Five state tech stories that made 2025
State technology offices juggled a lot in 2025: modernizing legacy systems, integrating artificial intelligence-powered tools, confronting cybersecurity threats, navigating tight budgets and delivering accessible digital services.
But, as they faced these ever-surging demands, they also grappled with the ever-evolving news landscape under the second Trump administration. From cancelled grants and sweeping federal program changes, to cascading political stalemates and disagreements over government’s role in regulating tech, this year proved just how valuable agility is for top tech officials and state agency leaders across the country.
Amidst this flux, there were five stories that consistently wove throughout the year, shaping how nearly every state tech agency adjusted, pivoted and actualized their goals. As state IT leaders balanced innovation with these constraints and aims for compliance, they showed how to institute broader transformation while piloting often unpredictable waters.
Here are the five biggest tech stories that defined 2025 for state governments.
A moratorium on state AI laws
If 2024’s biggest state IT story was the boom of generative AI, 2025’s was the moratorium that President Donald Trump enacted via executive order earlier this month that preempts state AI laws. Both executive and legislative arms of state government have spent the past several years crafting guardrails for consumer and internal use of the tech, with thousands of bills introduced and hundreds passed so far. In 2025, all of that work was thrown into limbo with the concept of a moratorium.
The idea of a moratorium on state AI laws was first shopped last spring, when a provision was included in a draft of the One Big Beautiful Bill — the broad, budget reconciliation legislation loaded with Trump administration priorities that eventually was passed in July. While the moratorium was dropped from the bill’s final text after a resounding 99-1 vote against the measure, whispers on Capitol Hill signaled it had not been defeated just yet, as top Republicans offered suggestions to pass the measure independently, or include it in another large spending bill or authorization package.
State leaders and the groups representing them immediately pushed back. In June, the National Association of State Chief Information Officers, the National League of Cities, the Council of State Governments, the National Association of Counties, the United States Conference of Mayors and the International City/County Management Association authored a joint letter to congressional leaders opposing the measure.
Several experts have predicted that the order will face legal challenges, claiming it oversteps states’ rights. At the end of November, a bipartisan group of 36 state attorneys general sent a letter to Congress also opposing AI preemption. While noting the benefits of AI, the AGs said the risks it poses, such as scams, deepfakes and harmful interactions — especially for vulnerable groups like children and seniors — make state and local legal protections essential.
However, proponents of the moratorium say it alleviates the often burdensome cost of compliance on small businesses, and helps to bolster technological innovation. Trump’s executive order, while offering carveouts for laws that govern states’ internal uses of AI, could impact state laws that extend to local governments, schools or other public entities. Laws interpreted as regulating AI vendors beyond the terms of their contracts with state and local government agencies might also be affected. But the full moratorium’s impact — and its legality — are sure to come into focus in 2026.
Bested by BEAD
Another far-reaching story that deeply impacted states in 2025 were the sweeping changes issued to the Broadband Equity, Access, and Deployment program over the summer. The expansion of high-speed, reliable broadband access nationwide has been seen as an essential part of giving governments, businesses and communities the connectivity needed to deploy and scale AI tools, cloud services and digital applications.
Just a few months after his appointment to the role by Trump, Commerce Secretary Howard Lutnick announced his intentions to “revamp” the $42.45 billion program, removing what he called “burdensome regulations” imposed by the Biden administration on states and internet service providers. These included the program’s labor, employment and climate reporting requirements.
The updated BEAD program guidance was officially published in June, sending state broadband offices into a scramble to readjust their proposals, and to conduct another round of project bidding referred to as the “Benefit of the Bargain Round,” which instructed states to select the lowest cost bidder. They also revoked any prior proposal approvals, and wiped away the program’s original rules about “nondeployment” funds. Despite pleas from lawmakers, the new rules have yet to be published.
The new rules also dropped the program’s original “fiber first” preference, which opened more pathways for states to spend BEAD funds on technologies like low-Earth orbit satellites and fixed wireless. While this was a move that some states, like Louisiana, were pushing for, the program changes delivered billions to SpaceX’s Starlink, which is owned by billionaire and former “special government employee” Elon Musk.
But those rules are currently under the microscope. In mid-December, the Government Accountability Office found that the National Telecommunications and Information Administration violated the Congressional Review Act when it did not submit its new BEAD rules to Congress prior to issuing them, and therefore, they could be legally ineffective.
It remains to be seen how the GAO’s finding will impact the program heading into the New Year — or how the nondeployment rules will pan out — but as of Dec. 19, 37 out of the 56 states and territories have had their BEAD final proposals approved by NTIA.
Leadership transitions
While states were left to contend with instability stemming from the federal government — as demonstrated by the last two items on this list — internal changes also drove some turbulence. A number of state tech offices faced leadership transitions, losing or gaining the chief information officers that set the state’s tech priorities.
Eleven states underwent CIO transitions in 2025. Many transitions were as a result of retirements or tied to gubernatorial transitions. However, what was stark in this year’s collection of changes is that some transitions were less transparent than others.
