Accepting $1.42 billion in federal broadband funding would require California to give up enforcing its net neutrality, affordability, and public-safety laws against its biggest providers. The state can get the money without the catch — by challenging the condition in court first.
In the summer of 2018, California learned what happens when no one can hold internet providers accountable.
As the Mendocino Complex Fire, then the largest wildfire in California history, tore across the north of the state, Santa Clara County firefighters were called in to help. They relied on a mobile internet connection to coordinate the thousands of personnel and vehicles racing to contain the fire. In the middle of that emergency, Verizon throttled their connection down to an unusable trickle. Despite the firefighters' pleas, Verizon refused to restore full service unless they upgraded to a more expensive plan, forcing crews to fall back on personal phones to keep their systems running during a disaster.
California responded. In 2019, the legislature passed a law, enforced by the California Public Utilities Commission (CPUC), that prohibits mobile providers from throttling first responders during emergencies. It's part of a broader set of protections, including rules requiring providers to keep people connected during disasters.
Those protections exist for a reason: left to their own devices, internet providers have put profits over public safety before.
California is now being asked to sign away those protections for fourteen years.
The decision facing California
In 2021, Congress created the Broadband Equity, Access, and Deployment (BEAD) program, a roughly $42 billion federal program to bring high-speed internet to places that still don't have it.
In July, the National Telecommunications and Information Administration (NTIA), the federal agency that distributes BEAD money, approved California's BEAD deployment plan. On August 31, it issued the award: $1.42 billion to connect about 270,000 homes and businesses.
Buried in the award's terms and conditions is a clause known as Condition 50. By signing the award, California would agree not to enforce its affordability, net neutrality, and public-safety protections against any internet service provider (ISP) that receives BEAD money.
It would be handcuffing itself for the next fourteen years.
Condition 50 isn't limited to the locations BEAD pays to connect. It covers any broadband service these ISPs offer anywhere in California, including their wireless services.
On top of that, California would have to write the same promise into its contract with every funded provider, handing each one its own contractual right to block enforcement.
Roughly 69% of California's BEAD funding flows to five large, national providers: Comcast ($400 million), AT&T ($331 million), Verizon/Frontier ($173 million), Amazon's Kuiper satellite service ($55 million), and SpaceX's Starlink ($22 million).
If California accepts the funding, three of the four major home-internet providers, two of the three major wireless carriers, and both major satellite providers would be shielded from enforcement of California’s consumer and public safety protections for the next fourteen years.
Condition 50 doesn't just block enforcement of today's rules. If California’s legislators or the CPUC added new disaster rules or affordability requirements, they couldn't enforce them against California's biggest broadband providers for well over a decade.
The grant goes to the State of California, and Condition 50 would bind the state itself, so the decision to accept it rests with Governor Newsom. The CPUC administers the BEAD program on the state's behalf. On September 17, the CPUC is scheduled to take a procedural vote ratifying the deployment plan NTIA approved in July.
But whether to accept the award on those terms or challenge Condition 50 in court first is the governor's decision to make.
What California would be giving up
The firefighter law is just one of the protections at stake. Condition 50 covers three kinds California has built up over years: affordability, net neutrality, and public safety.
The affordability stakes alone are enormous.
When the CPUC approved Verizon’s acquisition of Frontier in January, it required the merged company to offer a $20-a-month plan to low-income Californians. An estimated 5.8 million households qualify, and eligible customers save up to $30 a month. Under Condition 50, California could no longer enforce that requirement, because Verizon is among the providers Condition 50 covers.
Net neutrality is the principle that your internet provider shouldn't get to pick winners and losers online: it can't block or slow the apps and sites you choose, or charge them for a faster lane to reach you. After the FCC repealed the federal net neutrality protections in 2017, California passed its own net neutrality law, now widely regarded as the strongest in the country. The law showed its force as soon as it became enforceable: AT&T and Verizon promptly stopped exempting their own video apps from customers' data caps, a practice that had tilted the field against competitors.
That is how these protections mostly work. The credible threat of enforcement keeps providers in line without a regulator ever having to act. Condition 50 would remove that threat for fourteen years.
