State interest in AI regulations unlikely to die down soon, expert says
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By
Chris Teale
Even as the federal moratorium threatens to return, state legislators want to regulate the technology themselves absent action from Congress, and are looking at a variety of areas to do so.
DENVER — In late September, California Gov. Gavin Newsom signed legislation regulating artificial intelligence in the state, in a move state officials said installed “commonsense guardrails on the development of frontier artificial intelligence models.”
It represented one of the most significant moves towards regulating AI at the state level this year, as Colorado debates amending its own comprehensive law, while Utah and Texas have their own legislation in place, albeit with only the former currently in effect.
And while those laws represent the biggest forays into state-level AI regulation, lawmakers filed around 1,000 pieces of legislation on the technology this year alone and have seen around 100 enacted, according to Chelsea Canada, a program principal for financial services, technology and communications at the National Conference of State Legislatures. The lack of movement in Congress on AI is a key driver behind state efforts, she said.
“A lot of these trends track from questions around consumer data privacy laws we've been seeing parallel to the conversation around AI regulation, many states taking up data privacy laws without a federal standard that's been put in place,” Canada said during a panel discussion at the National Association of State Chief Information Officers’ annual conference. “The same goes with AI policy. Why there's so many proposals across the U.S. is because of that lack of AI policy at the federal level.”
This year, Canada said most of the bills filed — more than 450 — have focused on regulating the private sector’s use of AI, with government’s use of the technology the next most popular topic to attempt to regulate at around 250 bills. Regulating the public sector’s use of AI had been more popular in previous years, but Canada noted that, as more state task forces report back on government’s proposed uses of the technology, it has been overtaken.
Plenty of trends are popping up in those regulations, too. Canada said states have looked to regulate chatbots and AI’s use in healthcare, which she said are both especially pressing, given that they could “potentially harm constituents.” Also of interest has been regulating AI-generated deepfakes, especially around elections and sexually explicit content, which has happened largely in the last two years. That will continue to be a “huge trend,” she said, especially as next year’s midterm elections get closer, and states are thinking about existing laws on their books.
“In the sexually explicit bucket, some states are looking at maybe just already using the laws that are on the books and expanding definitions to include computer generated [content],” Canada said. “There's not really consensus on some of these, and AI definitions are still in process.”
Congress had attempted to halt this state-level activity regulating AI with a 10-year moratorium in Republicans’ budget reconciliation legislation earlier this year. And despite its removal from the final legislation, known as the “Big, Beautiful Bill,” experts and legislators alike warned it could return in some other form in the future.
At the time, supporters had said the moratorium was necessary to prevent state governments from stifling innovation, and to give a level of consistency to companies that were experimenting in the AI space. Canada said a lot of regulation at the state level has been “reacting to them being a barrier to innovation,” and so included bills in areas like AI education, infrastructure and workforce development.
States have been wrestling with various questions about AI and the future, and Canada said those are likely to continue.
“How is AI going to impact the workforce? How is AI going to impact education, and so forth?” she said. “If I had a crystal ball, which I don't, these trends, I think are going to continue, because we're just at the front end of it in the comprehensive [law] bucket.”