Amid artificial intelligence explosion, lawmakers debate best path to regulate

As the artificial intelligence industry rapidly expands, state legislators appear poised to continue imposing regulations on the technology.

Committees in both chambers of the Illinois General Assembly have heard bills that would implement various restrictions and give recommendations on the use of AI in state government and certain industries. The state already has some laws in place, but legislators raised concerns about the harm AI may still be causing consumers.

On April 9 and 10, the Senate held two virtual subject matter hearings on nearly 50 bills about AI and consumer protection, privacy, education and data centers.

Sen. Mary Edly-Allen, D-Libertyville, pointed to social media as an example of what happens when government does not place guardrails on new technology.

“If we got social media wrong, and we did, we cannot afford to get AI wrong,” Edly-Allen said. “Will we act on the lessons we have already learned?”

Industry stakeholders recommended lawmakers let the federal government take control of regulating AI, while acknowledging concerns about its impact. The president, however, declared via executive order in December that he is not in favor of broad AI regulations.

AI advocates also recommended Illinois mirror other states’ laws to prevent a complicated system for companies who operate in many locations.

“Our core concern is creating a patchwork environment, making Illinois a compliance outlier,” said Jarrett Catlin, state AI policy advisor at TechNet, a national technology policy advocacy group. “We need to create clear incentives for responsible behavior without prescribing a one-size-fits-all compliance regime.”

The “patchwork” argument echoes the president’s executive order, which declares that companies must be “free to innovate without cumbersome regulation,” and that state regulation “thwarts this imperative.”

In the hearings, the senators emphasized that they did not want to hinder development and business in the state but are deeply concerned about the lack of guardrails currently in place, particularly around chatbots and minors.

“This isn’t about stifling innovation … but you need to have guardrails to protect minors,” said Sen. Sue Rezin, R-Morris. “This bill is about ensuring that as technology moves faster than the law, we don’t leave consumer protections in the dust, especially when it comes to minors.”

Current and proposed statutes

Illinois already has some laws targeting AI use in image manipulation and intellectual property, according to Andrew Cunningham, senior director of government relations for the Illinois Chamber of Commerce. And broader legislation can be applied to AI usage, as has been done to AI meeting tools under the Biometric Information Privacy Act.

“In many ways, our state laws are adaptive, and bad actors using AI, or any technology, irresponsibly are not operating without potential legal ramifications,” Cunningham said in a statement to Capitol News Illinois.

Ketan Ramakrishnan, a Yale law professor, testified at the Senate hearings on the use of tort law to hold AI companies accountable. Tort is a branch of civil law that allows individuals to seek compensation for harm done to them by a company or individual.

“A lot of these early chatbot suits that you’re seeing are being brought through the common law in various states,” Ramakrishnan said. “These absolutely are not enough, as these systems become more powerful, but they provide an essential basis for other laws that might be passed.”

During the Senate hearings, lawmakers echoed concerns that these laws were not enough, especially when it comes to chatbots. They claimed the terms of service exempt those companies from being held liable for incorrect or harmful information the chatbots may share.

“Large corporations shouldn’t be allowed to hide behind a computer algorithm,” Rezin said. “If AI gives advice that causes consumers to lose their life savings or suffer an injury, the company that deployed the AI must be held responsible.”

The Chamber of Commerce is also currently working with the Illinois Department of Human Rights on implementation of a bill passed in 2024 that prohibits employers from using AI for recruitment, hiring and other employment-related decisions in ways that could result in discrimination of a protected class like gender or race.

“Unfortunately, because rules have not been adopted to implement this act, despite a Jan. 1 effective date, compliance and interpretation for businesses on such a new topic can be extraordinarily cumbersome,” Cunningham said, adding that this is a good example of how new technology is difficult to regulate and broad legislation can be difficult to implement.

Outside spenders, economic interests

As lawmakers consider these regulations, industry donors spent millions supporting “pro-AI” candidates in the midterm primary elections, with mixed results in statewide and national races. And just days before the primary election on March 17, human resource professionals from across Illinois descended upon the Capitol to meet with lawmakers about the use of AI in business and employment.

“Illinois is one of 19 states in the country who has started to try to regulate, to some extent, the use of AI,” said Emily Dickens, chief administrative officer for the Society of Human Resource Management.

A growing number of businesses have begun implementing AI in daily tasks, from generative AI in marketing campaigns to AI programs that analyze large data sets.

Cunningham said that while AI is playing an “increasingly important” role for businesses, its adoption is still in the early stages, with many companies navigating how to apply it.

“There is certainly growth in the hard and soft tech innovation sector when it comes to AI, but today many small businesses are relying more and more on AI to compete in today’s economy and expand their presence with limited budgets,” Cunningham said. “AI is also helping mid-sized and larger businesses with product development, cybersecurity, and tough fixes in our supply chain.”

Dickens emphasized that AI can be used to supplement work, but responsible use should recognize the necessity of humans: “There’s a balance between the innovation … and making sure that you are not excluding people from the workforce who are talented and want the dignity of work.”

That’s where HR comes in, she said.

“People will need a more nuanced and technical skill set” to use AI, Dickens said. “It’s the difference between going in with the whole army and going in with Navy SEALs.”

“HR is what’s been missing, because HR has to hire, HR has to train,” Dickens said. “HR is right in the middle, and we are the connector to education and employment.”

While any proposed bills are still a long way from becoming law, lawmakers remain deep in negotiations with AI industry stakeholders.

The question of whether and how Trump might impose his innovation-first agenda on the states also remains. He revoked Biden-era AI policies within days of taking office in January 2025, but The Department of Justice has made no move to sue states for their AI regulations — yet. With many conflicting interests, the path forward is still a long one.

Capitol News Illinois is a nonprofit, nonpartisan news service that distributes state government coverage to hundreds of news outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.