A Step Backward Disguised as Progress: Why Colorado's AI Bill Just Destroyed Colorado’s Business Future
By Mitch Mitchem
Figure 1: Colorado stands as an outlier in the global AI race, aligning with restrictive regimes like Russia, rather than innovation leaders.
A Future at Risk in a Global Race
As a father of four children, this bill sends a chilling message: my kids have no future in Colorado. This legislation in its current form, is telling the next generation of innovators, leaders, and creators that they need to look elsewhere to pursue their dreams.
As I said to the Governor of Colorado on the Ross Kaminsky show, "If someone walked into an office tomorrow and said, 'hey, just wanted you to know... I'm not going to use the Internet today. I just don't feel comfortable with the Internet... And by the way, I rode a horse to work because I don't feel comfortable with cars.' The entire office would look like that person is just a bit insane, right!?"
Yet Colorado Senate Bill 24-205—titled the "Colorado Artificial Intelligence Act"—would effectively position our entire state as that person refusing to use the internet while riding a horse to work.
On the surface, this bill claims to champion fairness, transparency, and ethical AI. But beneath that polished political language lies a troubling truth: this legislation is a Trojan horse for bureaucratic overreach, one that could derail Colorado's role as an emerging hub of artificial intelligence and digital innovation.
AI is not some distant concept. It's here, powering how we work, live, learn, and grow. But instead of supporting its thoughtful advancement, this bill locks us into a regulatory straitjacket before we've even stretched our wings.
“As of Feb, 2026, this bill will be in effect and Colorado will lose its seat at the AI table and the future.
At that point, we might as well all ride horses to work and unplug our internet connections, because that’s effectively what this bill is asking us to do.”
After training now over 39,000 people in AI implementation across industries ranging from professional sports to Fortune 500 companies, HIVE has witnessed firsthand how human-centered AI integration transforms organizations and empowers individuals. AI represents humanity's great equalizer, the first tool in history that democratizes access to world-class knowledge, allowing anyone, regardless of status or resources, to leverage knowledge previously hoarded by privileged institutions. (See more on this from our CTO, Glen Brackmann’s article.) This bill threatens to undermine that progress and stifle Colorado's potential at a critical moment in technological evolution, especially as global competitors like China and the UAE race ahead with ambitious national AI strategies. In other words, this bill destroys all agency for those that need it most.
Understanding the Bill: A Methodical Analysis
To fully grasp the implications of SB 24-205, sponsored by State Senators Robert Rodriguez and Brianna Titone, along with Representative Manny Rutinel, we at HIVE conducted a comprehensive analysis of its provisions, examining its definitions, requirements, and enforcement mechanisms. we then compared these elements to current best practices in AI implementation, national regulatory trends, and the real-world experiences of organizations successfully integrating AI.
My analysis reveals a fundamental disconnect between the bill's approach and the realities of effective AI integration:
1. Broad Definitions That Overreach
SB 24-205 targets so-called "high-risk AI systems," defined as any system that materially influences decisions related to employment, housing, education, healthcare, financial services, and legal matters.
What's the problem? Almost everything can fall into this bucket. An algorithm that flags job applicants for interview? Covered. A chatbot that recommends financial literacy tools? Covered. Even basic automation tools in HR or admissions might fall under this law's scrutiny. This is regulatory overkill, turning helpful, everyday tools into legal landmines.
The bill defines "algorithmic discrimination" as "any condition in which the use of an AI system results in an unlawful differential treatment or impact that disfavors an individual or group of individuals on the basis of their actual or perceived protected characteristics." This definition is so broad that virtually any differential outcome could potentially trigger liability, even when no discriminatory intent exists.
2. Excessive Burden on Developers and Startups
The law mandates comprehensive documentation, annual bias audits, public disclosures, and individual rights to appeal algorithmic decisions, along with penalties for noncompliance.
For large corporations, these are annoyances. For startups and builders, the lifeblood of innovation in Colorado, these are death sentences.
Specifically, developers must:
•Maintain extensive documentation on system design, development, and intended use
•Document all data used to train and test the system
•Implement measures to identify, assess, and mitigate reasonably foreseeable risks
•Conduct annual audits to identify and mitigate algorithmic discrimination
•Make certain information about high-risk systems publicly available
Entrepreneurs now face legal ambiguity, massive compliance costs, and the looming threat of being sued for undefined "algorithmic discrimination." That doesn't foster innovation. It strangles it in red tape.
3. It Assumes AI Is Guilty Until Proven Innocent
SB 24-205 is not about enabling ethical AI. It's about assuming AI is inherently dangerous and placing the burden of proof on developers to prove otherwise, before a single complaint is even filed.
