                  FOR PUBLICATION
  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

CHICANOS POR LA CAUSA, INC.;            
SOMOS AMERICA,
              Plaintiffs-Appellants,
               and
ARIZONA EMPLOYERS FOR
IMMIGRATION REFORM INC.;
CHAMBER OF COMMERCE OF THE
UNITED STATES; ARIZONA
CHAMBER OF COMMERCE; ARIZONA
HISPANIC CHAMBER OF COMMERCE;
ARIZONA FARM BUREAU
FEDERATION; ARIZONA                           No. 07-17272
RESTAURANT AND HOSPITALITY
ASSOCIATION; ASSOCIATED MINORITY               D.C. No.
                                            CV-07-01355-NVW
CONTRACTORS OF AMERICA; ARIZONA
ROOFING CONTRACTORS
ASSOCIATION; NATIONAL ROOFING
CONTRACTORS ASSOCIATION; WAKE
UP ARIZONA! INC.; ARIZONA
LANDSCAPE CONTRACTORS’
ASSOCIATION; ARIZONA
CONTRACTORS ASSOCIATION,
                          Plaintiffs,
                v.
JANET NAPOLITANO; TERRY GODDARD;
GALE GARRIOTT,
              Defendants-Appellees.
                                        



                            2891
2892                CPLC v. NAPOLITANO



CHICANOS POR LA CAUSA, INC.;            
SOMOS AMERICA,
                          Plaintiffs,
               and
ARIZONA EMPLOYERS FOR
IMMIGRATION REFORM INC.;
CHAMBER OF COMMERCE OF THE
UNITED STATES; ARIZONA
CHAMBER OF COMMERCE; ARIZONA
HISPANIC CHAMBER OF COMMERCE;
ARIZONA FARM BUREAU
FEDERATION; ARIZONA                           No. 07-17274
RESTAURANT AND HOSPITALITY
ASSOCIATION; ASSOCIATED MINORITY               D.C. No.
                                            CV-07-01355-NVW
CONTRACTORS OF AMERICA; ARIZONA
ROOFING CONTRACTORS
ASSOCIATION; NATIONAL ROOFING
CONTRACTORS ASSOCIATION; WAKE
UP ARIZONA! INC.; ARIZONA
LANDSCAPE CONTRACTORS’
ASSOCIATION; ARIZONA
CONTRACTORS ASSOCIATION,
              Plaintiffs-Appellants,
                v.
JANET NAPOLITANO; TERRY GODDARD;
GALE GARRIOTT,
              Defendants-Appellees.
                                        
                     CPLC v. NAPOLITANO     2893


ARIZONA CONTRACTORS                     
ASSOCIATION, INC.; ARIZONA
EMPLOYERS FOR IMMIGRATION
REFORM INC.; CHAMBER OF
COMMERCE OF THE UNITED STATES;
ARIZONA CHAMBER OF COMMERCE;
ARIZONA HISPANIC CHAMBER OF
COMMERCE INC.; ARIZONA FARM
BUREAU FEDERATION; ARIZONA
RESTAURANT AND HOSPITALITY
ASSOCIATION; ASSOCIATED MINORITY
CONTRACTORS OF AMERICA; ARIZONA
ROOFING CONTRACTORS
                                        
ASSOCIATION; NATIONAL ROOFING
CONTRACTORS ASSOCIATION;
ARIZONA LANDSCAPE CONTRACTORS’
ASSOCIATION,
              Plaintiffs-Appellants,
               and
WAKE UP ARIZONA! INC.; VALLE
DEL SOL INC.; CHICANOS POR LA
CAUSA, INC.; SOMOS AMERICA,
                          Plaintiffs,
                                        
2894               CPLC v. NAPOLITANO


                v.                   
CRISS CANDELARIA; ED
RHEINHEIMER; TERRENCE HANER;
DAISY FLORES; KENNY ANGLE;                 No. 08-15357
DEREK D. RAPIER; MARTIN
BRANNAN; ANDREW P. THOMAS;                   D.C. Nos.
MATTHEW J. SMITH; JAMES CURRIER;        CV-07-02496-NVW
BARBARA LAWALL; JAMES P.                 CV-07-02518-NVW
WALSH; GEORGE SILVA; SHEILA
POLK; JON SMITH; TERRY GODDARD;
FIDELIS V. GARCIA; GALE
GARRIOTT; MELVIN R. BOWERS Jr.,
             Defendants-Appellees.
                                     
                     CPLC v. NAPOLITANO     2895



ARIZONA CONTRACTORS                     
ASSOCIATION, INC.; ARIZONA
EMPLOYERS FOR IMMIGRATION
REFORM INC.; CHAMBER OF
COMMERCE OF THE UNITED STATES;
ARIZONA CHAMBER OF COMMERCE;
ARIZONA HISPANIC CHAMBER OF
COMMERCE INC.; ARIZONA FARM
BUREAU FEDERATION; ARIZONA
RESTAURANT AND HOSPITALITY
ASSOCIATION; ASSOCIATED MINORITY
CONTRACTORS OF AMERICA; ARIZONA
ROOFING CONTRACTORS                     
ASSOCIATION; NATIONAL ROOFING
CONTRACTORS ASSOCIATION;
ARIZONA LANDSCAPE CONTRACTORS’
ASSOCIATION,
                          Plaintiffs,
               and,
WAKE UP ARIZONA! INC.; VALLE
DEL SOL INC.; CHICANOS POR LA
CAUSA, INC.; SOMOS AMERICA,
              Plaintiffs-Appellants,
                v.
                                        
