California Governor Gavin Newsom and Anthropic announced in June 2026 a deal giving state and local government agencies access to Claude, Anthropic’s AI chatbot, at half price. The agreement also includes training and support from Anthropic.
Under the deal, state employees will be able to use Claude to draft documents and analyze information. “AI should not replace the human work of government; it should help our workers move faster, solve problems more effectively, and deliver better results for Californians,” Newsom said in a statement.
The agreement builds on a March executive order from Newsom aimed at accelerating AI adoption in government while maintaining stronger safety standards. “While others in Washington are designing policy and creating contracts in the shadow of misuse, we’re focused on doing this the right way,” Newsom said at the time.
The California deal comes as Anthropic’s relationship with the federal government has deteriorated sharply. Earlier in 2026, Anthropic clashed with the U.S. Department of Defense over a contract that would have allowed the agency to deploy Claude for any lawful use. Anthropic sought explicit protections preventing the government from using its technology to surveil Americans or deploy autonomous weapons without human oversight. Defense Secretary Pete Hegseth refused those terms, and the Pentagon signed a deal with OpenAI instead. The federal government subsequently designated Anthropic a “supply-chain risk,” barring the company from working with any other Pentagon contractors.
Despite that federal designation, California’s CIO and Department of Technology director Chris Given told POLITICO that the supply-chain risk label “just didn’t come up” during negotiations with Anthropic.
The divergence between California’s approach and the federal government’s stance may signal a broader split in how public institutions at different levels are choosing to engage — or disengage — with AI providers.
Source: TechCrunch