Commerce Committee Should Be Wary of Tying State AI-Law Moratorium to BEAD Funding
PORTLAND, Ore. (June 9, 2025) – The U.S. Senate Commerce Committee’s recently announced plans to make state eligibility for the federal Broadband, Equity, Access & Deployment (BEAD) program conditional on not enforcing artificial-intelligence regulations could risk undermining innovation in both sectors, according to International Center for Law & Economics (ICLE) Director of Innovation Policy Kristian Stout.
While the proposed 10-year moratorium on enforcement of state AI laws would be a welcome policy change, Stout said the long-term implications of combining the two unrelated areas of policy could have unforeseen consequences. He offered the following statement:
Ill-conceived state AI laws limit innovation and investment and deserve a pause. But tying the moratorium to BEAD funding—dollars already allocated and diligently sought by states and providers to bridge the digital divide—would be a bad precedent for Congress to set. These are unrelated policy areas, and this action risks undermining both public trust and program efficacy. While it might be the least-harmful option, given procedural constraints, it’s a blunt instrument that shouldn’t become standard practice. Congress needs to establish a more principled and sustainable approach to asserting national AI leadership.
Relevant Resources From ICLE Scholars
- Commentary: Federal Preemption and AI Regulation: A Law and Economics Case for Strategic Forbearance
- Regulatory Comments: ICLE Comments to House Energy and Commerce Committee Privacy Working Group
- Regulatory Comments: ICLE Comments on the NTIA’s Proposed BEAD Alternative Broadband Technology Guidance
- Blog Post: Lutnick’s BEAD Pivot: Progress Through Pragmatism
To schedule an interview with Kristian, contact Jim Fellinger at [email protected].
About ICLE
The International Center for Law & Economics is a nonprofit, nonpartisan research center working with a roster of more than one-hundred academic affiliates and research centers from around the globe. ICLE scholars promote the use of law and economics methodologies to inform public policy debates.