2896               CPLC v. NAPOLITANO


CRISS CANDELARIA; ED                 
RHEINHEIMER; TERRENCE HANER;
DAISY FLORES; KENNY ANGLE;
DEREK D. RAPIER; MARTIN                    No. 08-15359
BRANNAN; ANDREW P. THOMAS;
                                             D.C. Nos.
MATTHEW J. SMITH; JAMES CURRIER;
BARBARA LAWALL; JAMES P.                CV-07-02496-NVW
                                         CV-07-02518-NVW
WALSH; GEORGE SILVA; SHEILA
POLK; JON SMITH; TERRY GODDARD;
FIDELIS V. GARCIA; GALE
GARRIOTT; MELVIN R. BOWERS Jr.,
             Defendants-Appellees.
                                     
                     CPLC v. NAPOLITANO     2897


ARIZONA CONTRACTORS                     
ASSOCIATION, INC.; ARIZONA
EMPLOYERS FOR IMMIGRATION
REFORM INC.; CHAMBER OF
COMMERCE OF THE UNITED STATES;
ARIZONA CHAMBER OF COMMERCE;
ARIZONA HISPANIC CHAMBER OF
COMMERCE INC.; ARIZONA FARM
BUREAU FEDERATION; ARIZONA
RESTAURANT AND HOSPITALITY
ASSOCIATION; ASSOCIATED MINORITY
CONTRACTORS OF AMERICA; ARIZONA
ROOFING CONTRACTORS
ASSOCIATION; NATIONAL ROOFING
CONTRACTORS ASSOCIATION;
                                        
ARIZONA LANDSCAPE CONTRACTORS’
ASSOCIATION,
                          Plaintiffs,
VALLE DEL SOL INC.; CHICANOS
POR LA CAUSA, INC.; SOMOS
AMERICA,
                          Plaintiffs,
               and
WAKE UP ARIZONA! INC.,
                Plaintiff-Appellant,
                v.
                                        
2898                  CPLC v. NAPOLITANO


CRISS CANDELARIA; ED                   
RHEINHEIMER; TERRENCE HANER;
DAISY FLORES; KENNY ANGLE;                   No. 08-15360
DEREK D. RAPIER; MARTIN
                                               D.C. Nos.
BRANNAN; ANDREW P. THOMAS;
                                           CV-07-02496-NVW
MATTHEW J. SMITH; JAMES CURRIER;
BARBARA LAWALL; JAMES P.                  CV-07-02518-NVW
WALSH; GEORGE SILVA; SHEILA                  ORDER AND
POLK; JON SMITH; TERRY GODDARD;               AMENDED
FIDELIS V. GARCIA; GALE                        OPINION
GARRIOTT; MELVIN R. BOWERS Jr.,
             Defendant-Appellant.
                                       
        Appeal from the United States District Court
                 for the District of Arizona
          Neil V. Wake, District Judge, Presiding

                   Argued and Submitted
          June 12, 2008—San Francisco, California

                  Filed September 17, 2008
                  Amended March 9, 2009

   Before: Mary M. Schroeder, John M. Walker, Jr.,* and
             N. Randy Smith, Circuit Judges.

                 Opinion by Judge Schroeder




  *The Honorable John M. Walker, Jr., Senior United States Circuit
Judge for the Second Circuit, sitting by designation.
2900                CPLC v. NAPOLITANO




                        COUNSEL

Jonathan Weissglass, San Francisco, California, attorney for
plaintiffs/appellants.
                     CPLC v. NAPOLITANO                       2901
Mary O’Grady, Phoenix, Arizona, for the State defen-
dants/appellees.

Roger W. Hall, Phoenix, Arizona, for defendant/appellees,
Apache, Cochise, Gila, Graham, Greenlee, La Paz, Navajo,
Santa Cruz, and Yavapai Counties.

Daniel Jurkowitz, Tucson, Arizona, for defendant/appellee,
Pima County.


                          ORDER

  The Opinion filed on September 17, 2008, and appearing at
544 F.3d 976, is amended as follows: on slip Opinion page
13076, lines 21-22, change heading “B.” to read:

  B. The Act’s provisions mandating the use of E-Verify and
  creating potentially harsh sanctions are not impliedly pre-
  empted by federal law.

  The Opinion filed on September 17, 2008, and appearing at
544 F.3d 976, is further amended as follows: on slip Opinion
page 13078, line 14, insert the following text:

       Plaintiffs also argue that the Act’s potential sanc-
    tions of suspension or revocation of an employer’s
    business license impliedly conflict with IRCA
    because the Act’s sanctions are harsher than IRCA’s
    monetary sanctions. Plaintiffs urge that the harsh
    sanctions, even though expressly saved from express
    preemption, have the effect of encouraging employ-
    ers to discriminate, and that such an effect would
    conflict with IRCA’s purposes. Their argument is
    essentially speculative, as no complaint has yet been
    filed under the Act and we have before us no record
    reflecting the Act’s effect on employers. There is
2902                  CPLC v. NAPOLITANO
    thus no adequate basis in this record for holding that
    the sanctions provisions create an implied conflict
    rendering the Act facially invalid. See Crawford, 128
    S. Ct. at 1621-22.

