfully completed at least 2 years of a program for a bachelor's or higher degree in this country, or has served honorably in the uniformed services for at least 4 years.  Directs the Secretary to provide for a hardship exception to either or both of the first two of such requirements. Requires grant applicants to assure the Secretary that they: (1) have made significant progress in establishing a preschool through postsecondary education (P-16) longitudinal data system; and (2) will not discriminate against Dreamer students in awarding student aid or determining who is eligible for in-state tuition, if the student would otherwise be eligible for in-state financial aid as a state resident. Allots grants to each state based on its proportion of resident Dreamer students who are enrolled at least half-time in postsecondary education. Amends the Immigration and Nationality Act to direct the Secretary of Homeland Security (DHS) to collect a specified fee from recipients of F-1 visas, provided to nonimmigrant full-time students. Eliminates the prohibition on states offering unlawful aliens postsecondary benefits on the basis of their residence in the state that are more generous than those offered citizens or naturals of this country, without regard to their state residence. Allows individuals who have served honorably in the U.S. Armed Forces to be naturalized without having been lawfully admitted to this country for permanent residence.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Investing in States to Achieve 
Tuition Equality for Dreamers Act of 2014'' or ``IN STATE Act of 
2014''.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress makes the following findings:
            (1) The non-partisan Congressional Budget Office found that 
        comprehensive immigration reform would reduce the national 
        deficit by billions, strengthen Social Security solvency, 
        increase the number of jobs, and raise Gross Domestic Product.
            (2) According to a report by the Partnership for a New 
        American Economy, in 2010 more than 40 percent of Fortune 500 
        companies were founded by immigrants or their children, 
        generating a combined revenue of $4,200,000,000,000.
            (3) Thousands of deferred action childhood arrival students 
        graduate from high schools in the United States every year but 
        only a small fraction of those students enroll in higher 
        education.
            (4) Many jobs in the 21st century economy require some form 
        of postsecondary education.
            (5) Education provides an important pathway to the middle 
        class; college graduates have higher earnings and lower 
        unemployment rates than their less educated peers.
            (6) Since 2008, States are spending 28 percent less per 
        student in higher education, and tuition and fees continue to 
        rise. The increased costs are being shifted to students and 
        student loan debt continues to grow.
            (7) Investments in higher education provide youth a ladder 
        to achieving the American dream.
    (b) Purposes.--The purposes of this Act are to--
            (1) allow States to provide immigrant students timely and 
        affordable access to higher education;
            (2) incentivize States to maintain support for higher 
        education; and
            (3) promote increased access and affordability to 
        postsecondary education for students through State need-based 
        financial aid.

SEC. 3. AMERICAN DREAM GRANTS.

    (a) In General.--Subpart 4 of part A of title IV of the Higher 
Education Act of 1965 (20 U.S.C. 1070c et seq.) is amended by adding at 
the end the following:

``SEC. 415G. AMERICAN DREAM GRANTS.

