As California lawmakers struggle with a budget gap that has now grown to $26.3 billion, one of the hottest topics for many taxpayers is the cost to the state of illegal immigrants.
The question of whether taxpayers should provide services to illegal residents became a major political issue in California's last deep recession, culminating in the ballot fight over Proposition 187 in 1994. That history could repeat itself in the current downturn, as activists opposed to illegal immigration have launched a campaign for an initiative that would, among other things, cut off welfare payments to the U.S.-born children of illegal immigrants. Those children are eligible for welfare benefits because they are U.S. citizens.
State welfare officials estimate that cutting off payments to illegal immigrants for their U.S.-born children could save about $640 million annually if it survives legal challenges.
California has roughly 2.7 million illegal residents, according to an April 2009 report from the authoritative Pew Hispanic Center, accounting for about 7% of the state's population. State officials estimate that they add between $4 billion and $6 billion in costs, primarily for prisons and jails, schools and emergency rooms. Beyond those services, the illegal population adds to the overall cost of other parts of local government, from police and fire protection to highway maintenance and libraries.
On the other side of the ledger, illegal residents pay taxes -- sales taxes on what they buy, gasoline taxes when they fuel their cars, property taxes if they own homes. The total is hotly debated, although most researchers agree that the short-term costs to state and local government are bigger than the revenues.
Many companies that hire illegal workers also withhold Social Security and income taxes from their paychecks, based on workers' invalid Social Security numbers. That money goes mostly to the federal government, not to localities. The Social Security Administration estimates that in 2007, illegal residents nationwide contributed a net of $12 billion to the system.
The largest costs to California's budget from its illegal residents are in three areas:
* Education: The state has no official count of how many students are in the country illegally because school districts do not ask. But the state legislative analyst estimated, based on data from the Pew Hispanic Center, that the state's 6.3 million public school students include about 300,000 illegal residents. At an annual cost of about $7,626 each, the total comes to nearly $2.3 billion.
