State lawmakers are ready to try regulating the AI industry again

Everyone is talking about AI, whether it’s how much they love it or how much they hate it – or maybe both. Just look at Gov. Kathy Hochul, who has invested money to make New York a leader in AI research while just this week highlighting the dangers of deceptive generative AI during elections. 

The ever-evolving technology is, of course, more consequential than its use for making the governor look like Rambo. It’s why legislation to regulate the industry and the development and use of AI technology has emerged as one of the hottest topics over the last couple of years in Albany. Just last year, deep-pocketed AI startup billionaires found themselves wading into New York state politics as they lobbied against bills to enact safeguards that would affect their bottom lines.

With that in mind, state Sen. Kristen Gonzalez, chair of her chamber’s Internet and Technology Committee, will head up a hearing in New York City on Thursday to examine “risks and solutions” when using AI in areas like hiring, health care and financial services. “While the benefits of AI can be great, and advancements in AI have the potential to transform industries, AI systems are imperfect,” reads a public notice on the upcoming hearing. The stated goal is to better inform lawmakers of “best practices to adopt and challenges to address” when considering how to regulate the notoriously slippery and powerful industry. 

Passing those regulations won’t come easily. Legislators faced strong lobbying efforts against a trifecta of bills last year meant to get the ball rolling on the issue. Only one passed – the RAISE Act – and while it went slightly further than an existing law in California watered down by AI lobbyists, the final amended version closely mirrored the weaker West Coast rules.

The industry similarly lobbied against a bill sponsored by Gonzalez in 2024 to enact strict oversight of many government agencies’ use of AI. The governor ultimately signed that legislation, but only after negotiating for changes that largely gutted many of the regulations.

With the start of a new legislative session, lawmakers have a litany of AI regulatory proposals to consider. Gonzalez will once again push for her New York AI Act that would require audits to weed out bias in algorithms, create liabilities for companies when AI decisions result in unintended consequences and ensure businesses have plans to mitigate risk. Another measure, also from Gonzalez, would hold the developer of an AI chatbot used in health care and other professional settings liable if its use results in harm to a person who had sought guidance from a human in the field. Yet another bill would require transparency in the data used to train AI models.

Gonzalez’s committee has invited a variety of different groups to testify, including abor interests like DC37 and CWA, academics from New York University and Haverford College, tech regulatory advocates, community organizations and members of the tech industry. The hearing is set to begin at 10 a.m. on Thursday.