California accepts federal broadband funds but refuses to stop enforcing its own laws
California has accepted $1.42 billion from the US federal broadband program but rejects a condition requiring it to stop enforcing net neutrality and other telecom rules. The state has reserved the right to challenge the condition in court.
The California Public Utilities Commission (CPUC), which regulates utilities and telecommunications in the state, has agreed to accept $1.42 billion from the federal Broadband Equity, Access, and Deployment (BEAD) program. At the same time, the state does not accept the Trump administration's demand that it stop enforcing its net neutrality law and other telecom rules. The dispute could lead to several legal battles involving the state, the federal government and internet providers.
The condition
The National Telecommunications and Information Administration (NTIA), a US Commerce Department agency, decided last year that states receiving money from the $42 billion BEAD program must agree not to enforce rate regulation or net neutrality rules against providers that receive funding. Net neutrality rules bar providers from blocking content, throttling speeds, imposing data caps or engaging in paid prioritization. Providers could be exempt from such laws for up to 14 years.
California is slated to spend $1.42 billion to bring broadband to 270,571 locations and may ultimately receive up to $1.86 billion.
The state's position
In a letter to NTIA Administrator Arielle Roth, CPUC President John Reynolds wrote that the commission cannot be bound by terms that are unconstitutional or not authorized by law, and that it does not waive its right to challenge them. He also noted that the CPUC cannot prevent other state agencies, including the attorney general, from enforcing state law. The state will not pay out funds to providers until the disagreement with the NTIA is resolved. If the NTIA does not change its position, California could sue the administration.
An NTIA spokesperson said the award terms make up the entire agreement and that the CPUC letter is not part of it. According to the NTIA, California was the last of 56 states and territories to sign its agreement.
Consumer group Public Knowledge backed the state's stance. Stanford Law professor Barbara van Schewick said the letter does not change the award terms but puts California's arguments on record before contracts with providers are signed. A spokesperson for Governor Gavin Newsom said the state's laws, including net neutrality protections, still stand.
