Texas Responsible Artificial Intelligence Governance Act

Texas Responsible Artificial Intelligence Governance Act
Short Title	Texas Responsible Artificial Intelligence Governance Act
Official Text	Texas Responsible Artificial Intelligence Governance Act
Country/Jurisdiction	United States
State or Province	Texas
Regulatory Bodies	Texas Attorney General
Date Enacted	2025/06/22
Scope of the Law	Artificial Intelligence
Information
Taxonomy
Strategies

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The Texas Responsible Artificial Intelligence Governance Act (TRAIGA) was enacted law in Texas in June 2025 and becomes effective January 1, 2026. It focuses on the responsible development and deployment of AI systems within the state of Texas, and applies to individuals and entities that develop or deploy AI systems in Texas, or offer products or services used by Texas residents.

Text of the law

H.B. No. 149

AN ACT relating to regulation of the use of artificial intelligence

	systems in this state; providing civil penalties.
	       BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	       SECTION 1.  This Act may be cited as the Texas Responsible
	Artificial Intelligence Governance Act.
	       SECTION 2.  Section 503.001, Business & Commerce Code, is
	amended by amending Subsections (a) and (e) and adding Subsections
	(b-1) and (f) to read as follows:
	       (a)  In this section:
	             (1)  "Artificial intelligence system" has the meaning
	assigned by Section 551.001.
	             (2)  "Biometric [, "biometric] identifier" means a
	retina or iris scan, fingerprint, voiceprint, or record of hand or
	face geometry.
	       (b-1)  For purposes of Subsection (b), an individual has not
	been informed of and has not provided consent for the capture or
	storage of a biometric identifier of an individual for a commercial
	purpose based solely on the existence of an image or other media
	containing one or more biometric identifiers of the individual on
	the Internet or other publicly available source unless the image or
	other media was made publicly available by the individual to whom
	the biometric identifiers relate.
	       (e)  This section does not apply to:
	             (1)  voiceprint data retained by a financial
	institution or an affiliate of a financial institution, as those
	terms are defined by 15 U.S.C. Section 6809;
	             (2)  the training, processing, or storage of biometric
	identifiers involved in developing, training, evaluating,
	disseminating, or otherwise offering artificial intelligence
	models or systems, unless a system is used or deployed for the
	purpose of uniquely identifying a specific individual; or
	             (3)  the development or deployment of an artificial
	intelligence model or system for the purposes of:
	                   (A)  preventing, detecting, protecting against,
	or responding to security incidents, identity theft, fraud,
	harassment, malicious or deceptive activities, or any other illegal
	activity;
	                   (B)  preserving the integrity or security of a
	system; or
	                   (C)  investigating, reporting, or prosecuting a
	person responsible for a security incident, identity theft, fraud,
	harassment, a malicious or deceptive activity, or any other illegal
	activity.
	       (f)  If a biometric identifier captured for the purpose of
	training an artificial intelligence system is subsequently used for
	a commercial purpose not described by Subsection (e), the person
	possessing the biometric identifier is subject to:
	             (1)  this section's provisions for the possession and
	destruction of a biometric identifier; and
	             (2)  the penalties associated with a violation of this
	section.
	       SECTION 3.  Section 541.104(a), Business & Commerce Code, is
	amended to read as follows:
	       (a)  A processor shall adhere to the instructions of a
	controller and shall assist the controller in meeting or complying
	with the controller's duties or requirements under this chapter,
	including:
	             (1)  assisting the controller in responding to consumer
	rights requests submitted under Section 541.051 by using
	appropriate technical and organizational measures, as reasonably
	practicable, taking into account the nature of processing and the
	information available to the processor;
	             (2)  assisting the controller with regard to complying
	with requirements [the requirement] relating to the security of
	processing personal data, and if applicable, the personal data
	collected, stored, and processed by an artificial intelligence
	system, as that term is defined by Section 551.001, and to the
	notification of a breach of security of the processor's system
	under Chapter 521, taking into account the nature of processing and
	the information available to the processor; and
	             (3)  providing necessary information to enable the
	controller to conduct and document data protection assessments
	under Section 541.105.
	       SECTION 4.  Title 11, Business & Commerce Code, is amended by
	adding Subtitle D to read as follows:
	SUBTITLE D.  ARTIFICIAL INTELLIGENCE PROTECTION
	CHAPTER 551.  GENERAL PROVISIONS
	       Sec. 551.001.  DEFINITIONS. In this subtitle:
	             (1)  "Artificial intelligence system" means any
	machine-based system that, for any explicit or implicit objective,
	infers from the inputs the system receives how to generate outputs,
	including content, decisions, predictions, or recommendations,
	that can influence physical or virtual environments.
