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California Gov. Gavin Newsom signed a bill earlier this week that would impose a 25% tax on private detention centers, a policy that would apply to all the facilities that partner with Immigration and Customs Enforcement (ICE) in the Golden State.
“If we can’t kick out private facilities, we’ll go after their profits,” Newsom said in a press release.
The move, which Newsom hailed as a way to push back against President Donald Trump’s immigration crackdown and what he sees as the practice of privatizing federal enforcement, is raising concerns among immigration experts who believe the increased tax could force the government to explore alternative facilities less suited to housing detainees. It also poses questions about what would happen if all eight of ICE’s detention facilities choose to suspend their operations in California.
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That’s the view of Hans von Spakovsky, senior legal fellow and an immigration expert with Advancing American Freedom, a conservative-leaning think tank.
“It’s very clear that there’s only one purpose to this California gigantic tax increase, and that is to make sure that the federal government cannot find any private property owners, any private contractors in California that are willing to lease space to the federal government,” Spakovsky said in an interview with Fox News Digital.
“The alternative for the federal government is to look at all the different federal properties that the government actually owns out there, over which neither Newsom or anybody else in California can impose any kind of tax, and see if any of those federal facilities can be converted to being a detention facility.”
Spakovsky explained that could mean repurposing warehouses or office space.
The newly minted law, AB 1633, is among 20 other bills that Newsom signed on Tuesday. In its current form, the 25% tax applies to the gross income of any private detention facility and applies to federal, state and local contract recipients. Revenue from the bill will go to a “Due Process for All Fund,” designated for immigration-related services, according to the bill’s language. Now that AB 1633 has been signed into law, it will go into effect on July 1, 2028.
Alongside the bill, Newsom signed a handful of other restrictions.
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“We’re also banning the Orwellian practice of using shock gloves in enforcement activity as well as further protecting access to our court system,” Newsom said.
“We may not be able to dictate federal immigration policy, but we can make clear that activities taking place in California will be subject to California law.”
Despite Newsom’s framing, Spakovsky believes the governor will affect federal immigration law enforcement by limiting the overall space it has to operate. He pointedto reporting from Immigration and Customs Enforcement (ICE) that details its detention needs. He explained that the government relies on private contractors, at least partially, to avoid the costs of building out their own facilities.
“If you look at that report, currently ICE has about has enough detention space for about sixty-six thousand aliens. Okay, that’s the full size of the federal government’s detention capacity,” Spakovsky said.
If an entire state’s private detention contractors decided the tax is too high, ICE’s overall capacity could shrink.
California is home to eight ICE detention facilities, according to reporting from the Department of Homeland Security (DHS). All of them are privately operated.
The GEO Group, a corrections company, owns five facilities. Imperial Valley Gateway Center LLC, a local detention company, owns one more. Two more were purchased by DHS in July but are run by CoreCivic, a prison company, and have contracts through 2027 and 2029.
Although the bill won’t go into effect until 2028, in Trump’s last year of his second term, Spakovsky believes that the government might begin evaluating where else it can find partnerships to meet its detention needs sooner rather than later.
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“Look, if I was the federal government and I couldn’t find enough federal properties in California to do this, I would then go into neighboring friendlier states that I could quickly transport aliens I’ve detained and I would lease and rent facilities there,”
“I’d go to Arizona, I’d potentially go to Nevada, I’d go to other states where they might be eager for federal government money and the increased employment from private contractors hiring people to work on these facilities.”
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The office of Gavin Newsom did not immediately respond to a request for comment from Fox News Digital.
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