Colorado AI Law's Uncertain Future

U.S. Congress is considering a ban on states regulating artificial intelligence for the next 10 years, creating uncertainty for Colorado’s AI law. Colorado passed a comprehensive law regulating AI in 2024.

State Rep. Brianna Titone, a prime sponsor of Senate Bill 24-205, said the bill aims to protect consumers from AI systems. Titone said that AI systems are being used when people are trying to get a job, a loan, legal decisions, or get into college. The law requires companies to notify consumers when they interact with an AI system and allows consumers to challenge AI systems they believe are biased.

The law is set to take effect in February 2026, but the tech industry is asking for a delay because of concerns that companies won't be able to comply, which could put jobs at risk. The Colorado Technology Association wants the implementation delayed to at least 2027 to address their concerns.

Brittany Morris Saunders, president and CEO of the Colorado Technology Association, said the association wants to extend the implementation date for Senate Bill 24-205 to at least 2027.

Titone said she and other bill sponsors tried to work with the tech industry to improve the law during the past legislative session, but the effort was unsuccessful. Titone said that the tech industry is more interested in getting the law to go away altogether.

Dr. Kelly Kinnebrow, who developed Minerva, testified against SB24-205 last year. Kinnebrew said that the proposed changes in SB25-318 were more to her liking and that the changes are important improvements to help startups get going.

While SB25-318 didn't pass, changes to the state's AI law could still be made if Governor Jared Polis calls a special session later this year. Earlier this month, Polis said that changes need to be made to the law and sufficient time given for successful implementation.

However, changes may not be necessary if Congress passes a bill barring states from regulating AI for 10 years. Morris Saunders said the Colorado Technology Association supports a 10-year federal moratorium.

Morris Saunders said that Colorado is the only state with this level of AI regulation and that SB205 puts Colorado jobs and economic growth at risk. She said that the tech industry contributes over $100 billion to Colorado’s economy each year and accounts for 10 percent of the state’s total employment.

The federal AI moratorium is in the Republican budget bill Congress is considering, but it's unclear if it will survive in the U.S. Senate. A Senate rule known as the Byrd Rule prohibits proposals not directly related to the budget from being part of a reconciliation bill. The Senate parliamentarian will determine whether the AI provisions violate the Byrd Rule.