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Local Fiscal Effects of Illegal Immigration

Report of a Workshop

Barry Edmonston and Ronald Lee, editors

Committee on National Statistics

Committee on Population

Commission on Behavioral and Social Sciences and Education

National Research Council

NATIONAL ACADEMY PRESS
Washington, D.C. 1996



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Local Fiscal Effects of Illegal Immigration: Report of a Workshop Local Fiscal Effects of Illegal Immigration Report of a Workshop Barry Edmonston and Ronald Lee, editors Committee on National Statistics Committee on Population Commission on Behavioral and Social Sciences and Education National Research Council NATIONAL ACADEMY PRESS Washington, D.C. 1996

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Local Fiscal Effects of Illegal Immigration: Report of a Workshop NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The members of the committee responsible for the report were chosen for their special competences and with regard for appropriate balance. This report has been reviewed by a group other than the authors according to procedures approved by a Report Review Committee consisting of members of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The National Academy of Sciences is a private, nonprofit, self-perpetuating society of distinguished scholars engaged in scientific and engineering research, dedicated to the furtherance of science and technology and to their use for the general welfare. Upon the authority of the charter granted to it by the Congress in 1863, the Academy has a mandate that requires it to advise the federal government on scientific and technical matters. Dr. Bruce Alberts is president of the National Academy of Sciences. The National Academy of Engineering was established in 1964, under the charter of the National Academy of Sciences, as a parallel organization of outstanding engineers. It is autonomous in its administration and in the selection of its members, sharing with the National Academy of Sciences the responsibility for advising the federal government. The National Academy of Engineering also sponsors engineering programs aimed at meeting national needs, encourages education and research, and recognizes the superior achievements of engineers. Dr. William A. Wulf is interim president of the National Academy of Engineering. The Institute of Medicine was established in 1970 by the National Academy of Sciences to secure the services of eminent members of appropriate professions in the examination of policy matters pertaining to the health of the public. The Institute acts under the responsibility given to the National Academy of Sciences by its congressional charter to be an adviser to the federal government and, upon its own initiative, to identify issues of medical care, research, and education. Dr. Kenneth I. Shine is president of the Institute of Medicine. The National Research Council was organized by the National Academy of Sciences in 1916 to associate the broad community of science and technology with the Academy's purposes of furthering knowledge and advising the federal government. Functioning in accordance with general policies determined by the Academy, the Council has become the principal operating agency of both the National Academy of Sciences and the National Academy of Engineering in providing services to the government, the public, and the scientific and engineering communities. The Council is administered jointly by both Academies and the Institute of Medicine. Dr. Bruce Alberts and Dr. William A. Wulf are chairman and interim vice chairman, respectively, of the National Research Council. Support for this activity was provided by the U.S. Commission on Immigration Reform. ISBN 0-309-05592-X Additional copies of this report are available from: National Academy Press 2101 Constitution Avenue, N.W. Lock Box 285 Washington, DC 20055 Call 1-800-624-6242 or 202-334-3313 (in the Washington metropolitan area). This report is also available on-line at http://www.nap.edu Printed in the United States of America Copyright 1996 by The National Academy of Sciences. All rights reserved.

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Local Fiscal Effects of Illegal Immigration: Report of a Workshop COMMITTEE ON NATIONAL STATISTICS 1994–1995 NORMAN M. BRADBURN (Chair), National Opinion Research Center, University of Chicago JOHN E. ROLPH (Vice Chair), Department of Information and Operations Management, School of Business Administration, University of Southern California JOHN F. GEWEKE, Department of Economics, University of Minnesota, Minneapolis JOEL B. GREENHOUSE, Department of Statistics, Carnegie Mellon University ERIC A. HANUSHEK, W. Allen Wallis Institute of Political Economy, Department of Economics, University of Rochester ROBERT M. HAUSER, Department of Sociology and Institute for Research on Poverty, University of Wisconsin, Madison NICHOLAS JEWELL, Program in Biostatistics, School of Public Health, University of California, Berkeley WILLIAM NORDHAUS, Department of Economics, Yale University JANET L. NORWOOD, The Urban Institute, Washington, D.C. EDWARD B. PERRIN, School of Public Health and Community Medicine, University of Washington KEITH RUST, Westat, Inc., Rockville, Maryland DANIEL L. SOLOMON, College of Physical and Mathematical Sciences, North Carolina State University MIRON L. STRAF, Director

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Local Fiscal Effects of Illegal Immigration: Report of a Workshop COMMITTEE ON POPULATION 1994–1995 RONALD D. LEE (Chair), Department of Demography, University of California, Berkeley CAROLINE H. BLEDSOE, Department of Anthropology, Northwestern University JOSÉ-LUIS BOBADILLA, World Bank, Washington, D.C. JOHN BONGAARTS, The Population Council, New York, New York JOHN B. CASTERLINE, The Population Council, New York, New York LINDA G. MARTIN, RAND, Santa Monica, California ROBERT A. MOFFITT, Department of Economics, Brown University MARK R. MONTGOMERY, Department of Economics, State University of New York, Stony Brook ANNE R. PEBLEY, RAND, Santa Monica, California RONALD R. RINDFUSS, Department of Sociology, University of North Carolina, Chapel Hill JAMES P. SMITH, RAND, Santa Monica, California BETH SOLDO, Department of Demography, Georgetown University MARTA TIENDA, Population Research Center, University of Chicago AMY O. TSUI, Carolina Population Center, University of North Carolina, Chapel Hill JOHN HAAGA, Director

