Immigrants a Boon to State, Study Says

Using a novel approach, a Latino think tank has reached the same conclusion that many immigrant-rights activists have stated in the past: That immigrants--legal and illegal--contribute more in California in taxes than they cost in government services.

Rather than using a one-year data snapshot to determine the effects of immigrants on the state’s economy, a new study, “Why They Count: Immigrant Contributions to the Golden State,” uses the long-range premise that most of the state’s immigrants will spend the rest of their lives in California and will pay their fair share of state taxes over that span.

“The appropriate question is not whether the ‘net costs’ of providing services to immigrants yield a ‘surplus’ or a ‘deficit’ on an annual basis, but whether over the duration of immigrants’ residence in California, the state is able to benefit from a return on these investments,” says the study by the Tomas Rivera Center. The report will be released today.

The term “investment” is important, Rivera researchers say, because Gov. Pete Wilson, who railed against illegal immigrants in his 1994 reelection campaign, uses the same language in justifying spending increases for public education in his proposed 1996-97 state budget.

The study concludes that immigrants are worth the costs and that California does benefit from them.

For example, the study concludes that an immigrant educated in California costs an average of $62,600, but pays out an average of $89,437 in state income and sales taxes to education alone over more than 40 years of employment.

Researchers reached the conclusion by combining data supplied by the state Department of Education, the California Post-Secondary Education Commission, the National Center of Education Statistics and the state Department of Finance, with estimated total tax revenues--based on state income and sales taxes.

When tax revenues and costs for education and social service programs are combined, legal immigrants return a net surplus of $24,943 to the state over a lifetime, the study found. Illegal immigrants likewise employed over a lifetime return an average net of $7,890.

Wilson, through his press spokesmen, sharply criticized the report.

“This study is misleading at best and dishonest on its face because it mixes legal immigrants in with illegal immigrants,” Wilson press secretary Sean Walsh said. “You can’t lump them together. Gov. Wilson has never been against immigrants who choose to come in the right way.”

Not addressed in the Rivera study is the cost of incarcerating illegal immigrants, which Wilson argues brings immigrants’ costs to the state, including education, to a yearly tab of $1.6 billion--far short of what he says they contribute in taxes. Wilson also assailed the study for not including health costs incurred by immigrants. But researchers say they did not consider health costs but chose instead areas that they believe best represent immigrants’ contributions and costs.

Although they did not analyze all possible factors, the study’s researchers say the use of an immigrant’s lifetime to measure his or her contributions and costs is a truer method of determining whether that person is a burden.

“Every [other] study has been a snapshot of one year’s worth of expenditures and revenues and not surprisingly,” said Harry Pachon, the president of the Rivera center, “they come up with a deficit. A more complete picture is [obtained] when overall, all contributions and costs are considered.”

Pachon said he is willing to defend the worth of immigrants to society, especially to those who would dismiss the study as the product of a think tank sympathetic to immigrants.

“We stand by our figures and we’re ready to debate them,” Pachon said.

The Rivera researchers contend that all immigrants are under attack in the wake of the 1994 passage of Proposition 187.

“Though we recognize the value of immigrant contributions to the growth of our nation, ‘new’ immigrants have lately become a symbol of all that is wrong with America,” the report said. “[This new report] illustrates that contemporary immigrants are a vital part of the state’s economy and civil society.”

Since the 1980s, when illegal immigration in California gained wide attention, advocates on both sides of the issue have used various studies to bolster their positions on immigrants’ contributions.

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In 1985, a Rand Corp. study concluded that Mexican immigrants, including those without legal documents, were “probably . . . an economic asset” to the state. Latino activists and others at the time lauded the findings that “immigrants’ contributions in the form of taxes exceed the cost of providing public services that they use.”

Opponents, however, noted that the cost of educating illegal immigrants was not considered by Rand researchers, providing fuel for their arguments that California taxpayers could not afford to pay for their education.

More recent studies by Donald Huddle, an economics professor at Rice University in Houston, showed that immigrants were a drain on society. The findings provided support for backers of Proposition 187--the initiative now largely blocked in the courts that seeks to deny educational, health and other benefits to illegal immigrants.

One of Huddle’s studies, released in 1993, concluded that immigrants nationally generated costs of $42.5 billion more in 1992 than they returned in taxes that same year.

Advocates of immigrants’ rights and others denounced Huddle, saying, among other things, that his estimate of 19.3 million immigrants, legal and illegal, who settled in this country since 1970 was wildly inaccurate.

The Tomas Rivera Center, affiliated with the Claremont Graduate School, is a nonprofit public policy research institute named after a former chancellor at UC Riverside.

The Rivera study also found that immigrants are no more likely than California’s native-born residents to utilize the welfare system. For example, 9% of foreign-born mothers ages 15 to 44 are estimated to be on Aid to Families with Dependent Children [AFDC] as compared to 11% of native-born mothers in the same age group.

It also said Latino-owned manufacturing firms have grown more than 181% in the past 10 years, with 41% of them started by recent immigrants. The report calls this a significant contribution to the growth of the state’s economy.