Yep, pull HUD out, stop WIC and welfare, student loans (that would actually be beneficial to them), withhold highway funding. Stop all federal aid. But, that would take a congress that was all on the same page. Never gonna happen.
No, we would need the federal government to pass this law, ANY Mayor/city council, county seat or state legislature would pass this law, the same way the chuckleheads in CA and those dumb cities like Denver passed THEIR sanctuary laws.
Basically this would be a case of the local government who is fed up could “play railroad crossing chicken” with the other sanctuary cities using the federal government as the train.
Remove ICE and any border security from sanctuary counties and double the manpower in areas that are cooperating.