Colorado passes law to regulate AI use in consequential decision making

On May 17, 2024, the Colorado Legislature passed Senate Bill (SB) 24-205 to protect employees and consumers by prohibiting developers of high-risk artificial intelligence (AI) systems from engaging in “algorithmic discrimination” in consequential decision-making. This prohibition also applies to organizations that deploy these high-risk AI systems. Governor Jared Polis signed the bill into law on May 17, 2024.

Defining terms

Algorithmic discrimination occurs when AI treats individuals differently in an unlawful manner based on their membership in a protected class, such as religion, sex, or race. A high-risk AI system is defined as any system that makes or plays a substantial role in making a consequential decision, which is defined as “a decision that has a material legal or similarly significant effect on the provision or denial to any consumer, or the cost or terms of” the following services: