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CBO: E-Verify Extension Could Cost $570 Million

By Bill Leonard  9/25/2008
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A proposed five-year extension of the federal government’s electronic employment verification system will cost approximately $570 million, according to an estimate from the Congressional Budget Office.

The House of Representatives passed HR 6633 on July 31, 2008, that would extend the E-Verify program through 2013. Authorization for E-Verify is set to expire in November 2008. Business groups, including the Society for Human Resource Management and the HR Initiative for a Legal Workforce, have voiced support for the extension while urging Congress to seek alternatives for improving the effectiveness and efficiency of the E-Verify program—which is administered by the Department of Homeland Security (DHS) and the Social Security Administration (SSA).

According to the CBO report, the DHS is set to spend nearly $75 million during fiscal year 2008 to operate the E-Verify program. CBO projections show that those costs would increase to $102.2 million per year, and $511 million over the next five years, if Congress enacts the extension. Most of the cost increases would be the result of a growing workload at the DHS to run the E-Verify program. This heavier workload would require additional resources for staff, new computers and other overhead costs, the CBO estimate concluded.

The SSA would spend close to $61 million, the CBO projections show, over the five-year extension to keep pace with the expected growth of E-Verify, to handle inquiries and to improve the system’s technology. According to statistics from the DHS, approximately 80,000 employers participate in E-Verify, with nearly 1,000 employers per week using the system to verify the employment eligibility of job applicants and new hires.

SSA statistics show that U.S. employers will conduct nearly 6 million E-Verify queries during fiscal 2008—which ends Sept. 30, 2008. The CBO projects that the number of verification queries in 2009 will grow to 11 million and could reach 23 million by 2013. Most of that increase will result from employers joining the program voluntarily, the CBO researchers concluded, while the remaining growth in the program will result from state laws requiring employers to participate and from a proposed regulation that will require federal contractors to participate in the program.

Sources familiar with the issue say that the CBO estimate shows that E-Verify is not a free program, and they emphasize that Congress should examine the costs associated with administering the program carefully and look for ways to make the verification program effective and cost-efficient.

Bill Leonard is senior writer for SHRM Online.

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