The American Immigration Lawyers Association has already announced that it is moving its 300-to-400-person September convention, scheduled for Scottsdale, out of Arizona. Other groups are locked into contacts but some making new bookings are avoiding the state.
Hotels are already feeling the pinch.
"We've probably lost upwards of $100,000 in business," said Jim Hollister, general manager of the FireSky Resort & Spa, a Kimpton hotel in Scottsdale. "Some were definite on the books for us, some were people who were looking to stay with us."
Hollister said the biggest dollar loss came from corporate bookings but that plenty of leisure travelers called or e-mailed and specifically said they were canceling because of the immigration law.
Some guests who stayed last week, he said, said they loved the hotel but weren't coming back until the immigration law was changed.
Several large companies planning conferences are deciding to skip Arizona, according to Blake Fleetwood, president of Cook Travel, which has five agencies in the greater New York area. Fleetwood said he is organizing events for several investment banks and doctors' groups who contacted him after the law passed.
"They want to take any large Arizona properties off the list for now," Fleetwood said. "They don't want to support that type of behavior."
Fleetwood said that a boycott by the tourism industry could move policy, citing the King holiday example.
"If we can affect 5 or 10 percent of their business, that's a huge hit for them," he said. "There are too many other places to go to that are dying for business."
Fleetwood immigrated from South America when he was 4 and said that 90 percent of his agents were also not born in this country. He said the travel industry is watching this new law carefully and won't sit by idly.
"The rest of the United States is not going to put up with their anti-American attitude," he said. "We've sent many travelers to Arizona but now they don't want to go there until they stop these Gestapo-like laws. It's just un-American."
Arizona, with plenty of second homes and a pre-recession housing bust, is hurting more than most of the country. Tourism there has been steeply off and Debbie Johnson, president of the Arizona Hotel and Lodging Association, said this isn't going to help.
"Obviously, our members are concerned," Johnson told the Associated Press. "I thought there would be political issues. It has become so tourism-focused and that, to me, is the unfortunate side."
Johnson said there are 200,000 families, many of them Latinos and legal immigrants, who depend on a paycheck from the tourism industry.
"They don't want to lose their jobs," she added.