A key part of Arizona’s immigration law was temporarily blocked by a federal judge Wednesday. For now, police won’t be able to question people about their immigration status. For many businesses, the damage from the controversy is already done. Reduced spending in restaurants, grocery and retail stores has triggered a domino effect among businesses in the metro Phoenix business community and throughout Arizona.

Anecdotal evidence from business owners, real estate agents and community leaders indicates the mere specter of the bill has created a culture of fear among Hispanics in Arizona that’s slowly paralyzing sectors of the economy.

In addition, economic boycotts adopted by other states and cities have hit Arizona’s meeting and convention business. Since groups nationwide began announcing boycotts of the state because of SB 1070, at least 40 meetings have been canceled, which resulted in the loss of $12 million in lodging alone, according to Kristen Jarnagin, spokeswoman for the Arizona Hotel & Lodging Association.

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