LOS ANGELES -- California's "sanctuary city" fight with the Trump administration is not likely to have huge financial implications for its cities, according to recent analysis.
"While the final word will have to come from the courts, the available evidence suggests that California is unlikely to face major financial repercussions from this executive order if it upholds or even expands state and local sanctuary policies," Sara Kimberlin, a senior analyst for the California Budget & Policy Center, wrote in a
Nuveen Asset Management also said in a
President Donald Trump threatened in a Jan. 25 directive to withhold federal funding from sanctuary jurisdictions violating federal law "in an attempt to shield aliens from deportation."
California's Democrats, including Gov. Jerry Brown, have come out forcefully against both Trump's sanctuary cities' directive and his attempts to implement a travel ban keeping Muslims from several nations from coming to the U.S.
Trump's order did not define what a sanctuary city is.
Legislation introduced in Congress by Sen Pat Toomey, R-Pa., outlines it as "a state or political subdivision that has a statute, policy, or practice in effect that prohibits or restricts: (1) information sharing about an individual's immigration status, or (2) compliance with a lawfully issued detainer request or notification of release request."
There has been some confusion about which federal funds, and therefore, how much money is at risk.
If it were interpreted to mean any kind of federal funding, the implications for California "would be huge, as federal funds make up more than one-third of the state budget," Kimberlin said in an interview.
In similar cases, the courts have found that the federal money impacted has to be related to the issue at hand, which is immigration enforcement, Kimberlin said.
California's state and local governments receive very little federal funding for immigration enforcement, she said, and even federal funding related to the broader category of criminal justice represents just a small share of state and local government revenues.
Based on the definition in Toomey's bill and the actions Trump has singled out, Kimberlin said it appears policies around jails, and not policing, are the target. If that is the case, than it is county and state budgets that fund jails, and not cities, that are most at risk, she said.
According to Kimberlin, federal funding for immigration detention totals $50.6 million or one-five-thousandth of the overall state budget and less than a third of a percent of the state corrections and judicial budgets, she wrote.
In Los Angeles, federal funds related to corrections or judicial represent less than 3% of all federal funds received by the county and less than half a percent of the total county budget for fiscal year 2016-17, according to Kimberlin's research. In San Francisco County, these funds represent less than 1% of all federal funds received and less than one-twentieth of a percent of the total county budget.
"The funding issue also might be moot, because the U.S. Supreme Court has repeatedly held that the federal government cannot force states or local governments to enforce federal laws, most recently when it ruled states could not be forced to participate in Medicaid expansion under the Affordable Care Act," Kimberlin wrote.
Nuveen senior analyst Shawn O'Leary also raised doubts about the financial implications in a report that looked at federal revenue in all categories – not just criminal justice funding — for 20 of the largest U.S. cities.
Trump's executive order directs federal agencies to "ensure that jurisdictions that fail to comply with applicable federal law do not receive federal funds, except as mandated by law," he wrote.
The passage "except as mandated by law" is critical, O' Leary wrote, because the vast majority of federal revenue that flows to U.S. cities is due to laws enacted by Congress that provide federal funding for a mandate related to transportation, housing, health and safety.
Absent changes to laws authorizing federal funding by Congress, there is little risk the federal government could alter the flow of federal dollars to U.S. cities, O'Leary wrote.
State governments could pressure cities by directing them to comply with federal immigration laws or lose state funding.
Ten of the largest cities are in states where Republicans control the legislature and governor's office. But O'Leary said until these states begin to adopt any such legislation, it would be speculative to discuss how it might affect the cities' municipal budgets and the performance of their municipal debt.
"To the extent that federal funding is controlled by the executive branch, it is unlikely to represent a meaningful amount of money compared to a city's overall budget," O'Leary wrote.
Nuveen doesn't "expect moves by the Trump Administration to restrict federal funding to have much of an effect on U.S. cities, or by extension their municipal bonds."
To the extent that sanctuary cities may be under pressure, Nuveen "believes it is much more likely to come from state government that can pass laws that supersede local government policies."
In California, San Francisco and Santa Clara County have filed
Senate Bill 54, the California Values Act, introduced by State Senate President pro Tem Kevin de Leon to strengthen the state's stance on the sanctuary cities issue, was approved Monday in the Senate's Appropriations Committee in a 5-2 vote.
De Leon has said the bill prevents the state and local law enforcement agencies from having to act as deputies of U.S. Immigrations and Customs Enforcement agents.
"When local police are deputized to enforce immigration laws our communities become more – not less – dangerous," de Leon said. He added that it squanders limited law enforcement resources by having them arrest "otherwise law-abiding maids, students, busboys and day laborers for immigration violations."
Local governments would continue to comply with judicial warrants to transfer dangerous offenders into federal custody for immigration enforcement purposes, according to the legislation. The bill was amended to provide federal government a 60-day notice before violent felons are released from state prison or local custody.
Sen. Joel Anderson, R-Alpine, who opposes the bill, said it "continues to shield deportable rapists and child molesters, who are serving time as felons in our prisons."
