Pritzker signs AI regulation critics say harms innovation, ‘picks winners’

By Sean Reed | The Center Square
The Center Square

(The Center Square) – Illinois Gov. J.B. Pritzker signed legislation Monday that he and lawmakers said intends to provide new protections to Illinoisans amid advancements in the field of artificial intelligence.

Critics argue the law is what leading AI companies want, and it presents new barriers to entry for startups.

The law, which began as Senate Bill 315, includes provisions requiring AI companies to create policies to mitigate potential risks to users, with annual compliance audits to be conducted by third parties and findings shared with the state.

It also requires AI developers to report safety incidents to the state within three days, or within 24 hours if an incident poses immediate risk of death or harm to a user.

Pritzker said the new law, which allows companies a year to become compliant but takes effect Jan. 1, is needed as a result of federal inaction.

“We must protect our people from the dangers of AI while still harnessing the unique potential of the technology. And we’re doing it in Illinois with a bipartisan, first and most protective in the nation law,” Pritzker said.

While Pritzker said the law is one leading the nation, there are few differences between Illinois’ law and those of New York and California.

Jeremy Kudon, director of American Innovators Network, reiterated his long-running concern over the differences, which he said could have major impacts.

“It’s the third party audit requirement that sets it apart. Everything else is defensible and very close to what SB 53 in California was,” Kudon said. “That was the standard that we thought going into the process Illinois would adopt and would follow and create a national standard, a standard that was growing in acceptance.”

The governor, lawmakers and other top state officials were clear that they don’t want to stifle innovation, and they see clear uses for AI.

“It will have a profound impact on our work, on our health, and on our democracy. And much much more to be honest with you. The decisions we make today will decide whether this tool is used for good or for ill,” House Speaker Emanuel “Chris” Welch said.

State Sen. Mary Edly-Allen, D-Grayslake, said the law she sponsored seeks to provide transparency to users and while holding companies accountable.

Kudon said while state lawmakers are well meaning, major AI companies are essentially regulating themselves – a criticism also levied in the state over national regulatory measures pending in Congress.

“There is a concern when those organizations were advocating for this, I had the same concern in Massachusetts, where this is effectively the legislation that they want to see passed,” Kudon said. “I think the concern is that they will pull the ladder up and make it very, very difficult for any company that’s a startup today to ever be able to reach their heights.”