Illustration: Allie Carl/Axios
Fights are brewing in the Senate over broadband, spectrum, AI and digital service tax provisions in the reconciliation bill.
Why it matters: Tech policy is getting caught in the crosshairs of Republicans' massive budget bill.
State of play: A provision in the bill written by Senate Commerce Chair Ted Cruz would prohibit states from enforcing any AI regulation if they want to receive funds from the Broadband Equity Access and Deployment Program.
- Sen. Josh Hawley is planning to draft an amendment with Democrats to remove the provision and force a vote if it's not removed before the budget bill hits the floor, his office confirmed.
- Other GOP senators who championed BEAD may also start to raise concerns.
Tying the AI moratorium to broadband funds is an effort to resolve issues with the Senate's Byrd Rule, which prohibits non-budget language from being tacked onto a budget bill.
- An aide for Sen. Ed Markey said that, according to his office's read, there is no provision in the bill limiting the AI moratorium, meaning that even if states don't want the internet money, they'd still be forced to halt AI regulation.
- Some outside groups are also pushing back: Public Citizen called the move "a stunning display of corporate appeasement."
On spectrum, the Senate bill would restore the FCC's auction authority through 2034 and requires at least 800 MHz — 500 federal and 300 non-federal — of spectrum to be auctioned within an eight-year period.
- Sen. Mike Rounds is not satisfied. He and other DOD champions are looking to make changes to the language and negotiations are ongoing, though no specific changes have been proposed yet, his office confirmed.
What they're saying: "This language represents a reasonable compromise that will help avoid network congestion and maintain U.S. leadership in wireless innovation while protecting critical federal government missions," AT&T executive vice president for federal legislative relations Mike Ferguson said.
- FCC chair Brendan Carr said the spectrum provision "will create jobs, encourage innovation, and expand high-speed connections to more Americans."
- Advocacy group WifiForward prefers a carve-out that would protect spectrum in the 6 GHz band from future auction.
- "While a clear carve-out is preferable, we look forward to working with policymakers to ensure that consumer needs are put first as the bill continues through the reconciliation process," the group said.
What we're watching: The Senate Finance Committee has not released its title yet but could include a measure from the House that would set up a retaliatory measure for "unfair" foreign taxes.
- Corporate America is pushing back against the language, but it could be welcomed by the tech sector facing digital services taxes.
- Big Tech companies are clamoring for a reprieve from the EU and other countries, and the Trump administration has shown an appetite for such retaliation.
