When the Minuteman Project began April 1, local businesses saw a dip in sales because not as many shoppers were traveling across the border from Agua Prieta, Mexico, said Douglas Mayor Ray Borane.
"There was a lot of concern expressed right at the beginning. There was a sense of fear in Douglas among residents, a fear of being discriminated against," Borane said. "There was and is an aura of tension."
The tension has caused financial problems in this town of 15,000, where the economy is heavily reliant on Mexican shoppers who cross the border legally and 92 percent of the locals are Hispanic, Borane said.
The Minuteman Project volunteers, some of whom are armed, began spreading out earlier this month along a 23-mile stretch of desert between Douglas and Naco to the west. They alert authorities when they see someone cross the border but are not supposed to detain anyone.
Organizers say they want patrols to call attention to what they say is the federal government's failure to secure the border against illegal immigrants, smugglers and potential terrorists.
Law enforcement officials have said they fear the project will lead to vigilante violence, and human rights activists worried that it would attract white supremacists groups.
Steve Cho said business at his Douglas variety shop, which caters almost solely to shoppers from Mexico, normally starts picking up in April, but not this month.
Sales are 30 percent below normal for this time of year, he said.
"The last couple of weeks have been bad," Cho said. "We don't have that much traffic."
Sales have also dipped at Marlin's Saddle Shop, said owner Gerry Bohmfalk.
"The Minuteman Project is affecting us because so much of our business comes from Mexico," he said. "They don't want to come over here because they are intimidated about the Minutemen and the increased number of Border Patrol."
La Razon, a newspaper in Agua Prieta, was advertising an economic boycott of Douglas that was planned for the weekend partly because of the Minuteman Project.
Gabriel Ortega, a worker at Ortega Shoes, said he was concerned the boycott would hurt business. "I think the main fear has been the possibility of protests and people closing the border," he said.
Minutemen volunteers said the fears among shoppers traveling north from Mexico and among the residents of the border communities are unfounded.
"The men aren't even in Douglas. If they are afraid, it is from misinformation," said Mike Milmine, 57, of Phoenix, who was patrolling the border near Naco.
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