Ind. Code § 8-23-9-23

Sec. 23. It must be a condition of every contract let by the department for the construction of a state highway or bridge that all unskilled laborers employed on the work be residents of the county or counties in which the highway or bridge is being constructed if the labor is available. The department may designate the class of labor that is unskilled. However, if this subsection is in violation of a regulation of a federal authority, the provision may be eliminated from a contract that is payable in whole or in part with federal funds.