	             (2)  "Consumer" means an individual who is a resident
	of this state acting only in an individual or household context.  
	The term does not include an individual acting in a commercial or
	employment context.
	             (3)  "Council" means the Texas Artificial Intelligence
	Council established under Chapter 554.
	       Sec. 551.002.  APPLICABILITY OF SUBTITLE. This subtitle
	applies only to a person who:
	             (1)  promotes, advertises, or conducts business in this
	state;
	             (2)  produces a product or service used by residents of
	this state; or
	             (3)  develops or deploys an artificial intelligence
	system in this state.
	       Sec. 551.003.  CONSTRUCTION AND APPLICATION OF SUBTITLE.
	This subtitle shall be broadly construed and applied to promote its
	underlying purposes, which are to:
	             (1)  facilitate and advance the responsible
	development and use of artificial intelligence systems;
	             (2)  protect individuals and groups of individuals from
	known and reasonably foreseeable risks associated with artificial
	intelligence systems;
	             (3)  provide transparency regarding risks in the
	development, deployment, and use of artificial intelligence
	systems; and
	             (4)  provide reasonable notice regarding the use or
	contemplated use of artificial intelligence systems by state
	agencies.
	CHAPTER 552.  ARTIFICIAL INTELLIGENCE PROTECTION
	SUBCHAPTER A.  GENERAL PROVISIONS
	       Sec. 552.001.  DEFINITIONS. In this chapter:
	             (1)  "Deployer" means a person who deploys an
	artificial intelligence system for use in this state.
	             (2)  "Developer" means a person who develops an
	artificial intelligence system that is offered, sold, leased,
	given, or otherwise provided in this state.
	             (3)  "Governmental entity" means any department,
	commission, board, office, authority, or other administrative unit
	of this state or of any political subdivision of this state, that
	exercises governmental functions under the authority of the laws of
	this state.  The term does not include:
	                   (A)  a hospital district created under the Health
	and Safety Code or Article IX, Texas Constitution; or
	                   (B)  an institution of higher education, as
	defined by Section 61.003, Education Code, including any university
	system or any component institution of the system.
	       Sec. 552.002.  CONSTRUCTION OF CHAPTER. This chapter may
	not be construed to:
	             (1)  impose a requirement on a person that adversely
	affects the rights or freedoms of any person, including the right of
	free speech; or
	             (2)  authorize any department or agency other than the
	Department of Insurance to regulate or oversee the business of
	insurance.
	       Sec. 552.003.  LOCAL PREEMPTION. This chapter supersedes
	and preempts any ordinance, resolution, rule, or other regulation
	adopted by a political subdivision regarding the use of artificial
	intelligence systems.
	SUBCHAPTER B. DUTIES AND PROHIBITIONS ON USE OF ARTIFICIAL
	INTELLIGENCE
	       Sec. 552.051.  DISCLOSURE TO CONSUMERS. (a)  In this
	section, "health care services" means services related to human
	health or to the diagnosis, prevention, or treatment of a human
	disease or impairment provided by an individual licensed,
	registered, or certified under applicable state or federal law to
	provide those services.
	       (b)  A governmental agency that makes available an
	artificial intelligence system intended to interact with consumers
	shall disclose to each consumer, before or at the time of
	interaction, that the consumer is interacting with an artificial
	intelligence system.
	       (c)  A person is required to make the disclosure under
	Subsection (b) regardless of whether it would be obvious to a
	reasonable consumer that the consumer is interacting with an
	artificial intelligence system.
	       (d)  A disclosure under Subsection (b):
	             (1)  must be clear and conspicuous;
	             (2)  must be written in plain language; and
	             (3)  may not use a dark pattern, as that term is defined
	by Section 541.001.
	       (e)  A disclosure under Subsection (b) may be provided by
	using a hyperlink to direct a consumer to a separate Internet web
	page.
	       (f)  If an artificial intelligence system is used in relation
	to health care service or treatment, the provider of the service or
	treatment shall provide the disclosure under Subsection (b) to the
	recipient of the service or treatment or the recipient's personal
	representative not later than the date the service or treatment is
	first provided, except in the case of emergency, in which case the
	provider shall provide the required disclosure as soon as
	reasonably possible.
