It’s not clear what the economic impact of SB 4, the so-called “sanctuary cities” bill, will end up being. Certainly, Arizona’s SB 1070—which shares many common elements with the Texas law—had a measured impact on that state. (Estimates put it around $500 million in negative economic impact.) Major proposed boycotts from entities like Major League Baseball failed to materialize, but cities like Los Angeles, San Francisco, Oakland, Minneapolis, Denver, and Seattle all banned travel by city officials to Arizona, and limited the business transactions with Arizona-based companies. It’s too early to tell what impact it’ll have in Texas—but Democratic U.S. Senators Bob Menendez, of New Jersey, and Catherine Cortez Masto, of Nevada, have urged one prominent Texas event to reconsider its location—South by Southwest.

In an open letter published by the two senators addressing SXSW CEO Roland Swenson, they made their case:

We first would like to thank you for previously speaking out against harsh immigration policies such as President Trump’s Executive Order which bans citizens from predominantly Muslim countries from entering the United States.  It is because of your willingness to standup for what is right that we write to respectfully request you consider relocating the 2018 South by Southwest (SXSW) Conference and Festivals to a different state until the recent anti-immigrant SB4 law is repealed.


[T]his law stands diametrically opposed to the spirit of SXSW.  Throughout its 31 years, SXSW has been a beacon of consistency, standing with artists and participants regarding equality, tolerance, and safety during events.  SB4, however, would not allow SXSW to be a safe place for immigrants and Americans alike to visit, participate, and enjoy; the culture and safety of the event would be greatly diminished if your attendants are faced with the humiliation and harassment that this new law would inflict.  Not only does this law stand against what SXSW stands for but also what we fundamentally stand for as a nation that believes in basic dignity and respect for all.

For these reasons, we respectfully ask that you consider relocating the 2018 South by Southwest Conference and Festivals to a different state until Texas terminates its harmful, shameful immigration policies.  SB4 is the product of the anti-immigrant wave that has engulfed our country, and we need leaders like yourself to stand on the right side of history by rejecting the demonization of our Hispanic and immigrant communities.  Thank you for your attention to this important issue.

SXSW is a Texas-grown, Texas-based company, and the conference’s entire existence is predicated on being based in Austin. The city developed the infrastructure needed to host SXSW (a zillion clubs and bars that are staffed to handle the influx of business, a slew of new downtown hotel rooms) organically. Just up and moving the mega-conference to, say, Kansas City isn’t realistic for a few reasons, but the fact that there isn’t another city capable of replicating the SXSW experience—and certainly not within a ten-month window—is chief among them. It’s not like SXSW is the NCAA Final Four, which is the sort of traveling event that cities around the country have experience hosting. There’s no shortage of cities that would love to host SXSW, but there’s a real dearth of cities that are capable of it.

Even relocating events like the Final Four—which, if it happens, could easily be a result of the bathroom bill that made the ambitious list for the special legislative session Governor Greg Abbott called on Tuesday—are often as much about tough talk as they are action. The real impact tends to be measured less in what events get canceled, which is expensive and more sharply political than organizations with the mass-market appeal of the NCAA or other major sports leagues like to get.

It’s also possible—theoretically, at least—that the pressure on SXSW because of laws like SB 4 could force the conference to look for long-term alternatives to hosting in Texas. That wouldn’t be pressure coming from senators in New Jersey and Nevada, necessarily, but if there’s a strong boycott of the 2018 festival from either the rank-and-file attendees who pay its bills, or from the big-name titans of the tech, music, film, and media industries that give the event its cachet, the festival could start taking such considerations seriously.

For the moment, though, SXSW is staying put in Texas. A statement released to media from Swenson explains the reasoning:

We stand by the City of Austin in their challenge against SB4 and will continue to speak out against it, and all discriminatory legislation.

We agree with the Senators that SB4 stands diametrically opposed to the spirit of SXSW and respect their call to action. We understand why, in today’s political climate, people are asking us to leave Texas.

For us this is not a solution. Austin is our home and an integral part of who we are. We will stay here and continue to make our event inclusive while fighting for the rights of all.

Swenson’s position is reasonable—and it’s notable that he doesn’t make the argument that leaving Austin is unrealistic, which while true, would come off as a smidge hypocritical from an organization that’s floated such ideas themselves. As the 2017 regular session proved, and which Abbott’s comments at a reception in Belton about the smell of the air in “the People’s Republic of Austin” on Wednesday confirmed, bashing Austin is good for politics if you’re a Texas Republican. Leading SXSW to pull out of Austin might have a negative economic impact on the city to the tune of $320 million a year, but it’s a safe bet that any politician who voted for SB 4 would probably get cheers from their base for chasing it out of town.

All of which highlights the actual issue that SXSW—and any business whose values involve a fairly progressive worldview—face in operating in Texas in 2017. Austin leads the state in startups, venture capital, and patents. The sort of industries that are likely to form the basis of Texas’s modern economy are growing out of a city that the state’s leaders are quick to bash. At some point, Austin, SXSW, and all of the constituencies that those two entities represent are going to have to make some decisions about whether the animosity coming from the state to their interests is mutual—and if so, what to do about it.

Right now, SXSW aims to stay put, and they say that they’ll fight against SB 4 from within Texas. Time will tell if that’s where this all ends.