The Costs of Illegal Immigration to New Yorkers

Executive SummaryAnalysis based on current estimates of the illegal alien population residing in New Yorkindicates that population is costing the state’s taxpayers more than $5.1 billion per year foreducation, medical care and incarceration. That annual tax burden amounts to about $874 perNew York household headed by a native-born resident. Even if the estimated $730 million insales, income and property taxes collected from illegal immigrants are subtracted from the fiscaloutlays, net costs still amount to more than $4.5 billion per year.

The three cost areas discussed in this analysis (education, health care and incarceration resultingfrom illegal immigration) are the major cost areas. They are the same three program areasanalyzed in a 1994 study conducted by the Urban Institute, which provides a useful baseline forcomparison. Other studies have been conducted in the interim, showing trends that support theconclusions of this report.

Even without accounting for all of the numerous other areas in which costs associated withillegal immigration are being incurred by New York taxpayers, the program areas analyzed inthis study indicate that the burden is substantial and that the costs are rapidly increasing.

The more than $5.1 billion in costs incurred by New York taxpayers annually result from outlaysin the following areas:

Education. Based on estimates of the illegal immigrant population in New York anddocumented costs of K-12 schooling, New Yorkers spend more than $4.3 billionannually on education for the children of illegal immigrants. This estimate does notinclude programs for limited English students, remedial educational programs orbreakfast and lunch programs available to students from low-income families. Anestimated 11.7 percent of the K-12 public school students in New York are children ofillegal aliens.

Health care. Taxpayer-funded, unreimbursed medical outlays for health care providedto the state’s illegal alien population amount to an estimated $690 million a year.

Incarceration. The uncompensated cost of incarcerating deportable illegal aliens inNew York’s state and local prisons amounts to about $165 million a year. This estimateincludes only prison costs and not short-term or other detention costs, related lawenforcement and judicial expenditures, or the monetary costs of the crimes that led toincarceration.

2

The fiscal costs of illegal immigration borne by state taxpayers do not end with these three majorcost areas. The total local costs of illegal immigration is considerably higher if other cost areassuch as preventive health programs, special English instruction, interpretation services in courtsand hospitals, welfare programs used by the U.S.-born children of illegal aliens, or welfarebenefits for American workers displaced by illegal alien workers are also calculated.

If illegal immigrants obtained legal work status, and eventual permanent residence and possiblecitizenship, as currently advocated by the Bush administration and approved by the U.S. Senate,state income tax collections might increase, but this likely would be outweighed by increasedeligibility for public services available to low-income families. In addition, the possibility forfamily members of the current illegal alien population to come to the United States to reunitefamilies would increase the size of the poverty and near-poverty population using publicservices.

The Costs of Illegal Immigration to New YorkersA Report by the Federation for American Immigration Reform

3

IntroductionWhile the primary responsibility forcombating illegal immigration rests with thefederal government, there are many measuresthat state and local governments can take tocombat the problem. New Yorkers, whetherthey live in Albany or the Big Apple, shouldnot be expected to assume this already largeand growing burden from illegal immigrationsimply because local businesses or otherspecial interests benefit from being able toemploy lower cost workers. The state and/orlocal jurisdictions can adopt measures tosystematically collect information on illegalalien use of taxpayer-funded services and onwhere they are employed. Policies could thenbe pursued to hold employers financiallyaccountable.

The state could also adopt a cooperativeagreement with the federal government fortraining local law enforcement personnel inimmigration law in order to be able toincrease the number of illegal immigrantswho commit crimes who are turned over tothe immigration authorities for removal fromthe country.

New York allows illegal immigrants whogrew up in the state to attend public collegesat in-state tuition rates. According to theChronicle of Higher Education, the StateUniversity of New York system does not keeptrack whether the foreign student is legally inthe country; but the City University of NewYork hosts about 2,000 such students. NewYork City has a sanctuary policy thataccommodates illegal aliens by prohibiting itspolice from asking about immigration status.1

While it is reasonable for a state to requestfederal assistance to compensate for the fiscalburden of illegal immigration, it is alsoreasonable to limit that assistance if the state

is pursuing policies that encourage illegalaliens to come to and remain in the state.

Background InformationAccording to official estimates, New Yorkhad the nation’s third largest number of illegalimmigrants in its population in 2000. TheImmigration and Naturalization Service(INS), now part of the Department ofHomeland Security (DHS) estimated thatthere were 489,000 aliens residing illegally in

the state, which was about seven percent ofthe country’s total illegal alien population.2

Previously, in 1990, the INS estimated thatthe resident illegal alien population in thestate was 357,000 persons — so the estimatedillegal alien population was increasing rapidly— by more than one-third (37%) in ten years.

For comparison, an estimate by demographerJeffrey Passel for the Pew Hispanic Center in2005 put the illegal alien population of thestate between 550,000 and 650,000. Thisestimate ascribes to New York the nation’sfourth largest number of illegal alien residents(behind Florida as well as California andTexas). FAIR’s current estimate of NewYork’s illegal alien population is close to the

Estimated Illegal Aliens1990 – 2005

0

100

200

300

400

500

600

700

1990 1996 2000 2005*

Thou

sand

s

FAIR estimate. Other estimates by INS.FAIR 2006

4

high end of the Pew estimate, i.e., about645,000 persons, and we rank the state thirdin the nation (ahead of Florida).3

In addition to this estimated illegal alienpopulation, about 171,000 other New Yorkforeign residents (118,200 long-term illegalresidents and 52,900 illegal agriculturalworkers) received legal residence as a resultof the 1986 amnesty.4 The estimate of theillegal alien population also does not take intoaccount tens of thousands of other formerillegal aliens who have gained legal statussince then under INA Section 245(i) on thebasis of a petition by a relative or employer,or others granted asylum, or some other formof protection against deportation.

