USA: Recent Trends on AI Regulation by States

National Law Journal

During the past six months, there has been a trend in domestic executive action regulating artificial intelligence (AI). In addition to the White House’s executive order signed on Oct. 30, 2023, several state governors also signed executive orders creating guidelines for the use of AI technology by government agencies. The governors of MarylandVirginiaCalifornia, and Pennsylvania have recently taken executive action on AI. The state executive orders outline principles for ethical use of the technology while also dedicating resources to continued innovation. States have also established AI advisory panels that are responsible for oversight of AI deployment within state agencies, identifying potential use cases, and promoting the responsible use of AI technologies within the government.

The executive actions offer opportunities for the development and deployment of AI within state governments. For example, Pennsylvania recently launched a pilot program with OpenAI, a leader in the AI space, in which the Pennsylvania Office of Administration is piloting ChatGPT Enterprise to help the government understand and identify use cases for the safe and secure deployment of AI tools in its daily operations. In Maryland, the governor’s action on AI was one of several taken to modernize technology and enhance the digital experience in Maryland. The focus on investment in AI technology tracks the White House’s executive order, which directed increased investment in AI and a focus on recruiting AI professionals.

Along with the opportunities presented by the focus on continued AI innovation, the regulatory frameworks and guardrails established by recent executive actions are significant for private actors who contract with state governments. The regulatory actions outlined in the executive orders will likely guide contracting requirements for vendors and government contractors who use or plan to deploy AI. The executive orders are the precursor to additional guidelines and regulatory requirements by state governments that will likely come after identification of use cases and impact assessments evaluating the benefits, risks, and limitations of the technology for specific government functions.