Proponents of the bill say it provides educational access to undocumented students who excel in high school but can't afford college. Federal law covers undocumented students' education through grade 12.
Opponents argue that the bill is a waste of taxpayer money and provides sanctuary to people who are in the country illegally.
Lawmakers will take up the proposal in the Senate this week. If the bill makes it to Gov. Martin O'Malley's desk this year, Maryland would be the 11th state in the nation to provide lower tuition rates to undocumented students. A similar measure known as the DREAM Act failed at the federal level in December.
The Montgomery County Council is taking action this week on a resolution that would support the bill.
"Despite lacking legal status, many immigrant youth are working hard to achieve success in this country," the resolution reads.
Republican Del. Pat McDonough, who represents parts of Baltimore and Harford counties, is already threatening a legal fight once the bill passes, which he said is inevitable.
"The primary argument against it is that it's a financial issue," he told The Washington Examiner. "We firmly believe it is unconstitutional. ... This is going to go to court."
The costs to Maryland of about $3.5 million by fiscal 2016 were calculated by the state's independent Department of Legislative Services.
The difference between in-state and out-of-state tuition rates at Maryland's four-year universities averages more than $10,000 for a single semester. Community college tuition is two to three times less expensive for in-state students in Maryland. Roughly 300,000 illegal immigrants live in the state, according to legislative analysts.
"What this bill creates, in effect, is a new financial burden on the counties," said Senate Minority Leader E.J. Pipkin, a Republican from the Eastern Shore. "I think some counties are going to view this as an unfunded mandate sent to them by the state."
But the bill has enormous support among many of Maryland's Democrats, despite the costs.
"How do you calculate the advantage of someone getting a college education?" said Senate President Thomas V. Mike Miller Jr., D-Prince George's and Calvert counties.
The legislation would qualify undocumented students for in-state tuition at community colleges if they enroll within four years of graduating from a Maryland high school. The bill also would provide in-state tuition at four-year colleges to illegal immigrants who have earned an Associate of Arts Degree or completed 60 hours of classes at a Maryland community college. Students wishing to qualify for lower tuition would have to prove that they -- or their parents or guardians -- have filed for Maryland income taxes annually.