  With these amendments, the panel judges have voted to
deny the petition for panel rehearing. Judges Schroeder and
N.R. Smith have voted to deny the petition for rehearing en
banc, and Judge Walker so recommends.

  The full court has been advised of the petition for rehearing
en banc and no judge has requested a vote on whether to
rehear the matter en banc. Fed. R. App. P. 35.

  The petition for rehearing and petition for rehearing en
banc are DENIED. No further petitions for rehearing or
rehearing en banc will be accepted.


                          OPINION

SCHROEDER, Circuit Judge:

   This case is a facial challenge to an Arizona state law,
enacted in 2007 and aimed at illegal immigration, that reflects
rising frustration with the United States Congress’s failure to
enact comprehensive immigration reform. The Arizona law,
called the Legal Arizona Workers Act, targets employers who
hire illegal aliens, and its principal sanction is the revocation
of state licenses to do business in Arizona. It has yet to be
enforced against any employer.

   Various business and civil-rights organizations (collec-
tively, “plaintiffs”) brought these actions against the fifteen
county attorneys of the state of Arizona, the Governor of Ari-
zona, the Arizona Attorney General, the Arizona Registrar of
Contractors, and the Director of the Department of Revenue
                      CPLC v. NAPOLITANO                     2903
of Arizona (collectively, “defendants”). Plaintiffs allege that
the Legal Arizona Workers Act (“the Act”), Ariz. Rev. Stat.
§§ 23-211 to 23-216, is expressly and impliedly preempted by
the federal Immigration Reform and Control Act of 1986
(“IRCA”), 8 U.S.C. §§ 1324a-1324b, and the Illegal Immigra-
tion Reform and Immigrant Responsibility Act of 1996
(“IIRIRA”), Pub. L. No. 104-208, 110 Stat. 3009 (1996), cod-
ified in various sections of 8 U.S.C. and 18 U.S.C. They also
allege that the Act violates employers’ rights to due process
by denying them an opportunity to challenge the federal
determination of the work-authorization status of their
employees before sanctions are imposed.

   The district court held that the law was not preempted. The
main argument on appeal is that the law is expressly pre-
empted by the federal immigration law provision preempting
state regulation “other than through licensing and similar
laws.” 8 U.S.C. § 1324a(h)(2). The district court correctly
determined that the Act was a “licensing” law within the
meaning of the federal provision and therefore was not
expressly preempted.

   There is also a secondary, implied preemption issue that
principally relates to the provision requiring employers to use
the electronic verification system now being refined by the
federal government as a tool to check the work-authorization
status of employees through federal records. It is known as E-
Verify. Under current federal immigration law, use of the sys-
tem is voluntary, and the Arizona law makes it mandatory.
We hold that such a requirement to use the federal verification
tool, for which there is no substitute under development in
either the state, federal, or private sectors, is not expressly or
impliedly preempted by federal policy.

   Plaintiffs also contend that the statute does not guarantee
employers an opportunity to be heard before their business
licenses may be revoked. The statute can and should be rea-
sonably interpreted to allow employers, before any license
2904                   CPLC v. NAPOLITANO
can be adversely affected, to present evidence to rebut the
presumption that an employee is unauthorized.

   We uphold the statute in all respects against this facial chal-
lenge, but we must observe that it is brought against a blank
factual background of enforcement and outside the context of
any particular case. If and when the statute is enforced, and
the factual background is developed, other challenges to the
Act as applied in any particular instance or manner will not
be controlled by our decision. See Crawford v. Marion
County Election Bd., ___ U.S. ___, 128 S. Ct. 1610, 1621
(2008) (describing heavy burden of persuasion to sustain a
broad attack on the facial validity of a statute in all its applica-
tions).

                          Background

   Sanctions for hiring unauthorized aliens were first created
at the federal level when Congress passed IRCA in 1986. See
Pub. L. No. 99-603, 100 Stat. 3359 (1986). IRCA prohibits
knowingly or intentionally hiring or continuing to employ an
unauthorized alien, 8 U.S.C. § 1324a(a), which it defines as
an alien either not lawfully admitted for permanent residence
or not authorized to be employed by IRCA or the U.S. Attor-
ney General, 8 U.S.C. § 1324a(h)(3).

   IRCA also sets out the method of demonstrating an
employer’s compliance with the law through a paper-based
method of verifying an employee’s eligibility, known as the
I-9 system. Id. § 1324a(b). It requires employees to attest to
their eligibility to work and to present one of the specified
identity documents. Id. § 1324a(b)(1), (2). IRCA then requires
employers to examine the identity document the employee
presents and attest that it appears to be genuine. Id.
§ 1324a(b)(1)(A). The employer is entitled to a defense to
sanctions if the employer shows good-faith compliance with
the I-9 system, unless the employer has engaged in a pattern
or practice of violations. Id. § 1324a(b)(6).
                     CPLC v. NAPOLITANO                   2905
   The Attorney General is charged with enforcing violations
of IRCA. Id. § 1324a(e). Hearings are held before selected
administrative law judges (“ALJs”), and the ALJs’ decisions
are reviewable by the federal courts. Id. § 1324a(e)(3).

