Senate Parliamentarian Requests Rewrite of Controversial AI Provision in Trump's Tax Bill

AI measure in Trump tax bill sparks pushback in Senate

The Senate parliamentarian has asked for a rewrite of a controversial artificial intelligence (AI) provision included in President Trump's sweeping tax package, raising concerns that the measure could violate Senate reconciliation rules, which limit what policies can be included in budget-related bills. Under its current language, the provision in Trump's "big, beautiful bill" would block states from regulating AI models and systems if they wish to access $500 million in federal funding for AI infrastructure and deployment. Senate Commerce Republicans argue the latest draft clarifies that the optional funding would not override state laws in areas such as consumer protection and intellectual property. Despite those adjustments, Democrats maintain the measure could impact broader funding programs, including $42 billion in broadband grants, and fails to comply with the Byrd Rule, which prohibits provisions that make significant policy changes unrelated to the budget. The parliamentarian's latest review also advised that several provisions in the Republicans' "big, beautiful bill" would be subject to a 60-vote threshold if they remain in the legislation. The affected provisions fall under the jurisdictions of the Judiciary Committee and Commerce Committee. The AI provision has sparked bipartisan concerns, with some Republicans opposing its inclusion while House conservatives warn that Congress does not yet fully understand AI's implications to justify blocking state oversight. Senator Jeff Merkley, the Senate Commerce Committee's ranking member, criticized the broader bill's priorities following the parliamentarian's request for revisions. "We have been successful in removing parts of this bill that hurt families and workers, but the process is not over, and Democrats are continuing to make the case against every provision in this Big, Beautiful Betrayal of a bill that violates Senate rules," Merkley said. "Republicans are actively attempting to rewrite major sections of this bill to advance their families lose, and billionaires win agenda, but Democrats are scrutinizing all changes to ensure the rules of reconciliation are enforced. We cannot let Republicans succeed in betraying middle-class families across this country." Environmental experts have also raised alarms about the measure's potential impact, noting that AI's rapidly growing electricity demands could generate around 1 billion tons of carbon dioxide in the U.S. over the next decade -- more than Japan emits annually. Critics argue that restricting state oversight could delay the adoption of energy-efficient AI operations and slow transitions to cleaner energy sources. The parliamentarian's request for a rewrite adds another hurdle for GOP leadership as they work to finalize the legislation through the reconciliation process, which allows budget-related bills to bypass a Senate filibuster with a simple majority vote. For now, it remains unclear when the AI provision will be revised or whether it will remain in the final package sent to the Senate floor.

Senate parliamentarian greenlights AI moratorium again

A provision that bars states from regulating artificial intelligence (AI) for a 10-year period can remain in President Trump's sweeping tax package, the Senate parliamentarian determined Friday. The decision, announced by Senate Budget Democrats, once again found the moratorium clears a procedural hurdle known as the Byrd rule. The provision's future in the reconciliation bill appeared in danger Thursday, after Senate Parliamentarian Elizabeth MacDonough asked Senate Commerce Chair Ted Cruz (R-Texas) to rewrite the measure. It had initially been cleared by the Senate referee last weekend, after Cruz altered the language to tie the moratorium to federal funding. The most recent language banned states from regulating AI models and systems if they want access to $500 million in AI infrastructure and deployment funds. However, the parliamentarian voiced concerns about the provision when she met with Cruz and Sen. Maria Cantwell (D-Wash.), the top Democrat on the Senate Commerce Committee, on Wednesday night, Cantwell told reporters Thursday. Democrats had argued that the measure would impact $42 billion in broadband funding in violation of the Byrd rule. MacDonough's latest approval notes that the provision "does not violate the Byrd Rule as long as the conditions only apply to the new $500 million provided by the reconciliation bill," according to a press release from Senate Budget Democrats. The Byrd rule, which determines what can be voted on as part of the budget reconciliation process with a simple-majority vote, has represented a key hurdle to Republican priorities as they rush to pass Trump's spending bill by his self-imposed deadline of July 4.