That's like making car manufacturers prove their vehicles will never be involved in an accident. It's not realistic, and it's not how innovation works.
4. It Promotes a Fear-Based Narrative That Infantilizes Citizens
Perhaps most disturbing is the underlying message this bill sends to Colorado citizens: "You are too stupid to make decisions for yourself, so we need to save you from yourself." This infantilizing approach never works.
I believe deeply, based on my career in learning psychology, AI, and technology, that people are capable of adapting, learning, and thriving with new tools when given the opportunity. This bill does the opposite, it assumes citizens need protection from their own choices and capabilities.
The fear-based narrative behind this legislation says, "We like to control you, your ability to grow, and your need to thrive." It treats citizens as helpless infants rather than capable adults who can learn to use powerful tools responsibly.
History has repeatedly shown that attempts to "protect" people by restricting their access to transformative technologies only delays the inevitable while creating competitive disadvantages. From the printing press to the internet, fear-based restrictions have consistently failed while empowerment and education have succeeded.
5. The "Reasonable Care" Standard Creates Universal Liability
Perhaps the most insidious aspect of this bill is its requirement that developers and deployers exercise "reasonable care" to prevent algorithmic discrimination. This seemingly innocuous phrase is actually a legal landmine that threatens anyone using AI in any area.
Why? Because "reasonable care" is deliberately vague and undefined. There's no established precedent for what constitutes "reasonable care" in AI development or deployment.
This ambiguity creates a situation where:
Every AI user becomes vulnerable to legal action
Compliance is impossible to guarantee in advance
Courts and regulators define "reasonable" after the fact
Organizations must guess what might be considered "reasonable"
The standard can shift over time as interpretations change
This vague standard effectively creates universal liability for AI users across all sectors. A small business using an AI tool for customer service could be held liable for failing to exercise "reasonable care" even if they had no way to know what that standard required. A teacher using an educational AI tool could face similar liability.
The "reasonable care" standard doesn't just affect developers, it creates a chilling effect across the entire AI ecosystem, discouraging adoption even for the most beneficial applications.
The Science vs. The Bill: How Colorado Ignores Educational Evidence
The Colorado AI Bill's approach to education is particularly troubling when contrasted with the growing body of empirical evidence on AI's educational benefits. A comprehensive meta-analysis published in May 2025 in Humanities and Social Sciences Communications examined 51 research studies on ChatGPT's impact on education between November 2022 and February 2025. The findings directly contradict the bill's restrictive approach:
Key Research Findings:
Large Positive Impact on Learning Performance: The meta-analysis found that ChatGPT has a "large positive impact on improving learning performance" (g = 0.867), demonstrating that AI tools significantly enhance student achievement across various educational contexts.
Positive Impact on Learning Perception: The research showed a "positive impact on enhancing learning perception" (g = 0.456), indicating that students develop more positive attitudes toward learning when using AI tools.
Positive Impact on Higher-Order Thinking: The analysis revealed a "positive impact on fostering higher-order thinking" (g = 0.457), demonstrating that AI tools help students develop critical thinking, analysis, and problem-solving skills.
Effectiveness Across Course Types: The research found that ChatGPT's positive impact was moderated by course type, learning model, and duration, suggesting that flexible implementation approaches yield the best results.
Recommended Integration Approaches: The study specifically recommends that "the broad use of ChatGPT at various grade levels and in different types of courses should be encouraged to support diverse learning needs" and that "ChatGPT should be actively integrated into different learning modes to enhance student learning."
How Colorado's Bill Contradicts the Evidence:
Colorado AI Bill (SB 24-205) creates significant challenges for educational institutions that use AI in several key ways:
Teaching with ChatGPT: Schools that teach students to use AI Large Language Models would likely be classified as "deployers" of high-risk AI if those tools contribute to consequential decisions about students (like assessments or educational pathways). So this critical need would be eliminated.
AI for Grading: Using AI to grade papers or tests would almost certainly qualify as a "high-risk AI system" under the bill, as it directly affects educational outcomes. This means teachers will be handcuffed and unable to leverage this technology for efficiency thus further slowing educational progress.
AI in Hiring: To further destroy Colorado education, institutions using AI in hiring decisions would face the full weight of the bill's requirements, including:
Extensive documentation requirements
Annual audits for algorithmic discrimination
Public disclosures about AI use in hiring
Individual notices to job candidates
Appeal processes for candidates
Potential liability under the vague "reasonable care" standard
The bill's requirements create a significant administrative and compliance burden that many educational institutions may not have the resources to meet. This could lead many schools to abandon beneficial AI tools rather than risk non-compliance, effectively denying Colorado students access to educational technologies that have been proven to enhance learning outcomes.