   IRCA contains an express preemption provision, which
states: “The provisions of this section preempt any State or
local law imposing civil or criminal sanctions (other than
through licensing and similar laws) upon those who employ,
or recruit or refer for a fee for employment, unauthorized
aliens.” Id. § 1324a(h)(2). The scope of the savings clause,
which permits state “licensing and similar laws,” is a critical
issue in this appeal.

   IIRIRA directed the Attorney General to establish three
pilot programs to ensure efficient and accurate verification of
any new employee’s eligibility for employment. Pub. L. No.
104-208, §§ 401-405, 110 Stat. 3009, 3009-655 to 3009-666.
One of these programs, the Basic Pilot Program, was to be
made available in at least five of the seven states with the
highest estimated populations of aliens not lawfully present in
the United States. Id. § 401(c), 110 Stat. at 3009-656. Con-
gress amended IIRIRA in 2002 by extending the four-year
period for the pilot programs to a six-year period, see Basic
Pilot Extension Act of 2001, Pub. L. No. 107-128, § 2, 115
Stat. 2407, 2407 (2002), and again in 2003 by extending the
six-year period to an eleven-year period, see Basic Pilot Pro-
gram Extension and Expansion Act of 2003 (“Expansion
Act”), Pub. L. No. 108-156, § 2, 117 Stat. 1944, 1944 (2003).
The Basic Pilot Program has thus been extended until Novem-
ber 2008. The Expansion Act also expanded the availability
of the Basic Pilot Program to all fifty states. See id. § 3.

   The Basic Pilot Program, now known as E-Verify, is an
internet-based system that allows an employer to verify an
employee’s work-authorization status. It is an alternative to
the I-9 system. After an employer submits a verification
request for an employee, E-Verify either issues a confirmation
2906                 CPLC v. NAPOLITANO
or a tentative nonconfirmation of work-authorization status. If
a tentative nonconfirmation is issued, the employer must
notify the employee, who has eight days to challenge the find-
ing. The employer cannot take any adverse action against the
employee during that time. If an employee does challenge the
tentative nonconfirmation, the employer will be informed of
the employee’s final work-authorization status. Any employee
who either does not challenge a tentative nonconfirmation or
is unsuccessful in challenging a tentative nonconfirmation
must be terminated, or the employer must notify the Depart-
ment of Homeland Security (“DHS”) that it will continue to
employ that person. An employer who fails to notify DHS of
the continued employment of a person who received a final
nonconfirmation is subject to a civil money penalty. An
employer who continues to employ a person after receiving a
final nonconfirmation is subject to a rebuttable presumption
that it knowingly employed an unauthorized alien.

   Against this federal backdrop, we turn to the state law at
issue here. Arizona enacted the Legal Arizona Workers Act
on July 2, 2007, with an effective date of January 1, 2008.
2007 Ariz. Sess. Laws Ch. 279. The Act allows the superior
courts of Arizona to suspend or revoke the business licenses
of employers who knowingly or intentionally hire unautho-
rized aliens. Ariz. Rev. Stat. § 23-212. Any person may sub-
mit a complaint to the Arizona Attorney General or a county
attorney. Id. § 23-212(B). After determining a complaint is
not false or frivolous, the appropriate county attorney is
charged with bringing an action against the employer in supe-
rior court. Id. § 23-212(C), (D). The Act uses IRCA’s defini-
tion of “unauthorized alien.” See id. § 23-211(11).
Additionally, the Act requires that the court use the federal
government’s determination of the employee’s lawful status.
Id. § 23-212(H).

  The Act makes participation in E-Verify mandatory for all
employers, although it provides no penalty for violation of the
requirement. See id. § 23-214(A). The Act also includes an
                      CPLC v. NAPOLITANO                    2907
affirmative defense for good-faith compliance, explicitly
incorporating IRCA. See id. § 23-212(J).

   The Act mandates a graduated series of sanctions for viola-
tions. A first violation requires the employer to terminate the
employment of all unauthorized aliens, file quarterly reports
of all new hires for a probationary period, and file an affidavit
stating that it terminated all unauthorized aliens and will not
intentionally or knowingly hire any others. Id. §§ 23-212(F)-
212.01(F). A second violation during the probationary period
results in the permanent revocation of the employer’s business
license. Id. §§ 23-212(F)(2), (3), 23-212.01(F)(2), (3).

   Plaintiffs originally filed an action challenging the Act on
July 13, 2007, less than one month after the Act’s enactment.
The district court dismissed the first action for lack of subject
matter jurisdiction because it did not name as defendants any
of Arizona’s county attorneys, who have the responsibility of
enforcing the Act.

   In December 2007, plaintiffs filed a second complaint, this
time including the Arizona county attorneys as defendants.
The principal contentions were that the Act was expressly
preempted by federal law because the Act was not a “licens-
ing” or “similar” law within the meaning of the savings clause
of IRCA’s preemption provision; that, even if the Act was not
expressly preempted, it was impliedly preempted because its
sanctions provisions and E-Verify requirement conflict with
federal law; and that the Act violated employers’ due process
rights because it did not allow them an adequate opportunity
to dispute the federal government’s response that an employee
was not authorized to work.

