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The 10-Year Ban on State AI Law Lives, At Least for Now, in Senate Version of Budget Bill

By  |  June 8, 2025

The Republican-led Senate Energy and Commerce Committee on Thursday released its version of the Big Beautiful budget bill passed by the House of Representatives last month with a modified version of the 10-year moratorium on state AI laws still attached. Rather than an outright ban on enforcing such laws, as in the House bill, the Senate version conditions a state receiving money from a new $500 million fund to carry out the Commerce Department’s Broadband, Equity, Access, and Deployment (BEAD) Program on the state agreeing to “pause” enforcement of its own AI laws for 10 years.

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    According to a summary of the bill prepared by the committee, such a pause would not apply to any regulation that has the primary purpose of “removing legal impediments to or facilitate the deployment” or AI models or systems, or has the purpose of “streamlining licensing, permitting, routing, zoning, procurement, or reporting procedures in a manner that facilitates the adoption of such models or systems.”

    The change introduced in the Senate version is primarily intended to allow the provision to pass muster under the Senate’s so-called Byrd rule, which proscribes what can be included in a budget reconciliation measure, by tying the ban at least nominally to a spending measure. It could also potentially help win over GOP opponents of the House version by giving states a measure of discretion over whether to accept the ban.

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    Whether it will succeed on either count, however, is unclear. Asked whether the change is enough for the provision to get past the Byrd rule, Senate Majority Leader John Thune (R-SD) said simply, “we’ll see.” The decision rests with the Senate parliamentarian, although Thune has the authority to replace the parliamentary scorekeeper.

    Related: Proposed Federal Ban on State Regulation of AI

    Two GOP senators, Josh Hawley (Mo.) and Marsha Blackburn (Tenn.) previously voiced opposition to the House version provision. Neither offered an immediate comment on the Senate version of the ban, although Blackburn expressed support for the overall bill in a post on X. Hawley voiced objection to other parts of the Senate draft, including the addition of cuts to Medicaid benefits, rather than merely imposing a work requirement as in the House bill.

    Over in the House, Rep. Marjorie Taylor Greene (R-Ga.), went public last week with a scathing objection to the ban and vowed to vote against the overall bill after having voted for it the first time, if the provision was not removed.

    “I’m not voting for the development of skynet and the rise of the machines by destroying federalism for 10 years by taking away state rights to regulate and make laws on all AI. Forcing eminent domain on people’s private properties to link the future skynet is not very Republican,” she wrote on X. “And with this clause, the state of GA would have no way to regulate or make laws to protect human jobs, property rights, and the safety and security of people of the state of Georgia.”

    Her office had no immediate comment on the Senate version.

    A separate provision of the Senate bill includes an apparent compromise that would allow the Federal Communications Commission to resume spectrum auctions, raising a projected $85 billion in federal revenue. The FCC’s previous authority had elapsed in 2023, and Senate Commerce chairman Ted Cruz (R-Texas) had feuded with defense hawks in the Senate who wanted to reserve the bandwidth for military use. The bill would restore the FCC’s authority through 2034 and require it to auction at least 800 megahertz  — 500 Mhz of federal and 300 non-federal spectrum – over the eight-year period.