	       Sec. 552.052.  MANIPULATION OF HUMAN BEHAVIOR. A person may
	not develop or deploy an artificial intelligence system in a manner
	that intentionally aims to incite or encourage a person to:
	             (1)  commit physical self-harm, including suicide;
	             (2)  harm another person; or
	             (3)  engage in criminal activity.
	       Sec. 552.053.  SOCIAL SCORING. A governmental entity may
	not use or deploy an artificial intelligence system that evaluates
	or classifies a natural person or group of natural persons based on
	social behavior or personal characteristics, whether known,
	inferred, or predicted, with the intent to calculate or assign a
	social score or similar categorical estimation or valuation of the
	person or group of persons that results or may result in:
	             (1)  detrimental or unfavorable treatment of a person
	or group of persons in a social context unrelated to the context in
	which the behavior or characteristics were observed or noted;
	             (2)  detrimental or unfavorable treatment of a person
	or group of persons that is unjustified or disproportionate to the
	nature or gravity of the observed or noted behavior or
	characteristics; or
	             (3)  the infringement of any right guaranteed under the
	United States Constitution, the Texas Constitution, or state or
	federal law.
	       Sec. 552.054.  CAPTURE OF BIOMETRIC DATA. (a)  In this
	section, "biometric data" means data generated by automatic
	measurements of an individual's biological characteristics.  The
	term includes a fingerprint, voiceprint, eye retina or iris, or
	other unique biological pattern or characteristic that is used to
	identify a specific individual.  The term does not include a
	physical or digital photograph or data generated from a physical or
	digital photograph, a video or audio recording or data generated
	from a video or audio recording, or information collected, used, or
	stored for health care treatment, payment, or operations under the
	Health Insurance Portability and Accountability Act of 1996 (42
	U.S.C. Section 1320d et seq.).
	       (b)  A governmental entity may not develop or deploy an
	artificial intelligence system for the purpose of uniquely
	identifying a specific individual using biometric data or the
	targeted or untargeted gathering of images or other media from the
	Internet or any other publicly available source without the
	individual's consent, if the gathering would infringe on any right
	of the individual under the United States Constitution, the Texas
	Constitution, or state or federal law.
	       (c)  A violation of Section 503.001 is a violation of this
	section.
	       Sec. 552.055.  CONSTITUTIONAL PROTECTION. (a)  A person may
	not develop or deploy an artificial intelligence system with the
	sole intent for the artificial intelligence system to infringe,
	restrict, or otherwise impair an individual's rights guaranteed
	under the United States Constitution.
	       (b)  This section is remedial in purpose and may not be
	construed to create or expand any right guaranteed by the United
	States Constitution.
	       Sec. 552.056.  UNLAWFUL DISCRIMINATION. (a)  In this
	section:
	             (1)  "Financial institution" has the meaning assigned
	by Section 201.101, Finance Code.
	             (2)  "Insurance entity" means:
	                   (A)  an entity described by Section 82.002(a),
	Insurance Code;
	                   (B)  a fraternal benefit society regulated under
	Chapter 885, Insurance Code; or
	                   (C)  the developer of an artificial intelligence
	system used by an entity described by Paragraph (A) or (B).
	             (3)  "Protected class" means a group or class of
	persons with a characteristic, quality, belief, or status protected
	from discrimination by state or federal civil rights laws, and
	includes race, color, national origin, sex, age, religion, or
	disability.
	       (b)  A person may not develop or deploy an artificial
	intelligence system with the intent to unlawfully discriminate
	against a protected class in violation of state or federal law.
	       (c)  For purposes of this section, a disparate impact is not
	sufficient by itself to demonstrate an intent to discriminate.
	       (d)  This section does not apply to an insurance entity for
	purposes of providing insurance services if the entity is subject
	to applicable statutes regulating unfair discrimination, unfair
	methods of competition, or unfair or deceptive acts or practices
	related to the business of insurance.
	       (e)  A federally insured financial institution is considered
	to be in compliance with this section if the institution complies
	with all federal and state banking laws and regulations.
	       Sec. 552.057.  CERTAIN SEXUALLY EXPLICIT CONTENT AND CHILD
	PORNOGRAPHY. A person may not:
	             (1)  develop or distribute an artificial intelligence
	system with the sole intent of producing, assisting or aiding in
	producing, or distributing:
	                   (A)  visual material in violation of Section
	43.26, Penal Code; or
	                   (B)  deep fake videos or images in violation of
	Section 21.165, Penal Code; or
	             (2)  intentionally develop or distribute an artificial
	intelligence system that engages in text-based conversations that
	simulate or describe sexual conduct, as that term is defined by
	Section 43.25, Penal Code, while impersonating or imitating a child
	younger than 18 years of age.
