Local businesses fear 'Sanctuary Cities' ban will harm economy

Some Austin businesses fear the newly signed anti-sanctuary cities law will damage the Texas economy. (CBS Austin)

Some Austin businesses fear the newly signed anti-sanctuary cities law will damage the Texas economy.

Magdalena says that negative effects started shortly after Trump’s inauguration.

For the past eight years, Magdalena has worked at department store near Rundberg and Lamar in North Austin. Much of her client base come to the store in the strip mall to cash checks or transfer money, sometimes to family out of the country.

However, after ICE made themselves known in the area with multiple reported arrests, one that went viral in a super market parking lot. She says customers aren’t sending money -- they’re saving it.

“They’re scared that any officer can stop us because of the color of their skin,” she said.

Sunday’s Facebook live signing of the sanctuary cities ban didn’t alleviate any fear.

Starting September 1st, the law will allow police officers to ask crime victims and witnesses their immigration status.

“Before they had fear at the national level, but now the fear is at the local level,” said Magdalena.

Gavino Fernandez with the League of United Latin American Citizens (LULAC) said immigration worries amplified after Governor Abbott signed SB 4 into law.

“There is a fear, an intimidation in the community just after he signed it,” said Fernandez.

Fernandez hopes the court system keeps SB 4 from going into effect on September 1st, but he said he’s already starting to notice East Austin businesses struggle to keep employees. at a 7th Street strip mall a block away from the LULAC office, two businesses tell CBS Austin they fight to keep loyal employees because they fear driving to work puts them at risk of getting pulled over by police and questioned about their immigration status.

“It becomes an obstacle of having a quality of life,” said Fernandez. “They’ll migrate, they’ll leave (and) that will be an impact that will have an impact on the economy.”

A 2016 Texas Public Policy study on Immigrant impact on the Texas economy shows immigrants make up more than 20 percent of the Texas workforce. The study states “the economic and social impact of the immigration population in Texas mush be measured along a number of different dimensions, including the amount of tax revenue they bring in, the amount they consume in state provided benefits and the crime rate.”

The study measures in 2010, the state of Texas collected $178 million in property taxes and $1.4 billion in sales taxes from unauthorized immigrants.

“Texas receives more tax revenue from unauthorized immigrants than any other state besides California,” states the year-old study.

Magdalena fears her business will continue to slow because instead of spending or sending money -- customers will conserve it.

“They’ll have to pay a lawyer or fine to be able to come out of jail and keep working,” she said.