Not only has New York’s illegal alienpopulation grown rapidly, the overall foreign-born population, which includes illegal aliens,has shot up since the 1965 change in U.S.immigration law. The foreign-born populationwas 83.3 percent larger in 2000 than 3decades earlier, while the native-bornpopulation was 13.9 percent smaller. Thesegment of the population that was secondgeneration (the offspring of immigrants) hadincreased by 17.4 percent. In 1970, theimmigrant stock population — immigrantsand their children — made up less than one-third (32.9%) of New York’s population. In2000, that share had risen to more than two-fifths (44.4%) of the larger population. (Seechart).

Calculating the Costs of IllegalImmigrationThis study estimates the fiscal impact to thestate’s taxpayers resulting from the major costareas associated with illegal immigration. Italso estimates what offset there might be as aresult of tax payments by that population. Itdoes not look at the value of goods andservices produced by illegal alien workers,i.e., their economic contribution, because it is

assumed that if the work is essential, andillegal immigrants are unavailable, the workwill be done by legal workers, althoughemployers might have to raise their wageoffer to attract them. Similarly, this studydoes not include the costs associated with jobdisplacement of legal workers who are laidoff or fail to get a job as a result of beingreplaced by illegal workers willing to workfor lower wages. Those costs, which wouldinclude unemployment compensation, welfareoutlays, lost taxes, etc., are real, but difficultto quantify.

Studies of the cost of illegal immigration toNew Yorkers have been done previously. InJanuary 1994, the New York SenateCommittee on Cities released a report thatestimated the net costs of illegal immigrationat $5.6 billion annually — $2 billion in social

services, $.28 billion in criminal justice costs,and $3.2 billion for education.5 This 1994study estimated the costs of programs used byboth legal and illegal immigrants andincluded cost areas that are not included inthis current study, e.g. $1 billion a year fornew school construction.

A 1994 Urban Institute study of the costs ofillegal immigration in New York and six other

Population Change1970 – 2000

0

5

10

15

20

1970 2000

Mill

ions

Foreign-Born

Offspring*

Native-Born

*Offspring refers to U.S.-born children of immigrants.FAIR 2006


5

states will be described in detail in thefollowing section. That study was funded bythe U.S. Department of Justice in order toallow the federal government to respond tolawsuits filed by several states seeking redressfor their increasing fiscal burden.

Another study of the costs of immigration inNew York by Rice University economistDonald Huddle estimated the fiscal costs fromimmigrants in New York in 1996 at about$29.5 billion ($10.5 billion net aftersubtracting for tax payments), but thiscalculation included both legal and illegalimmigrants, and the entire foreign-bornpopulation of the state was estimated to benearly 3 million in 1995. The Huddle studyalso identified displacement costs —associated with American workersunemployed because of the illegal foreignworkers — amounting to an additional cost tothe state’s taxpayers of $3.6 billion annually.6

National recognition of the fact that illegalimmigration represents a fiscal burden may beseen in the fact that the Congress hasauthorized and appropriated funds to assistNew York and other states for medical

outlays that public hospitals are required bylaw to provide illegal aliens and for theincarceration of illegal immigrants. Federalrecognition of the fiscal costs to stategovernments from illegal immigrants alsomay be seen in the State Legalization ImpactAssistance Grants (SLIAG) program, whichprovided $3.5 billion to states in the aftermathof the 1986 amnesty for illegal aliens to easethe burden of the additional expenses the

states were required to assume. Those grantsphased out in 1994, and the states since thenhave been bearing an unreimbursed burdenassociated with this amnestied illegalimmigrant population.7

What Are the Costs Of IllegalImmigration?The costs of illegal immigration are bothquantifiable and non-quantifiable. Becausedata on use of services by illegal aliensgenerally are not collected, even quantifiablecosts are generally based on educatedestimates.

The absence of recorded data on illegal alienenrollment in school, use of taxpayer-supported medical care, and other publicservices is not accidental. It is due in largepart to the efforts of service providers, civillibertarians, business interests and immigrantsupport groups that have thwarted datacollection efforts in order to keep these costshidden from the taxpayers who must pay forthem. The most recent example of theseefforts to obscure the costs of services toillegal aliens may be seen in the campaignagainst a requirement that emergency health

care providers collect andprovide to immigrat ionauthorities information on illegalalien patients in order to receivecompensation from a federalappropriation. The health careproviders, civil libertarians andillegal immigrant advocacy

groups vociferously opposed the datacollection requirement, and in 2004 HHSdropped its proposed regulation.8

Some of the quantifiable costs areas — if dataare available — are: Illegal alien use of emergency medical

facilities.

“Studies have shown that at the state and local level,immigrants use more in services than they pay in localtaxes. The National Academy of Sciences found thatthe average immigrant imposes a net lifetime fiscalcost on state and local governments of $25,000.”

—Senator Hillary ClintonPress Release, May 22, 2006

6

Well-baby maternity care, deliveryexpenses, and long-term care that areincurred for children born to illegalimmigrants.

Educating illegal alien children. Educating the U.S.-born children of

illegal aliens. Supplemental educational outlays, e.g.,

Limited English Proficiency (LEP)program staff salaries and foreignlanguage teaching materials. According tostatistics collected by the U.S. Departmentof Education, LEP enrollment in NewYork in 2003 was nearly 303,000students.

Subsidized tuition in the state’s highereducation institutions borne by thetaxpayer under a policy that allows illegalaliens to enroll as state residents. FAIRestimated in 2005 the potential cost to thestate’s taxpayers from allowing in-stateuniversity tuition to illegal alien studentsat $28.8 to $37.5 million per year. 9

Housing subsidies for low-incomefamilies.

State welfare assistance. A study ofwelfare payments to illegal immigrantsnationwide by the Center for ImmigrationStudies concluded that average non-

medical welfare outlays to illegal-immigrant headed households averaged$151 per year.10

Incarcerated illegal aliens, if tried on statecharges, cost the state’s taxpayers for theinvestigation, prosecution, translation andinterpreter services, judicial management,incarceration, medical services andpossible parole costs. The federalg o v e r n m e n t p r o v i d e s p a r t i a lcompensation of those costs only if itaccepts that the prisoners are aliensdeportable upon release.

