INSIDE COMPLIANCE

The Colorado AI Act (CAIA), formally known as the “Consumer Protections for Artificial Intelligence” Act, was set to take effect on June 30, 2026. It would have required companies deploying high-risk AI (AI that makes, or is a substantial factor in making, a consequential decision about a person, unlike a low-risk tool such as a spam filter) in hiring, lending, housing, healthcare, and other areas to run a review of how an AI system affects the people subject to it, operate an AI-focused risk-management program, and satisfy a reasonable care duty to avoid discrimination. But on May 14, 2026, Governor Jared Polis signed SB 26-189 (the AI Replacement Law), scrapping the CAIA before any of the burdensome requirements came due. Because the AI Replacement Law lets companies deploy AI first and only offers protection after someone has been harmed, it is an insufficient safeguard for the people affected by AI-driven decisions.