DOT Allows Use of Local Hire Preference on Highway and Transit Contracts

The U.S. Department of Transportation (DOT) announced a pilot program this week that will allow state and local governments to utilize local hiring preferences on their federal-aid highway and federal transit assisted contracts. The pilot program is effective immediately. In addition, DOT issued a notice of proposed rulemaking to alter Federal Highway Administration (FHWA) and Federal Transit Administration (FTA) regulations that will make these changes permanent. DOT has provided a 30-day comment period on these changes.

FHWA and FTA regulations have traditionally prohibited the use of local hire preferences because of their impact on competition; however, there have been efforts by some in Congress to allow the use of local preferences. A provision in last year’s transportation appropriations legislation allowed transit agencies to use local hiring requirements on FTA-funded projects for FY 2015.

AGC has opposed local hiring preferences in the past and will continue to do so. Comments will be submitted challenging the constitutional basis for this proposal.  In addition, AGC is reaching out to Congressional allies who oppose these local preferences, asking them to weigh in with DOT opposing the changes.  

For more information, please contact Brian Deery at or (703) 837-5319.