Reps. Jay Obernolte (R-Calif.) and Lori Trahan (D-Mass.) released a 269-page discussion draft of the Great American AI Act on June 4, 2026, and its Section 121 would preempt state and local laws governing AI model development for three years.

The bill is structured around four titles: Frontier AI Governance, Workforce, Cybersecurity, and Research, Development, and International Cooperation. Per DLA Piper’s analysis, Section 111 imposes frontier model disclosure requirements, Section 112 mandates third-party audits, and the draft bars retaliation against whistleblowers. It also codifies the Center for AI Standards and Innovation, formerly the AI Safety Institute, with a Commerce-appointed director and $100 million authorized for each of fiscal years 2027, 2028, and 2029.

Cosponsors include Reps. Scott Franklin (R-Fla.), Suhas Subramanyam (D-Va.), Erin Houchin (R-Ind.), and Scott Peters (D-Calif.). The bipartisan packaging didn’t hold for long. The House Democratic Commission on AI came out against the draft within hours.

On June 16, a coalition of state legislators organized by Americans for Responsible Innovation urged Congress to strike the preemption clause, warning it sweeps in state work on training-data copyright, CSAM, discrimination, and consumer privacy. The letter carried 51 signers drawn from an earlier 260-lawmaker effort.

Brad Carson, ARI’s president, said the draft “takes the current floor on state AI legislation and turns it into a federal ceiling.” Fordham law professor Zephyr Teachout, speaking at an ARI press conference, called it “an incredibly broad preemption regime.”

Obernolte and Trahan say they’ll revise before formal introduction. Opponents are already invoking the 99-1 Senate vote that killed the 2025 reconciliation moratorium, a recent precedent for what happens when a preemption clause arrives without a federal framework yet in force.

Sources

Sources