Tech Giants Shift Focus to Statehouses Amid Federal AI Regulation Uncertainty
Federal lobbying expenditures by major technology companies have reached unprecedented levels this year. However, with progress on federal artificial intelligence (AI) regulation currently stalled in Washington, industry leaders are increasingly directing their attention towards state legislatures. California has emerged as a key battleground, mirroring the strategies employed in the federal arena, where Meta has consistently increased its spending to influence state-level policy.
Political contributions represent a potent tool for exerting influence, and Sacramento lawmakers have been keenly observing the activities of newly formed political action committees (PACs). While the precise amount Meta intended to invest in these new entities remained undisclosed until recently, reports indicate a significant financial commitment. According to IRS filings obtained by POLITICO, Meta contributed $45 million to its Alliance for Technology and Economic Prosperity (ATEP) PAC in late September.
The company indicated that the disclosure would not be filed with the agency's online system by the standard Monday deadline, citing technical difficulties and stating they were attempting to submit hard copies. ATEP is a non-federal PAC designed to operate across multiple states, although Meta has yet to specify which ones it will prioritize. The project is spearheaded by Brian Baker, a veteran Republican operative, and Hilltop Public Solutions, a Democratic consulting firm. By the end of last year, ATEP had invested approximately $329,000 in activities including polling, consulting, and legal services, as detailed in state filings.
In addition to the new PAC, Meta’s existing California-specific super PAC, which received $20 million in the previous year, entered 2026 with a substantial $19.7 million in cash reserves, according to filings with the Secretary of State’s office. This super PAC is designed to support candidates for state offices regardless of their political affiliation and has not ruled out contributing to California’s upcoming gubernatorial race. Brian Rice, Meta’s vice president of public policy, is leading the committee's efforts.
A Meta spokesperson suggested the company may further increase its financial contributions to both PACs as the year progresses, although no definitive decisions have been made. This significant infusion of cash into the two super PACs is part of a broader strategic shift, resulting in a series of new political committees established in California over the past week, backed by substantial investments from tech billionaires and companies.
Several of these new PACs are specifically focused on influencing the state legislature. One such group, “Grow California,” has been funded with $5 million each by crypto executive Chris Larsen and Bitcoin advocate Tim Draper. Larsen, chairman of crypto company Ripple, stated in an interview that the super PAC aims to address an imbalance in California politics, arguing that organized labor has undue influence on elections. He expressed a desire to support candidates who are not perceived as being aligned with organized labor interests.
The Grow California PAC has significantly increased its fundraising since January, according to former Sacramento lobbyist Shaudi Fulp, who is leading the committee on behalf of Larsen and Draper. Fulp did not disclose the sources of the additional contributions and commitments. Lorena Gonzalez, president of the California Federation of Labor Unions, responded to the announcement by asserting that unions will continue to represent the interests of working people, while big tech billionaires will primarily advocate for their own.
California law permits independent groups like super PACs to contribute unlimited amounts to or against candidates, provided they do not coordinate directly with their campaigns or make direct donations. Earlier this week, reports revealed the launch of another California super PAC, backed by $10 million from Meta and Google. Meta also contributed $50 million in the past week to support Governor Gavin Newsom’s administration in the renovation of three state-owned buildings on Sacramento’s Capitol Mall.
Furthermore, Larsen has joined forces with Google co-founder Sergey Brin and other industry leaders in a $35 million investment in a new state ballot measure drive. Robert Brown, the secretary of Brin’s family foundation, is serving as the principal officer for this committee. These multifaceted efforts underscore the growing importance of state-level politics for major technology companies seeking to navigate the evolving regulatory landscape and maintain favorable policy outcomes.
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