"What license do I need?" is one of the first questions new federal contractors ask — usually after a salesperson told them they need one. The honest answer is narrower than the sales pitch — and more useful.
The general rule
Federal contracts are governed by federal rules, not state licensing boards. The federal “responsibility” determination that decides who gets an award is set by FAR Part 9 (the Federal Acquisition Regulation), and it does not require a state contractor’s license. The government cares about your registrations (UEI, SAM.gov, CAGE), your past performance, and your responsibility determination.
No blanket exemption
There is no blanket federal rule that wipes out state licensing. State contractor-licensing statutes and state trade licenses (electrical, plumbing, HVAC, engineering) can still apply depending on the state, the location of the work, and the specific trade. West Virginia’s contractor-licensing law is the example most often cited for federal construction work in that state — and the state’s licensing statute has been reorganized in recent years, so treat any “one state” shortcut as something to re-verify against the current official code before you rely on it.
The practical rule: before you bid, confirm the licensing rules for the state where the work will actually be performed. Your federal registrations cover the federal side; they do not answer the state question for you.
For construction, the duty is explicit: FAR 52.236-7 (Permits and Responsibilities) requires the contractor to comply with all applicable licenses, permits, and law. So it is never a blanket "no license" — the real question is which licenses apply to the state and the work.
What you might actually need: clearances
Security clearances sometimes. Federal work takes you places: an NSA facility where the crew worked the back side of a mountain building while armed guards watched and everything was videoed; nuclear missile silos where contractors work on one side of a steel wall while the people with the keys work on the other. Those jobs require site-specific clearances and escorted access — the government handles the process, but it takes time and clean backgrounds. They also pay accordingly: clearance work has a built-in moat of fewer competitors.
The practical checklist
- Get your UEI, register in SAM, and let the CAGE code assign itself.
- Before you bid, check the state where the work happens for any contractor or trade license requirement.
- If you want clearance work, start the conversation early — the process is slow and site-specific.
- Don't let a license salesman scare you into paperwork you don't need. Anyone charging to "register you in SAM" is charging for a free form.