   The matter proceeded to hearing, and the district court dis-
missed the Arizona Attorney General for lack of subject mat-
ter jurisdiction, because he lacks the authority to bring
enforcement actions. The court ruled in favor of the remaining
defendants on the merits. It held that the Act is not expressly
2908                 CPLC v. NAPOLITANO
preempted by IRCA because the Act is a licensing law within
the meaning of the savings clause. It held that neither the
Act’s sanctions provisions, nor the provision mandating use
of E-Verify, was inconsistent with federal policy, and thus
they were not impliedly preempted. Finally, the court held
that the Act did not, on its face, violate due process because
employers’ due process rights were adequately protected.
Plaintiffs now appeal.

                          Discussion

I.   Preemption

   Federal preemption can be either express or implied. See
Fid. Fed. Sav. & Loan Ass’n v. de la Cuesta, 458 U.S. 141,
152-53 (1982). When a federal statute contains an explicit
preemption provision, we are to “ ‘identify the domain
expressly pre-empted’ by that language.” Medtronic, Inc. v.
Lohr, 518 U.S. 470, 484 (1996) (quoting Cipollone v. Liggett
Group, Inc., 505 U.S. 504, 517 (1992)). IRCA contains an
express preemption clause in its provision creating sanctions
for hiring unauthorized aliens. It preempts all state sanctions
“other than through licensing and similar laws.” 8 U.S.C.
§ 1324a(h)(2). Plaintiffs contend that the Act is expressly pre-
empted.

   Implied preemption has two subcategories. See Lorillard
Tobacco Co. v. Reilly, 533 U.S. 525, 541 (2001). The first is
field preemption, where “the depth and breadth of a congres-
sional scheme . . . occupies the legislative field.” Id. (citing
Fid. Fed. Sav., 458 U.S. at 153). The second is conflict pre-
emption, which occurs when either “ ‘compliance with both
federal and state regulations is a physical impossibility,’ ”
Fid. Fed. Sav., 458 U.S. at 152 (quoting Fla. Lime & Avocado
Growers, Inc., 373 U.S. 132, 142-43 (1963)), or where “state
law stands as an obstacle to the accomplishment and execu-
tion of the full purposes and objectives of Congress,” id.
(internal quotation marks omitted) (quoting Hines v. David-
                     CPLC v. NAPOLITANO                    2909
owitz, 312 U.S. 52, 67 (1941)). For conflict preemption to
apply, the conflict must be an actual conflict, not merely a
hypothetical or potential conflict. See English v. Gen. Elec.
Co., 496 U.S. 72, 89 (1990). Plaintiffs contend that even if the
entire Act is not expressly preempted, the mandatory require-
ment to use E-Verify is impliedly preempted because it con-
flicts with the voluntary program in IIRIRA.

  A. The Act is not expressly preempted because it falls
  within IRCA’s savings clause.

   [1] The explicit preemption provision in IRCA states: “The
provisions of this section preempt any State or local law
imposing civil or criminal sanctions (other than through
licensing and similar laws) upon those who employ, or recruit
or refer for a fee for employment, unauthorized aliens.” 8
U.S.C. § 1324a(h)(2). The parties agree that the Act is
expressly preempted by IRCA unless it falls within the sav-
ings clause of IRCA’s express preemption provision. Plain-
tiffs argue that the Act does not fall within the savings clause
because they contend the Act is not a “licensing law” within
the ordinary meaning of the phrase, and that the savings
clause was not intended to permit a state to create an adjudi-
cation and enforcement system independent of federal
enforcement of IRCA violations.

   The district court held that the plain language of section
1324a(h)(2) does not facially preempt the Act because it does
no more than impose conditions on state licenses to do busi-
ness and thus falls within the savings clause. Ariz. Contrac-
tors Ass’n v. Candelaria, 534 F. Supp. 2d 1036, 1046-47 (D.
Ariz. 2008). The court rejected plaintiffs’ argument that sec-
tion 1324a(h)(2) permits only licensing sanctions that are pre-
ceded by a federal adjudication of employer liability,
reasoning that neither the plain language of section
1324a(h)(2) nor the legislative history supports plaintiffs’
position. Id. at 1046-48.
2910                  CPLC v. NAPOLITANO
   [2] The district court also rejected plaintiffs’ argument that
the savings clause should be interpreted narrowly, holding
that because regulation in the employment field is tradition-
ally an area of state concern, there is a presumption against
preemption. Id. at 1050-52. An issue central to our preemp-
tion analysis is thus whether the subject matter of the state
law is in an area of traditionally state or federal presence.
When Congress legislates “in a field which the States have
traditionally occupied . . . . we start with the assumption that
the historic police powers of the States were not to be super-
seded by the Federal Act unless that was the clear and mani-
fest purpose of Congress.” United States v. Locke, 529 U.S.
89, 108 (2000) (internal quotation marks omitted) (quoting
Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947)).
Conversely, we do not assume non-preemption “when the
State regulates in an area where there has been a history of
significant federal presence.” Id.

   [3] A leading case involving the employment of illegal
aliens is De Canas v. Bica, 424 U.S. 351 (1976). The
Supreme Court there upheld a state law prohibiting the
employment of unauthorized aliens against a preemption chal-
lenge because it concluded that the authority to regulate the
employment of unauthorized workers is “within the main-
stream” of the state’s police powers. Id. at 356, 365. The
Court reasoned that “the fact that aliens are the subject of a
state statute does not render it a regulation of immigration,
which is essentially a determination of who should or should
not be admitted into the country, and the conditions under
which a legal entrant may remain.” Id. at 355.

