THE STAKES ARE HIGH FOR MICHIGAN

The Cost of the Federal Republican Megabill:
IMMIGRATION

The OBBBA drastically expands funding for Immigration and Customs Enforcement (ICE) and gives the Trump administration broad authority to implement a mass deportation program. 

National Impact

• A total of $170 billion is allocated for a mass deportation program:
  • $45 billion is provided to expand the U.S. Immigration and Customs Enforcement’s (ICE) detention capacity, more than quadrupling their annual budget at a time when the agency is serially violating civil rights. The law explicitly approves the use of these funds for the detention of families, risking trauma. 
  • $32 billion for immigration agents and operations — sensitive locations can now be raided, such as schools, churches and hospitals. Expedited removal allows for quick deportations without due process. This includes processing asylum claims outside the U.S., most likely through the Remain in Mexico program, which requires asylum seekers to stay in often unsafe conditions in Mexico while they wait for their U.S. court hearings. 
  • Two measures allocate $40 million for U.S. Customs and Border Protection and the U.S. Department of Health and Human Services to conduct physical examinations of unaccompanied minors without caregivers, specifically to identify gang-related tattoos and other markings. The measures are vaguely written and could be intrusive/traumatizing. 
  • $75 billion in border surveillance and enforcement, which could hurt Michigan’s population growth.
  • The bill sets aside two separate funding streams totaling $13.5 billion for states and local governments to get reimbursed for a wide range of activities tied to enforcing federal immigration laws. This includes 287(g) agreements deputizing local enforcement officers to carry out immigration enforcement duties. These have historically proven expensive, harm trust with the local community and create liability as they encourage racial profiling. However, Sec. 11051(3) may allow law enforcement to use this funding for overhead costs, not just reimbursement for immigration expenses, creating a strong incentive for cash-strapped departments. This is likely shifting local law enforcement away from real community safety priorities and redirects resources toward unnecessary and politically driven enforcement efforts.
  • $3.3 billion to the Department of Justice in part to hire up to 100 judges, which, according to the National Immigration Law Center, is largely to prosecute immigrants for status offenses. Even with expedited removal, the massive expansion in ICE capabilities is likely to cause further delays in immigration proceedings, for which immigrants will be charged fees. There has already been a 154% increase in ICE arrests in Michigan since President Donald Trump took office in January.

• Stricter background checks for potential sponsors may discourage undocumented relatives or mixed-status households from stepping up to care for unaccompanied children, leaving those children in inadequate government detention conditions longer. The law also allows for the rapid deportation of children if an officer determines they are not at risk of trafficking or persecution.
• Higher existing fees plus newly introduced charges for regularizing status. These fees are onerous for many immigrants whose wealth is primarily held in low-exchange value currencies. This turns asylum and the U.S. immigration system into a pay-to-play system that will lock would-be taxpaying community members out of the U.S. and the Michigan labor force. Refugee admissions have already been effectively suspended. 
• Parents who file taxes using ITINs but don’t have SSNs will lose access to several new tax benefits, including the $6,000 deduction for individuals over 65, student loan debt forgiveness due to death or disability, and new deductions of up to $25,000 for tips and up to $12,500 for overtime pay.
• The bill limits enrollment in new Trump Accounts (tax-advantaged savings accounts for kids for long-term investments) to children with SSNs.
• The law also cuts federal Medicaid funding. Previously, states got a 90% match under the ACA’s Medicaid expansion, but under the OBBBA, that drops to the regular, lower match rate — and only for emergency care given to lawfully present immigrants during their five-year waiting period. This means states will receive less funding and residents with low incomes will have fewer health care options. These changes weaken essential safety nets, undermine public health, and leave lawfully present immigrants with little to no support — even as many work, pay taxes and raise families in the U.S.

Repercussions for Michigan

• 738,000 immigrants live in Michigan.
• Children (American citizens), whose parents do not have Social Security numbers (SSNs) will lose Child Tax Credit benefits; one of the most effective anti-poverty programs in the U.S. That’s about 22,300 children in Michigan even when their parents pay taxes with Individual Taxpayer Identification Numbers (ITINs). With 300,000 Michigan children living in immigrant families — including 70,000 high schoolers representing 15% of the state’s high school population — Michigan’s economic future depends on the stability of these families.
• Michigan has been a top refugee resettling state. At a time when international immigration accounted for 60% of the state’s population growth over the last decade, the combined effect of these changes imperils a crucial portion of our future tax base and labor force.
• Recent policy changes, including those in the OBBBA, will likely discourage workers in sectors critical to Michigan’s development like construction, auto manufacturing, software development, agriculture and health care. 
  • 19,000 migrant, H-2A and seasonal farmworkers provide labor for Michigan’s farming operations each season, supporting the state’s $104.7 billion agricultural economy
  • 14% of Michigan’s auto manufacturing workers are immigrants
  • Immigrants represent 28% of physicians in Michigan
  • 30% of Michigan’s software developers are immigrants.
• 287(g) agreements deputize local law enforcement to perform certain functions of federal immigration agents and increase cooperation with ICE, opening the door to more deportations. These agreements…
  • Disrupt the economy.  Deputizing local police to conduct immigration enforcement creates widespread fear that deters immigrant workers from essential jobs in agriculture, manufacturing and food processing. With immigrants comprising 8% of Michigan’s workforce, this chilling effect could trigger immediate labor shortages and force business closures.
  • Create fiscal strain. Enforcement of 287(g) programs drains local budgets through training costs and detention expenses, while deterring the $290 million in Michigan state and local taxes that undocumented immigrants contribute annually. Counties bear enforcement costs while losing critical tax revenue that’s meant to support schools, infrastructure and other important public services.
  • Cause community terror and family separation. 287(g) agreements turn routine police interactions into deportation threats and increase racial profiling for mixed-status families. Traffic stops, domestic violence calls and crime reporting become immigration enforcement opportunities, destroying police-community trust and making Michigan communities less safe.

Analysis provided by
Scott Preston, Senior Policy Analyst