American workers who are displaced byillegal foreign workers willing to acceptlower wages may qualify for a number ofprograms paid for by the taxpayer.11

Tax losses to the state resulting fromlowered earnings by workers where wagelevels have been depressed by theavailability of illegal alien workers, plustaxes lost by the proliferation of illegalaliens working in the undergroundeconomy. This leads to the need for thestate to levy a higher tax burden.

Some of other cost areas where data areunavailable or unquantifiable include: Law enforcement costs associated with

non-felony crimes committed by illegalaliens, including general crime preventionand enforcement expenses, misdemeanoroffenses, prosecution, indigent defense,adult probation, juvenile probation, etc.

The growing burden of providing illegalimmigrants an array of services such asforeign language interpretation andtranslation, especially in the health care,law enforcement and judicial systems.

Degraded quality of education resultingfrom increased numbers of students wholag in educational preparation, Englishfluency, and support structure at home.

Parental liaison, translation at PTAmeetings and other school meetings, andnewsletters prepared in foreign languages

Limited English Students 1994 – 2003

0

50

100

150

200

250

300

Thou

sand

s

Data from Dept. of Education survey reportFAIR 2006


7

for the school-age children of illegalaliens.

Increased insurance rates that areassociated with crimes perpetrated byillegal immigrants, especially propertyloss and auto theft.

Remittances sent abroad are a cost to thelocal economy, because the earnings donot remain in the state and contribute tothe local economy. If U.S. citizens orlegal residents were filling those jobs, theearnings would usually be spent locallywith beneficial multiplier effects.

Congestion, inconvenience and propertyvalue loss which often coincide with thepresence of illegal aliens seeking day-labor jobs.

Other examples include the inconvenience oflong waits to receive medical attention whenthere is congestion in the emergencyadmissions offices of public hospitals, and thepermanent closure of emergency rooms inmany hospitals due to the overwhelminguncompensated costs.12

Similarly unquantifiable is the erosion ofrespect for the law when an increasing shareof the population lives illegally in the country;when law enforcement officers arerequired to ignore this law breaking;when employers illegally hireunauthorized workers; and many ofthose workers are in the under-ground economy. Social cohesionmay be strained by having to copewith increasingly pervasivelanguage barriers, and rising incomeinequali ty associated withimmigration.

Updating The Urban Institute

Cost EstimatesIn 1994, in preparation for defending thefederal government against lawsuits by the

states with the largest illegal alienpopulations, the Department of Justicecontracted with the Urban Institute to studythe issue of the fiscal burden borne by thestates from illegal immigration. The UrbanInstitute released its report, Fiscal Impacts ofUndocumented Aliens: Selected Estimates forSeven States, in September 1994. That reportnotes that the state government estimated theannual cost to New York and localgovernments for public education, emergencyhealth care, social services, and incarcerationof undocumented immigrants at about $826million.

The study’s methodology compared taxpayments at all levels within the state withexpenditures on only three programs, albeitthe major cost areas of education, health care,and incarceration. The study estimated thetotal annual fiscal costs to be from $710million to $755 million. It then estimated theamount of state and local taxes received bythe state and local governments from theillegal immigrants as an offset to the costs.The net uncompensated fiscal cost to thestate’s taxpayers was estimated at between$288 and $333 million annually.

Size of the Illegal ImmigrantPopulationThe Urban Institute based its cost calculationon an estimate of 470,000 illegal immigrantresidents in New York in 1993. This was

1994 Urban Institute Study($ millions)

Fiscal Category Outlays Receipts Net CostEducation $634 $634

UncompensatedMedical Care

31–76 31–76

Incarceration 45 45Tax Payments $422 -422

Total $710–$755 $422 $288–$333

8

fewer than the state’s estimate of 530,000persons. The Census Bureau estimated illegalalien residents at between 423,000 and582,000 persons in 1992.

The most recent official estimate of theresident illegal immigrant population in NewYork by the INS — before it merged into theDepartment of Homeland Security (DHS) —was 489,000 persons, reflecting the findingsof the 2000 Census. This official estimateexcludes certain categories of illegalimmigrants such as those who have been inthe country for less than one year and thosegranted Temporary Protected Status.

The Pew Hispanic Center released an estimatein April 2006 that New York’s illegal alienpopulation in 2005 was between 550,000 and650,000 persons.13 New York City’s MayorBloomberg, like his predecessor MayorGiuliani, has publicly stated that the illegalalien population of the city (he may bereferring to the consolidated metropolitan areathat spills into New Jersey, Connecticut andPennsylvania) is 500,000 persons.14

FAIR’s estimate of the illegal alienpopulation in New York in 2005 is645,000 persons. This represents 5.4percent of the estimated national totalillegal alien population, and it is thenation’s third largest concentration ofillegal aliens after California and Texas.It is also about 3.3 percent of NewYork’s overall population, and it is the13th highest concentration of illegalimmigrants per capita in the country.

Size of the Illegal Alien K-12

Student PopulationThe U.S. General Accounting Office (GAO)released a report in 2004 on difficulties inestimating state costs of illegal alienschoolchildren. It noted that data are notcollected by most school systems, and that

makes providing a precise estimate of theillegal alien population in public schoolscurrently not possible.15 The study’sconclusion did not mean, however, thatballpark estimates of the costs wereinappropriate or invalid. It should be kept inmind that the cost estimates in this studynecessarily are simply ballpark estimates donefor the purpose of increasing awareness of thegeneral magnitude of the burden borne byNew York’s taxpayers as a result of illegalimmigration.

The Urban Institute’s study estimated K-12illegal alien enrollment in New York’s publicschools twelve years ago at 88,000 students,virtually the same as the state’s estimate atthat time.