   [4] Plaintiffs argue that reliance on De Canas is now mis-
placed because IRCA, passed after De Canas, brought the
regulation of unauthorized employees within the scope of fed-
eral immigration law. They rely on language in a later case
where the Court said that IRCA made the employment of
unauthorized workers “central to ‘[t]he policy of immigration
law.’ ” Hoffman Plastic Compounds, Inc. v. NLRB, 535 U.S.
                      CPLC v. NAPOLITANO                    2911
137, 147 (2002) (quoting INS v. Nat’l Ctr. for Immigrants’
Rights, Inc., 502 U.S. 183, 194 & n.8 (1991)) (alteration in
original). That case, however, did not involve preemption, or
indeed any state regulation. It considered whether the
National Labor Relations Board (“NLRB”) could award back-
pay to an unauthorized worker, and the Court held it could
not. The Court said that the NLRB had impermissibly
“trench[ed] upon federal statutes and policies unrelated to the
[National Labor Relations Act]” by awarding backpay to an
unauthorized alien worker who was improperly terminated
from his employment for participating in union-related activi-
ties. Id. at 140, 141, 144. Because it did not concern state law
or the issue of preemption, Hoffman did not affect the contin-
uing vitality of De Canas. We conclude that, because the
power to regulate the employment of unauthorized aliens
remains within the states’ historic police powers, an assump-
tion of non-preemption applies here.

   Plaintiffs contend that the term “license” was intended to
encompass only licenses to engage in specific professions,
such as medicine or law, and not licenses to conduct business.
There is no support for such an interpretation. “Licensing”
generally refers to “[a] governmental body’s process of issu-
ing a license,” Black’s Law Dictionary 940 (8th ed. 2004),
and a “license” is “a permission, usually revocable, to commit
some act that would otherwise be unlawful,” id. at 938. The
Act provides for the suspension of employers’ licenses to do
business in the state. See Ariz. Rev. Stat. § 23-212(F). Such
licenses are defined as “any agency permit, certificate,
approval, registration, charter or similar form of authorization
that is required by law and that is issued by any agency for
the purposes of operating a business in this state.” Id. § 23-
211(9)(a). The statute’s broad definition of “license” is in line
with the terms traditionally used and falls within the savings
clause. The language of the savings clause therefore exempts
such state licensing regulation from express preemption. A
recent district court case that considered the same issue
reached the same conclusion. See Gray v. City of Valley Park,
2912                 CPLC v. NAPOLITANO
No. 4:07CV00881 ERW, 2008 WL 294294, at *8, 10, 12
(E.D. Mo. Jan. 31, 2008) (holding that city ordinance govern-
ing issuance and denial of business permits fell within mean-
ing of savings clause). But see Lozano v. City of Hazleton,
496 F. Supp. 2d 477, 519-21 (M.D. Pa. 2007) (concluding that
state law prohibiting employment of illegal aliens was
expressly preempted by IRCA).

   Plaintiffs nevertheless contend that the legislative history
demonstrates that Congress intended the savings clause to
permit states to impose a state sanction only after there had
been a federal determination of an alien’s unauthorized status.
Plaintiffs rely on the second sentence in a paragraph from Part
I of House Report 99-682, which as a whole states:

       The penalties contained in this legislation are
    intended to specifically preempt any state or local
    laws providing civil fines and/or criminal sanctions
    on the hiring, recruitment or referral of undocu-
    mented aliens. They are not intended to preempt or
    prevent lawful state or local processes concerning
    the suspension, revocation or refusal to reissue a
    license to any person who has been found to have
    violated the sanctions provisions in this legislation.
    Further, the Committee does not intend to preempt
    licensing or “fitness to do business laws,” such as
    state farm labor contractor laws or forestry laws,
    which specifically require such licensee or contractor
    to refrain from hiring, recruiting or referring undocu-
    mented aliens.

H.R. Rep. No. 99-682(i), at 58 (1986) as reprinted in 1986
U.S.C.C.A.N. 5649, 5662. As the district court found, how-
ever, this paragraph as a whole does not support plaintiffs’
argument. The paragraph describes the federal law as pre-
empting “civil fines and/or criminal sanctions,” neither of
which the Act imposes. The paragraph does not suggest that
the federal law would preempt local laws that suspend or
                     CPLC v. NAPOLITANO                    2913
revoke licenses on the basis of IRCA violations, or state
licensing laws that require employers not to hire unauthorized
workers. As the district court concluded, plaintiffs’ reading of
the second sentence, as permitting enforcement only of state
licensing regulations conditioned on federally adjudicated
violations, is contradicted by the third sentence, which recog-
nizes states can condition an employer’s “fitness to do busi-
ness” on hiring documented workers. That is what the
Arizona Act does.

   [5] In sum, the Act does not attempt to define who is eligi-
ble or ineligible to work under our immigration laws. It is
premised on enforcement of federal standards as embodied in
federal immigration law. The district court therefore correctly
held that the Act is a “licensing” measure that falls within the
savings clause of IRCA’s preemption provision.

