Having been slapped down previously for discriminating against nonresidents in making county and state hires, the state Legislature was careful in complying with legal standards in giving preference to Hawaii residents hired for local public works projects. A federal threat now against the state because of the new law requires clarification to satisfy those concerns.

The U.S. Department of Housing and Urban Development issued a bulletin this month warning the state and counties that laws favoring Hawaii residents for construction projects and companies with apprentice programs violates HUD rules.

The bulletin warns that HUD procurement prohibits "imposed in-state or local geographical preferences in the evaluation of bids or proposals."

Legislators this year say they were assured that a bill requiring at least 80 percent of workers on a state or county public works contract to be residents would be deemed legal. Several other states have similar laws with minimum resident-worker quotas ranging from 50 percent to 95 percent.

The U.S. Supreme Court ruled in 1984 that it did not violate the Constitution’s assurance of "all privileges and immunities of citizens in the several states" as long as a state could cite a "substantial reason for the difference in treatment."

Even so, Hawaii legislators included a clause that the 80 percent requirement would not be enforced if it was found to be "in conflict with any federal law" or it would result in disqualification of receiving federal aid.

The American Civil Liberties Union of Hawaii, which successfully obtained a federal judge’s 2006 invalidation of forbidding nonresidents from public employment, acknowledged that the 80-percent legislation could survive a legal challenge because of "the current economic climate."

Legislators rejected the ACLU’s suggestion that the legislation be temporary because of that reason.

The bill grew out of an $11 million Aloha Stadium renovation project awarded to a mainland company that hired all nonresidents. Former Sen. Robert Bunda, a co-sponsor of the bill, maintained that it would have pumped $800,000 into Hawaii’s economy if 80 percent of the workers had been residents.

In vetoing the bill, Gov. Linda Lingle rightly expressed concern about "an ill-defined, ambiguous and complex compliance structure for contractors and state and county agencies." She envisioned a contractor being puzzled about whether the quota of resident workers be applied every day, every month over the project’s duration.

In her veto message, Lingle also asserted that "the courts are divided" about the validity of states requiring the hire of residents in public works projects.

Legislators, who overrode Lingle’s veto, now should determine before convening in January how to bring the law into compliance with federal rules, if possible.