Public safety is the third protection at risk, and the need for it is growing. As climate change makes wildfires and other disasters more frequent, wireless networks have become a lifeline: for evacuation orders, for families trying to reach one another, for first responders like the Santa Clara crews. Whether those networks hold up when lives depend on them shouldn't be left to a company's discretion.
California would be stepping back at the worst possible moment
The broadband market is consolidating quickly. Fewer providers mean fewer checks on prices and bad behavior, exactly when strong state protections matter most.
Federal protections won't fill the void. The federal Affordable Connectivity Program, which gave qualifying households $30 a month toward their broadband bills, ran out of money and ended in June 2024; roughly half of the 5.8 million eligible California households had signed up. Efforts in Congress to revive it have failed.
Meanwhile, the FCC's 2024 net neutrality rules were struck down by a federal court in January 2025, and the agency has neither the authority nor the will to police internet providers.
If California steps back, no one steps in.
Why this is happening
Condition 50 is the result of a years-long campaign to escape California’s protections by the large phone and cable companies who are now getting BEAD funding.
Internet providers have been fighting California's net neutrality law for years, without success. They spent millions lobbying the legislature to kill the law and even paid for robocalls falsely warning seniors that it would raise their phone bills. When they asked the courts to strike down the law, they lost three times: first at the district court, then at the federal court of appeals, and a third time when the full appeals court refused to rehear the case, with not a single judge voting to take it up.
Having lost in the Capitol and in court, the providers found another route: allies in the federal government willing to use broadband money as leverage to force California to give up these kinds of protections.
It's already working. In July 2025, a California lawmaker shelved a bill that would have required a $15 broadband plan for low-income households after federal officials warned it could cost the state its BEAD funding.
For the large phone and cable companies, Condition 50 is the prize: hundreds of millions of dollars, and fourteen years of freedom from the rules they couldn't defeat any other way.
The math doesn't add up
About half of all eligible California households signed up for the federal Affordable Connectivity Program when it existed. If just one in five of these eligible households, or 20%, signed up for the Verizon/Frontier $20-a-month broadband plan (a deliberately conservative estimate), it would save low-income Californians roughly $4.2 billion over ten years. That's nearly three times the entire $1.42 billion in BEAD funding California would be accepting.
And that’s only the savings from a single plan.
California would be trading away billions in savings for its most vulnerable residents, plus its power to protect people during disasters and rein in ISP misbehavior, for a check worth a fraction of what it's giving up.
It’s a bad deal, and California should reject it.
There is a better way
California doesn't have to choose between connecting families and protecting them. California doesn’t have to reject the money to protect its laws; it can challenge Condition 50 in court and strip the condition from the grant.
A challenge would rest on solid legal ground.
Congress designed BEAD to get broadband built while making sure the providers who take the money follow the law: the statute directs states to ensure that funded providers can carry out their work “in compliance with all applicable Federal, State, and local laws,” while Condition 50 demands the opposite: that California promise not to enforce its own laws.
A federal agency can't use fine print in a grant to override what Congress wrote into the statute.
If California wins, it gets the full $1.42 billion without the condition, and can connect the 270,000 households without giving up its power to protect all Californians.
But timing is everything: California has to challenge the condition before it accepts the award.
Once the state signs, two things change: challenging Condition 50 becomes a lot harder. And enforcing any of the affected protections could prompt NTIA to cut off the BEAD money that hasn't yet been paid out.
The result: California would still have its protections on the books, but no regulator or attorney general would risk the state's broadband funding to enforce just one of them.
This decision is too important to rush
The CPUC's September 17 vote will draw attention, but by the CPUC's own account it merely ratifies California's plan; it doesn't accept Condition 50.
The decision that matters – whether to sign the agreement – is separate, and still ahead.
There's no need to rush it. Under BEAD's own rules, California has until the end of September to decide, and it can request another 30 days after that.
A fourteen-year commitment that trades away billions in savings and California's power to protect people in emergencies is not a decision to make against a self-imposed clock.
At a minimum, Governor Newsom should take the time the BEAD rules allow. Better still, he should refuse to sign away California's net neutrality, affordability, and public-safety protections and go to court to get the money the way Congress intended: with every state protection intact.
Professor Barbara van Schewick is a professor of law at Stanford University and the director of Stanford Law School’s Center for Internet and Society.