Artificial intelligence (AI) is progressing rapidly and powering solutions previously unimaginable. At the same time, AI legislation is on the rise and a patchwork of state restrictions looms over the momentum of innovators and US leadership. This Monday, HB 2094, the High-Risk Artificial Intelligence Developer and Deployer Act, was vetoed by Governor Glenn Youngkin (R-VA). HB 2094 epitomized the perils of restrictive legislation and Governor Youngkin’s prudent courage is an investment in Virginia’s future.

HB 2094 sought to regulate “high risk systems,” technology that is involved in important decisions like hiring and loans. Companies could be held accountable for the decisions their AI makes, and must go to great lengths before, during, and after using their technology to ensure compliance. The sheer amount of paperwork involved in enforcing and following this law was enough to make it unworkable. Furthermore, the legislation was inconsistent in its application; not all businesses using tech to make high risk decisions were included. The Center for Data Innovation provided an example that captures the contradictions within HB 2094, “consider that an insurer who uses AI to determine who gets a home loan would likely not be subject to the bill’s requirements but a housing association using AI to screen tenants would be. Both decisions affect access to housing and both sectors are already subject to anti-discrimination oversight. Drawing a bright line between them makes no sense.”

HB 2094 would have seriously harmed the tech economy of Virginia. In a letter to Governor Youngin, the U.S. Chamber of Commerce evaluated the consequences for Virginia businesses and concluded that, “Subjecting small businesses to rules that hinder their ability to use AI tools will hinder their ability to compete. HB 2094 could have significantly impacted the usefulness of AI tools used by small businesses as well as subject them to compliance costs that put them at a disadvantage.” While one of the goals of the bill was to create a more equitable business environment, disadvantaged small businesses and stratifying the tech market is hardly equity.”

Recognizing these risks, Governor Youngkin took a stand. In his veto statement, he identified the heart of the issue: “The role of government in safeguarding AI practices should be one that enables and empowers innovators to create and grow, not one that stifles progress and places onerous burdens on our Commonwealth’s many business owners. This bill would harm the creation of new jobs, the attraction of new business investment, and the availability of innovative technology in the Commonwealth of Virginia.” The Governor’s leadership in this area serves as a powerful example to other governors and lawmakers and sets a precedent for thoughtful policymaking over rushed regulation.

Other state legislatures are taking a different approach to regulating AI, and acting in the spirit of Governor Youngkin’s push to “enable and empower innovators to create and grow.” “Right to Compute” laws have emerged in Montanna and New Hampshire. Though the proposals differ in their nuances, both are efforts to protect citizens’ right to use and develop technology without preemptive and unwarranted red tape. Taylor Barkley, director of the Abundance Institute, explains the ethos of such proposals: “the “right to compute” is rooted in the principle that individuals should be free to use technology without unnecessary government barriers. While one could argue this right is already implied, the current wave of AI regulations necessitates explicit protection. Unlike states proposing strict pre-deployment regulations that stifle innovation, Montana and New Hampshire offer a balanced model: minimizing government interference while implementing safeguards against genuine harm.”

When states are hospitable to AI and innovation more broadly, good follows. In Louisiana, major investments from groups like Meta are creating jobs and signaling to the national tech industry that Louisiana is prepared to receive the economic boost that a thriving tech sector brings. Instead of the fearful and short-sighted approach of Virginia’s HB 2094 and similar measures, lawmakers can explore frameworks that work in the best interest of their state and have long-term benefits for the businesses in their communities.