Alabama immigration crackdown costing state billions: study

BIRMINGHAM, Ala (Reuters) - Alabama's crackdown on illegal immigrants, widely seen as the toughest in the United States, could cost the state's economy up to $10.8 billion, according to a new study.

The Alabama law, passed in June, requires police to detain people they suspect of being in the United States illegally if they cannot produce proper documentation when stopped for any reason, among other measures.

A cost-benefit analysis released this week by University of Alabama economist Samuel Addy estimated up to 80,000 jobs could be vacated by illegal immigrants fleeing the crackdown, costing Alabama's economy up to $10.8 billion.

The lost jobs would cost Alabama up to $264.5 million in lost state sales and income taxes, and as much as $93.1 million in lost city and county sales taxes, it found.

At the low end of the range, Addy found the crackdown could cost the state economy $2.3 billion.

A U.S. appeals court blocked Alabama from enforcing parts of the law, including a provision that permits the state to require public schools to determine the legal residency of children upon enrollment. But the court left most of the law untouched.

State Republicans who support the law say it will help create jobs for legal residents by driving out undocumented workers and their families, and save up to $280 million they said is spent by the state each year on health and education services for the undocumented.

Addy says it is not clear whether the law will provide more or improved educational opportunities.

"This is based on the wrong assumption that illegal immigrants do not pay taxes," the study says. "They pay some taxes and the economy enjoys certain benefits as a result of the demand created by their presence."

Addy said he based his findings on the Department of Homeland Security's estimate that 120,000 illegal immigrants live in Alabama, and assumed some 40,000 to 80,000 workers could leave the state. As for income, Addy used an annual range of $15,000 to $35,000 per worker, below the state's average income of about $40,000.

Alabama's Bureau of Labor and the Alabama Department of Industrial Relations declined to comment on the figures.

There are an estimated 11.2 million illegal immigrants in the United States.

(Editing by Tim Gaynor and Paul Thomasch)