Senate parliamentarian requests AI moratorium be rewritten in 'big, beautiful bill'

Senate Parliamentarian Elizabeth MacDonough has asked Senate Commerce Chair Ted Cruz (R-Texas) to rewrite the controversial artificial intelligence (AI) provision in President Trump's tax package, Sen. Maria Cantwell (D-Wash.) told reporters Thursday. Cruz and Cantwell (D-Wash.), the ranking member of the Senate Commerce Committee, met with the Senate parliamentarian Wednesday night, a source familiar with the conversations confirmed. During this conversation, the parliamentarian expressed concerns the provision may violate the Senate's reconciliation procedural rules, Cantwell said. When asked whether Cruz is being asked to rewrite it, Cantwell told Politico, "That's what was the last night request from, I think, from the Parliamentarian. Or, well, I mean, I don't know what they said, but yeah, that's what's going on." Under its current language, the provision bans states from regulating AI models and systems if they want access to $500 million in AI infrastructure and deployment in federal funding. Senate Commerce Republicans said the current language, which narrowed a previous version this week, "makes clear the optional $500 million state AI program would not affect participating states' tech-neutral laws, such as those for consumer protection and intellectual property rights. But Democrats argue the bill would still impact $42 billion in broadband funding and not comply with the Senate's Byrd Rule, which prohibits provisions from making drastic policy changes. Cantwell told reporters she does not have a timeline for when the provision could be rewritten. The parliamentarian's request comes just days after she first approved the provision last weekend. Republicans are using the budget reconciliation process to advance Trump's legislative agenda while averting the Senate filibuster. To do this, the Senate parliamentarian's approval of the provisions is needed for a simple majority vote. When reached for comment, Cruz's communications director Macarena Martinez said the office would not comment on "private consolations with the parliamentarian." "The Democrats would be wise not to use this process to wishcast in public," Martinez told The Hill. Despite the previous changes to the language, the provision is expected to receive pushback from a handful of Republicans. Republican Sens. Marsha Blackburn (Tenn.) and Ron Johnson (Wis.) told The Hill they are against the provision, while Sen. Josh Hawley (R-Mo.) said he is willing to introduce an amendment to eliminate the provision during the Senate's marathon vote-a-rama if it is not taken out earlier. Some Republicans in the House are also coming out against the measure as a way to advocate for states' rights. A group of hard-line conservatives argued in a letter earlier this month to Senate Republicans that Congress is still "actively investigating" AI and "does not fully understand the implications" of the technology. This was shortly after Rep. Marjorie Taylor Greene (R-Ga.) confirmed she would be a "no" on the bill if it comes back to the House with the provision included. "I am 100 percent opposed, and I will not vote for any bill that destroys federalism and takes away states' rights, ability to regulate and make laws when it regards humans and AI," she told reporters earlier this month. It has also received criticism from some Republican state leaders, like Arkansas Gov. Sarah Huckabee Sanders, who warned in a Washington Post op-ed that the measure "would have unintended consequences and threatens to undo all the great work states" have done for AI protections.

Senate Parliamentarian Raises Doubts About Provision Banning State AI Rules | PYMNTS.com

By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions. The parliamentarian advised Senate Commerce Chair Ted Cruz to rewrite the provision, saying that in its current form, it may violate Senate rules, Bloomberg reported Thursday (June 26), citing unnamed sources. Senate Republicans are using a special budgetary process to fast-track the tax bill that includes the AI provision, but to stay within the chamber's rules, they must ensure that it does not include significant policy changes, according to the report. Critics of the provision have argued that it violates that requirement by forcing states to choose between making their own rules about AI or receiving federal funds for internet broadband projects, the report said. Cruz altered the text of the provision this week to clarify that only states that seek funding for AI infrastructure would be subject to the 10-year ban on implementing AI regulations, per the report. He told reporters Wednesday (June 25), per the report, that he is "confident that the provision will remain in the bill that we pass into law." It was reported Wednesday that Senate Majority Leader John Thune said he expected a 10-year ban on state AI regulations to survive in "some version" in the One Big, Beautiful Bill. Based on feedback from other lawmakers, "it might change in some way," Thune said. Thune, who is a backer of the provision, said: "We want to be the leaders in AI and quantum and all these new technologies. And the way to do that is not to come in with a heavy hand of government; it's to come in with a light touch." An opponent of the moratorium on state AI rules, Sen. Josh Hawley, R-Mo., said in the Wednesday report: "I think it's terrible policy. It's a huge giveaway to some of the worst corporate actors out there." It was reported Friday (June 20) that the Senate parliamentarian had ruled the provision was in line with the special budgetary process being used by Republicans and that the proposed ban on state-level AI regulation would remain in the bill.