Is this one of the most important parts of the One Big Beautiful Bill Act?

Congress is currently debating the One Big Beautiful Bill Act. Among the many provisions is a ten-year moratorium on state Artificial Intelligence (AI) regulations to help avoid a patchwork of rules. We recently hosted a webinar with the Abundance Institute discussing the future of AI and the need for a federal moratorium on state regulations (video below).

Our region needs regulatory certainty to attract AI companies looking to expand. The proposed federal moratorium would provide exactly that—a stable, predictable environment where tech firms can invest with confidence, knowing they won't face a confusing patchwork of conflicting regulations across state lines. Further explaining why this is important, several regional business leaders and MSPC board members sent the following letter to Congress discussing the need for a federal AI regulatory moratorium.

Dear Members of Congress,

As business leaders across Montana, Washington, and Idaho, we write to urge your support for federal legislation establishing a moratorium on state-level artificial intelligence regulation. The emerging patchwork of inconsistent state AI laws threatens to undermine economic growth, innovation, and competitiveness across our region and nation.

Economic Impact on Regional Businesses. Our states' economies depend heavily on industries that increasingly rely on AI technologies—from agriculture and energy to manufacturing and logistics. A fragmented regulatory landscape creates substantial compliance burdens that disproportionately harm smaller businesses and startups that lack the resources to navigate dozens of different state requirements.

Compliance costs are already mounting. Companies operating across state lines face the impossible task of complying with conflicting regulations. What's permissible AI use in Montana may violate Washington state law, forcing businesses to choose between limiting their operations or accepting significant legal and financial risks. These costs ultimately get passed to consumers and reduce our competitiveness against international competitors who benefit from more unified regulatory approaches.

Innovation suffers under regulatory uncertainty. The current trajectory toward state-by-state AI regulation is driving investment and talent away from our region. Tech companies and AI developers are increasingly choosing to locate in jurisdictions with clearer, more predictable regulatory environments. This brain drain threatens our states' long-term economic development and technological leadership.

Current Federal Protections Are Sufficient

Existing federal frameworks already provide robust consumer protections without stifling innovation. The Federal Trade Commission Act prohibits unfair and deceptive practices, including AI applications that harm consumers. Sector-specific regulations in healthcare (HIPAA), finance (FCRA, ECOA), and other industries already address AI use in high-risk contexts. The National Institute of Standards and Technology has developed comprehensive AI risk management frameworks that provide industry guidance without prescriptive mandates.

State-level regulation adds complexity without corresponding benefits. Most proposed state AI laws duplicate existing federal protections while creating operational chaos for businesses. Rather than enhancing consumer protection, this regulatory proliferation often reduces it by creating loopholes and enforcement gaps between jurisdictions.

The Case for Federal Preemption

National competitiveness requires national standards. China and the European Union are developing unified AI governance frameworks that give their companies clear competitive advantages. The United States cannot afford to handicap its AI sector with a maze of conflicting state requirements while other nations advance with coordinated approaches.

Interstate commerce demands federal oversight. AI systems inherently operate across state boundaries through cloud computing, data processing, and digital services. State-level regulation of inherently national and international technologies creates constitutional commerce clause conflicts and practical enforcement impossibilities.

Small businesses need regulatory certainty. Our region's entrepreneurs and small businesses—the backbone of our rural and suburban economies—cannot afford teams of compliance lawyers to interpret dozens of different state AI laws. Federal preemption would level the playing field and allow these businesses to focus resources on growth and innovation rather than regulatory navigation.

Regional Economic Considerations

Our four-state region offers unique advantages for AI development and deployment—abundant renewable energy, strong research universities, and growing tech sectors. However, regulatory fragmentation threatens to undermine these natural advantages. Companies evaluating where to locate AI operations increasingly factor regulatory complexity into their decisions, often choosing states or countries with more streamlined approaches.

Agriculture and natural resources sectors are particularly vulnerable. Precision agriculture, predictive maintenance in energy production, and supply chain optimization all rely heavily on AI technologies. Inconsistent state regulations could force these critical industries to abandon beneficial AI applications, reducing productivity and competitiveness.

Conclusion

The United States stands at a critical juncture in AI development. We can choose a path of coordinated federal leadership that promotes innovation while protecting consumers, or we can allow regulatory fragmentation to undermine our technological leadership and economic competitiveness.

We respectfully urge you to champion a time bound moratorium on state-level AI regulation. This approach will protect jobs, promote innovation, and ensure that our region remains competitive in the global AI economy while maintaining appropriate consumer protections through existing and enhanced federal frameworks.

Thank you for your consideration of this critical issue. We look forward to working with you to ensure America maintains its leadership in artificial intelligence while supporting the economic prosperity of our states and communities.

Sincerely,

Aaron Klein, Contio (Idaho)

Scott Brown, CEO of Sterling Urgent Care (Idaho)

Todd Cranney, Managing Partner of Riverwood Strategies (Idaho)

William Junkermier, Vice President at Cerium Networks (Montana)

John Otter, Board member of Simplot (Idaho)

Tom Power (Washington)

Julie Shiflett, Founder of Northwest CFO (Idaho)

Russ Stromberg (Idaho)