	SUBCHAPTER C.  ENFORCEMENT
	       Sec. 552.101.  ENFORCEMENT AUTHORITY. (a)  The attorney
	general has exclusive authority to enforce this chapter, except to
	the extent provided by Section 552.106.
	       (b)  This chapter does not provide a basis for, and is not
	subject to, a private right of action for a violation of this
	chapter or any other law.
	       Sec. 552.102.  INFORMATION AND COMPLAINTS. The attorney
	general shall create and maintain an online mechanism on the
	attorney general's Internet website through which a consumer may
	submit a complaint under this chapter to the attorney general.
	       Sec. 552.103.  INVESTIGATIVE AUTHORITY. (a)  If the
	attorney general receives a complaint through the online mechanism
	under Section 552.102 alleging a violation of this chapter, the
	attorney general may issue a civil investigative demand to
	determine if a violation has occurred.  The attorney general shall
	issue demands in accordance with and under the procedures
	established under Section 15.10.
	       (b)  The attorney general may request from the person
	reported through the online mechanism, pursuant to a civil
	investigative demand issued under Subsection (a):
	             (1)  a high-level description of the purpose, intended
	use, deployment context, and associated benefits of the artificial
	intelligence system with which the person is affiliated;
	             (2)  a description of the type of data used to program
	or train the artificial intelligence system;
	             (3)  a high-level description of the categories of data
	processed as inputs for the artificial intelligence system;
	             (4)  a high-level description of the outputs produced
	by the artificial intelligence system;
	             (5)  any metrics the person uses to evaluate the
	performance of the artificial intelligence system;
	             (6)  any known limitations of the artificial
	intelligence system;
	             (7)  a high-level description of the post-deployment
	monitoring and user safeguards the person uses for the artificial
	intelligence system, including, if the person is a deployer, the
	oversight, use, and learning process established by the person to
	address issues arising from the system's deployment; or
	             (8)  any other relevant documentation reasonably
	necessary for the attorney general to conduct an investigation
	under this section.
	       Sec. 552.104.  NOTICE OF VIOLATION; OPPORTUNITY TO CURE.  
	(a)  If the attorney general determines that a person has violated
	or is violating this chapter, the attorney general shall notify the
	person in writing of the determination, identifying the specific
	provisions of this chapter the attorney general alleges have been
	or are being violated.
	       (b)  The attorney general may not bring an action against the
	person:
	             (1)  before the 60th day after the date the attorney
	general provides the notice under Subsection (a); or
	             (2)  if, before the 60th day after the date the attorney
	general provides the notice under Subsection (a), the person:
	                   (A)  cures the identified violation; and
	                   (B)  provides the attorney general with a written
	statement that the person has:
	                         (i)  cured the alleged violation;
	                         (ii)  provided supporting documentation to
	show the manner in which the person cured the violation; and
	                         (iii)  made any necessary changes to
	internal policies to reasonably prevent further violation of this
	chapter.
	       Sec. 552.105.  CIVIL PENALTY; INJUNCTION.  (a)  A person who
	violates this chapter and does not cure the violation under Section
	552.104 is liable to this state for a civil penalty in an amount of:
	             (1)  for each violation the court determines to be
	curable or a breach of a statement submitted to the attorney general
	under Section 552.104(b)(2), not less than $10,000 and not more
	than $12,000;
	             (2)  for each violation the court determines to be
	uncurable, not less than $80,000 and not more than $200,000; and
	             (3)  for a continued violation, not less than $2,000
	and not more than $40,000 for each day the violation continues.
	       (b)  The attorney general may bring an action in the name of
	this state to:
	             (1)  collect a civil penalty under this section;
	             (2)  seek injunctive relief against further violation
	of this chapter; and
	             (3)  recover attorney's fees and reasonable court costs
	or other investigative expenses.
	       (c)  There is a rebuttable presumption that a person used
	reasonable care as required under this chapter.
	       (d)  A defendant in an action under this section may seek an
	expedited hearing or other process, including a request for
	declaratory judgment, if the person believes in good faith that the
	person has not violated this chapter.
