Scalise: No AI Moratorium in National Defense Authorization Act

WASHINGTON, Dec. 4, 2025 – Republicans are no longer looking to block state AI laws as part of a must-pass defense bill.

House Majority Leader Steve Scalise, R-La., told reporters Tuesday that GOP supporters of the President Donald Trump-backed measure were considering other options. Democrats and several Republican lawmakers and governors have been fiercely opposed to including the measure in the National Defense Authorization Act.

“If you can add it, that’s great, but that wasn’t the best place for this to fit,” Scalise said, according to The Hill and other outlets. “But we’re still looking at other places because there’s still an interest.”

It’s not clear what the text of this AI moratorium would have been. A failed effort to include such a ban in the One Big Beautiful Bill Act would have used Broadband Equity, Access, and Deployment funding as a means to ensure compliance – and get the provision past a rule requiring budget bills to pertain to spending and revenue.

The bill would have made $500 million available under the program for AI development, but states wouldn’t have been able to access it if they heavily regulated AI companies. Democratic opponents to the provision disputed that, and maintained the language would have empowered the Commerce Department to claw back some of the $42.45 billion in existing funding if states regulated AI.

The provision, pushed by Sen. Ted Cruz, R-Texas, was stripped from the bill by a 99-1 vote in the Senate. 

A draft executive order that circulated last month, but wasn’t signed, would have tied non-deployment funding under BEAD to a ban on “onerous” AI laws. States and territories are going to have a collective $21 billion left over after funding deployment projects, a result of the Trump administration’s push for cost savings.

The draft executive order would have directed Commerce’s National Telecommunications and Information Administration to prepare a memo detailing plans to withhold those non-deployment funds from states with too many regulations on AI companies.

Trump and the tech industry are still eager for federal preemption of state-level AI laws.

“We must have one Federal Standard instead of a patchwork of 50 State Regulatory Regimes,” Trump posted on his social media platform Truth Social last month. “If we don’t, then China will easily catch us in the AI race. Put it in the NDAA, or pass a separate Bill, and nobody will ever be able to compete with America.”