STUDY: ILLEGALS COST U.S. BILLIONS.

Byline: Lisa Friedman Washington Bureau

WASHINGTON - Poorly educated and often unskilled, illegal immigrants cost the federal government more than $10 billion annually, and the net cost would nearly triple to $29 billion if they became legalized, according to a report released Wednesday.

The report, by a group that advocates tighter border controls, debunked the conventional wisdom that illegal immigrants don't pay payroll taxes. More than half of them are employed on the record, and they pay about $16 billion annually in federal taxes, but they receive far more in federally subsidized services - about $26 billion, the report authors said.

``The primary reason they create a fiscal deficit is their low education levels and resulting low incomes and tax payments, not their legal status or their unwillingness to work,'' said Steven A. Camarota, research director for the Center for Immigration Studies, a Washington, D.C.-based think tank favoring low immigration.

``There is no single better predictor of income in the modern American economy than one's education level. As a result, a large share of illegals are likely to remain poor even if given legal status.''

Immigration advocates blasted the study as election-year immigrant- baiting.

``It's nothing new. It's always around campaign time when anti-immigration groups come out with reports that are not as accurate as they could be,'' said Rep. Hilda Solis, D-El Monte, who questioned the study's numbers and cited other reports that found that households headed by illegal immigrants contribute about $8,100 more than they receive in benefits.

Frank Sharry, executive director of the National Immigration Forum advocacy group in Washington, D.C., called the report dishonest.

``Where is the acknowledgment that, overall, immigrants pay more in taxes than they use in services and contribute billions to our national income every year? Where are the estimates of how much the U.S. benefits from the education immigrants receive in their countries of birth?''

The report, titled ``The High Cost of Cheap Labor,'' examined the gap between federal taxes and services in 2002, based on U.S. Census Bureau figures collected in March 2003.

It says the problem is not that illegal immigrants use too many social services. In fact, researchers found that they use 46 percent less than legal immigrants.

But with two-thirds of illegal immigrants lacking a high school diploma, they enjoy little hope - with or without a green card - of making a substantial financial contribution to the U.S. tax base, the researchers said.

Estimates place the number of illegal immigrants in the United States at 8 million to 10 million.

A 1997 study by a Rice University professor found the net cost of illegal immigration in California alone was $28 billion, including federal, state and local government impacts. Since that time, the number of illegal immigrants in California has risen from about 2 million to about 5 million.

In 1992, the Golden State Center for Policy Studies estimated that Los Angeles County spent about $276 million each year providing health, education and welfare benefits to illegal immigrants. Since then, some Los Angeles County officials offered an estimate of the county's health care costs for illegal immigrants at roughly $500 million a year.

The new study was released as Republicans are drafting a party platform supporting President George W. Bush's plan to give some illegal immigrants temporary legal status under a guest-worker program.

Democratic presidential challenger John Kerry has advocated a four-part plan giving a citizenship path to illegal immigrants who have paid taxes and pass a security screening.

The report authors argue for stricter enforcement of immigration laws, which Camarota said would boost wages of native-born workers as well as reduce the federal costs of illegal immigration.

Researchers estimated that illegal immigrants, if given amnesty, would pay 77 percent more in federal taxes - about $3,200 a year. But they also would become eligible for more public programs such as federally subsidized Medicaid - which is known as Medi-Cal in California - and the earned-income tax credit, and each household would cost the government about $8,200 a year compared with the current $2,700.

Critics said the services-for-taxes calculation tells only part of the story.

``Nothing is said about profits earned by employers of immigrants, the tax revenues these profits generate, the revenue produced by immigrant businesses, and the consumption and economic activity created by immigrants'' Sharry said.

The CIS report is the first to focus on the financial stress illegal immigration and any potential amnesty have on the federal budget.

At the federal level, the Center for Immigration Studies found that illegal immigrants impose the greatest costs on Medicaid, $2.5 billion; treatment for the uninsured, $2.2 billion; food assistance programs, including food stamps and school lunches, $1.9 billion; and the federal prison and court system, $1.6 billion.

At the same time, the report authors poke holes in the notion that illegal immigrants flock to the welfare rolls. Camarota maintained that limiting access to social services, while politically popular, would not save much money.

Lisa Friedman, [phone]

lisa.friedman(at)langnews.com

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ILLEGAL IMMIGRANTS' INCOME AND EDUCATION

SOURCE: Center for Immigration Studies

Gregg Miller/Staff Artist