State Government’s Race to Shape AI

We all know gen AI (artificial intelligence) is set to redefine work. As companies rush to create AI strategies for businesses, lawmakers are also racing to identify how to best manage AI’s impact on society. In the past year, we have seen states step up to create AI regulations. Let’s take a closer look in today’s blog.

Politics aside, I too recognize this may be nearly impossible for some. Still, for the sake of this discussion, let’s try. The Transparency Coalition’s 2025 report identifies 73 new AI laws across 27 states, making this one of the fastest periods of AI policymaking in American history. These laws span a wide range of concerns:

• Crackdowns on deepfakes affecting fraud, harassment, and intellectual property
• Safety requirements for AI tools used by children
• Rules limiting or prohibiting AI systems in therapy or healthcare contexts
• Designation of certain professions—such as community college teaching—as human-only
• Liability rules preventing individuals from blaming AI for unlawful acts
• Restrictions on foreign-developed AI tools for use in state agencies
• Upcoming requirements for digital provenance systems in consumer devices
• Clear statements establishing consumer ownership of AI-generated outputs

What’s notable is how bipartisan and targeted these policies have become across many different states. Legislators are responding to immediate, practical risks rather than waiting for federal guidance. States are shaping AI governance one use case at a time, from election integrity to medical advice to digital safety for kids.

Here on the blog, I wrote about how California Governor Gavin Newsom signed legislation designed to enhance online safety by installing guardrails on the development of frontier AI models. California isn’t alone either.

In Texas, Governor Greg Abbott and the Texas legislator passed a major piece of AI legislation that has been labeled the TRAIGA (Texas Responsible Artificial Intelligence Governance Act), which goes into effect Jan. 1, 2026. Texas is clearly positioning itself as a pro-innovation state with guardrails as well. The act establishes a clear framework for producing AI products or services used in the state of Texas.

Illinois state lawmakers passed a law requiring humans to teach, while California and Utah prevent police officers from using AI to write up incident reports. Kansas and Oregon prohibited the use of DeepSeek and other foreign-owned or developed AI systems on state computers. These are just a handful of examples of what states are doing to create regulations around the use of AI in different vertical markets.

Wherever you stand on this fencepost, the bottomline is regulation for AI is coming—and in many cases it is already here. And in fact, they are coming fast and furious, state-by-state. Companies must understand the policy frameworks that will govern how AI operates. The future belongs to organizations that can be policy aware.

AI is reshaping communication, regulation, and authority all at once. And those who prepare now will shape what comes next. For now, we are seeing the bulk of regulation at the state level, but what is happening at the federal level will also have an impact on the future of AI at work.

So, join here next week as we take a closer look at the federal government’s race to shape AI, and the implications that it will have on business and work.

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