With the collapse of a fragile compromise proposal in the Senate to revamp federal immigration policy, a comprehensive bill looks dead on Capitol Hill for this year. Some suggest that narrower, enforcement-oriented legislation still has a chance of approval. But industry observers predict that if Congress doesn't act, states and municipalities could become more aggressive about passing their own immigration measures. That could force employers to contend with many varying requirements around the country. After supporters of the Senate immigration measure on June 28 fell 15 votes short of the 60 needed to end debate and move to a vote on the bill, Edward Kennedy (D-Mass.), a key architect of the proposal, said, "It's now clear that we are not going to complete our work on immigration reform." Congressional leaders say they have no plans to bring back the bill in the foreseeable future.

What's next? Sen. Lindsey Graham (R-S.C.) says, "I worry that local and state governments will begin to act more aggressively and create a hodge-podge of laws." Local measures may run the gamut from prohibiting landlords from renting apartments to immigrants without sufficient paperwork to punishing employers who hire undocumented workers. Many of the cities that have passed such laws, including Escondido, Calif., have faced lawsuits and public outcry from civil rights groups.

Kelly Knott, the Associated General Contractors' director of congressional relations for human resources and labor, worries that lawmakers now may try to take a piecemeal approach to passing enforcement-only measures. While groups like AGC advocate appropriate penalties for employers, they also want to see companies provided a system for ensuring that their workers are legal. "You need to give employers the tools," says Knott. "You can't just increase fines when they're already in a catch-22 situation." While many groups chided Congress for failing to pass comprehensive immigration legislation, just what would constitute a bill that most could live with is difficult to figure out. The AFL-CIO strongly opposes a temporary-worker program. "The guest-worker provision was something that really would have had a detrimental effect on the construction industry," says Tom Owens, director of communications for the AFL-CIO Building and Construction Trades Dept.

The Associated Builders & Contractors did not support the Senate bill's guest-worker provision. Brewster Bevis, ABC's director of legislative affairs, says, "Our craft a two-year program, and our journeyman program is a four-year. To bring somebody in, pay for all the training for two years, and then they have to leave immediately when they're done, that just doesn't make sense."