In discussions of welfare state restructuring, the focus has largely been on institutions that are well established and funded by the state. This study, focusing on the U.S. refugee resettlement institutional domain, theoretically examines organizational entities that are refugee- run and grassroots, and how they fit as peripheral to their larger, state-funded counterparts. Third-order devolution, as conceptualized in this paper, is the extended delegation of social responsibilities from the state and then unto state-contracted organizations of the third sector, and then further unto state-detached organizations of the informal sector. “Informal,” “unofficial,” “quasi”-organizations run by and for refugee communities in these most peripheral levels at the grassroots are forwarded as shadows of the shadow state. That is, pressure is exerted further downward, but without means nor legitimacy, in multiscalar governance of U.S. refugee resettlement. The contestations and relationalities that constitute the shadow state must thus be viewed against a voluntary sector that is heterogeneous, multi-scalar and power-laden, rather than unitary. Theoretical considerations also raise questions about new organizational forms in addressing resettlement and migration, and the tripartite relationship between the state, state-contracted/funded organizations, and state-detached organizations at the grassroots.