   Plaintiffs finally contend that this kind of state regulation
must be preempted because there is a potential for conflict in
the practical operation of the state and federal law. They point
to a hypothetical situation in which an employer may be sub-
ject to conflicting rulings from state and federal tribunals on
the basis of the same hiring situation. Whether principles of
comity or issue preclusion would allow such a result are ques-
tions not addressed by the parties. In any event, a speculative,
hypothetical possibility does not provide an adequate basis to
sustain a facial challenge. See Crawford, 128 S. Ct. at 1621.

  B. The Act’s provisions mandating the use of E-Verify and
  creating potentially harsh sanctions are not impliedly pre-
  empted by federal law.

   Plaintiffs argue that the Arizona provision mandating the
use of E-Verify is impliedly preempted because it conflicts
with Congressional intent to keep the use voluntary. They
contend that Congress wanted to develop a reliable and non-
burdensome system of work-authorization verification, and
that mandatory use of E-Verify impedes that purpose. They
2914                 CPLC v. NAPOLITANO
rely on the Supreme Court’s decision in Geier v. Am. Honda
Motor Co., 529 U.S. 861 (2000). Geier recognized that state
laws that fall within a savings clause and are therefore not
expressly preempted are still subject to the “ordinary working
of conflict pre-emption principles.” Id. at 869. A state law is
preempted through conflict preemption when it “ ‘stands as an
obstacle to the accomplishment and execution of the full pur-
poses and objectives of Congress.’ ” Id. at 873 (quoting
Hines, 312 U.S. at 67). Geier involved a Department of
Transportation regulation that was designed to encourage
competition among automobile manufacturers to design effec-
tive and convenient passive-restraint systems. The regulation
required only 10% of a car manufacturer’s production to
include airbags. The Court in Geier held that state tort law,
permitting liability to be imposed for failure to provide air-
bags, conflicted with the federal policy to encourage develop-
ment of different restraint systems. Id. at 886.

   [6] The district court here held that Arizona’s requirement
that employers use E-Verify was not preempted because,
while Congress made participation in E-Verify voluntary at
the national level, that did not in and of itself indicate that
Congress intended to prevent states from making participation
mandatory. Ariz. Contractors, 534 F. Supp. 2d at 1055-56.
We agree with that holding. Congress could have, but did not,
expressly forbid state laws from requiring E-Verify participa-
tion. It certainly knew how to do so because, at the same time,
it did expressly forbid “any State or local law imposing civil
or criminal sanctions (other than through licensing and similar
laws) upon those who employ, or recruit or refer for a fee for
employment, unauthorized aliens.” 8 U.S.C. § 1324a(h)(2).

   [7] Furthermore, this case is unlike Geier, where the
Supreme Court found strong evidence of Congress’s intent to
promote competition and balance federal goals in a competi-
tive environment encouraging alternative systems. Here, E-
Verify is a federal government service that Congress has
implicitly strongly encouraged by expanding its duration and
                     CPLC v. NAPOLITANO                   2915
its availability (to all fifty states). See Basic Pilot Program
Extension and Expansion Act of 2003, Pub. L. No. 108-156,
117 Stat. 1944, 1944; Basic Pilot Extension Act of 2001, Pub.
L. No. 107-128, sec. 2, 115 Stat. 2407, 2407. Though Con-
gress did not mandate E-Verify, Congress plainly envisioned
and endorsed an increase in its usage. The Act’s requirement
that employers participate in E-Verify is consistent with and
furthers this purpose, and thus does not raise conflict preemp-
tion concerns.

   Appellants contend that conflict preemption is a concern
here also because of the Act’s potentially discriminatory
effects. Their argument is that E-Verify increases discrimina-
tion against workers who look or sound “foreign,” and that
mandatory E-Verify usage thus upsets the enforcement/
discrimination balance that Congress has maintained by keep-
ing E-Verify optional. This argument fails because Congress
requires employers to use either E-Verify or I-9, and appel-
lants have not shown that E-Verify results in any greater dis-
crimination than I-9.

   Plaintiffs also argue that the Act’s potential sanctions of
suspension or revocation of an employer’s business license
impliedly conflict with IRCA because the Act’s sanctions are
harsher than IRCA’s monetary sanctions. Plaintiffs urge that
the harsh sanctions, even though expressly saved from
express preemption, have the effect of encouraging employers
to discriminate, and that such an effect would conflict with
IRCA’s purposes. Their argument is essentially speculative,
as no complaint has yet been filed under the Act and we have
before us no record reflecting the Act’s effect on employers.
There is thus no adequate basis in this record for holding that
the sanctions provisions create an implied conflict rendering
the Act facially invalid. See Crawford,128 S. Ct. at 1621-22.

II.   Due Process

  The deprivation of a property interest must “ ‘be preceded
by notice and opportunity for hearing appropriate to the
2916                 CPLC v. NAPOLITANO
nature of the case.’ ” Cleveland Bd. of Educ. v. Loudermill,
470 U.S. 532, 542 (1985) (quoting Mullane v. Cent. Hanover
Bank & Trust Co., 339 U.S. 306, 313 (1950)). An Arizona
business license is a property interest. See, e.g., Comeau v.
Ariz. State Bd. of Dental Exam’rs, 993 P.2d 1066, 1070 (Ariz.
Ct. App. 1999). An opportunity to be heard must be “ ‘at a
meaningful time and in a meaningful manner.’ ” Mathews v.
Eldridge, 424 U.S. 319, 333 (1976) (quoting Armstrong v.
Manzo, 380 U.S. 545, 552 (1965)). Employers thus should be
given an opportunity to be heard before their business licenses
are suspended or revoked under the Act.

