On May 7, Texas Gov. Greg Abbott (R) signed S.B. 4 into law. Despite organized protests, a state representative’s hunger strike, and much heated debate , the bill passed on party lines, placing the state at the forefront of implementing the Trump administration’s hard-line anti-immigrant agenda.

S.B. 4 is a show me your papers style law that permits law enforcement officers to check the immigration status of anyone they suspect to be in the country without authorization. It purports to require jurisdictions to honor detainers from Immigration and Customs Enforcement (ICE). Under law, ICE detainers are voluntary requests to hold someone beyond the point when they would otherwise be released. S.B. 4 also forbids jurisdictions from enacting policies that limit law enforcement agencies from checking the immigration status of anyone stopped, essentially banning a range of what are considered sanctuary policies. In addition, S.B. 4 makes refusing to cooperate with detainer requests a criminal offense. Under S.B. 4, individuals face fines, jail time, or loss of office if they do not honor detainers, and jurisdictions that try to limit such involvement are subject to fines as well. These repercussions reach beyond law enforcement agents—elected officials, city and county staff, and university public safety officials are also included in these measures.

As the Trump administration works on Steve Bannon’s whiteboard of anti-immigrant pledges at the federal level, S.B. 4 has Texas serving as a handmaid. This column explains some of the potential negative consequences that could follow the passage of S.B. 4.

Why S.B. 4 is so dangerous

S.B. 4 is a troubling policy for many reasons. Requiring police officers to act as immigration agents erodes trust between law enforcement and immigrant communities, reducing public safety. If immigrants are afraid to report crimes or cooperate with police, the larger community suffers. In addition, such laws increase the likelihood that racial profiling tactics will be used. Even with proper training and awareness, research shows that individuals are susceptible to relying on stereotypes. Furthermore, U.S. courts have ruled that honoring detainers past an individual’s release date violates the Fourth Amendment, putting law enforcement between a rock and a hard place when deciding which policies to adhere to.

Important stakeholders throughout the state oppose S.B. 4, including police chiefs, sheriffs, religious leaders, and the Texas Border Coalition. The American Civil Liberties Union has already issued a travel alert to warn those visiting Texas that they are at risk of violations to their constitutional rights.

What’s at stake with S.B. 4

4.7 million immigrants live in Texas, but the threat from S.B. 4 extends to many more people. 2.7 million Texans live in a house where a family member lacks legal status, including 1.2 million children. Texas is a majority-minority state—meaning that, under S.B. 4, three of every five people in Texas will be at risk of being profiled based on the color of their skin.

Furthermore, Latinos and Asians in the state have $297 billion in purchasing power. This is a staggering amount that outweighs the oil and gas industry’s contributions to Texas’ GDP. But these economic contributions could shrink as Latinos and Asians become too scared to go about their daily lives. Worse, these contributions could disappear if these Texans leave the state because of the law.

Unauthorized immigrant workers in Texas contribute roughly 4 percent, or $60.1 billion, to the state’s GDP annually. Removing these workers would open a giant hole in Texas’ finances. To put this number in context, $60.1 billion is more than Texas’ annual state and local investments in public education funding. The construction industry would be hit hardest: Nearly half of construction industry employers in the state are concerned about worker shortages, and unauthorized workers account for a large share of their laborers. Economists expect the construction industry to grow, exacerbating tensions that could result in serious long-term implications for the Texas economy.

Learning from the past

Texas will not be the first state to feel the economic fallout from discriminatory laws and policies. As the possibility of an economic boycott brews, lessons exist from states such as North Carolina, Arizona, and Alabama. The Associated Press projected that North Carolina would lose $3.8 billion after implementing H.B. 2, the anti-LGBT law that bars transgender people from using restrooms in accordance with their gender identities. And the Center for American Progress found that after Arizona passed S.B. 1070—another show-me-your-papers law—in 2010, the state lost more than $141 million from conference cancellations and booking declines alone, not to mention additional losses of associated spending, tax revenue, economic output, and jobs. A broader analysis of H.B. 56, Alabama’s similar anti-immigrant legislation, suggested a much larger cost—up to $10.8 billion in losses to the state’s overall GDP.

While some states are looking to Texas as a potential example, others are moving in the opposite direction. A bill similar to S.B. 4 recently failed in Florida, and states such as California and Vermont are taking proactive steps to prevent law enforcement officials from acting as immigration agents. As states consider how to position themselves on immigration, they must look beyond the current political climate and set their own tone. Welcoming immigrants rather than rejecting them comes with economic benefits, including billions of dollars in state and local taxes, while bills like S.B. 4 have detrimental effects and should be left behind.

Nicole Prchal Svajlenka is a Senior Policy Analyst with the Immigration Policy team at the Center for American Progress.