ALCATRAZ Act Creates New Federal Grant to Reimburse States for Migrant Detention Costs Starting 2025

The newly proposed Accelerated Logistics and Coordination for Arresting, Transporting, and Removing Aliens Zones Act—or the ALCATRAZ Act—sets up a brand new federal grant program designed to pay states and local governments back for the costs of detaining migrants. This isn't about new money, though. The bill specifically dictates that the initial funding for this new Detention and Logistics Program must come from unspent money previously earmarked for FEMA’s Shelter and Services Program (SSP). Essentially, the bill takes resources intended for migrant support and shelter and redirects them to fund detention.

The Shift from Shelter to Detention

This funding move is the clearest signal of the bill’s priority shift. The FEMA Shelter and Services Program helps non-profits and local governments provide temporary housing, food, and basic services to migrants released from federal custody. Redirecting those leftover funds to the new Detention and Logistics Program means less cash available for those vital services. For a busy city trying to manage the flow of people, this could mean the difference between providing a temporary bed and having people sleeping on the street. The shift in federal spending priorities is clear: the focus is moving from assisting with integration and basic needs to incentivizing and funding longer-term detention.

Incentivizing State-Level Detention

Starting January 20, 2025, state and local governments can apply to the Department of Homeland Security (DHS) for reimbursement for their migrant detention costs. This is a huge financial incentive for states to get more involved in detention. If a county jail decides to hold people who would otherwise be released, the federal government promises to foot the bill. However, the Secretary of Homeland Security gets wide, undefined authority here. They get to decide exactly how states must apply, what information they must provide, and when they get paid. This broad discretion means the process could be slow, complicated, or selectively applied, leaving local governments guessing about when—or if—they’ll see that reimbursement check.

The Mandate to Build and Raid

Beyond just paying for existing detention, the ALCATRAZ Act is pushing for expansion. DHS is required to report to Congress within 90 days with a plan to “quickly build new migrant detention facilities.” This plan must include scouting existing federal or state properties that could be converted. For communities, this means new, large-scale detention facilities could pop up quickly, potentially bypassing the usual environmental and community review processes that accompany major construction projects. Furthermore, DHS must identify “underused, wasteful, or unnecessary” government accounts and suggest redirecting that money to fund the new detention program. This is a vague mandate that could be used to justify cutting funding from entirely unrelated government services—everything from infrastructure projects to public health initiatives—based on a subjective determination of what counts as “wasteful.”

What This Means for Everyday Life

If you live in a state or county that shares a border or is near a major migration route, this bill could affect you in a couple of ways. First, you might see a rapid increase in detention capacity in your area, potentially converting a local military base or other large property into a facility without much local input. Second, if your community relies on federal funds for services—like FEMA’s assistance after a natural disaster, or even other social programs—you need to pay attention to which accounts DHS targets as “wasteful.” The cost of this new detention incentive program could ultimately be borne by other, unrelated federal programs that directly benefit taxpayers and local communities.