   The Act sets forth the procedures to be followed in bringing
an enforcement action. Any person may submit a complaint
about a suspected violation to either the Arizona Attorney
General or a county attorney. Ariz. Rev. Stat. § 23-212(B).
The Attorney General or county attorney investigating a com-
plaint must verify the alleged unauthorized alien’s work-
authorization status with the federal government pursuant to
8 U.S.C. § 1373; the state official is prohibited from attempt-
ing to make an independent determination of the alien’s sta-
tus. Id. After a complaint is investigated and found not to be
false or frivolous, a county attorney must bring an enforce-
ment action against the employer in state court in the county
in which the alien was employed. Id. § 23-212(C), (D). The
court is to expedite the action, which includes scheduling the
hearing as quickly as is practicable. Id. § 23-212(E).

  Subsection (H) of section 212 describes the state court’s
procedures to obtain information from the federal government
on whether an alien was unauthorized to work:

    On [sic] determining whether an employee is an
    unauthorized alien, the court shall consider only the
    federal government’s determination pursuant to 8
    United States Code § 1373(c). The federal govern-
    ment’s determination creates a rebuttable presump-
    tion of the employee’s lawful status. The court may
                      CPLC v. NAPOLITANO                      2917
    take judicial notice of the federal government’s
    determination and may request the federal govern-
    ment to provide automated or testimonial verifica-
    tion pursuant to 8 United States Code § 1373(c). Id.
    § 23-212(H). Section 1373(c) of title 8 of the U.S.
    Code provides that the Immigration and Naturaliza-
    tion Service “shall respond to an inquiry by a Fed-
    eral, State, or local government agency, seeking to
    verify or ascertain the citizenship or immigration sta-
    tus of any individual within the jurisdiction of the
    agency for any purpose authorized by law, by pro-
    viding the requested verification or status informa-
    tion.” 8 U.S.C. § 1373(c).

   Plaintiffs contend, in this facial challenge, that the Act vio-
lates due process because it deprives employers of their busi-
ness licenses without providing them an adequate opportunity
to dispute whether an employee was authorized to work.
Plaintiffs rely on the first sentence of subsection (H) to argue
that the Act prohibits employers at the state-court hearing
from presenting any evidence to rebut the federal govern-
ment’s § 1373 response on the issue of the employee’s work
status. Defendants, however, point to the second sentence of
subsection (H), which provides that the federal response
creates only a rebuttable presumption. They contend that the
employer can rebut the federal response with other evidence
during a hearing.

   [8] Plaintiffs’ interpretation of subsection (H) is flawed
because it gives no meaning to the second sentence of the pro-
vision. That sentence at least implicitly contemplates a hear-
ing to rebut the presumption created by the federal
determination of an employee’s unauthorized status. See Ariz.
Rev. Stat. § 23-212(H). Arizona law, consistent with ordinary
principles of statutory interpretation, requires that “ ‘[e]ach
word, phrase, clause, and sentence [of a statute] must be given
meaning so that no part will be void, inert, redundant, or trivi-
al.’ ” Williams v. Thude, 934 P.2d 1349, 1351 (Ariz. 1997)
2918                  CPLC v. NAPOLITANO
(second alteration in original) (emphasis omitted) (quoting
City of Phoenix v. Yates, 208 P.2d 1147, 1149 (Ariz. 1949)).
We conclude that the statute provides an employer the oppor-
tunity, during the state court proceeding, to present rebuttal
evidence.

   Furthermore, defendants explain any apparent incongruity
between the first two sentences of subsection (H) by pointing
to parallel language found in an earlier subsection, subsection
(B), which relates to the initial investigation of a complaint:

    When investigating a complaint, the attorney general
    or county attorney shall verify the work authoriza-
    tion of the alleged unauthorized alien with the fed-
    eral government pursuant to 8 United States Code
    § 1373(c). A state, county or local official shall not
    attempt to independently make a final determination
    on whether an alien is authorized to work in the
    United States.

Ariz. Rev. Stat. § 23-212(B). Defendants explain that this sec-
tion, like the first sentence of subsection (H), provides, some-
what inartfully, that the initial investigation and the basis for
bringing an enforcement action must be limited to the federal
response, thereby precluding independent state investigation.
The employer would then have the opportunity to present evi-
dence. The district court agreed. The district court persua-
sively reasoned that requiring the state or county to obtain a
federal determination of an employee’s work status before
bringing proceedings may be intended to protect employees
from direct investigation by the state.

   [9] We therefore conclude that the district court correctly
determined that the Act provides sufficient process to survive
this facial challenge. More importantly, the district court also
found that the statute does not preclude the presentation of
counterevidence when an employer’s liability is at issue, Ariz.
Contractors, 534 F. Supp. 2d at 1058, and we agree with this
                     CPLC v. NAPOLITANO                  2919
interpretation. An employer’s opportunity to present evidence
at a hearing in superior court, in order to rebut the presump-
tion of the employee’s unauthorized status, provides the
employer a meaningful opportunity to be heard before sanc-
tions are imposed. We conclude that subsection (H) is facially
constitutional.

  The district court’s judgment is AFFIRMED.
