Colorado lawmakers pass new AI Act after years-long battle

Colorado lawmakers passed the most sweeping artificial intelligence law in the country back in 2024, since then they've been working to repeal and replace it.

"What was passed two years ago, Senate Bill 205, would have a chilling effect on attracting tech businesses to Colorado, and actually ran some off, because it messages that Colorado is not open for business," said Senate Minority Leader Lisa Frizell.

Lawmakers discussed a solution during last year's regular session and special session. A task force was even created to address it.

"This is a super diverse group of companies, individuals, organizations, coming together to really formulate solid policy in this space. And we did it," Frizell said.

The bill, now on the governor's desk, passed with bipartisan support and works to prevent algorithmic discrimination. It includes a mandate to notify an individual when AI is being used in "consequential decisions" such as employment, healthcare, and housing.

"That bill was introduced very late in the session, and it just flew through, because everybody knows how important it is," Frizell said.

However, two bills aimed at the construction of data centers that power the use of AI failed.

"This has become an extremely complicated and hot topic in the state of Colorado," Frizell said.

The bills were on opposite ends of the spectrum. One incentivized the construction of data centers in Colorado and the other restricted it.

"They don't have to be, but they can be really taxing on our water resources," Frizell said. "There are ways to build data centers with a more closed system. But we can't shut down what has become an incredibly important business in the state of Colorado."

While lawmakers were unable to find middle ground on the hot button issue, it signifies more work to be done even as the state legislature adjourns on Wednesday.