Illegal Immigration and local government finance

The CBO has a good review of the literature on the costs of illegal immigration for state and local governments.  Key grafs:

Over the past two decades, most efforts to estimate the
fiscal impact of immigration in the United States have
concluded that, in aggregate and over the long term, tax
revenues of all types generated by immigrants–both
legal and unauthorized–exceed the cost of the services
they use….However,
many estimates also show that the cost of providing
public services to unauthorized immigrants at the state
and local levels exceeds what that population pays in state
and local taxes.

…The amount that state and local governments spend
on services for unauthorized immigrants represents a
small percentage of the total amount spent by those
governments to provide such services to residents in
their jurisdictions.

For example,… the Oklahoma Health Care Authority estimated …that,
since fiscal year 2003 (the first fiscal year considered), the
services provided to unauthorized immigrants have
accounted for less than 1 percent of the total individuals
served and cost less than 1 percent of the total dollars
spent for Medicaid services.

If you look, you can find some places where the costs are significant, in San Diego for example 9 percent of the law enforcement budget was associated with illegal immigration.


I suppose that another question is revenue, in addition to raw costs. I suspect that illegal immigrants generally pay sales taxes at a similar rate to most people, and even local property tax as well, whether indirectly when renting or directly (since there is little US squatting). Income taxes may be a different story, though I really can't say for sure. (My understanding is that payroll taxes tend to be paid as well, as the IRS finds it easier to impose sanctions on employers.)

If so, that's a double strike against California, where so much of the state's income is from state income tax on its wealthy, and something in favor of, e.g., Texas and Florida.

Oklahoma doesn't spend much, eh? That's good news. The article estimates the costs to California in the "tens of billions." Considering that the California state budget is $145 billions, that would mean aliens take up in the area of 10% of the state budget, more than the current budget deficit. That's not just "some places," that's the entire state. The report also cites an estimate that 25% of illegal aliens in California pay no taxes at the workplace.

But the costs continue as more people compete for jobs, health services, education,etc., from generation to generation. How many kids do the illegals have?

Calculating what illegal migration has caused to the nation is a huge job . I think no government will try to burn its leg into this. Its a hot issue and no one wants to solve it

Looking at the report, it appears to exclude the costs of legal children of illegal immigrants.

Thus, it seems it is worse than useless for calculating the total budgetary costs of illegal immigration.

How about the Los Angeles Unified School District's $24 billion school construction program?

The real question is what would be the results of a policy comparison. It's all well and good to say that in the present state, illegal immigration costs or benefits government coffers to a certain amount versus some universe where it doesn't exist at all, but what significance does that have?

Dr. Kap Kool,

You bet it is significant! The report must be totally wrong.
So, illegal immigrants cost the feds lots of money, but not
the state or local governments. Of course. Thanks for pointing
out to us this very important point!

How much of the expense of illegal immigrants is caused not by their immigration, but by our making it illegal?

How much of their tax evasion is caused not by their desire to shirk, and how much by their desire not to be caught?

In other words, how much of a problem is caused by illegal immigration versus the illegality of that immigration?

The key question is who benefits and who pays for it. A bad recession will highlight this.

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This is a fantastic idea and I am sure it will help quite a few people out there!

The truth is that immigrants are a problem that should be morphed into something so the state wins something as well and it could end the stress of being an immigrant... An immigrant comes just for a better job so that means he works somewhere and earns money... with that money he pays rent and buys food... so he is a helper with the local economy... maybe immigrants should be treated differently... banks Manchester

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