House Democrats Warn NTIA on Trump's Draft AI Order Restricting BEAD Money
Three House Commerce Committee Democratic leaders pressed NTIA Administrator Arielle Roth on Tuesday to follow “the letter” of the 2021 Infrastructure Investment and Jobs Act as the agency rolls out funding from the $42.5 billion BEAD program, citing “significant concerns” about the Trump administration's implementation of the initiative. They in part objected to President Donald Trump's draft proposal to require NTIA to potentially curtail non-deployment BEAD funding for states that the administration determines have AI laws that are overly burdensome (see 2511200057).
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An executive order that Trump signed Monday afternoon didn’t include language from the BEAD draft and instead launched the unrelated Energy Department Genesis Mission AI public-private partnership. But initial reports that generally described Trump’s intent to issue an AI order ahead of the signing renewed questions among telecom policy stakeholders about how the earlier draft would affect BEAD and the FCC. That draft would direct the FCC to consider adopting a national standard for AI models that preempts state laws.
Lobbyists said they now expect Trump to delay issuing a final version of the draft order until after Congress finalizes a conference version of the FY 2026 National Defense Authorization Act, in case lawmakers can reach a deal to include language to preempt state AI laws. Trump’s proposal would require NTIA to issue a policy notice within 90 days “specifying the conditions under which States may be eligible for” non-deployment BEAD funds, based on proposed Commerce Department and DOJ evaluations of states’ AI laws. Some estimates have found that $20 billion of the BEAD money qualifies as non-deployment money, based on states’ spending plans.
“It is evident that NTIA’s implementation of” BEAD violates IIJA’s statutory language “and ignores the intent of Congress, jeopardizing the bipartisan goal of delivering fast, reliable, and affordable internet to everyone in America,” said House Commerce ranking member Frank Pallone, D-N.J., Communications Subcommittee ranking member Doris Matsui, D-Calif., and Oversight Subcommittee ranking member Yvette Clarke, D-N.Y., in a letter to Roth. “We also remind you that any Executive Order issued by the President cannot override existing laws passed by Congress.” Matsui and FCC Commissioner Anna Gomez were among Democrats who blasted Trump’s draft order last week (see 2511200057).
Trump can’t empower “NTIA to impound tens of billions of dollars that Congress authorized and appropriated in full to achieve specific policy outcomes, including universal connectivity, affordability, scalable infrastructure, and broadband adoption,” the House Commerce Democrats said. “Congress intentionally envisioned a range of acceptable uses of BEAD funds and flexibility for states and territories because barriers to connectivity are different in every community. We urge you to release to each state and territory its full BEAD allocation, including all” non-deployment funds.
RDOF 'Repeat'?
The House Commerce Democrats also warned Roth about the Trump administration's “emphasis on the cheapest upfront cost, using an undocumented and arbitrary set of statewide per-location costs over more reliable metrics like speed, bandwidth, scalability, and cost over the lifespan of the technology.” Those actions collectively put “the Trump BEAD Program on a trajectory to repeat [the FCC Rural Digital Opportunity Fund] defaults and failed commitments.”
The lawmakers asked Roth to respond by Dec. 12 to questions aimed at ensuring NTIA “remains on track to close the digital divide as required by statute,” including when the agency will “provide guidance on the use of non-deployment funds."
An NTIA spokesperson said the agency “has received the letter and will respond in due course.”
New Street’s Blair Levin, architect of the FCC’s National Broadband Plan during the Obama administration, strongly questioned the Trump administration’s legal authority to restrict any state’s access to allocated BEAD funding. “If a Democratic administration said you don't get your non-deployment money if you have any restrictions on access to abortion, I believe most people would say that's ridiculous,” Levin told us. It’s also “confusing” that Trump is targeting non-deployment BEAD funding when Commerce Secretary Howard Lutnick wants “all the non-deployment funds back anyway.”
Build American AI Executive Director Nathan Leamer, who was an adviser to ex-FCC Chairman Ajit Pai, told us it “makes sense” for the Trump administration to condition some BEAD funding on whether recipient jurisdictions are overregulating AI because that technology is “wholly dependent on [the type of] next-generation connectivity” that universal broadband would provide. “This administration is looking for an appropriate vehicle to tell NTIA, ‘If states want this money, they can't just handcuff their state-based entrepreneurs and what they can use this technology’” for, Leamer said. “Unfortunately, some state laws can actually hinder their ability to use AI.”
Jeffrey Westling, a senior scholar of innovation policy at the International Center for Law & Economics, said the draft order’s BEAD language would likely be more palatable to congressional Republicans, given that it targets only non-deployment money that some in the GOP have eyed clawing back anyway (see 2511070035). Republicans “have really been hitting [the Biden administration] for the last two years that nothing’s been actually deployed” via BEAD, he told us. “Theoretically, this shouldn't delay any actual deployment like this, so it's a lot less of a problem [for lawmakers who] want to make sure they're getting the broadband actually built out to constituents.”