Inside California's upcoming year in AI
Add Axios as your preferred source to
see more of our stories on Google.
Illustration: Sarah Grillo/Axios
2026 will be action-packed in California as officials and companies prepare for kids' safety fights, new regulations and the midterms.
Why it matters: California has long been the nation's testbed for innovation and regulation, and all eyes will be on the state this year thanks to AI.
What we're watching: Chatbots are set to take center stage this year.
- Assemblymember Rebecca Bauer-Kahan's Leading Ethical AI Development for Kids Act didn't make it across the finish line last year, but she's planning to introduce a bill within the next month "along the same lines" to protect kids from AI chatbots.
- State Sen. Steve Padilla, meanwhile, is pushing to halt the production of toys with AI chatbot capabilities with SB 867, a first-of-its-kind bill that would place a four-year moratorium on toys with AI and chatbot features for kids under 12.
- We'll also be tracking an effort to get a Common Sense-OpenAI ballot initiative meant to protect kids from AI and chatbots on the ballot.
"The enforcement that's in the ballot initiative is not the enforcement that I would like to see. I didn't get to weigh in or draft it," Bauer-Kahan said.
- "Meaningful enforcement will be an important piece of what the legislature is looking at for sure," she said, without specifying what that would look like.
California's Transparency in Frontier AI Act, SB 53, went into effect on Jan. 1, and frontier AI companies will now have to publish safety reports and follow new transparency, reporting and whistleblower rules.
- SB 53 was tossed around in fights in Congress and at the White House about how to preempt state-level AI regulation as industry looks to get rid of a patchwork of regulation.
- Bauer-Kahan shrugged off the White House's threats to sue states over AI regulation and said that Congress is "a much bigger threat."
Affordability, data centers and AI job displacement are also coming to a head as elections near.
- Bauer-Kahan said she'd like to focus on how AI is going to impact California's workforce.
- "We will be looking at some transparency to try to better understand as policymakers how the economy is going to be affected by the AI age, and how we can start to prepare for that and prepare California for an economy that's frankly going to be different," she said.
- One route, Bauer-Kahan said, is transparency into how models are being used in workplaces right now.
Bauer-Kahan also introduced data center legislation this week to understand and track how much energy is being used and better plan for the grid, adding companies have to pay for it, not consumers.
- That approach is better than a full-on moratorium, which she said would hurt the state's economy.
The bottom line: Even as the Trump administration threatens state-level AI policy, California is pushing ahead with legislative efforts to regulate the tech.
