Relating to regulation of the use of artificial intelligence systems in this state; providing civil penalties.

89th Legislature (2025) Introduced by Salman Bhojani and 11 co-sponsors

Texas HB 149 establishes AI system regulations and civil penalties for violations, effective January 2026, to govern algorithmic decision-making in the state.

Effective on 1/1/26

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Legislative bill overview

HB 149 establishes a regulatory framework for artificial intelligence systems in Texas, creating standards for AI use and imposing civil penalties for violations. The bill, signed into law in June 2025, takes effect January 1, 2026, and applies to both public and private sector AI deployment within the state.

Why is this important

As AI systems increasingly influence critical decisions in hiring, lending, criminal justice, and healthcare, this legislation attempts to protect Texas citizens from algorithmic bias and harmful automated decision-making. The enforcement mechanism through civil penalties creates legal accountability for AI developers and deployers who fail to meet state standards.

Potential points of contention

Definition and scope ambiguity: The bill's specific definition of regulated "AI systems" is unclear from this summary—overly broad definitions could stifle innovation, while narrow ones may leave harmful systems unregulated

Compliance burden and costs: AI regulation may disproportionately affect smaller companies and startups, potentially benefiting large tech firms that can afford compliance infrastructure

Preemption concerns: Tension between state-level regulation and federal AI frameworks under development, potentially creating conflicting requirements for companies operating across multiple states