Colorado lawmakers introduce new AI rules
Add Axios as your preferred source to
see more of our stories on Google.
Illustration: Brendan Lynch/Axios
State lawmakers plan to scrap their first-in-the-nation artificial intelligence law and replace it with rules designed to appease the tech industry.
Why it matters: The long-awaited, hotly contested bill could define how AI is governed in Colorado and serve as a model for future regulation.
Driving the news: The latest regulatory framework, introduced Friday, would target automated decision-making technology that makes "consequential decisions" related to an individual's compensation, eligibility for and access to education, employment, housing, financial services, insurance and health care.
- Any entity using AI must notify consumers and allow them to review and correct any inaccurate personal data used in decision-making.
- Liability for violations of state discrimination laws may fall on the AI developer or the entity that deploys the product.
The law would take effect Jan. 1, 2027, to give the attorney general's office time to craft disclosure requirements and enforcement practices.
What they're saying: "This bill strikes an appropriate balance of protecting consumers while not being onerous on developers or the businesses [that] use AI technology," said Sen. Robert Rodriguez (D-Denver), the bill's main sponsor.
Catch up quick: Rodriguez pushed the state's first AI regulations into law in 2024, but that generated backlash from the business community, which said the bill went too far and would hurt innovation and cost jobs.
- In the 2025 legislative session and a subsequent special session, the business community and lawmakers failed to agree on changes, instead delaying the law's effective date to this June.
- Gov. Jared Polis convened a working group of tech groups and consumer advocates to find a solution; the latest measure reflects many of those recommendations.
Between the lines: By repealing Colorado's existing law, sponsors said it would render moot a lawsuit filed by Elon Musk's xAI company and the U.S. Department of Justice.
Yes, but: President Trump's executive order restricting states from creating AI regulations appeared to target Colorado, and a new law, if approved, would likely draw more court challenges.
What we're watching: The bill's first hearing could come as soon as Tuesday in the Senate's business and technology committee.