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Local Fiscal Effects of Illegal Immigration: Report of a Workshop WORKSHOP PARTICIPANTS RONALD LEE (Chair), Department of Demography, University of California, Berkeley FRANK BEAN, Population Resource Center, University of Texas ANNE BRIDGMAN, Board on Children and Families, National Research Council and Institute of Medicine ALICIA CACKLEY, Health, Education, and Human Services Division, U.S. General Accounting Office THOMAS DOWNES, Department of Economics, Tufts University THOMAS ESPENSHADE, Office of Population Research, Princeton University CYNTHIA FAGNONI, Health, Education, and Human Services Division, U.S. General Accounting Office ED FERNANDEZ, Bureau of the Census, U.S. Department of Commerce JOHN GEWEKE, Department of Economics, University of Minnesota MICHAEL HOEFER, U.S. Commission on Immigration Reform DAVID HOWELL, U.S. Commission on Immigration Reform WILLARD MANNING, Institute for Health Services Research, University of Minnesota DAVID MONK, Department of Education, Cornell University SUSAN FORBES MARTIN, U.S. Commission on Immigration Reform DAVID NIELSEN, Office of the Assistant Secretary for Planning and Evaluation, U.S. Department of Health and Human Services DEBORAH PHILLIPS, Board on Children and Families, National Research Council and Institute of Medicine SARAH ROSENBAUM, Center for Health Policy Research, George Washington University RAFAEL SERRANO, Center for Health Policy Research, George Washington University ANDREW SHERRILL, Health, Education, and Human Services Division, U.S. General Accounting Office MICHAEL TEITELBAUM, Alfred P. Sloan Foundation ROBERT WARREN, Immigration and Naturalization Service, U.S. Department of Justice RUTH WASEM, Congressional Research Service KAREN WOODROW-LAFIELD, U.S. Commission on Immigration Reform BARRY EDMONSTON, Study Director, Committee on National Statistics CANDICE EVANS, Project Assistant, Committee on National Statistics KAREN FOOTE, Research Associate, Committee on Population JOHN HAAGA, Director, Committee on Population CAROL PARSONS, Consultant, Committee on National Statistics MIRON STRAF, Director, Committee on National Statistics

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Local Fiscal Effects of Illegal Immigration: Report of a Workshop Contents     PREFACE   ix     INTRODUCTION   1     CASE STUDIES   4     Los Angeles County   4     United States and Texas   7     San Diego County   9     California   10     Seven States   11     FISCAL EFFECTS   13     Education   13     Health Care   16     Incarceration and Criminal Justice   18     Revenues   20     CONCLUSIONS   22     Weaknesses in the Case Studies   22     Research and Data Needs   24     REFERENCES   26     APPENDIX: WORKSHOP AGENDA   29

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Local Fiscal Effects of Illegal Immigration: Report of a Workshop Preface The U.S. Commission on Immigration Reform was established by the Immigration Act of 1990 to examine the impact of immigration policy on localities and on the nation as a whole, including effects on social, economic, and community relations; population size and characteristics; and the environment. The commission has nine members, with the chair appointed by the President and the other eight members appointed by Congress.1 The commission issued its first interim report in September 1994 and will issue its final report in 1997. The interim report (U.S. Commission on Immigration Reform, 1994) recommended in principle that there should be federal aid to some states and local areas because of the effect of illegal immigration on public service costs. It noted, however, that "weak data make it difficult to determine the extent of [the] burdens of the net fiscal impact of illegal immigration (p. 25)," and further acknowledged the need for a "concerted effort to develop better data on such effects, with impact assistance provided only to the extent that actual net costs are accurately identified (p. 26)." At the request of the commission, the Committee on National Statistics and the Committee on Population held a workshop in October 1994 to review six recent case studies that assess the net fiscal impact of illegal immigration on state and local public services. The workshop was in response to the commission's recommendation for further investigation of the available data and analysis and of whether they have been used in developing reliable estimates of the net costs 1   Barbara Jordan served as the commission's chair until her death in January 1996.

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Local Fiscal Effects of Illegal Immigration: Report of a Workshop of providing public services to illegal aliens and their children. Specifically, workshop participants were asked to consider: assumptions about estimates of the number and characteristics of illegal immigrants, assumptions about estimates of the fiscal effects of selected public services for illegal immigrants, and assumptions about the possible employment displacement effect of illegal immigrants on residents. The workshop participants did not attempt to provide new estimates of fiscal effects, but rather to elucidate the main problems with current empirical studies, as well as strategies for improving the data, methods, and analyses on fiscal effects. The two committees assembled a group of experts from a variety of related disciplines, including demography, economics, sociology, health care studies, education, and specialists in several immigration topics, joined by representatives from various government agencies and nonprofit research organizations. Those attending the workshop participated as individuals, not as representatives of their respective agencies or organizations. The workshop was chaired by Ronald Lee, chair of the Committee on Population. Barry Edmonston served as the key staff organizer for the workshop, and Candice Evans skillfully handled the administrative duties. Carol Parsons, serving as a consultant to the Committee on National Statistics, took notes at the workshop and worked with Barry Edmonston to prepare an initial draft report. Deborah Carr, a consultant to the Committee on National Statistics, assisted with report preparation, and Michele Conrad ably guided the report from preparation through review and publication. The report also benefited from the editorial skills of Eugenia Grohman. The directors of our committees, Miron Straf and John Haaga, provided key oversight of the activity. We thank all of them, and the workshop participants, for their efforts on this important topic. Norman M. Bradburn, Chair Committee on National Statistics Ronald D. Lee, Chair Committee on Population