GOP Approves Spectrum Sales, AI Spending in Trump Tax Bill (1)

Republicans moved forward with reauthorizing spectrum sales to internet companies to generate billions of dollars that would help fund President Donald Trump’s sweeping tax cuts and spending bill.

The House Energy and Commerce Committee early Wednesday advanced the communications and technology portion of the GOP-only measure that aims to extend Trump’s tax breaks from his first term and fulfill his border security, defense, and energy agenda. Republicans have sought to find hundreds of billions of dollars in savings to pay for the massive reconciliation bill. Lawmakers in both chambers view spectrum sales as an attractive offset.

FCC Receives Powers to Auction Spectrum in Republican Tax Bill

The approved legislative text would restore the Federal Communications Commission’s ability for the next decade to auction off new radio airwaves to telecommunications providers, such as Verizon Communications Inc., AT&T Inc., T-Mobile US Inc., and Elon Musk’s Starlink. The agency’s authority expired over two years ago and industry giants have urged Congress to act to help fuel their infrastructure networks.

The bill would direct the FCC to identify at least 600 megahertz of spectrum to sell to private companies on an “exclusive, licensed basis.” The plan could raise $88 billion, according to Committee Chair Brett Guthrie (R-Ky.).

The Congressional Budget Office estimates that the House committee’s overall reconciliation plan would reduce deficits by more than $880 billion through fiscal 2034. The markup, which started Tuesday afternoon and lasted overnight into Wednesday, is among several in recent days as Republicans seek to advance the package without Democratic support.

Democratic Opposition

The committee in the last Congress, Democrats argued, had unanimously advanced a bipartisan bill to reauthorize the FCC’s spectrum auction authority. Democrats accused Republicans of now abandoning bipartisan negotiations and moving ahead with partisan legislation to cover Trump’s tax breaks.

Democrats filed unsuccessful amendments that would have directed some revenue from spectrum auctions toward improving emergency communications, supporting first responders, and deploying broadband services.

“Spectrum is a limited public resources and its proceeds should be used for public good. We’ve had many discussions today about ways that that funding can be used: to invest in our communications infrastructure, to invest in its cybersecurity, to invest in next-generation 9-1-1 deployment,” said Rep. Jennifer McClellan (D-Va.). “Spectrum auction proceeds should not be used to line the pockets of government officials, their families, or the ultra-wealthy.”

Other Democratic-led amendments covered a range of issues. Some read that the legislation would not take effect unless Cabinet members received cybersecurity training on commercial messaging apps, for example, or unless Trump declared compliance with a federal law that bans TikTok.

AI Spending

Republicans also advanced text that would give the Commerce Department $500 million to modernize and secure federal information technology systems by deploying artificial intelligence. The proposal calls for the agency to replace legacy technology with “state-of-the-art commercial artificial intelligence systems and automated decision systems.”

Another approved section would place a 10-year ban on states enforcing new AI regulations and laws. Dozens of states have rolled out rules on AI, largely aimed at mitigating the technology’s risks. In response, industry officials have called for a federal framework to replace the patchwork of regulations, which they say impede innovation. Lawmakers have floated ideas for federal preemption.

Democrats criticized both proposals, claiming the new spending would enrich major technology executives providing AI products and services to the government and the moratorium would put more Americans at risk of AI-generated harms. Policy experts have separately voiced skepticism about the latter section, as legislation must relate to spending for approval via reconciliation according to Senate rules.

“House Republicans are leaving American consumers, and especially our children, at the mercy of Big Tech and their powerful and invasive algorithms,” said ranking member Frank Pallone (D-N.J.), who filed an amendment to strip the moratorium language.

Rep. Jay Obernolte (R-Calif.), an AI policy leader, defended the measure as empowering federal employees to adopt AI to fuel productivity and efficiency and consequently better use taxpayer money. As for the moratorium, “no one is suggesting that AI should be unregulated—I certainly don’t believe that,” Obernolte said. “But the appropriate body for doing that regulation is the US Congress,” he continued, encouraging his colleagues to pass AI legislation.