When immigrants become citizens, cities benefit

Urban Institute study shows it’s a "win-win" for cities

A new study indicates that cities can reduce their spending by encouraging immigrants to apply for citizenship. According to Nisha Agarwal, the Commissioner of the New York's Office of Immigrant Affairs, “Immigrants represent a major source of economic power for the United States, and our collective economic wellbeing depends in large part on successful integration of immigrants.” 

The Urban Institute study estimates that 23% of the foreign population in US cities is eligible for naturalization. When an immigrant becomes a citizen, their earnings increase by an average of 8.9%, or $3,200. After naturalization, the immigrants’ employment rate would rise 2.2 percentage points, and they would be more than 6 percentage points more likely to buy a home, which translates to 45,000 new homeowners in the cities studied. Revenue from federal, state and city income tax, as well as from federal payroll tax, would yield an additional $2 billion.

The benefits to receiving American citizenship range from access to a broader group of employers to the right to vote, as the report outlines. But there are many reasons why legal immigrants may not apply for citizenship. Amoung them: lack of proficiency in English, administrative barriers, and the $680 cost of the application. Some legal residents don’t want to become citizens because they maintain close ties with their home countries. Others are not aware they can hold dual citizenship with their home country.

The Urban Institute took a closer look at New York and San Francisco to assess the risk of increased public spending due to naturalization. Calculating changes in food stamp, Social Security and family assistance benefits in the two cities, the research shows that encouraging citizenship could help city economies.

In New York, where a whopping 38% of the population was born abroad, tax revenues on all levels, from city to federal, would rise by $789 million if all of those eligible for naturalization got their American passports, and public benefits would fall by $34 million. In San Francisco, benefits would cost the city $4 million, but with tax revenue rising by $90 million, the net benefit is significant.

New York mayor Bill de Blasio announced earlier this year that the city would launch a program that helps immigrants get free citizenship services at New York’s public libraries. “Mayors across America can attest: naturalization is a key mechanism for empowering immigrant families. These families make significant contributions to a city’s economy and cultural landscape, and when they succeed, we all succeed,” he said in a statement accompanying the study.

According to Commissioner Agarwal, “Naturalization represents a major opportunity for cities to provide real assistance to a significant proportion of their immigrant populations, as well as to encourage economic growth through new tax revenue and, in many cases, through reduced expenditures on public benefits.”

This post is based on a news story from Quartz, which is available here: http://qz.com/572738/when-immigrants-become-us-citizens-cities-benefit-economically-study-says/ 

The Urban Institute study can be downloaded here: http://www.urban.org/research/publication/economic-impact-naturalization-immigrants-and-cities