Justice Department Says Every State Agency Must Report Immigrants to DHS or the State Can Lose Its Share of $16.4 Billion in Welfare Funds

The Justice Department announced on Sept. 2, 2026 an Office of Legal Counsel opinion, dated Sept. 1, holding that when a state participates in the Temporary Assistance for Needy Families and Supplemental Security Income programs, every agency in that state government - not only those administering the benefits - must report individuals known to be not lawfully present to the Department of Homeland Security. The opinion withdraws a 1998 opinion that read the requirement narrowly. All fifty states, the District of Columbia and several territories participate; federal TANF grants exceed $16.4 billion annually. Deputy Assistant Attorney General Joshua Craddock, the opinion's author, said "failure to comply may lead to serious consequences, including loss of program funding."

Extending a reporting duty from benefits agencies to an entire state government conditions a broad category of safety-net funding on state cooperation with federal immigration enforcement, an area where courts have previously limited federal leverage over states.

The opinion applies prospectively, with no retroactive penalties. CNN reported it is likely to face legal challenges; a similar USDA effort to condition food-stamp funding was preliminarily enjoined earlier this year.