Say you’re a Latino living in Arizona, who has a “contact” with the police. They think you may be an illegal alien, and ask for your identification. Turns out, there’s no law requiring any citizen to actually possess or carry identification with them. What’s the next step for the police?
Oh, and by the way, police have always been allowed to check the immigration status of suspects, this just allows them to check the status of other people who have “contact” with the police.