““If the teacher comes back the next day and says, ‘so how did it go with AI? What did you learn? What did you gain from it?’ They’re having an interaction. Now you’re seeing the three things fused together, the teacher, the student and the AI.””
As I shared with Governor Polis during our conversation, Harvard research demonstrated that students using AI as a coach "learned and retained at twice the rate" of their peers. The meta-analysis confirms this wasn't an isolated finding but part of a consistent pattern across dozens of studies.
Colorado's students deserve access to these proven educational benefits. Instead, this bill creates regulatory barriers that will likely prevent many schools from implementing AI tools that could dramatically improve learning outcomes. This approach doesn't protect students, it actively harms their educational opportunities and future competitiveness in an AI-enabled world.
While global educational institutions are rapidly integrating AI to enhance learning, Colorado's bill would effectively force our students to "ride horses to school" in an age of educational acceleration. The evidence is clear: AI enhances learning performance, improves student perception of learning, and develops higher-order thinking skills. Colorado's bill ignores this evidence and chooses fear over educational progress.
My Beliefs: Rooted in Learning, Psychology, and Technology
My perspective on AI isn't theoretical, it's grounded in decades of experience with learning psychology, technology integration, and human development. I fundamentally believe:
People who learn to use AI effectively soar; those who resist fail. This isn't speculation, it's the pattern I've observed across 39,000 training experiences. The divide between AI-enabled and AI-resistant individuals grows wider every day.
AI enhances human capabilities rather than diminishes them. When properly integrated, AI tools actually help restore essential human skills like critical thinking, complex communication, and creativity.
Friction is the enemy of progress. The most successful AI implementations remove barriers rather than create them. Regulatory friction doesn't protect, it paralyzes.
Education, not restriction, is the path forward. People can learn to use powerful tools responsibly when given the opportunity and guidance.
These beliefs aren't just philosophical positions, they're practical insights derived from real-world implementation and measurable outcomes.
Why This Hurts Colorado: Economic and Innovation Impact
The Colorado AI Bill creates significant barriers to innovation and economic growth that will reverberate throughout our state's economy:
It Scares Away Investment and Talent
Venture capital doesn't fund ideas with legal anchors attached. Innovators don't move to states where they need a legal team before they write a line of code. This bill tells the world: "Colorado doesn't trust builders."
The regulatory burden imposed by SB 24-205 creates a competitive disadvantage for Colorado businesses compared to their counterparts in other states. While companies in states with more innovation-friendly environments can move quickly to adopt and integrate AI, Colorado businesses will be slowed by compliance requirements and legal uncertainty.
That's exactly how Colorado will appear to the tech world if we implement this bill—like we're refusing to embrace the future while other states race ahead.
It Undermines AI's Everyday Utility
AI isn't just ChatGPT. It's cancer detection, fraud prevention, personalized education, and smarter energy use. By stifling its development, Colorado risks delaying or outright missing the benefits AI could bring to schools, hospitals, and local communities.
The bill's broad definition of "high-risk AI systems" encompasses many common business applications, potentially subjecting routine tools to heavy regulation. This creates a chilling effect on innovation, as businesses may avoid experimenting with new AI applications due to compliance concerns.
In education alone, we've seen remarkable benefits from AI integration. As I shared with Governor Polis, "every study that's coming out now is showing that students that use it consciously are actually learning faster and retaining more. Harvard did a study about this last year... one hundred and ninety eight students split into two groups. The group that could use AI as a coach with clear direction from the professor learned and retained at twice the rate."
Colorado's students and educators deserve access to these benefits without unnecessary regulatory barriers.
It Makes Colorado a National Outlier, for the Wrong Reasons
While other states build AI ecosystems, Massachusetts, Texas, Florida; Colorado is building a wall of regulation around its innovators. And since efforts to amend the bill failed in May 2025, we're now locked into one of the most aggressive regulatory frameworks in the country.
Our comparative analysis shows that Colorado's approach represents a significant departure from the prevailing national trend:
Most states are taking more measured, targeted approaches to AI regulation
The federal government has focused on voluntary frameworks rather than prescriptive requirements
Other states provide longer implementation periods or phase in requirements gradually
Most states limit enforcement to regulatory agencies without creating new private causes of action
This puts Colorado at a distinct disadvantage in the race to attract and retain AI talent and investment.
A Global Perspective: How Colorado Risks Falling Behind
The contrast becomes even more stark when we compare Colorado's approach to global AI leaders like China and the UAE, who are implementing ambitious national strategies to accelerate AI adoption and secure competitive advantage.
