A non-domiciled CDL is a commercial license a state issues to someone whose legal home is somewhere else. For most of its history, it existed for Mexican and Canadian drivers and for Americans living in the handful of places that don’t issue CDLs. Before September 2025, 49 CFR Part 383 let a state issue one to a foreign applicant who showed an unexpired Employment Authorization Document or a foreign passport with an I-94. The federal rule required the license to expire no later than the applicant’s authorized stay. States checked status through the federal SAVE system.
The system depended on each state reading federal immigration paperwork correctly, and audits since then show many didn’t.
When I wrote the original piece on Aug. 27, 2025, DOT had just announced funding threats against California, New Mexico and Washington over English proficiency enforcement, and the Harjinder Singh crash in Fort Pierce was two weeks old. The Trucksafe count of English violations nationally was in the low thousands a month. Secretary of State Marco Rubio had paused issuance of worker visas for commercial truck drivers on Aug. 21, 2025, covering H-2B, E-2 and EB-3 filings. Duffy had ordered an audit of non-domiciled CDL issuance in every state.
What the audit found
FMCSA’s 2025 Annual Program Reviews found non-domiciled CDLs improperly issued in California, Colorado, Pennsylvania, South Dakota, Texas and Washington, Duffy said at a September 2025 news conference. The most common problem was a license that ran months or years past the driver’s authorized stay. Some states issued standard CDLs to people who should have received non-domiciled ones, which strips the expiration safeguard out entirely.
California’s numbers were the largest. The state told DOT in October 2025 that about 20,000 of its non-domiciled CDLs had been issued with expiration dates past the holder’s legal stay, and argued that violated California law but not federal law. DOT said about 25% of the state’s non-domiciled licenses were improperly issued, including licenses to Mexican nationals who weren’t eligible for non-domiciled CDLs at all. In November 2025, California sent 60-day cancellation notices to about 17,000 holders, later adding about 3,000 more.
After the D.C. Circuit stayed FMCSA’s interim rule on Nov. 13, the state moved to restore the licenses, and in February 2026 a California state court ordered the DMV to let about 17,000 drivers keep or reapply for their credentials. In January 2026, FMCSA determined California had missed its Jan. 5 corrective action deadline and said it would withhold about $160 million starting Oct. 1, 2026. That’s separate from the roughly $40 million DOT pulled in 2025 over English enforcement. California challenged the $160 million in the D.C. Circuit, and the case was argued Sept. 11. The state isn’t issuing or reissuing non-domiciled CDLs under FMCSA’s directive, and existing licenses stay valid through their printed dates.
Washington’s Department of Licensing told Overdrive on Oct. 1, 2025, that it found 685 cases from Jan. 1, 2018, through Aug. 31, 2025, where a driver received a standard CDL instead of a non-domiciled one, including Singh. The department said all 685 were otherwise qualified. New York faces a $73.5 million withholding determination over its non-domiciled licenses. In North Carolina, an FMCSA sample audit in January 2026 found 54% of the non-domiciled CDLs reviewed were issued illegally; Duffy warned the state it could lose $48.7 million to $50 million, and the DMV canceled or downgraded 1,147 licenses, allowing it to resume issuing under the stricter rules. In Texas, NTSB documents released in March 2026 say DPS issued the driver in the March 2025 Austin crash that killed five people a standard CDL when federal rules called for a non-domiciled one.
What the rule did
FMCSA’s interim final rule of Sept. 29, 2025, at 90 Fed. Reg. 46,509, limited non-domiciled CDLs and learner’s permits to three nonimmigrant classes: H-2A agricultural workers, H-2B nonagricultural workers and E-2 treaty investors. Employment Authorization Documents stopped qualifying, which took asylum seekers, refugees, asylees, and Deferred Action for Childhood Arrivals recipients out of eligibility. The D.C. Circuit stayed it on Nov. 13. FMCSA issued a materially identical final rule on Feb. 13, 2026, effective March 16. It caps the license at one year or the end of lawful stay, requires “NON-DOMICILED” printed conspicuously on the card, requires renewed status checks and in-person visits for duplicates, address changes, and reinstatements, and tells states that can’t comply to stop issuing. FMCSA estimates about 194,000 current holders will age out of eligibility, roughly 30,000 to 40,000 a year at renewal.
The D.C. Circuit declined to stay the final rule on May 5 and heard the merits on Sept. 15.
The panel questioned whether the E-2 investor visa works as a proxy for a driving record and whether consular officers ever check driving history. Nineteen Florida non-domiciled holders filed a separate suit in the Southern District of Florida on April 15. The State Department has since resumed issuing some visas to commercial drivers, and Overdrive has reported signs of rising non-domiciled issuance to H-2 and E-2 holders.
What Dalilah’s Law would add
Section 3 of Dalilah’s Law writes the three-visa limit into 49 U.S.C. 31311(a)(12), requires states to confirm status through a system DOT designates before issuing, transferring, renewing, or upgrading, caps the card at one year or the end of the authorized stay, and requires states to produce issuance records within 48 hours of a federal request. Within a year of enactment, every state must audit its unexpired non-domiciled CDLs, revoke those that don’t comply, and report how many it issued and how many it revoked.
Section 4 rewrites 49 U.S.C. 31314. Current law lets DOT withhold funds and decertify a state CDL program, and each fight has been a separate negotiation, as California’s shows. The bill sets a schedule: up to 8% of a noncompliant state’s National Highway Performance Program, Highway Safety Improvement Program, and Congestion Mitigation and Air Quality apportionments in the first year of noncompliance, up to 12% in each year after, with the withheld money lost to the state. The effective date in the text is Oct. 1, 2026, the same day California’s $160 million withholding is set to start. The National Association of Counties has warned its members that county projects funded through those formula programs would take the hit for a state’s licensing decisions.
A statute also removes the E-2 argument from the Administrative Procedure Act. If the D.C. Circuit finds FMCSA’s E-2 reasoning arbitrary, the rule falls. If Congress writes the same line into law, the policy question stays open for Congress to fix, and the eligibility limit stands.
What changed in the rest of the original
My original piece walked through H-2B allocations to trucking, Minnesota’s Commercial Driver Academy and workforce grants, and state noncommercial license programs for undocumented residents. Some of it needs correcting. California’s AB 60 license and Minnesota’s Driver’s Licenses for All law cover non-commercial licenses. Neither makes anyone eligible for a CDL, which has always required federal status verification, so the link I drew between those programs and CDL issuance was wrong as written.
WIOA and state grant money that funds CDL training doesn’t screen for CDL eligibility, and that’s still true; under the final rule and Section 3, a trainee on an EAD would finish a funded course and still be unable to get the license.
The fair concession belongs here too. The Nov. 13 stay order said FMCSA’s own data appeared to show the drivers the rule excludes were involved in fatal crashes at a lower rate than those it keeps, and California’s filings argue the same. The audits found states issuing the wrong card and the wrong expiration date. They didn’t find that the drivers holding those cards crashed more. The case for Section 3 is a vetting case: states can’t pull a foreign driving record, and a U.S. license should rest on a record someone can check.
California, New York and North Carolina are the first states to learn what noncompliance costs under current law, one negotiation at a time. On Oct. 1, the date Congress wrote into Section 4, California is scheduled to start losing money anyway.