FAIR, in its June 2005 research report“Breaking the Piggy Bank: How IllegalImmigration Is Sending Schools Into theRed”16 used an Urban Institute estimate of thestudent share of the resident illegal populationand the federal governments estimate of thesize of the illegal alien population in NewYork. For that study, FAIR estimated that thetotal illegal immigrant public schoolpopulation in New York in 2004 was about110,000 students.

Because of the continuing rise in theillegal alien population in New York aswell as nationwide, we estimate that in2006 the number of illegal alienstudents in the state’s public schools isabout 120,000 persons. That is 36percent higher than the 1993 estimateby the Urban Institute and the state.

This estimate of the illegal immigrant studentpopulation does not include those studentswho are the children of illegal immigrants butwere born in this country. The Urban Institutechose to ignore these costs even though thesechildren would not be in the New York public


9

school system were it not for the illegalpresence of their parents. The cost ofeducating these additional students is anadded fiscal burden that results from illegalimmigrant settlement in the state.17

Jeffrey Passel, one of the Urban Instituteresearchers who participated in the 1994 andsubsequent studies of the school-agepopulation, has estimated that there are nearlytwice as many U.S.-born children of illegalimmigrant parents as children illegally in theUnited States (3 million compared to 1.6million).18 Moreover, most of the children ofillegal aliens who are not currently in theschool system are below school age and willenter the system within a few years.

Applying this same proportion of the U.S.-born children of illegal aliens to theirillegal alien siblings yields an estimatedadditional 225,000 children of illegalimmigrants in New York’s schools in 2006whose educational costs are included in thisstudy. The combined 345,000 children ofillegal aliens in public schools representabout 11.7 percent of the state’s total K-12public school enrollment.19

Cost of Educating the Illegal

Immigrant K-12 populationThe Urban Institute’s 1994 calculation of thecost of K-12 education in New York wasbased on a per-student annual cost to statetaxpayers of about $7,205. If costs remainedconstant, outlays on the education of the 2006larger population of illegal alien studentswould have risen from about $634 million toa present cost of about $865 million and thecosts of educating the children of illegalaliens born in the United States would beabout $1.62 billion. Combined, that would bea cost of more than $2.25 billion. However,educational outlays have not been constant;they have risen considerably.

The FAIR research report on educationaloutlays for illegal immigrant education used a$11,900 average per pupil cost in New Yorkreported by the National Center for EducationStatistics (NCES) for the 2004 school yearand calculated the cost of educating illegalimmigrant students in New York in 2000 tobe about $1.31 billion per year. The cost ofeducating their siblings was estimated at$1.83 billion per year, for a combined total ofabout $3.14 billion.

The most recent National EducationAssociation estimate of average public schoolcost in New York20 indicates that educationalcosts per pupil have risen to a current level ofabout $12,408 in 2004. The use of an averagecost factor may underestimate the costsassociated with the illegal resident population.As the authors of the 1994 Urban Institutestudy explained, “We believe thatundocumented aliens are more likely thanother students to live in urban areas where perstudent expenses are relatively high.”21

Using the estimate of the current illegalK-12 immigrant population — updatedto 2006 — and an updated estimatedper pupil annual cost of $12,500, resultsin an estimated current cost to NewYork’s taxpayers of at least $1.5 billionper year. Using the same per pupil costestimate for the U.S.-born children ofillegal aliens suggests the additionalexpense of educating these childrenthrough the 12th grade is at least anadditional $2.8 billion per year — or atotal annual public educational costfrom illegal immigration of more than$4.3 billion per year.

The state’s admission of illegal aliens into thestate’s public universities and communitycolleges at taxpayer subsidized in-state tuitionrates is an additional expense not included in

10

the above calculation. Our estimate of thatoutlay in New York is that it could be costingthe taxpayers $29-38 million per year.

Emergency Medical OutlaysUpdated EstimateEstimates of the costs of uncompensatedmedical outlays are necessarily imprecise. Asthe GAO noted in a May 2004 report,“Hospitals generally do not collectinformation on their patients’ immigrationstatus, and as a result, an accurate assessmentof undocumented aliens’ impact on hospitals’uncompensated care costs — those not paidby patients or by insurance — remainselusive.”22

However, there is no doubt that illegalimmigrant usage of emergency medical careis a burden on local taxpayers, and this wasrecognized by the U.S. Congress in theBalanced Budget Act (BBA) of 1997, whichprovided $25 million in annual compensationto heavily impacted states. Congress renewedand upped the level of assistance ten-fold in2003 with an appropriation of $1 billion to beapportioned among all states over the 2005-08fiscal years, i.e., $250 million each year.

The Urban Institute’s 1994 calculation of theannual unreimbursed expense to the state foremergency medical services in New York wasa range of $31 to $76 million. A similarcalculation today yields a much higherestimate.

The Urban Institute based its estimate ofuncompensated medical outlays by New Yorktaxpayers on data collected by the federalgovernment in the State Legalization ImpactAssistance Grants (SLIAG) program. Thatprogram, authorized and funded by Congress,helped states cope with the additional servicesthey were required to provide as a result ofthe 1986 Immigration Reform and ControlAct amnesty for nearly 3 million illegal alien

residents. Their calculation of the cost wasbased on their estimate of the size of theillegal immigrant population and the cost ofemergency medical services at that time.

As we showed above, the estimated illegalalien population today in New York is nearlyhalf-again the size it was estimated to be bythe Urban Institute estimate. This implies,conservatively, that the Urban Institute’sestimated emergency medical outlays wouldbe between $46 to $112 million today if costswere constant — which, of course, they arenot. If those medical expenses were adjustedfor inflation, they would be about $60 to $147million today.