China's Innovation-First Approach
China has implemented a comprehensive, state-driven AI strategy that prioritizes innovation and economic growth:
•The Next-Generation AI Development Plan (2017) aims to position China as the global leader in AI by 2030
•The Made in China 2025 initiative focuses on achieving AI self-sufficiency and technological independence
•China is establishing entrepreneurial bases and innovation hubs to foster AI development
•The government is actively encouraging the development of homegrown AI models like Manus
•Regulation is targeted and sector-specific, designed to enable rather than restrict innovation
UAE's Pro-Innovation Strategy
Similarly, the UAE has implemented a forward-looking, government-led AI strategy focused on economic diversification:
•The National AI Strategy 2031 projects AI will contribute $91 billion to the Emirati economy
•The UAE is the first country to integrate AI into policymaking
•The government has created a dedicated Artificial Intelligence Office to implement the strategy
•The regulatory approach focuses on outcomes rather than prescriptive requirements
•The UAE is strategically balancing international partnerships to accelerate AI adoption
Colorado's Global Disadvantage
While these global competitors race ahead with enabling frameworks and strategic investments, Colorado's bill creates friction that could impede the state's ability to compete:
Colorado businesses will face higher compliance costs than competitors not just in other states but globally
Investment capital naturally flows to jurisdictions with the most favorable innovation environments
The bill could push Colorado talent and companies toward international competitors with more supportive frameworks
The absence of a positive vision for AI's role in Colorado's economy contrasts sharply with international leaders
While China and UAE view AI as a strategic opportunity to be accelerated, Colorado treats it as a risk to be controlled
This global context makes the need for course correction even more urgent. Colorado cannot afford to fall behind in the global AI race due to well-intentioned but misguided regulation.
Real-World Impact: The Truth About AI Integration
The truth I've witnessed across thousands of AI implementations is simple but profound: people who learn to use AI effectively soar; those who resist fail.
This isn't hyperbole, it's a pattern that repeats across industries, roles, and organizations. My team and I have seen it firsthand: individuals, teams, and companies who embrace AI at every level succeed at levels they never imagined possible. Conversely, those who resist struggle to grow and ultimately get clobbered by more adaptive competitors.
The difference is stark and undeniable. Organizations that fully integrate AI across their operations experience:
Exponential productivity gains
Enhanced decision-making capabilities
Unprecedented creative output
Significant competitive advantages
This divide will only grow wider as AI capabilities advance. Colorado's bill, by creating barriers to adoption and integration, effectively pushes more of our citizens and businesses into the "resist and fail" category rather than the "embrace and soar" group.
The Right Approach: Regulate Outcomes, Not Potential
Regulation isn't inherently bad. But we need smart regulation—that targets bad outcomes, not broad potential use cases. We should be punishing actual harm, not theoretical risk.
A more effective approach, based on our extensive experience at HIVE:
Focus on Outcomes
Provide Clear Guidelines That Are Flexible
Support Innovation: Create regulatory sandboxes and safe harbors for experimentation
Phase Implementation: Introduce requirements gradually to allow for adaptation
Harmonize with Federal Approaches:
Learn from Global Leaders
As I noted in my interview with Governor Polis, when discussing AI in education: "If the teacher comes back the next day and says, 'so how did it go with AI? What did you learn? What did you gain from it?' They're having an interaction. Now you're seeing the three things fused together, the teacher, the student and the AI."
This collaborative, outcome-focused approach is what we need from regulation as well—not prescriptive requirements that assume harm before it occurs.
It may be too late for Colorado
As of Feb, 2026, this bill will be in effect and Colorado will lose its seat at the AI table and the future. Worse, we'll lose the next generation of builders to states that understand: the future doesn't wait.
At that point, we might as well all ride horses to work and unplug our internet connections, because that's effectively what this bill is asking us to do.
Mitch Mitchem is the founder of HIVE, a company specializing in behavior change in companies, leadership, AI enablement training, and technology that removes friction. HIVE has trained over 39,000 individuals in effective AI implementation across industries ranging from small and medium business, professional sports to Fortune 500 companies.
References
1.Wang, J., & Fan, W. (2025). The effect of ChatGPT on students' learning performance, learning perception, and higher-order thinking: insights from a meta-analysis. Humanities and Social Sciences Communications, 12, 621.
2.Colorado Senate Bill 24-205 (2024). Colorado Artificial Intelligence Act.
3.Harvard Study on AI in Education (2024). Impact of AI coaching on student learning and retention rates.
4.China's Next-Generation AI Development Plan (2017). National strategy for AI leadership.
5.UAE National AI Strategy 2031 (2019). Framework for AI integration and economic development.
