Mayor Kurt L. Schmoke announced yesterday that he has organized a special investigative team to examine the employment records of contractors working on construction projects in Baltimore to crack down on the hiring of illegal immigrants.

Last week, 13 illegal aliens were arrested at a construction site in Mount Vernon, and union leaders have told Mr. Schmoke that such workers are forcing legitimate contractors out of work.

"We are concerned about unscrupulous contractors coming in and low-balling us because they can hire people for very low wages, and they work from sunup to sundown without overtime," said William P. Kaczorowski, president of the Baltimore Building Trades Council. "We can't compete with those rates."

"I have heard that the problem is becoming larger and larger," Mr. Schmoke said. "There are too many people in our city who are out of work for these contractors to bring in illegal workers."

To combat the practice, Mr. Schmoke created a team to be led by the city solicitor's office and consists of investigators from the Public Works Department and the Wage Commission. Mr. Schmoke said the investigators will go unannounced to various construction sites -- particularly those involving publicly funded projects -- to review citizenship documentation for workers.

If violations are discovered, the mayor said, the investigators would turn over the information to the Immigration and Naturalization Service. INS officials say illegal aliens are a significant problem in Baltimore. They say contractors who hire illegal aliens risk severe fines and some are ordered by an administrative law judge to show their hiring records on future jobs.

Mr. Kaczorowski thinks the penalties should be tougher.

"There should be some type of regulation that if the contractor is found to be in violation, they should not be able to bid on future projects," he said. "The contractors know no one is going to bother them, and that if they get caught they are going to get a slap on the wrist."