Senator Eliot Shapleigh - El Paso, Texas

International Bank of Commerce Vice President Eddie Aldrete. (File photo: RGG/Steve Taylor)

AUSTIN, April 22 – Enacting legislation to punish businesses that knowingly hire undocumented workers could harm the Texas economy and leave even legal residents without work, according to some Texas business leaders.

Eddie Aldrete, the senior vice president of International Bank of Commerce and a ranking member of the San Antonio Hispanic Chamber of Commerce told the House Committee on State Affairs on Tuesday that Texas’ reputation as one of the best sites for businesses would suffer if House bill 48 was enacted.

The bill, authored by Rep. Debbie Riddle, R-Houston, would allow the Texas Workforce Commission to revoke the license of a business owner who employs undocumented workers for up to a year. Business owners could also face civil penalties or criminal charges for engaging in the practice.

“We have prided ourselves in the last few years of being a leader in the United States as a place to do business,” Aldrete said. “CNBC the network has ranked us as the best place in the country to do business, 64 of the nations Fortune 500 companies’ headquarters are based here in Texas, more than any other state. Chief Executive Magazine has selected Texas as the No. 1 place to do business and today nine of the top 20 cities on the Forbes magazine list as the best place for jobs are cities in Texas.”

That could all change, he added, if the state legislature forces private businesses to enforce immigration laws, which he said should be practiced instead by the federal government.

“We pride ourselves in participating in trade missions, going to Mexico, going to Canada, going to other foreign countries to try to recruit business and bring them to Texas,” he said. “But now when we go on those trade missions we will have to say … ‘If you make a single mistake in the hiring process you are likely to lose your business license.’”

Aldrete argues that employers will be forced to turn their human resource departments into legal compliance departments and cited the example of Ariz. businessman Jason LeVecke as proof that the proposed legislation is flawed. LeVecke decided against opening 20 fast-food chain restaurants in his home state after it enacted similar legislation, called there the Employer Sanctions Law.

“I have 1200 employees at 70 different locations. If a manager were to make a mistake based on the documentation provided by the applicant then I, as the business owner, could lose my license,” LaVecke stated in written testimony provided to the committee. “I would be personally and professionally bankrupt as a result.”

LeVecke added that the construction industry in Ariz. has been decimated by the law as it has lost more than 40,000 skilled laborers since it was enacted.

Bill Hammond, the president of the Texas Association of Business and a board member of Texas Employers for Immigration Reform (TEIR), agreed the law would not solve problems but instead harm the state’s economy.

He argued that because the bill mandates verifying applicants’ rights to work in the country through the federal E-verify program, which he said is flawed, businesses will not only lose money but also qualified staff.

In a statement released by TIER, Hammond said that according to a 2007 federal study, 10 percent of all naturalized citizens have errors in their files, which makes them ineligible for employment.

“The broken E-verify system would put additional burdens on employers in an already difficult economy,” he said. “It would create an untenable situation for employers and lead to massive firings and the shutdown of businesses across the state.”

Alberto Cardenas, who serves as executive counsel to the group Americans for Immigration Reform, said the proposed law has the effect of “drilling a dry hole.”

He said Americans for Immigration Reform commissioned the Waco-based Perryman Group to study the economic impact of enforcement-only immigration proposals.

“The result of Dr. Perryman’s study reflects that if Texas were to lose 1.1 million undocumented workers, it would cost the state treasury $220 billion worth of revenue from all of us together,” he testified.

Cardenas said he also took issue with the belief held by proponents of enforcement-only immigration policies that undocumented workers take jobs from citizens.

“We don’t negate the fact that many Texans who were born in this country are today out of work,” he said. “We do however take exception to those who believe that a workforce in agriculture, the service industry, construction and other vital areas are not needed and that currently unemployed Texans are going to fill those opportunities.”

The country must also address what Cardenas said was a double-standard.

“On one hand our country says, of course, ‘Keep out’ at the border, but a few miles in says ‘Help wanted,’” he told the committee.

“This inconsistency needs to be addressed in Washington (D.C.). Meaningful immigration reform is important to all Americans. We must protect our borders, we must provide an employer verification system and, of course, a temporary-worker program in a humane fashion to deal with those who are here in an undocumented way.”