Reporting in 2004 on the issue of illegalaliens and uncompensated medical outlaysburdening hospitals, the Business Firstjournal reported that the uncompensated costsincurred by western New York hospitals in2003 reached $90 million. “The HealthcareAssociation of New York State believes…[i]tcosts the state’s hospitals between $300million to $380 million to care for thispopulation in their emergency rooms.”23

A Government Accountability Office reportfurnished an estimate of the costs for in-patient care in hospitals provided to patientswithout a Social Security number — asurrogate for illegal residence status. Thatsurvey found estimated expenditures in NewYork of $474 million in fiscal year 2002.24

Not included in this estimate is the out-patientcosts associated with treating the illegal alienpopulation in emergency rooms.

The GAO survey, in our view, provides arealistic surrogate for estimating medicalcosts attributable to illegal aliens asinpatients. Those expenses will be higherwhen out-patient emergency room care isadded, and they have increased still furthersince 2002 as the illegal alien population has


11

grown and as the cost of medical services hasalso risen. The resulting annual costs of allmedical services provided to the illegalimmigrant population could easily be as highas nearly half-again the inpatient expenditurescaptured in the GAO survey.

The annual out-of-pocket expendituresfor medical care for illegal immigrantsin New York in 2006 are likely as muchas $700 million. The state was allocatedfederal compensation of $12.5 millionfor 2004 by the Centers for Medicare &Medicaid Services. This fraction of theoutlay would still leave the amount ofthe annual uncompensated outlaysborne by the state’s taxpayers at about$690 million.

Size of the Illegal Alien Prisoner

PopulationIn 1994, the Urban Institute estimated theillegal alien prisoner population to be 2,158persons. This estimate was arrived at bycomparing state records on foreign-bornprisoners with the records of the INS toconfirm that the aliens were subject todeportation upon removal. Missed in thisprocess would be any alien prisoner who wasnot in the INS records. The state included acorresponding share of persons whosealienage and legal status were unknown andestimated the deportable alien population at2,703 persons.

In FY 1999, the state documented 6,249illegal alien detention years in its filing underthe State Criminal Alien Assistance Program(SCAAP). More recently, in FY 2004, thestate documented about 6,470 deportablealien prisoner-years in state and localdetention facilities. More than half (56.1%) ofthe about $57 million SCAAP compensationwent to the state, while New York Cityreceived 37.1 percent of the distribution.

Similarly, the state accounted for most of theprisoner-year detentions (4,362 - 67.4%) andNew York City had the second largest share(1,656 prisoner-years — 25.6%).

The SCAAP payments cover only a share ofcorrections staff salaries related to theincarceration of criminal aliens. In FY’05, forexample, SCAAP compensated only aboutone-third of the documented salary expenses.Other expenses such as the feeding, clothing,transportation, and medical attention providedto those prisoners are not included in thecompensation calculation. Also not includedin the SCAAP payments is detention of illegalaliens who are arrested for minor offenses andreleased in less than four days.

According to House Concurrent Resolution95, which passed the U.S. Senate on March26, 2003, "the incarceration of undocumentedcriminal aliens" cost state and localgovernments more than $13 billion in FY'02.SCAAP payments to the states in that yearamounted to $543 million, i.e., less than 4.2percent of costs.

It is safe to assume that the number ofdeportable alien prisoner-years in NewYork facilities in 2005 was about 6,500.That is about three times the size of theillegal alien prisoner population used inthe 1994 Urban Institute study.

Uncompensated IncarcerationCost Updated EstimateThe Urban Institute calculated in 1994 theannual cost of incarcerating an illegal alienwas about $20,806. The state estimated theannual per prisoner cost at $24,602 in 1993.Total unreimbursed costs claimed by the state($66.5 million) were 48 percent higher thanthe Urban Institute estimate.

12

SCAAP data indicate that New York hasreceived partial compensation for theincarceration costs since 1995. For 1999, thestate received about $93.2 million incompensation, which was 38.6 percent of theexpenditures. This meant New York’staxpayers absorbed nearly $148 million inexpenses. The average per prisoner cost wascalculated by the state at about $38,640, anamount more than half again (57%) higherthan in 1994.

Congress has cut the amount of fundsavailable for SCAAP reimbursement since1999 resulting in the share of federalreimbursement being similarly decreased. Infiscal year 2001, New York received SCAAPcompensation of $94.8 million, i.e., only 19.3percent of the itemized illegal alienexpenditures. New York received a SCAAPaward of about $44 million in 2003, about$43 million in 2004, and less than $43 millionin 2005 (56% by the state, 37% by New YorkCity, and the balance by other localjurisdictions). The most recent published costper prisoner filing by the state in SCAAP was$22,073 (in FY’2003). The compensationcriteria limited the reimbursement claim topersonnel costs of incarcerations staffassigned to illegal alien detention. Therestricted criteria for compensation explainsthe drop from earlier similarly estimated costsand other cost estimates. We judge from theSCAAP data and other studies that aconservative per prisoner cost estimate isabout $32,000 per year.25

On the basis of an estimated illegal alieninmate population in New York of 6,500prisoner years, the total salary-relatedincarceration costs are about $208mill ion per year. Offsett ingreimbursements under SCAAP wouldreduce that to a net amount of out-ofpocket expenditures by New Yorktaxpayers of about $165 million.

As noted above, this estimate includes only afraction of all criminal costs generated byillegal aliens. Additional expenses could beattributed to overhead costs of runningincarceration facilities and the locally jailedpopulation of illegal aliens who are notcovered by the SCAAP reporting andreimbursement. In addition, there arenumerous other administration of justiceexpenses, e.g., law enforcement, andprosecution, crime and insurance costs, etc.that have not been included in thiscalculation. As noted above, these additionalcosts could amount to several times theamount identified in this study.26

Offsetting Taxes Paid By IllegalImmigrantsThe Urban Institute study provided only theresearchers’ (but not the state’s) estimate ofstate and local income tax payments plus salesand property taxes paid by illegal immigrants.These amounted to a total of $422 million.Included in that total were state sales taxes(36.7%), income tax (8.1%), and state andlocal property taxes (55.2 percent). Thisestimate meant that illegal immigrants, whoconstituted 2.4 percent of the state’spopulation in 1992, contributed 1.2 percent oftax collections that year. Both the size of theillegal immigrant population and sales taxesand property taxes collected will have risenwith inflation since the 1994 study.

