Undocumented college students can begin receiving publicly funded financial aid beginning in 2013.
The non-partisan Legislative Analyst now pegs the cost to taxpayers at $65 million per year when fully implemented, nearly three times more than the original low-end estimate. It's difficult to pinpoint an actual number because University of California and California State University tuitions keep rising.
"This legislation essentially says to these students the taxpayers will cover your tuition. So if the tuition goes up, the taxpayer cost goes up," said Steve Boilard, Legislative Analyst's Office.
The report also found the Dream Act, passed through the Legislature as AB 131 this fall, will hurt legal students getting a grant called "institutional aid."
"It could be that everybody's grant will go down a little because you're trying to spread a fixed pot of money across more students," said Boilard.
Aides for Assm. Gil Cedillo (D-Los Angeles) who pushed through the Dream Act say the costs are minimal, and that they were up front about the effects on legal students. They point out undocumented students who qualify for in-state tuition are paying into the financial aid pot with their fees.
"For us, it's was an equity issue," said Dan Savage, Cedillo's chief of staff. "If they're going to pay into it as students, then they should benefit from it by being able to receive institutional aid."
Dream Act opponents have been trying to repeal AB 131 through the referendum process, which allows them to ask voters whether California should keep the law.
The Stop AB 131 Movement has just about a month left to gather 505,000 signatures to qualify for the ballot. The group believes the new report will help them get there.
Referendum coordinator Rigo Avelar thinks that $65 million per year could help other areas hurt by budget cuts.
"All these programs that got decimated, they could sure use that money there as opposed to giving it away," said Avelar. "People are at the point where, 'No, we don't have to take it anymore.'"