CHANDLER, AZ — As communities across Arizona push back against new data centers and artificial intelligence projects, the Trump administration is taking steps to nationalize how AI is regulated, a move that could make it harder for states to set their own rules.
The shift comes as the Chandler City Council unanimously denied a proposed data center following hours of public comment and strong community opposition.
While Chandler leaders were making their decision locally, President Donald Trump was in the Oval Office outlining a very different approach from the federal level.
“We want to have one central source of approval,” President Trump said. “Every time you make a change, and it could be a reasonable change, you still won’t get it approved if you go to 50 states,” Trump said.
The new executive order in part, directs the Justice Department to challenge state AI laws that conflict with federal policy. The administration argues that a patchwork of state-by-state regulations slows innovation and weakens the country’s ability to compete globally in artificial intelligence.
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In Chandler, Mayor Kevin Hartke said he does not expect the new executive order to affect the city’s vote.
“I understand in President Trump’s words not wanting to have 50 states with 50 different policies with AI, but really this was a land use question not an AI policy question,” Hartke said.
Some community members say the executive order still raises red flags, particularly because it allows the federal government to withhold certain discretionary funds from states that adopt AI policies the administration views as too restrictive.
“That seems to be the motus operandi right now, is they hold federal funds over your head to get what they want, which isn’t really the way the government should be operating,” said Joseph Russo, who protested the Chandler data center project.
The order does not automatically cut off funding, but it wants to give federal agencies the ability to withhold some funds grants on states aligning with federal AI policy.
Valley AI entrepreneurs argue that national rules are necessary to keep the U.S. competitive, pointing to industries like airlines and food safety, where federal standards helped create consistency and growth.
“I have three children, three boys, there is no way I want a country like China to be the leader in AI. I want the United States specifically to be the leader,” said Andrew Bart, CEO of Algoface.
The Trump administration says the executive order is just a starting point and plans to use it as a springboard to push a national AI framework through Congress in 2026.
