DOJ warns states of potential loss of welfare funding for not reporting illegal migrants

<p>The Justice Department warned states they could lose billions of dollars in welfare funding if they do not report known illegal migrants to the federal government, according to a legal opinion released on September 3, 2026.</p><p>The DOJ's Office of Legal Counsel stated that states participating in two key welfare programs must require all state agencies to report individuals known to be unlawfully present to the Department of Homeland Security. This marks a significant shift from a 1998 Office of Legal Counsel interpretation that limited the reporting requirement to agencies administering the programs.</p><p>Previously, only state agencies that administered the funding for the welfare programs were required to report illegal migrants, while other agencies, such as colleges and departments of motor vehicles, were not subject to this mandate.</p><p>Deputy Assistant Attorney General Joshua Craddock stated, "Failure to comply may lead to serious consequences, including loss of program funding."</p><p>Since returning to the White House, President Donald Trump has adopted an aggressive approach targeting both illegal and legal immigration, which includes deploying federal agents into cities to conduct raids on migrant communities and partnering with state and local law enforcement to locate suspected illegal migrants.</p><p>The administration has pressured Democrat-led states that have refused cooperation with federal immigration enforcement by threatening federal funding.</p><p>This policy shift could face legal challenges, as Democrat-led states have already sued to block DHS from collecting personal details of individuals receiving funds under the Temporary Assistance for Needy Families program. Courts have limited some administration efforts to require the sharing of information on migrants with DHS, although in some cases, judges have allowed federal immigration authorities to collect certain information, including Medicaid data.</p><p>All 50 states and Washington, D.C., participate in the reporting requirements tied to the two programs: Temporary Assistance for Needy Families and Supplemental Security Income. Federal Temporary Assistance for Needy Families grants exceed $16.5 billion annually, and Supplemental Security Income federal benefits exceed $60 billion annually. Illegal migrants are not eligible for either program.</p><p>Reuters contributed to this report.</p>