As immigration enforcement in Minnesota takes a toll on local businesses whose customers and employees stay off the streets out of fear, some public policymakers have a message for the White House: Stop.
Democratic state treasurers, auditors and comptrollers from 15 states – including two from California – sent a letter to President Trump on Wednesday calling for an end to aggressive tactics that they say have hurt economic activity and tax revenues.
“Many of our states are already sending more taxpayer dollars to Washington than we receive in federal support,” said the letter, whose signatories included the tax officials of Maryland, Oregon and New York. “We are now expected to absorb the tax consequences of the enforcement actions. This is unacceptable.”
State revenue officials do not often participate as a group in law enforcement matters. They leave that to state attorneys general, who often write class letters and court briefs, typically with members of their own party.
The letter was organized by For the Long Term, a group of progressive-leaning state and local financial supervisors who aim to promote economic and fiscal stability beyond the rapid fluctuations of election cycles. The signatories said they came together when they realized that events in Minnesota were falling within their jurisdiction as public stewards.
The Department of Homeland Security did not respond to a request for comment on the letter. Tom Homan, Mr. Trump’s border czar, said Wednesday that the administration would withdraw 700 immigration agents from Minnesota and leave about 2,000 there.
Immigration and Customs Enforcement presence was also expanded in other states, including Illinois, where Operation Midway Blitz took place in the fall. Mike Frerichs, state treasurer, said sales and income taxes have fallen during that time as people avoid restaurants and stores in neighborhoods like Chicago’s Little Village out of fear of federal officials.
“When you terrorize people and they think they’re going to get arrested or shot, they stay home and don’t spend money,” Mr. Frerichs said. “Donald Trump and Stephen Miller may not care about immigrants coming to this country, but the fear and chaos they sow in our cities impacts taxpaying Americans.”
Officials in other states are thinking about what could happen if ICE uses force.
“There is always a concern that our state could be next,” said Mike Pellicciotti, the treasurer of Washington, where there are large immigrant communities in both agriculture and technology. He said the ICE operation was just one of several strikes by the federal government over the past year, including tariffs.
“This reckless economic policy has an impact on all areas,” said Pellicciotti. “We are a trade-dependent state. We are a state that relies on talented workers from around the world who want to come.”
Mr. Trump has threatened to withhold funding from Democratic cities and states, including child care subsidies, housing assistance and food stamps. The White House also withdrew clean energy and other infrastructure grants, such as $205 million for the $16 billion New York-New Jersey Gateway Project.
State and local finances will likely take a while to see the damage from the Trump administration’s immigration restrictions and increased enforcement efforts, said William Glasgall, public finance adviser at the Volcker Alliance think tank. Many states, particularly in the Northeast and the industrial Midwest, relied on immigration to maintain or grow their populations.
“Budgets are getting tighter and tighter, and if immigration restrictions start to strain the tax base — we’ll see in the next year or two what that looks like in terms of sales tax growth and income tax growth — then you have reason to be concerned,” Glasgall said.
The list of signatories included states that experienced an influx of migrants during the Biden administration, a situation that also entailed huge fiscal costs. They were largely borne by cities like Denver, whose mayor unsuccessfully sought federal help as he spent tens of millions of dollars to house the newcomers. The nonpartisan Congressional Budget Office found that while the increase boosted state and local governments’ tax revenues, their spending increased by another roughly $10 billion.
State finance officials said current efforts to expel illegal immigrants are having a much broader impact on local economic activity, as even legal residents fear being stopped and detained.
“All of a sudden it’s a huge barrier for people to get involved in their communities,” Colorado Treasurer Dave Young said. Immigrants are also critical to the state’s workforce, he said.
“I’m concerned that so many of these people who are here and provide these tremendous services that we desperately need will put us in a significant economic bind if they leave Colorado.”