Alabama's Immigration Law to Cost State Millions in Lost Taxes, Study Says

Alabama employers say Latinos -- including legal immigrants -- are not showing up at their jobs because of the hostile environment they feel since an immigration law took effect. (AP)

Alabama's new immigration law is likely to cost the state tens of millions of dollars in lost taxes, says a new study.

The report by the Center for Business and Economic Research at the University of Alabama would cause 70,000 to 140,000 undocumented immigrants to lose jobs and would cost about $1.2 billion to $5.8 billion in the earnings of those immigrants as well as $56.7 million to $264.5 million in lost state income taxes and sales taxes.

"The cost is quite certain," said the center's director, Sam Addy. "It's simple economics. If you have more people you have a bigger economy, less people a smaller economy."

A sponsor of the immigration bill, Republican Rep. Micky Hammon of Decatur, disputed the report.

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"It's clear the study overestimates the negative and underestimates the positive to skew the result toward an agenda," he said. "If 40,000 illegal workers leave the state, they free up jobs that homegrown Alabamians are happy to have."

Hammon said the state's lower unemployment rate proves the immigration bill is working.

"It doesn't take a PhD to see that since the law was signed unemployment has dropped from 10 percent to 8.1 percent," Hammon said. "In Marshall County, once a known hotbed for illegal immigration, unemployment has plunged from 10 percent in June to 6.9 percent last month."

Statewide, the unemployment rate has dropped from 9.3 percent to 8.1 percent since January, 2011.

The report found that the economic costs of the new law outweigh the benefits. The report listed benefits of the new law and saving state funds used to provide benefits to undocumented immigrants and making more employment opportunities available to legal residents. But the report said the costs to the state include hurting the state's economic development effort and the cost of implementing and enforcing the law.

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Workers who leave will not be replaced by high salaried workers and will not be a big boost to the economy, said Addy, a U.S. citizen who came from the west African country of Ghana in 1989.

The sponsor of the bill in the Senate, Sen. Scott Beason, R-Gardendale, said the study does not take into account that many immigrant workers send much of what the earn to family members back home.

"It's our understanding that a tremendous amount goes out of state," Beason said.

The study estimates that 20 percent of undocumented workers "send their earnings to their home countries."

This is based on a story by The Associated Press.

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