Preemption at Work: Federal Projects and the Limits of State Licensing
A recent federal decision in Louisiana reinforces the long‑established rule that state contractor licensing laws cannot apply to contractors or subcontractors working on federal projects, unless the federal government expressly requires it.
In United States of America, for the use and benefit of Timberline Construction Group, LLC v. APTIM Federal Services, LLC, et al., No. 24‑669, the Middle District of Louisiana denied the plaintiff’s motion for summary judgment on whether Florida’s state licensure law applied to a federal project in Lee County, Florida. Relying on over 70 years of precedent, the court held that subjecting federal contractors and subcontractors to state licensing requirements would improperly interfere with federal interests.
The case law on preemption of state licensing requirements is well established. In the seminal case, Leslie Miller v. Arkansas, 352 U.S. 187 (1956), the Supreme Court held that Arkansas’s licensing law did not apply to a contractor performing work on behalf of the federal government. The Court explained that allowing a state licensing board to evaluate contractor qualifications would give the state a “virtual power of review” over the federal government’s determination of contractor responsibility in violation of the Supremacy Clause.
Since then, courts have consistently applied Leslie Miller broadly. In Gartrell Construction, Inc. v. Aubry, 940 F.2d 437 (9th Cir.1991), the Ninth Circuit rejected the argument that state licensing laws avoid preemption simply because they are enforced after a contract is awarded. In Airport Constr’n & Materials v. Bivens, 279 Ark 161 (1983), the court found that Leslie Miller extended to federal subcontractors.
Against this backdrop, the court in Timberline rejected the argument that state licensing laws may be enforced against subcontractors on a federally controlled project on federally leased land. The court explained that under the Federal Acquisition Regulations, responsibility determinations for subcontractors ultimately remain within the federal government’s control, either directly or through the prime contractor. Thus, subcontractors performing work on federal projects fall squarely under the protection of Leslie Miller.
The court rejected the argument that land ownership is required for preemption. It noted that there is no meaningful distinction between federally owned and federally leased property when federal interests are at play. The key factor is that the work is being done for a federal project.
In sum, this district court decision confirms the principles announced in Leslie Miller continue to apply. State contractor licensing requirements are preempted for both contractors and subcontractors working on federal projects, regardless of whether the project is located on federally owned or leased land, unless the federal government explicitly states otherwise.
Please contact Nena Eddy, Anthony Gambino or any member of the Phelps Construction/Design team if you have questions or need advice or guidance.