Estimates of tax contributions are inherentlydifficult because many illegal workers areworking in the underground economy, e.g., asday laborers or in sweatshops, and pay noincome tax.27 However, some taxes are beingcollected from illegal workers even if theywork in the “informal sector,” because theypay sales taxes and they pay property taxes,even if only indirectly by contributing to thetax included in the rent of an apartment.


13

If the Urban Institute’s estimate of state andlocal tax collections rose in proportion to therise in the illegal immigrant population, itwould be about 37 percent higher, or $580million today. However, as sales tax andproperty tax payments have probably kept upwith inflation, this estimate must be furtherincreased to allow for that.

Updating for both the increased illegalimmigrant population and for inflationsuggests that current annual taxpayments would be about $233 millionin sales taxes, $51 million in incometaxes, and $350 million in propertytaxes — for a total of about $.73 billion.That represents about a 73 percentincrease from the Urban Institute’sestimate.

Balancing the Outlays for andReceipts from Illegal Immigrants

in New York

This analysis of fiscal outlays andreceipts associated with illegalimmigration indicates a total net costto New York taxpayers of more than$4.5 billion per year.

If expenditures besides education, medicalcare and incarceration of illegal immigrantswere included in the estimate, it is clear thatthe total costs attributable to New York

taxpayers as a result of illegal immigrationwould be much higher. A 1997 national levelcomprehensive study on the fiscal costs ofillegal immigration found the expenditures forthe three cost areas used in this studyamounted to less than one-third of totalexpenditures without including an estimatefor costs associated with displacement ofAmerican workers.28

In 2005 there were about 5.9 millionhouseholds in New York headed bynative-born residents. So the averagecost to those households to supportthese programs used by the estimated645,000 illegal aliens and another225,000 children of illegal immigrationis at least $874 per native household peryear. This cost does not include theirshare of the federal tax burden thatresults from this same population ofillegal aliens.

This per household estimate is higher than theestimated costs per nativehousehold nationwide, althoughnot as high as in California($1,178), reported by a panel ofexperts for the NationalAcademies of Science (NAS) in1997.29 This NAS calculationincluded costs from both legal andillegal immigrants. The principalauthor of the NAS report,economist James P. Smith, notedthat, "The undocumented tend to

be less skilled, less educated,"30 therebyimplying that the higher the share of illegalimmigrants in the immigrant population, thehigher are likely to be the costs because oftheir lower earnings and tax payments.

Future ImplicationsOver the past decade, New York’s taxpayershave been required to assume a growing

Illegal Immigrants2005 Outlays and Receipts

($ millions)Category Outlays Taxes Net CostEducation Illegal Aliens $1,500 $1,500 Children of Illegal Aliens 2,800 2,800Uncompensated Medical Care 690 690Incarceration 165 165Tax Payments 730 -730Total $5,155 $730 $4,525

14

burden in governmental outlays because ofthe rising number of illegal aliens living in thestate. Unless measures are taken to stem theflow of illegal immigration, these costs maybe expected to continue to rise. The rise in theillegal alien population, if it should continueto increase at the same rate that it has grownover the past decade, could reach more than800,000 persons in another ten years with acorresponding increased cost in emergencymedical services, education and incarcerationexpenses.

Whether or not today’s illegal residents wereto gain legal status — as provided for inlegislation passed by the Senate in May thisyear31 — an amnesty provision would notsignificantly change the cost burden on theNew York taxpayer, because the illegal alienpopulation, in general, does not have theeducational preparation or work skills thatwould allow it to move to higher paying jobsand contribute more in tax payments. Rather,the adoption of any amnesty provision maywell increase the ability of illegal immigrantsto access to public services — and, therefore,increase the costs.

RecommendationsThe significant fiscal costs to New Yorkersassociated with illegal immigration are notinevitable. While the federal government hasthe primary responsibility for enforcingimmigration laws, state and localgovernments have a role to play that caneither discourage or encourage illegalimmigrants settling in their jurisdiction. Forexample, state and local policies can eitherfacilitate or hinder federal immigration lawenforcement efforts.

While New York should not be expected tobear an unfair burden resulting from thefederal government’s failure to enforce thecountry’s immigration law, it would besimilarly unfair that the state have its

expenses underwritten by taxpayers across thecountry if the state has adopted laws orpolicies that encourage the settlement ofillegal immigrants in the state.

Examples of state and local policies thatundermine federal immigration lawenforcement efforts and encourage illegalimmigrant settlement include the following: Issuing state driver’s licenses and voter

registration cards to illegal aliens; Extending public assistance program

eligibility to illegal aliens; Offering in-state tuition to illegal alien

students as the state has done; Adopting sanctuary or don’t-ask-don’t tell

policies that shield illegal aliens fromimmigration authorities;

Providing governmental support for ortolerance of formal or informal hiringcenters where illegal aliens seek day-laborjobs;

Accepting foreign government-issuedidentity cards as establishing residence inthe state.

Examples of state and local governmentpractices that discourage illegal aliensettlement and facilitate federal enforcementof the immigration law include the following: Establishing systematic data collection for

illegal alien use of public services. Adopting policies to identify employers of

the illegal aliens in order to put an end totheir ability to exploit low cost illegalalien labor by passing costs to the public.

Requiring the collection and verificationof Social Security numbers for theissuance of unrestricted driver’s licensesand identity cards;

“They [undocumented workers] are a partof our fabric in a practical sense. They’renot going to get deported…They’realready here.”32

—New York City Mayor Michael Bloomberg


15

Issuing restricted driver’s licenses toaliens legally present in the state so thatthe license expires when the authorizedstay in the United States expires;

Refusing to accept the validity of driver’slicenses from states that allow illegalaliens to obtain licenses withoutsupporting documents that prove anapplicant’s legal residence.

