Senate report: Illegal immigration costs state $131M

Indiana lawmakers studying the issue of illegal immigration in the state will view a report Wednesday that finds undocumented people will cost the state’s taxpayers $130.7 million this year.

Those costs, which include K-12 education, health care and incarceration costs, equate to less than 1 percent of Indiana’s 2016 budget of $15.4 billion. And critics say such studies don't take into account the tax revenue illegal residents pay to state and local governments.

The report, prepared by the Republican-led Office of Senate Fiscal Policy based on data provided by the Pence administration, will be presented at the second meeting of the Senate’s Select Committee on Immigration Issues at 1 p.m. Wednesday. That committee is charged by Senate President Pro Tem David Long, R-Fort Wayne, with examining the "effect of unauthorized aliens upon the economic well-being of Indiana" and make legislative recommendations.

"I think the numbers indicate there’s a real cost that Hoosier taxpayers bear each and every year because of the failure of the federal government to enforce federal immigration law,” said state Sen. Mike Delph, R-Carmel, who is chairman of the committee. “There’s no free lunch. When the federal government doesn’t do its job, they shift cost and other burdens to state and local government."

Indiana has an estimated 93,000 undocumented immigrants, and about 64 percent of those of working age are employed, according to the Migration Policy Institute.

The Senate report follows up on a similar 2012 report that was ordered by state law. Illegal immigrants cost the state roughly the same amount—$130.9 million—in the same areas of education, health care and incarceration, according to that report prepared by the state Office of Management and Budget. 

But Terri Morris-Downs, executive director of Indianapolis’ Immigrant Welcome Center, said lawmakers should look not just at the costs of undocumented immigrants but also at the benefits. She said the report "does not look at them as consumers and taxpayers.”

Indiana Immigrants who are here illegally paid $108.9 million in state and local taxes in 2010, according to the Institute on Taxation and Economic Policy. But were they to have legal status, they would have paid $141.7 million in state and local taxes, according to the group.

And foreign-born Latinos in Indiana paid $251.4 million in state and local taxes in 2013, according to the Partnership for a New American Economy. That group includes legal and illegal immigrants.

“When you look at some of the major industries in Indianapolis and even throughout the state—mainly agriculture, manufacturing, logistics, warehousing and the hospitality industry—all of those big industries depend on immigrant workers for both low-skill and high-skill jobs,” Morris-Downs said. "Making the state of Indiana a very immigrant-unfriendly state will hurt us economically.”

Delph said he was open to having other data presented to the study committee, but he said he was not apt to “validate illegal activity by talking about the benefits of breaking the law.”

Delph also said that since illegal immigrants “live in constant fear of detection and deportation,” they “go to work, go to church and they don’t go out to restaurants."

The biggest cost that the Senate report lists is the cost of educating undocumented kids in Indiana schools—which it estimates to be $100.5 million in 2016—but that’s not something Indiana legislators can change.

The U.S. Supreme Court ruled in 1982 that states and local governments cannot restrict the rights of children—no matter the immigration status—to attend U.S. public schools from K-12.

Morris-Downs acknowledged there are costs to educating immigrants, but she said “a good education will lead them to being successful adults, just as a good public education will help any child succeed later in life.”

“We want children who are raised in Indiana to stay in Indiana and grow Indiana through their work and through innovation,” Morris-Downs said.

The other costs the report lists are to incarcerate illegal immigrants, which is estimated at $9.9 million, and to provide health care and other public assistance, which is estimated at $20.3 million.

Delph acknowledged "my own biases” on the immigration issue but said he won’t make any judgments about future legislation until the study committee concludes.

Earlier this year, the Carmel Republican authored legislation that would take away businesses' licenses in Indiana if they repeatedly hire undocumented immigrants.