At the top of 2025, states such as North Carolina, Tennessee, Kentucky and Indiana kicked off the New Year in flux. In North Carolina, Teena Piccone stepped up to replace Chief Information Officer Jim Weaver, who served as the CIO leading North Carolina’s IT department since March 2021.
In Tennessee, CIO Stephanie Dedmon announced her retirement, triggering a search for a new CIO throughout the first part of the year. In March, the state announced that Kristin Darby, a former health care and finance executive, would be the state’s new CIO. Just north in Kentucky, CIO Ruth Day announced her resignation effective end of 2024, leading to the promotion of longtime deputy CIO Jim Barnhart in May.
And in Indiana, following the departure of CIO Tracy Barnes at the end of 2024 ahead of the new gubernatorial administration taking office, Indiana Gov. Mike Braun named Warren Lenard, an auto dealership executive, as the state’s new CIO in March.
However, some leadership transitions were more opaque. Amaya Capellan, the Pennsylvania CIO, and Chief Technology Officer Brian Andrews stepped away from their roles under unspecified circumstances in October. Capellan has not spoken on the issue, adding only on LinkedIn about the move that “leadership and I agreed that this was the right time for a transition.” Bry Pardoe, who has served as executive director of Pennsylvania’s Commonwealth Office of Digital Experience, or CODE PA, since its formation in April 2023, was named to be Capellan’s replacement in October.
And Laura Clark, Michigan’s CIO, quietly resigned after nearly 20 years with the state government this month, although that transition appeared to have been much more amicable with Clark sharing in a post on LinkedIn Dec. 30 about her next role at Michigan State University as assistant CIO.
Dwindling federal cyber funding
Just like the uncertainty surrounding BEAD and state AI laws, state tech leaders also faced sweeping declines in federal support for state and local cybersecurity efforts. This year saw substantial changes to both the operations of the Cybersecurity and Infrastructure Security Agency and the State and Local Cybersecurity Grant Program, which was created by the 2021 Infrastructure Investment and Jobs Act under former President Joe Biden.
At the start of the year, funding was discontinued for the Elections Infrastructure Information Sharing and Analysis Center, or EI-ISAC, a program housed at the nonprofit Center for Internet Security that provides training, threat-monitoring services and shares resources with elections officials in state and local government offices across the country.
And then the Multi-State Information Sharing and Analysis Center also lost funding for several of its services, including stakeholder engagement, cyber threat intelligence and cyber incident response. This left many jurisdictions without free or heavily subsidized cyber services, and forced the MS-ISAC to move to a fee-based model.
To add to the complexity, new grant rules issued by the Department of Homeland Security prohibited localities from spending SLCGP funds on MS-ISAC services, further complicating how states and locals could use their awards. While the SLCGP continued to remain active with about $91.75 million allocated under the Infrastructure law, this was significantly less than earlier years, and it’s now set to expire.
And as cybersecurity support from the federal government dwindled, state and local officials began to prioritize self-reliance instead.
In November, there was legislative movement to reauthorize the SLCGP program, including the House passage of the PILLAR Act, which would extend and stabilize grant funding until 2033. However further action has yet to be taken, and questions remain about future federal support for state and local government’s cybersecurity efforts.
Government shutdown
And lastly, state agencies also reeled from the impacts of programs temporarily shuttering or defaulting because of the record-breaking federal government shutdown this fall. The shutdown stemmed from a stalemate over extending subsidies from the Affordable Care Act.
The 43-day shutdown disrupted the flow of reimbursement checks to state and local governments, as well as other vessels of federal support that many states normally rely on for major technology and infrastructure projects. This, in many cases, forced governments to delay or rethink spending and planning this fall.
One of the shutdown’s most notable impacts on state and local operations were the lapses to the Supplemental Nutrition Assistance Program benefits in November, after the federal government announced it had “insufficient funds” to pay full SNAP benefits, affecting about 42 million Americans, including low-income families, seniors and children.
The lapse forced state agencies to scramble in covering the difference, as they were already grappling with technical, financial and policy adjustments required by H.R.1, the sweeping federal law known as the One Big Beautiful Bill. The law reshaped how programs like Medicaid and SNAP are administered, including expanding work requirements, eliminating nutrition education and increasing state administrative costs.
A report published in October by the Digital Benefits Network and the Beeck Center for Social Impact and Innovation at Georgetown University found that updating these state eligibility and enrollment platform technologies presents a challenge to implementing the changes required by H.R.1. Many systems are decades old and costly to modify.
And as these administrative systems were thrown into uncertainty — a direct consequence of the shutdown’s interruption of federal operations — states also contended with the uncertainty of whether they’d receive reimbursement even if they were to cover SNAP benefits in the absence of federal funding.
Beyond tech offices, state agencies managing the Women’s, Infant, and Children’s program also began to brace themselves for a potentially sharp increase in demand because of the shutdown’s impact on the SNAP program.
But the impact was much more far-reaching: one expert told StateScoop’s Priorities Podcast that the shutdown caused “states and localities to fundamentally rethink their partnership with the federal government,” the effects of which are likely to be felt as we head into 2026.
