New Street's Levin: BEAD Conditions on State Laws Legally 'Dubious'
NTIA conditioning any state receiving BEAD funds on not imposing rate regulation or net neutrality-like rules on a BEAD subgrantee or on not regulating AI is of "dubious legality," New Street Research's Blair Levin said Wednesday. He told us much the same earlier this week (see 2511250076). Levin said there have been numerous cases where courts have held that the president can't condition the grant of funds appropriated by Congress in ways that coerce the states. The major questions doctrine and its limit on executive power also could be a route to challenging the conditions, he said. States "would have a material chance of overturning" those executive actions. NTIA head Arielle Roth said last month that the agency was telling states they can't put rate regulation and state-level net neutrality rules on BEAD-funded projects (see 2510280051).
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However, Levin said, the Trump administration has successfully made threats in the past that are legally dubious, but the aggrieved parties chose to avoid litigation. Similarly, states might not fight the White House so they can receive BEAD funds quickly, he said. In addition, the Commerce Department would likely "engage in selective enforcement, with particular attention to Blue States." The net neutrality reference seems "designed to force California into an awkward position of choosing to obtain the funding or choosing to retain the right of states to adopt laws it believes [are] in the public interest."