How Trump's ‘big beautiful bill' could wreck Utah's groundbreaking AI laws
Utah Gov. Spencer Cox said President Donald Trump's 'big, beautiful' budget package could derail the state's groundbreaking artificial intelligence laws unless it is changed.
The 1,000-page bill that passed the House last month includes a 10-year prohibition on AI regulations. An updated Senate version removed the all-out ban but conditioned $500 million in AI infrastructure grants on states pausing enforcement of AI laws.
Behind these provisions is a desire by some lawmakers to prevent a nationwide patchwork of AI regulations that hampers innovation amid competition with China. But Cox, and Utah's top tech policymakers, said the approach taken by Trump's bill interferes with the state's right to react to rapidly evolving technologies.
'Our hope is that the last version of this bill that passes, whatever that looks like, will allow for the smart type of regulation that we're doing in Utah, and prevent the bad kind of regulation that would stop AI from reaching its fullest potential,' Cox said Tuesday during a monthly PBS broadcast.
Utah has been recognized around the world for having the 'first and smartest of the AI regulations that have been proposed,' according to Cox. These policies include bills that create a state-run AI policy lab, clarify consumer protection liability for AI and require AI disclosures in industries like finance and mental health.
The governor said that multiple members of the U.S. House have told his team that they were not aware of the AI moratorium when they voted on the bill. Members of the White House and Senate have also said that they don't want the 'BBB bill' to eliminate Utah's law, Cox said.
'AI companies actually support what we're doing because they recognize that this is the right way to do AI regulation as opposed to just piecemeal,' Cox said.
Cox agreed that 'a hodgepodge' of AI laws around the country would cause the U.S. to 'fall behind and we would lose this global race that is happening right now.' But he said a moratorium on AI policy shouldn't come at the expense of Utah's novel approach which doesn't actually tell AI companies how they can develop their models.
Utah Rep. Doug Fiefia, R-Herriman, said the problem goes beyond counterproductive policy. It targets the foundation of states rights that has allowed Utah to lead out on so many issues, according to Fiefia, a freshman lawmaker who previously worked at Google.
'States are laboratories for innovation when it comes to policy, and I believe that the federal government should not overreach on this process and allow it to work,' Fiefia said. 'We will not give over our control because the federal government believes that it's the right thing to do to win this race.'
On Tuesday, Utah House legislative leadership, and 62 state senators and representatives, sent a letter authored by Fiefia to Utah's congressional delegation arguing that the moratorium hindered 'Utah's nationally recognized efforts to strike the right balance between innovation and consumer protection.'
Not only would the moratorium harm state efforts to legislate guardrails, it would also hurt businesses that are using AI responsibly by allowing their competitors to engage in unethical behavior, according to Fiefia.
States have shown they are more nimble than the federal government when they need to adapt to change, Fiefia said. And this is the approach Fiefia believes Utah has demonstrated in opening up legal pathways for innovation while updating the law for the threats posed by AI.
'Just because we want to move fast in this global arms race of AI doesn't mean we can't do so with a seat belt,' Fiefia said. 'I believe that we can both win this AI race, but also doing it in a thoughtful and meaningful way.'
The AI moratorium faces procedural hurdles in addition to ideological pushback. Utah Sen. Kirk Cullimore, R-Sandy, pointed out that reconciliation bills are meant only to amend the annual budget and not make substantive policy shifts.
Some senators have alleged that the AI moratorium does not comply with the 'Byrd Rule,' a procedural requirement that prohibits 'nonbudgetary' additions during the budget 'reconciliation' process.
Cullimore, who was the sponsor behind most of Utah's AI legislation, was in Washington, D.C., last week, speaking with members of the House Commerce Committee, which oversaw the inclusion of the AI moratorium provisions.
The intentions behind the moratorium, Cullimore said, were to prevent states from implementing what are called 'foundational regulations' that restrict the kind of technology AI companies can develop.
Utah's laws do not do this, according to Cullimore, who also signed Fiefia's letter, but they would still be sidelined by the 'big beautiful bill' even if the moratorium is replaced by the conditioned federal funding.
'I think the drafting of the moratorium was so broad that it potentially encompassed all of that stuff,' he said. 'So I hope that that we can refine the text a little bit, and then if they want to put those conditions in on foundational regulation, I think that'd be appropriate.'
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