California state Sen. Steve Padilla is taking aim at a tax break that has quietly benefited a nonprofit landlord behind a local ICE jail in Imperial County. His latest move would shut down a property-tax loophole that let nonprofits tied to private immigration detention claim charitable exemptions, even while pulling in hefty detention fees.
The change zeroes in on the nonprofit owner of the Imperial Regional Detention Facility near Calexico, which has avoided millions in property taxes while collecting substantial detention-related revenue.
Padilla Reworks SB 420 To Target Detention Tax Loophole
Last Wednesday, Padilla filed new language to amend Senate Bill 420 so that organizations connected to private immigration detention operations would be blocked from using the state’s Welfare Exemption if any part of their operations is run by a for-profit company and functions as a detention center, according to Padilla’s office.
His office framed the amendment as a way to keep taxpayers from indirectly subsidizing private detention contractors and to bring California’s tax policy in line with the state’s stated opposition to private immigrant jails.
What The Amendment Would Actually Do
The new language tightens the Revenue and Taxation Code so that a property used, in whole or in part, as a detention center operated by a for-profit contractor would no longer qualify for a charitable property-tax exemption, according to reporting on the measure. In other words, if a nonprofit owns the land but a private prison company is running the jail, that setup would not get treated as a charity for tax purposes.
Davis Vanguard explains that the amendment would make a nonprofit landlord’s organizational status insufficient on its own to secure the Welfare Exemption when the property is, in effect, a private ICE detention facility.
How The Brawley Community Foundation Got The Break
The push to change the law was sparked by reporting that the Brawley Community Foundation owns the Imperial Regional Detention Facility through a subsidiary and that state and county officials granted it the Welfare Exemption.
Public records and prior coverage show that the exemption has slashed the foundation’s property tax bill by at least $6 million since 2016, and that most of its roughly $40 million in annual revenue comes from detention-center fees, according to KPBS.
Allegations, Inspections And Two Deaths At The Facility
The Calexico detention center is operated by Management & Training Corporation, a for-profit contractor whose facilities have faced scrutiny in multiple states. Oversight reviews have flagged problems with care and operations at the Imperial Regional Detention Facility itself.
The California Department of Justice documented two deaths at the facility along with other concerns, and ICE inspection reports have also noted compliance deficiencies.
Legal And Fiscal Stakes Of The Welfare Exemption
The Welfare Exemption is jointly administered by the state Board of Equalization and county assessors, and it is not granted automatically. Organizations must first obtain an Organizational Clearance Certificate before a county can approve the property-tax break.
BOE materials outline the OCC requirement, and officials in Imperial County have said they will reexamine the Brawley Community Foundation’s application in light of the recent scrutiny, as KPBS reported.
What Happens Next For SB 420
Padilla’s office says the new language has been formally added to SB 420 and that the bill will come before the Legislature in the coming months. Padilla’s office casts the amendment as part of a broader effort to rein in profiteering in the immigration-detention system.
Community organizers in Imperial County say tightening the rules is overdue. “I don’t see the detention center as a community benefit at all,” Kristian Salgado, an organizer with the Imperial Liberation Collaborative, told Davis Vanguard, arguing that the jobs created by the facility do not outweigh the harms it causes.
