Colorado has always prided itself on being a trailblazer, and in 2024, it made headlines as the first state to pass a comprehensive law regulating artificial intelligence. The goal? To protect everyday people from the unseen influence of AI in decisions that shape their lives—whether applying for a job, seeking a loan, or navigating legal matters.
But just as the ink dried on Senate Bill 24-205 (SB24-205), a new wave of uncertainty rolled in. Congress is now considering a 10-year federal ban on state-level AI regulations, which could put Colorado’s law on ice before it even takes effect in 2026.
What Does Colorado’s AI Law Do?
At its core, SB24-205 is about transparency and fairness. The law requires companies and organizations to notify consumers whenever they’re interacting with an AI system. Imagine applying for a job and knowing whether a computer, not a human, is making the call. If you believe an AI system has treated you unfairly, the law gives you a way to challenge that decision through the state attorney general.
State Representative Brianna Titone, one of the law’s main sponsors, emphasizes that AI is evolving rapidly, and regulations need to keep pace. "If there’s an AI system making decisions on behalf of an entity, how is that affecting you? Do you even know that this AI system is being used?" she asks. The law aims to answer those questions and empower consumers.
Industry Pushback and Calls for Delay
Not everyone is on board. The tech industry, a major economic driver in Colorado, has voiced concerns about the law’s complexity and the short timeline for compliance. The Colorado Technology Association argues that companies need more time to adapt and that the law, as written, could put jobs and economic growth at risk. They’re pushing for a delay in implementation until at least 2027.
Startups, too, have weighed in. Dr. Kelly Kinnebrew, who leads a Boulder-based AI platform, believes the law was initially too broad but appreciates recent efforts to carve out exceptions for smaller companies. While some improvements have been made, the industry remains wary of unintended consequences.
The Federal Wild Card
The biggest twist in the story comes from Washington, D.C. Congress is debating a federal budget bill that includes a 10-year moratorium on state-level AI regulations. If passed, this would override Colorado’s law and any similar efforts in other states. The fate of this provision is uncertain, hinging on complex Senate rules and political negotiations.
Governor Jared Polis and other state leaders acknowledge that Colorado’s law may need tweaks before it goes live. They’re open to changes and want to ensure that businesses have enough time to comply. But if Congress acts first, the entire conversation could become moot.
What Should Coloradans and Businesses Do Now?
- Stay informed: The legal landscape is shifting quickly. Businesses and consumers alike should keep an eye on both state and federal developments.
- Prepare for transparency: Even if the law is delayed or changed, the trend toward greater transparency in AI is likely to continue.
- Engage with policymakers: Both industry leaders and everyday citizens have a voice in shaping how AI is regulated. Don’t hesitate to share your perspective with lawmakers.
Summary of Key Points
- Colorado passed the nation’s first comprehensive AI regulation, set to take effect in 2026.
- The law focuses on transparency and consumer protection, requiring notification and offering recourse for biased AI decisions.
- The tech industry is pushing for a delay, citing concerns about compliance and economic impact.
- Congress may enact a 10-year federal ban on state AI laws, which could override Colorado’s efforts.
- The situation remains fluid, with possible changes at both the state and federal levels.
As the debate continues, one thing is clear: the conversation about how to regulate AI is just getting started, and Colorado is at the center of it all.