	       (e)  A defendant in an action under this section may not be
	found liable if:
	             (1)  another person uses the artificial intelligence
	system affiliated with the defendant in a manner prohibited by this
	chapter; or
	             (2)  the defendant discovers a violation of this
	chapter through:
	                   (A)  feedback from a developer, deployer, or other
	person who believes a violation has occurred;
	                   (B)  testing, including adversarial testing or
	red-team testing;
	                   (C)  following guidelines set by applicable state
	agencies; or
	                   (D)  if the defendant substantially complies with
	the most recent version of the "Artificial Intelligence Risk
	Management Framework: Generative Artificial Intelligence Profile"
	published by the National Institute of Standards and Technology or
	another nationally or internationally recognized risk management
	framework for artificial intelligence systems, an internal review
	process.
	       (f)  The attorney general may not bring an action to collect
	a civil penalty under this section against a person for an
	artificial intelligence system that has not been deployed.
	       Sec. 552.106.  ENFORCEMENT ACTIONS BY STATE AGENCIES. (a)  A
	state agency may impose sanctions against a person licensed,
	registered, or certified by that agency for a violation of
	Subchapter B if:
	             (1)  the person has been found in violation of this
	chapter under Section 552.105; and
	             (2)  the attorney general has recommended additional
	enforcement by the applicable agency.
	       (b)  Sanctions under this section may include:
	             (1)  suspension, probation, or revocation of a license,
	registration, certificate, or other authorization to engage in an
	activity; and
	             (2)  a monetary penalty not to exceed $100,000.
	CHAPTER 553. ARTIFICIAL INTELLIGENCE REGULATORY SANDBOX PROGRAM
	SUBCHAPTER A. GENERAL PROVISIONS
	       Sec. 553.001.  DEFINITIONS. In this chapter:
	             (1)  "Applicable agency" means a department of this
	state established by law to regulate certain types of business
	activity in this state and the people engaging in that business,
	including the issuance of licenses and registrations, that the
	department determines would regulate a program participant if the
	person were not operating under this chapter.
	             (2)  "Department" means the Texas Department of
	Information Resources.
	             (3)  "Program" means the regulatory sandbox program
	established under this chapter that allows a person, without being
	licensed or registered under the laws of this state, to test an
	artificial intelligence system for a limited time and on a limited
	basis.
	             (4)  "Program participant" means a person whose
	application to participate in the program is approved and who may
	test an artificial intelligence system under this chapter.
	SUBCHAPTER B. SANDBOX PROGRAM FRAMEWORK
	       Sec. 553.051.  ESTABLISHMENT OF SANDBOX PROGRAM. (a) The
	department, in consultation with the council, shall create a
	regulatory sandbox program that enables a person to obtain legal
	protection and limited access to the market in this state to test
	innovative artificial intelligence systems without obtaining a
	license, registration, or other regulatory authorization.
	       (b)  The program is designed to:
	             (1)  promote the safe and innovative use of artificial
	intelligence systems across various sectors including healthcare,
	finance, education, and public services;
	             (2)  encourage responsible deployment of artificial
	intelligence systems while balancing the need for consumer
	protection, privacy, and public safety;
	             (3)  provide clear guidelines for a person who develops
	an artificial intelligence system to test systems while certain
	laws and regulations related to the testing are waived or
	suspended; and
	             (4)  allow a person to engage in research, training,
	testing, or other pre-deployment activities to develop an
	artificial intelligence system.
	       (c)  The attorney general may not file or pursue charges
	against a program participant for violation of a law or regulation
	waived under this chapter that occurs during the testing period.
	       (d)  A state agency may not file or pursue punitive action
	against a program participant, including the imposition of a fine
	or the suspension or revocation of a license, registration, or
	other authorization, for violation of a law or regulation waived
	under this chapter that occurs during the testing period.
	       (e)  Notwithstanding Subsections (c) and (d), the
	requirements of Subchapter B, Chapter 552, may not be waived, and
	the attorney general or a state agency may file or pursue charges or
	action against a program participant who violates that subchapter.
	       Sec. 553.052.  APPLICATION FOR PROGRAM PARTICIPATION. (a)
	A person must obtain approval from the department and any
	applicable agency before testing an artificial intelligence system
	under the program.
	       (b)  The department by rule shall prescribe the application
	form. The form must require the applicant to:
	             (1)  provide a detailed description of the artificial
	intelligence system the applicant desires to test in the program,
	and its intended use;
	             (2)  include a benefit assessment that addresses
	potential impacts on consumers, privacy, and public safety;
	             (3)  describe the applicant's plan for mitigating any
	adverse consequences that may occur during the test; and
	             (4)  provide proof of compliance with any applicable
	federal artificial intelligence laws and regulations.
	       Sec. 553.053.  DURATION AND SCOPE OF PARTICIPATION. (a) A
	program participant approved by the department and each applicable
	agency may test and deploy an artificial intelligence system under
	the program for a period of not more than 36 months.
