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Colorado rewrites its first-in-the-nation AI law before it takes effect

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Why it matters

Colorado Governor Jared Polis signed SB 189 on May 15, 2026, substantially rewriting the state's AI regulation before it took effect. The revised law, known as the Colorado Automated Decision-Making Act (CADMA), replaces the original Consumer Protections for Artificial Intelligence Act with a narrower framework focused on transparency and human review rather than broad anti-discrimination mandates. The new statute eliminates the original law's bias-audit and incident-reporting requirements, instead emphasizing disclosure obligations, consumer notice rights, correction mechanisms, and human review in consequential decisions affecting employment, housing, lending, insurance, health care, education, and government services. The effective date moves to January 1, 2027.

The Colorado Attorney General holds exclusive enforcement authority under the revised statute. The original law, SB24-205, was signed in 2024 with an initial February 1, 2026 effective date, then delayed to June 30, 2026 before this rewrite took hold. The specific scope and compliance mechanics of CADMA's disclosure and review requirements remain under review as implementation guidance develops.

Colorado's rewrite signals a significant retreat from the state's initial position as the nation's first comprehensive AI regulator. The change reflects two years of industry pushback and practical concerns that the original framework imposed excessive compliance burdens. Companies that had begun preparing for the original statute's requirements should reassess their compliance strategies under the narrower CADMA framework, particularly regarding which automated decision systems trigger obligations and what disclosure and human-review protocols now apply.

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