    ``(a) Dreamer Students.--
            ``(1) In general.--In this section, the term `Dreamer 
        student' means an individual who--
                    ``(A) was younger than 16 years of age on the date 
                on which the individual initially entered the United 
                States;
                    ``(B) has provided a list of each secondary school 
                (as that term is defined in section 9101 of the 
                Elementary and Secondary Education Act of 1965) that 
                the student attended in the United States; and
                    ``(C)(i) has earned a high school diploma or a 
                commensurate alternative award from a public or private 
                high school or secondary school, has obtained a general 
                education development certificate recognized under 
                State law, has obtained a high school equivalency 
                diploma in the United States, or is scheduled to 
                complete the requirements for such a credential before 
                the next academic year begins;
                    ``(ii) has acquired a degree from an institution of 
                higher education or has completed not less than 2 
                years, in good standing, in a program for a bachelor's 
                degree or higher degree in the United States; or
                    ``(iii) has served in the uniformed services for 
                not less than 4 years and, if discharged, received an 
                honorable discharge.
            ``(2) Hardship exception.--The Secretary shall issue 
        regulations that direct when a State shall waive the 
        requirement of subparagraph (A) or (B), or both, of paragraph 
        (1) to qualify as a Dreamer student under paragraph (1), if the 
        individual--
                    ``(A) demonstrates compelling circumstances for the 
                inability to satisfy the requirement of such 
                subparagraph (A) or (B), or both; and
                    ``(B) satisfies the requirement under subparagraph 
                (C) of paragraph (1).
    ``(b) Grants to States.--
            ``(1) Reservation for administration.--From the amounts 
        appropriated to carry out this section for each fiscal year, 
        the Secretary may reserve not more than 1 percent of such 
        amounts to administer this section.
            ``(2) Grants authorized to eligible states.--From the 
        amounts appropriated to carry out this section for each fiscal 
        year and not reserved under paragraph (1), the Secretary shall 
        award grants to eligible States to enable the States to carry 
        out the activities described in this section.
            ``(3) Eligibility.--A State is eligible to receive a grant 
        under this section if the State--
                    ``(A) increases access and affordability to higher 
                education for students by--
                            ``(i) offering in-State tuition for Dreamer 
                        students; or
                            ``(ii) expanding in-State financial aid to 
                        Dreamer students; and
                    ``(B) submits an application to the Secretary that 
                contains an assurance that--
                            ``(i) the State has made significant 
                        progress establishing a longitudinal data 
                        system that includes the elements described in 
                        section 6201(e)(2)(D) of the America COMPETES 
                        Act (20 U.S.C. 9871(e)(2)(D)); and
                            ``(ii) notwithstanding any other provision 
                        of law, the State will not discriminate, in 
                        awarding student financial assistance or 
                        determining who is eligible for in-State 
                        tuition, against a Dreamer student if the 
                        student would otherwise be eligible for in-
                        State financial aid.
            ``(4) Allotments.--The Secretary shall allot the amount 
        appropriated to carry out this section for each fiscal year and 
        not reserved under paragraph (1) among the eligible States in 
        proportion to the number of Dreamer students enrolled at least 
        half-time in postsecondary education who reside in the State 
        for the most recent fiscal year for which satisfactory data are 
        available, compared to the number of such students who reside 
        in all eligible States for that fiscal year.
    ``(c) Supplement Not Supplant.--Grant funds awarded under this 
section shall be used to supplement, and not supplant, non-Federal 
funds that would otherwise be used for activities authorized under this 
section.
    ``(d) Authorization and Appropriation of Funds.--There are 
authorized to be appropriated, and there are appropriated, to carry out 
this section--
            ``(1) $55,000,000 for fiscal year 2015;
            ``(2) $55,000,000 for fiscal year 2016;
            ``(3) $60,000,000 for fiscal year 2017;
            ``(4) $60,000,000 for fiscal year 2018;
            ``(5) $75,000,000 for fiscal year 2019;
            ``(6) $75,000,000 for fiscal year 2020;
            ``(7) $85,000,000 for fiscal year 2021;
            ``(8) $85,000,000 for fiscal year 2022;
            ``(9) $100,000,000 for fiscal year 2023; and
            ``(10) $100,000,000 for fiscal year 2024.''.
    (b) Offset.--Section 281 of the Immigration and Nationality Act (8 
U.S.C. 1351) is amended--
            (1) by striking ``The fees'' and inserting the following:
    ``(a) In General.--The fees'';
            (2) by striking ``: Provided, That nonimmigrant visas'' and 
        inserting the following:
    ``(b) United Nations Visitors.--Nonimmigrant visas'';
            (3) by striking ``Subject to'' and inserting the following:
    ``(c) Fee Waivers or Reductions.--Subject to''; and
            (4) by adding at the end the following:
    ``(d) F-1 Visa Fee.--In addition to the fees authorized under 
subsection (a), the Secretary of Homeland Security shall collect a $150 
fee from each nonimmigrant admitted under section 101(a)(15)(F)(i), 
which fee shall be deposited in the general fund of the Treasury.''.
    (c) Restoration of State Option To Determine Residency for Purposes 
of Higher Education.--
            (1) Repeal.--Section 505 of the Illegal Immigration Reform 
        and Immigrant Responsibility Act of 1996 (8 U.S.C. 1623) is 
        repealed.
            (2) Effective date.--The repeal under paragraph (1) shall 
        take effect as if included in the original enactment of the 
        Illegal Immigration Reform and Immigrant Responsibility Act of 
        1996 (division C of Public Law 104-208).
    (d) Naturalization.--Section 328(a) (8 U.S.C. 1439(a)) is amended 
by inserting ``, without having been lawfully admitted to the United 
States for permanent residence, and'' after ``naturalized''.