bers. They also required assumptions and estimates about the incidence of business and real estate taxes, the degree to which the costs and benefits of various public services are affected by additional beneficiaries, and other characteristics of the economy. The panel's calculations for the annual fiscal impacts were made for households as the unit of analysis, rather than individuals, because households are the primary units through which public services are consumed and taxes paid. Ideally, the revenues from and expenditures on U.S.-born children of immigrants should be included in estimating the fiscal impact of immigrants, and this procedure was followed in the panel's estimates of long-run fiscal impacts. However, for the annual estimates, only those U.S.-born children who remain in the parent's household were included. As a result, the analysis tends to overstate the net fiscal burden of past immigration, because it generally includes U.S.-born children of immigrants in immigrant households when they are of school-age (and hence costly), while excluding them once they have reached working ages and moved out on their own to become contributors (or at least a lighter burden).

At the state and local government levels in New Jersey, the net fiscal burden from immigrant-headed households in the 1989-90 fiscal year is estimated to be $232 per native-headed New Jersey household, measured in 1996 dollars. A similarly constructed estimate for California from the 1994-95 fiscal year gives a net fiscal burden of $1,178 per native-headed California household, again measured in 1996 dollars. On average, immigrant-headed households from these two states make small positive net contributions to the federal government, equivalent to a reduction of $2 to $4 per year in federal taxes for resident households nationwide. (There are indications, however, that immigrants outside California have a more substantial positive impact at the federal level.)

New Jersey and California both have large numbers of immigrants and, as a consequence, the net fiscal burden on native residents in those states imposed by immigrant-headed households is relatively high. If the net fiscal impact of all U.S. immigrant-headed households were averaged across all native households in the United States, the burden would be considerably lower—on the order of $166 to $226 per native household.

There are three main reasons why immigrants receive more in services than they pay in taxes in these annual calculations: (1) immigrant-headed households include more school-age children than native households on average, and therefore currently consume more educational services; (2) immigrant-headed households are poorer than native households on average, and therefore receive more state and locally funded income transfers; and (3) immigrant-headed households have lower incomes and own less property than native households on average, and thus pay lower state and local taxes.

Across the immigrant population, the size of the net fiscal burden imposed on native residents varies significantly. It is by far the heaviest for households of immigrants originating in Latin America. Immigrants from Europe and Canada