	       (b)  The department may extend a test under this chapter if
	the department finds good cause for the test to continue.
	       Sec. 553.054.  EFFICIENT USE OF RESOURCES.  The department
	shall coordinate the activities under this subchapter and any other
	law relating to artificial intelligence systems to ensure efficient
	system implementation and to streamline the use of department
	resources, including information sharing and personnel.
	SUBCHAPTER C. OVERSIGHT AND COMPLIANCE
	       Sec. 553.101.  COORDINATION WITH APPLICABLE AGENCY. (a)
	The department shall coordinate with all applicable agencies to
	oversee the operation of a program participant.
	       (b)  The council or an applicable agency may recommend to the
	department that a program participant be removed from the program
	if the council or applicable agency finds that the program
	participant's artificial intelligence system:
	             (1)  poses an undue risk to public safety or welfare;
	             (2)  violates any federal law or regulation; or
	             (3)  violates any state law or regulation not waived
	under the program.
	       Sec. 553.102.  PERIODIC REPORT BY PROGRAM PARTICIPANT. (a)
	A program participant shall provide a quarterly report to the
	department.
	       (b)  The report shall include:
	             (1)  metrics for the artificial intelligence system's
	performance;
	             (2)  updates on how the artificial intelligence system
	mitigates any risks associated with its operation; and
	             (3)  feedback from consumers and affected stakeholders
	that are using an artificial intelligence system tested under this
	chapter.
	       (c)  The department shall maintain confidentiality regarding
	the intellectual property, trade secrets, and other sensitive
	information it obtains through the program.
	       Sec. 553.103.  ANNUAL REPORT BY DEPARTMENT. (a) The
	department shall submit an annual report to the legislature.
	       (b)  The report shall include:
	             (1)  the number of program participants testing an
	artificial intelligence system in the program;
	             (2)  the overall performance and impact of artificial
	intelligence systems tested in the program; and
	             (3)  recommendations on changes to laws or regulations
	for future legislative consideration.
	CHAPTER 554. TEXAS ARTIFICIAL INTELLIGENCE COUNCIL
	SUBCHAPTER A. CREATION AND ORGANIZATION OF COUNCIL
	       Sec. 554.001.  CREATION OF COUNCIL. (a) The Texas
	Artificial Intelligence Council is created to:
	             (1)  ensure artificial intelligence systems in this
	state are ethical and developed in the public's best interest;
	             (2)  ensure artificial intelligence systems in this
	state do not harm public safety or undermine individual freedoms by
	finding issues and making recommendations to the legislature
	regarding the Penal Code and Chapter 82, Civil Practice and
	Remedies Code;
	             (3)  identify existing laws and regulations that impede
	innovation in the development of artificial intelligence systems
	and recommend appropriate reforms;
	             (4)  analyze opportunities to improve the efficiency
	and effectiveness of state government operations through the use of
	artificial intelligence systems;
	             (5)  make recommendations to applicable state agencies
	regarding the use of artificial intelligence systems to improve the
	agencies' efficiency and effectiveness;
	             (6)  evaluate potential instances of regulatory
	capture, including undue influence by technology companies or
	disproportionate burdens on smaller innovators caused by the use of
	artificial intelligence systems;
	             (7)  evaluate the influence of technology companies on
	other companies and determine the existence or use of tools or
	processes designed to censor competitors or users through the use
	of artificial intelligence systems;
	             (8)  offer guidance and recommendations to the
	legislature on the ethical and legal use of artificial intelligence
	systems;
	             (9)  conduct and publish the results of a study on the
	current regulatory environment for artificial intelligence
	systems;
	             (10)  receive reports from the Department of
	Information Resources regarding the regulatory sandbox program
	under Chapter 553; and
	             (11)  make recommendations for improvements to the
	regulatory sandbox program under Chapter 553.
	       (b)  The council is administratively attached to the
	Department of Information Resources, and the department shall
	provide administrative support to the council as provided by this
	section.
	       (c)  The Department of Information Resources and the council
	shall enter into a memorandum of understanding detailing:
	             (1)  the administrative support the council requires
	from the department to fulfill the council's purposes;
	             (2)  the reimbursement of administrative expenses to
	the department; and
	             (3)  any other provisions necessary to ensure the
	efficient operation of the council.