Entering a cooperative agreement withfederal immigration authorities fortraining local law enforcement personnelin immigration law enforcement so thatlaw breakers who are identified as illegalimmigrants can be turned over to theimmigration authorities for removal fromthe country rather than being releasedback into society;

Requiring government contractors toparticipate in the Basic Pilot documentverification system for all of their newemployees working on governmentcontracts.

New York City maintains a policy thatprevents its police from informingimmigration authorities when it arrests anillegal alien. This makes it a sanctuary city.As a result, in 2002, for example, fourMexican illegal residents, accompanied byone legal immigrant, abducted and brutallyraped a 42-year-old mother of two near somerailroad tracks in Queens, New York. Threeof the illegal aliens had been previouslyarrested numerous times by the New YorkPolice Department for crimes such as assault,attempted robbery, criminal trespass, illegalgun possession, and drug offenses. Butpursuant to New York’s sanctuary policy, thedepartment had never notified theimmigration authorities to take custody ofthem and deport them.33

New York has taxpayer-supported day laborcenters in Nassau County at Glen Cove and

Freeport, and at the present time, New YorkCity has empanelled a TemporaryCommission on Day Laborer Job Centers,comprised of representatives of nonprofit andadvocacy groups, city officials — includingthe police — and leaders of two privately runday labor centers to consider establishingsimilar day labor centers in the city.34 Alreadythere is a day labor center, the Bay Parkwaycenter run by the Rockland ImmigrationCoalition, which is operating on New YorkCity property.

The state had a loophole in its driver’s licenseprocedures that allowed illegal aliens toobtain licenses because it failed to verify theauthenticity of Social Security numbers (SSN)provided by applicants. However, thatproblem has been identified, and the statetook remedial measures in 2004 when it foundabout 300,000 of its driver's licenses had beenissued with false Social Security numbers.Notices were sent advising that the licensewould be revoked unless the holder provideda valid SSN. New York does not acceptforeign consular identity documents forpurposes of issuing driver’s licenses.

Local Reform Activists Should

Also Focus on National PoliciesNew Yorkers have a right to expect theirnational and local elected representatives towork to alleviate the fiscal burden of illegalimmigration. To simply convert illegal alienresidents to legal resident status with anamnesty violates a fundamental principle ofimmigration reform, because that willencourage rather than deter future illegalimmigration. A policy that conveys themessage that the country or any state or localgovernment will tolerate and rewardforeigners who ignore our immigration lawinvites the world to see illegal immigration asan accepted route to seeking a better life inour country and perpetuates the problem.

16

As Barbara Jordan, a former member ofCongress from Texas and chair of the U.S.Commission on Immigration Reform summedup her view on immigration:

The credibility of immigration policy canbe measured by a simple yardstick: peoplewho should get in, do get in; people whoshould not get in are kept out; and peoplewho are judged deportable are required toleave.

—U.S. Immigration Policy: Restoring Credibility,USCIR 1994

Most New Yorkers agree with Dr. Jordan’sview. The February, 2006 Empire State Pollfound that about 72 percent of all stateresidents responded that entering the UnitedStates without valid immigration documentsshould be made a criminal offense, two-thirdsof the state's residents strongly support bordercontrols, and less than ten percent supportedincreases in immigration — as President Bushhas proposed and the U.S. Senate has passedin S.2611 (the poll found that 45 percent ofrespondents support a decrease inimmigration and an equal share think thenumber of immigrants in New York shouldremain the same).35

New York’s elected representatives owe it tothe state’s citizens and legal residents touphold the principle that the United States isfounded on respect for the rule of law, and toact in ways that demonstrate the country doesnot accept those who disrespect ourimmigration law.


17

Endnotes 1 Congress adopted measures in 1996 that barred local ordinances that prohibited employees from providinginformation on illegal aliens to federal officials. The law says, “Notwithstanding any other provision of Federal,State or local law, a Federal, State, or local government entity or official may not prohibit or in any way restrict anygovernment entity or official from sending to or receiving … information regarding the citizenship or immigrationstatus, lawful or unlawful, of any individual.” New York City, which in 1989 had adopted a non-cooperation policy,sued to overturn the new federal law. The case eventually went to the U.S. Supreme Court, which refused in 2000 tooverturn an Appeals Court ruling against the city’s non-cooperation policy.[2]The Appeals Court had found that thecity had no right to “passive resistance,” because such claims violate the Supremacy Clause of the Constitution. As aresult, Mayor Bloomberg reluctantly rescinded the policy in 2003, but, in the face of political protests fromsupporters of illegal aliens, he reinstated a similar “don’t ask, don’t tell” policy for the police.

2 2002 Yearbook of Immigration Statistics, DHS Office of Immigration Statistics, Oct. 2003.

3 The estimate of illegal immigrants in New York may be significantly understated if estimates of the Chinese illegalalien population developed by Rutgers University professor Ko-lin Chin on the basis of his research in New YorkCity are correct. However, current U.S. asylum policy, which allows illegal Chinese entrants to gain permanentresidence on the basis of claims of fear of persecution under China’s one-child family planning policy, and is newsince Professor Ko-lin did his research, may have converted much of the flow of smuggled Chinese from illegal tolegal residents.

4 1991 Statistical Yearbook of the Immigration and Naturalization Service, INS, M-367, September 1992.

5 “Our Teeming Shore … a legislative report on the impact of U.S. immigration policy in New York State,” (alsoknown as the Padavan Report) issued January 24, 1994 by the New York Senate Committee on Cities.

6 Huddle, Donald, “The Net Costs of Immigration: The Facts, the Trends, and the Critics,” Carrying CapacityNetwork, Washington, DC, 1996. See also, Huddle, Donald, “Immigration and Jobs: The Process of Displacement,”May 1995.

7 David Simcox, “Measuring the Fallout: The Cost of the IRCA Amnesty after 10 Years,” Center for ImmigrationStudies, May 1997.

