California faces $1.86 billion choice

California is about to accept federal broadband grants but must surrender its net neutrality law to do so. The Trump administration is conditioning all BEAD funding on states agreeing not to enforce net neutrality rules.

What California's net neutrality law does

California's law prohibits ISPs from blocking or throttling lawful traffic and bans fees to websites for prioritized delivery. The state won a yearslong court battle to defend these protections.

Trump admin's BEAD program conditions

The National Telecommunications and Information Administration says states must exempt ISPs from net neutrality and rate regulation everywhere in the state, not just where they receive funding. The exemption lasts up to 14 years.

Vote scheduled for tomorrow

The California Public Utilities Commission votes tomorrow to ratify the state's final BEAD plan. The CPUC calls it procedural, but advocacy groups say it's a critical moment to defend net neutrality.

Legal experts warn of consequences

Paul Goodman, legal counsel for the Center for Accessible Technology, says the vote is 'the beginning of the end' for California's net neutrality protections. Winning a court battle would be much harder after accepting the money.

“It's the beginning of the end”

Broader regulatory authority at risk

The NTIA requirement forbids not just net neutrality enforcement but also rate regulation and utility-style rules on broadband service. California could lose authority over companies like AT&T and Verizon.

Nearly 30 groups urge state to fight

Advocacy organizations sent a letter to Governor Newsom and state leaders opposing the BEAD conditions. They argue accepting these terms sets a dangerous precedent for federal coercion.

“would set a dangerous precedent for the federal government to use federal funding as a cudgel”

AT&T could escape state obligations

Once BEAD money is accepted, AT&T could claim it cannot be regulated on copper landline phone service or required to serve all customers. AT&T is already trying to exit state obligations in California.

Verizon's low-income plan at risk

A merger condition requires Verizon to offer $20-per-month broadband to low-income Californians. The BEAD exemption could jeopardize this requirement, costing low-income residents far more than the $1.86 billion grant.

Emergency responder protections lost

California's 2019 law prohibits throttling first responders during emergencies. This protection, enacted after Verizon throttled firefighters during a wildfire, would be eliminated under BEAD conditions.

Five companies get most funding

Roughly 69 percent of California's BEAD funding goes to Comcast, AT&T, Verizon, Amazon's Kuiper, and SpaceX's Starlink. All would be exempt from state net neutrality rules for 14 years.

Law professor says Congress intended otherwise

Stanford Law professor Barbara van Schewick argues the federal BEAD law requires funded providers to follow state laws. She says a federal agency cannot use grant fine print to override what Congress wrote into the statute.

“A federal agency can't use fine print in a grant to override what Congress wrote into the statute”

Suing before accepting money is better

If California sues before finalizing the agreement, it can challenge the NTIA requirements in the Ninth Circuit Court of Appeals, which has a favorable view of such claims. After accepting money, the DC Circuit applies a much higher bar.

State has limited time to act

The CPUC has a deadline at the end of this month to sign the agreement with the NTIA. The state can request a thirty-day extension and file a lawsuit challenging the conditions during that period.

New York faces similar dilemma

New York accepted $664.6 million in BEAD funding but may now be unable to enforce its Affordable Broadband Act requiring $15 to $20-per-month service. The state won a court battle defending the law less than two years ago.

Trump admin blocked rate-setting bills

California Assemblymember Tasha Boerner proposed a bill requiring ISPs to offer $15 broadband plans to low-income residents. She dropped it after Trump administration officials warned it would jeopardize BEAD funding.