	       Sec. 554.002.  COUNCIL MEMBERSHIP. (a) The council is
	composed of seven members as follows:
	             (1)  three members of the public appointed by the
	governor;
	             (2)  two members of the public appointed by the
	lieutenant governor; and
	             (3)  two members of the public appointed by the speaker
	of the house of representatives.
	       (b)  Members of the council serve staggered four-year terms,
	with the terms of three or four members expiring every two years.
	       (c)  The governor shall appoint a chair from among the
	members, and the council shall elect a vice chair from its
	membership.
	       (d)  The council may establish an advisory board composed of
	individuals from the public who possess expertise directly related
	to the council's functions, including technical, ethical,
	regulatory, and other relevant areas.
	       Sec. 554.003.  QUALIFICATIONS. Members of the council must
	be Texas residents and have knowledge or expertise in one or more of
	the following areas:
	             (1)  artificial intelligence systems;
	             (2)  data privacy and security;
	             (3)  ethics in technology or law;
	             (4)  public policy and regulation;
	             (5)  risk management related to artificial
	intelligence systems;
	             (6)  improving the efficiency and effectiveness of
	governmental operations; or
	             (7)  anticompetitive practices and market fairness.
	       Sec. 554.004.  STAFF AND ADMINISTRATION. The council may
	hire an executive director and other personnel as necessary to
	perform its duties.
	SUBCHAPTER B. POWERS AND DUTIES OF COUNCIL
	       Sec. 554.101.  ISSUANCE OF REPORTS. (a) The council may
	issue reports to the legislature regarding the use of artificial
	intelligence systems in this state.
	       (b)  The council may issue reports on:
	             (1)  the compliance of artificial intelligence systems
	in this state with the laws of this state;
	             (2)  the ethical implications of deploying artificial
	intelligence systems in this state;
	             (3)  data privacy and security concerns related to
	artificial intelligence systems in this state; or
	             (4)  potential liability or legal risks associated with
	the use of artificial intelligence systems in this state.
	       Sec. 554.102.  TRAINING AND EDUCATIONAL OUTREACH. The
	council shall conduct training programs for state agencies and
	local governments on the use of artificial intelligence systems.
	       Sec. 554.103.  LIMITATION OF AUTHORITY. The council may
	not:
	             (1)  adopt rules or promulgate guidance that is binding
	for any entity;
	             (2)  interfere with or override the operation of a
	state agency; or
	             (3)  perform a duty or exercise a power not granted by
	this chapter.
	       SECTION 5.  Section 325.011, Government Code, is amended to
	read as follows:
	       Sec. 325.011.  CRITERIA FOR REVIEW. The commission and its
	staff shall consider the following criteria in determining whether
	a public need exists for the continuation of a state agency or its
	advisory committees or for the performance of the functions of the
	agency or its advisory committees:
	             (1)  the efficiency and effectiveness with which the
	agency or the advisory committee operates;
	             (2)(A)  an identification of the mission, goals, and
	objectives intended for the agency or advisory committee and of the
	problem or need that the agency or advisory committee was intended
	to address; and
	                   (B)  the extent to which the mission, goals, and
	objectives have been achieved and the problem or need has been
	addressed;
	             (3)(A)  an identification of any activities of the
	agency in addition to those granted by statute and of the authority
	for those activities; and
	                   (B)  the extent to which those activities are
	needed;
	             (4)  an assessment of authority of the agency relating
	to fees, inspections, enforcement, and penalties;
	             (5)  whether less restrictive or alternative methods of
	performing any function that the agency performs could adequately
	protect or provide service to the public;
	             (6)  the extent to which the jurisdiction of the agency
	and the programs administered by the agency overlap or duplicate
	those of other agencies, the extent to which the agency coordinates
	with those agencies, and the extent to which the programs
	administered by the agency can be consolidated with the programs of
	other state agencies;
	             (7)  the promptness and effectiveness with which the
	agency addresses complaints concerning entities or other persons
	affected by the agency, including an assessment of the agency's
	administrative hearings process;
	             (8)  an assessment of the agency's rulemaking process
	and the extent to which the agency has encouraged participation by
	the public in making its rules and decisions and the extent to which
	the public participation has resulted in rules that benefit the
	public;
	             (9)  the extent to which the agency has complied with:
	                   (A)  federal and state laws and applicable rules
	regarding equality of employment opportunity and the rights and
	privacy of individuals; and
	                   (B)  state law and applicable rules of any state
	agency regarding purchasing guidelines and programs for
	historically underutilized businesses;
	             (10)  the extent to which the agency issues and
	enforces rules relating to potential conflicts of interest of its
	employees;
	             (11)  the extent to which the agency complies with
	Chapters 551 and 552 and follows records management practices that
	enable the agency to respond efficiently to requests for public
	information;
	             (12)  the effect of federal intervention or loss of
	federal funds if the agency is abolished;
	             (13)  the extent to which the purpose and effectiveness
	of reporting requirements imposed on the agency justifies the
	continuation of the requirement; [and]
	             (14)  an assessment of the agency's cybersecurity
	practices using confidential information available from the
	Department of Information Resources or any other appropriate state
	agency; and
	             (15)  an assessment of the agency's use of artificial
	intelligence systems, as that term is defined by Section 551.001,
	Business & Commerce Code, in its operations and its oversight of the
	use of artificial intelligence systems by persons under the
	agency's jurisdiction, and any related impact on the agency's
	ability to achieve its mission, goals, and objectives, made using
	information available from the Department of Information
	Resources, the attorney general, or any other appropriate state
	agency.
