California moves forward with bill to regulate AI amid Silicon Valley concerns

The California State Assembly Appropriations Committee voted today in favor of a bill to regulate the artificial intelligence industry that has drawn the ire of some in Silicon Valley and federal lawmakers.

SB 1047, the Secure Innovation for Frontier AI Models Act, would require developers of “frontier” models — models that cost at least $100 million to train — to implement safety safeguards and testing frameworks. The bill would also require companies with such models to undergo audits and provide “reasonable assurances” that the models won’t cause a catastrophe. Developers would have to report on their safety work to state agencies.

According to Fast Company, the bill would also establish a new agency called the Frontier Model Division, which would assist the California state government with enforcing the bill and creating new safety standards.

The bill, which has faced opposition from big tech companies including Meta Platforms Inc. and Google LLC, also proposes establishing “CalCompute,” a publicly funded computing cluster program aimed at providing operational expertise and user support to create “equitable” AI innovation.

Although the bill has strong support in the California Assembly, which is dominated by Democrats, Ro Khanna and Zoe Lofgren, Democratic members of Congress who represent Silicon Valley, have expressed concern that the bill could stifle innovation.

“As a representative of Silicon Valley, I have been pushing for thoughtful regulation around artificial intelligence to protect workers and address potential risks, including misinformation, deepfakes, and an increase in wealth disparity,” Rep. Khanna said in a statement. “I fully agree that legislation is necessary and appreciate the intent behind SB 1047, but I am concerned that the bill as currently written is ineffective, punishes individual entrepreneurs and small businesses, and harms California’s spirit of innovation.”

Lofgren, the ranking member of the House Science, Space, and Technology Committee, separately said the bill is “heavily skewed” toward addressing hypothetical risks “while largely ignoring demonstrable risks of AI such as misinformation, discrimination, non-consensual deepfakes, environmental impacts, and workforce displacement.”

In the face of criticism, the bill has undergone some minor modifications. TechCrunch reports that the revised bill will no longer require AI labs to submit certifications of security test results “under penalty of perjury.” Under the amendments, AI labs will only be required to submit public statements describing their security practices without the threat of criminal liability.

Others who also oppose the bill include Christopher Nguyen, CEO of artificial intelligence startup Aitomatic Inc., who told SiliconValley.com that the bill may hurt startups that rely on large language models like Meta’s Llama 31.

“We rely heavily on this thriving open-source AI ecosystem,” Nguyen said. “If we can’t keep cutting-edge technology accessible, it will immediately impact the startup ecosystem, small businesses, and even the average person.”

The amended bill, as it stands, is now being sent to the California Assembly for approval. Given the Democratic majority, it is now just a matter of knowing when it will be approved and become law.

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