A new executive order signed by President Trump on December 11 could affect states’ eligibility for federal broadband funding, potentially complicating grants under the Broadband Equity Access and Deployment (BEAD) program.
The executive order, "Ensuring a National Policy Framework for Artificial Intelligence," focuses primarily on federal preemption of state AI regulations and notes that the policy of the United States, regarding AI, is to “sustain and enhance the United States’ global AI dominance through a minimally burdensome national policy framework for AI.”
Section 5 of the order directly links state AI laws to BEAD funding eligibility by directing the Department of Commerce to restrict access to non-deployment funds for states with "onerous AI laws."
Policy Guidance Within 90 Days
The executive order directs the Secretary of Commerce to publish, within 90 days, an evaluation identifying state AI laws that conflict with the administration's policy. The order specifically targets laws that "require AI models to alter their truthful outputs," as well as laws that may force AI developers and deployers to report or disclose information in a manner that violates constitutional protections.
According to the order, states identified as having problematic AI laws will be ineligible for BEAD non-deployment funds "to the maximum extent allowed by Federal law.”
The Commerce Department's policy notice must also explain "how a fragmented State regulatory landscape for AI threatens to undermine BEAD-funded deployments" and "the growth of AI applications reliant on high-speed networks."
The order further directs federal agencies to assess their discretionary grant programs and determine whether they can condition grants on states either not enacting conflicting AI laws or agreeing not to enforce existing AI laws during the funding period.
The Commerce Department's evaluation is expected by mid-March 2026, and should clarify which specific state laws may trigger funding restrictions and how states can maintain eligibility for the full range of BEAD resources.