	       SECTION 6.  Section 2054.068(b), Government Code, is amended
	to read as follows:
	       (b)  The department shall collect from each state agency
	information on the status and condition of the agency's information
	technology infrastructure, including information regarding:
	             (1)  the agency's information security program;
	             (2)  an inventory of the agency's servers, mainframes,
	cloud services, and other information technology equipment;
	             (3)  identification of vendors that operate and manage
	the agency's information technology infrastructure; [and]
	             (4)  any additional related information requested by
	the department; and
	             (5)  an evaluation of the use or considered use of
	artificial intelligence systems, as defined by Section 551.001,
	Business & Commerce Code, by each state agency.
	       SECTION 7.  Section 2054.0965(b), Government Code, is
	amended to read as follows:
	       (b)  Except as otherwise modified by rules adopted by the
	department, the review must include:
	             (1)  an inventory of the agency's major information
	systems, as defined by Section 2054.008, and other operational or
	logistical components related to deployment of information
	resources as prescribed by the department;
	             (2)  an inventory of the agency's major databases,
	artificial intelligence systems, as defined by Section 551.001,
	Business & Commerce Code, and applications;
	             (3)  a description of the agency's existing and planned
	telecommunications network configuration;
	             (4)  an analysis of how information systems,
	components, databases, applications, and other information
	resources have been deployed by the agency in support of:
	                   (A)  applicable achievement goals established
	under Section 2056.006 and the state strategic plan adopted under
	Section 2056.009;
	                   (B)  the state strategic plan for information
	resources; and
	                   (C)  the agency's business objectives, mission,
	and goals;
	             (5)  agency information necessary to support the state
	goals for interoperability and reuse; and
	             (6)  confirmation by the agency of compliance with
	state statutes, rules, and standards relating to information
	resources.
	       SECTION 8.  Not later than September 1, 2026, the attorney
	general shall post on the attorney general's Internet website the
	information and online mechanism required by Section 552.102,
	Business & Commerce Code, as added by this Act.
	       SECTION 9.  (a)  Notwithstanding any other section of this
	Act, in a state fiscal year, a state agency to which this Act
	applies is not required to implement a provision found in another
	section of this Act that is drafted as a mandatory provision
	imposing a duty on the agency to take an action unless money is
	specifically appropriated to the agency for that fiscal year to
	carry out that duty.  The agency may implement the provision in that
	fiscal year to the extent other funding is available to the agency
	to do so.
	       (b)  If, as authorized by Subsection (a) of this section, the
	state agency does not implement the mandatory provision in a state
	fiscal year, the state agency, in its legislative budget request
	for the next state fiscal biennium, shall certify that fact to the
	Legislative Budget Board and include a written estimate of the
	costs of implementing the provision in each year of that next state
	fiscal biennium.
	       SECTION 10.  This Act takes effect January 1, 2026.


	______________________________	______________________________
	   President of the Senate	Speaker of the House     


	       I certify that H.B. No. 149 was passed by the House on April
	23, 2025, by the following vote:  Yeas 146, Nays 3, 1 present, not
	voting; and that the House concurred in Senate amendments to H.B.
	No. 149 on May 30, 2025, by the following vote:  Yeas 121, Nays 17,
	2 present, not voting.
	
	______________________________
	Chief Clerk of the House   

	       I certify that H.B. No. 149 was passed by the Senate, with
	amendments, on May 23, 2025, by the following vote:  Yeas 31, Nays
	0.
	
	______________________________
	Secretary of the Senate   
	APPROVED: __________________
	                Date       
	 
	         __________________
	              Governor

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