Cruz, Cantwell Still at Odds on AI Moratorium and BEAD Funding
Cantwell said a new amendment could still condition all $42.45 billion on complying, which Cruz continued to deny.
WASHINGTON, June 30, 2025 – Sens. Ted Cruz, R-Texas, and Maria Cantwell, D-Wash., are still at odds over whether the Republican budget bill’s moratorium on state artificial intelligence regulations would be a condition for $42.45 billion in broadband funding. Senators are currently undertaking a marathon vote on proposed amendments as the GOP eyes a self-imposed July 4 deadline for getting both chambers of Congress to clear the package.
Cruz and Sen. Marsha Blackburn, R-Tenn., who had opposed the AI moratorium, reached a deal on an amendment that would allow states to enforce laws related to children’s safety online and protecting people’s names, images, and likenesses, so long as they did not impose an “undue or disproportionate burden” on AI systems. The Senate would still have to approve the measure.
The moratorium, down to five years from ten after previous revisions, is tied to $500 million in new funding for AI development under the Broadband Equity, Access, and Deployment program. States that want the extra funding would have to comply with the moratorium.
FROM SPEEDING BEAD SUMMIT
Panel 1: How Are States Thinking About Reasonable Costs Now?
Panel 2: Finding the State Versus Federal Balance in BEAD
Panel 3: Reacting to the New BEAD NOFO Guidance
Panel 4: Building, Maintaining and Adopting Digital Workforce Skills
Cantwell, the top Democrat on the Senate Commerce Committee, which Cruz leads, argued that the whole of the program’s funding could ultimately be tied to complying with the AI regulation ban.
“This amendment allows Secretary of Commerce Howard Lutnick to force states to take the $500 million as part of a new allocation of BEAD funds under the formula versus allowing states to apply voluntarily,” Cantwell’s office said in a release. “He will have the ability to deny funding unless a State accepts the new funding and includes it in its broadband plan, that the Secretary must approve.”
Cruz’s office has maintained that taking the funding would be voluntary, and that states could only potentially have BEAD funding rescinded if they took the extra money. The office said Monday that the amendment was no different in that respect and Cantwell’s office was “still wrong.”
All BEAD funding has already been obligated to states and territories, but they need to get federal approval before using the money on broadband deployment. The existing language and amendment would allow the Commerce Department to de-obligate a state’s money if the state were obligated any of the new funding and violated the moratorium.
States are currently hustling to update their maps and run an additional round of bidding under new rules commerce handed down earlier this month. New final spending plans are due at the agency by Sept. 4.
Blackburn’s office did not immediately respond to a request for comment.
Spectrum, Byrd rule
The Senate parliamentarian affirmed Friday that the existing AI provision passed muster under the Byrd rule, which requires budget reconciliation bills to contain only items that relate directly to spending and revenue.
Some parts of the spectrum auction language in the bill had to be reworked to comply, but not the core language.
“The Parliamentarian advised that several sub-provisions are impermissible, including language on: how spectrum is selected or auctioned; duplicative savings clauses; and seeking input from other agencies on their spectrum uses,” the office of Sen. Jeff Merkley, D-Ore., said in a release.
Material provisions of the spectrum text, including the requirement that the Federal Communications Commission sell off 800 megahertz and protections for military airwaves, were left unchanged in updated text posted Saturday.
Sen. Jacky Rosen, D-Nev., also sent a letter Friday to Lutnick and Defense Secretary Pete Hegseth urging them to protect the Citizens Broadband Radio Service. Users of the shared band, including wireless ISPs and the cable industry, have sought protection in the reconciliation bill, similar to that afforded to military airwaves in exchange for support from allied lawmakers.
“I encourage you to consider this technology as a key comparative advantage for the United States, rather than support reductions that could undermine American competitiveness,” Rosen wrote.
AT&T put forward a plan last year to auction off the CBRS band, and the Defense Department endorsed selling off a portion of the band as a means of satisfying the wireless industry’s desire for airwaves while keeping key military bands closed off.