8 Department of Health & Human Services letter of October 1, 2004 from Dr. Mark B. McClellan, Administrator toNational Alliance for Hispanic Health stating, “Our intention is to accept the public comments that suggested the useof indirect, non-burdensome eligibility methods to target the funds using methods that do not require providers toobtain direct evidence of a patient’s immigration status.”

9 Martin, Jack, “Breaking the Piggy Bank; How Illegal Immigration is Sending Schools into the Red,” FAIR, June2005. The report is available in its entirety at www.fairus.org.

10 Camarota, Steven, “Back Where We Started: An Examination of Trends in Immigrant Welfare Use Since WelfareReform,” Center for Immigration Studies, March 2003.

11 Huddle, op.cit. The study calculated probable costs based on one American out of work for every four illegalresidents. Factoring in unemployment compensation, uncompensated medical outlays, food stamps and otherassistance, Huddle calculated that the costs would be about $2,500 per year per displaced worker. In New York,Huddle estimated the resulting cost at $3.6 billion in 1996 rising to $4 billion in 2006.

12 “Hospital-Based Emergency Care: At the Breaking Point,” National Academies Press (2006). “…many patientscome in the front door, but not enough can be admitted to the hospital in a timely manner to make room for more

18

incoming patients. As admitted patients back up in the ED, crowding becomes severe. ED overcrowding blocksaccess to emergency care, induces stress in providers and patients alike, and can lead to errors and impaired qualityof care. …Substantial financial losses and ED and trauma center closures have been attributed to uncompensatedemergency and trauma care.” (p.16)

13 The Pew Hispanic Center report “Estimates of the Unauthorized Migrant Population for States based on theMarch 2005 CPS,” issued April 26, 2006.

14 ‘Mayor: Undocumented workers ‘part of our fabric,’ Newsday, March 28, 2006

15 GAO-04-733, June 2004 op.cit.

16 “Breaking the Piggy Bank,” op.cit.

17 FAIR believes that the practice of conferring U.S. citizenship on children born in the United States to illegal aliensis a misapplication of the U.S. Constitution’s 14th Amendment. It disregards the “subject to the jurisdiction thereof”clause of the Amendment.

18 “By including children, proposal may increase strain on schools, health care,” Jerry Kammer, Copley NewsService, San Diego Union Tribune, February 9, 2004.

19 U.S. National Center for Education Statistics, Public Elementary and Secondary Staff, Schools and SchoolDistricts: School Year 2002-03. The enrollment for 2003 was 2,888,000, and the rate of increase suggests a 2006enrollment of about 2,942,000 students.

20 Table 243. Public Elementary and Secondary Estimated Finances, and by State, Statistical Abstract of the UnitedStates, http://www.census.gov/compendia/statab/education/.

21 “Fiscal Impacts of Undocumented Aliens: Selected Estimates for Seven States,” The Urban Institute, September1994.

22 GAO-04-472, May 2004, op.cit.

23 “Hospitals reject alien-care funding program,” Business First of Buffalo, September 24, 2004.

24 GAO-04-472, “Undocumented Aliens: Questions Persist about Their Impact on Hospitals,” May 28, 2004.

25 According to a Bureau of Justice publication (NCJ-151651, April 1995), “Jails and Jail Inmates 1993-94: Censusof Jails and Survey of Jails” average annual operating costs per inmate were highest in New York $29,297 in 1993.According to the New York State Catholic Conference, “The NYS Department of Corrections currently spends$32,000 per inmate per year to incarcerate offenders.” Website consulted August 1, 2006: See:(http://www.nyscatholicconference.org/pages/our_agenda/show_issueDetails.asp?id=131). Whitley, Sheri M. andJeannie Yip “Alternatives to Prison Could Save State Millions,” Columbia News, July 13, 2006; “Incarcerationcosts roughly $30,500 per inmate per year in New York State.”

26 “Rikers Houses Low-Level Inmates at High Expense,” New York Times, January 16, 2004. “New York City'sCorrection Department spent an average of nearly $59,000 per inmate in the 2003 fiscal year. But when all cityexpenses are factored in - insurance and pension benefits for correction staff, for instance, as well as more than $150million for jail medical care - the yearly per-inmate cost is closer to $100,000, according to the city's IndependentBudget Office.”

27 According to the Center for Immigration Studies (“The High Cost of Cheap Labor,” August 2004), “…weestimate that more than half of illegals work ‘on the books’.”


© September 2006Federation for American Immigration Reform

1666 Connecticut Avenue, NW • Suite 400 • Washington, DC 20009(202) 328-7004 • (202) 387-3447 • [email protected] • www.fairus.org

28 Donald Huddle, “The Net National Costs of Immigration: Fiscal Effects of Welfare Restorations to LegalImmigrants,” Carrying Capacity Network, Washington, DC, 1997.

29 “The New Americans: Economic, Demographic, and Fiscal Effects of Immigration,” National Academies ofScience, May 1997, Washington, DC. The estimated net cost in California was $1,178 per year, but it has asignificantly higher proportion of its population comprised of illegal aliens according to the government’s estimate,i.e., 6.5 percent in California compared to 2.1 percent in Florida in 2000.

30 “Economic impact hotly debated”, The Arizona Republic, Aug. 26, 2001.

31 S.2611, Hegel-Martinez bill passed 5/25/2006.

32 ‘Mayor: Undocumented workers ‘part of our fabric,’ op .cit..

33 Testimony by Heather Mac Donald, Senior Fellow, Manhattan Institute for Policy Research, before the HouseJudiciary Subcommittee on Immigration, Border Security, and Claims, April 13, 2005.

34 “City to Consider Job Centers for Day Labor,” The New York Times, June 16, 2006.

35 2006 Empire State Poll, Cornell University, released July 4, 2006, 800 adult respondents,http://www.newswise.com/articles/view/521696/.

This report was prepared by Jack Martin.

The Costs of Illegal Immigration to New Yorkers

Documents

Transcript of The Costs of Illegal Immigration to New Yorkers