Illinois lawmakers debate AI regulation as federal government stays hands-off
Illinois legislators are moving forward with AI restrictions even as the federal government signals it will not impose broad regulations on the technology. The state Senate held two virtual hearings in April on nearly 50 bills addressing AI use in government, consumer protection, privacy, education and data centers.
The hearings revealed a split between lawmakers concerned about AI harms and industry groups urging restraint. Senators emphasized they want to protect consumers-particularly minors-without stifling business development.
The social media lesson
State Sen. Mary Edly-Allen, D-Libertyville, invoked social media as a cautionary tale. "If we got social media wrong, and we did, we cannot afford to get AI wrong," she said during the hearings.
Sen. Sue Rezin, R-Morris, pointed to chatbots as a specific concern. "Large corporations shouldn't be allowed to hide behind a computer algorithm," Rezin said. "If AI gives advice that causes consumers to lose their life savings or suffer an injury, the company that deployed the AI must be held responsible."
Industry pushes back against state-by-state rules
Tech industry representatives urged lawmakers to let the federal government handle AI regulation. They warned that different state rules would create compliance burdens for companies operating across multiple states.
Jarrett Catlin, state AI policy advisor at TechNet, said: "Our core concern is creating a patchwork environment, making Illinois a compliance outlier. We need to create clear incentives for responsible behavior without prescribing a one-size-fits-all compliance regime."
The federal government's position supports this view. President Trump's executive order issued in December states that companies must be "free to innovate without cumbersome regulation," and that state regulation "thwarts this imperative."
What Illinois already has on the books
Illinois has existing laws targeting AI use in image manipulation and intellectual property. Broader state statutes also apply to AI tools-the Biometric Information Privacy Act, for example, has been used to regulate AI meeting tools.
The state is still implementing a 2024 law that prohibits employers from using AI for recruitment and hiring in ways that could discriminate based on protected characteristics like race or gender. The Illinois Chamber of Commerce noted that lack of clear rules for implementation has created confusion for businesses trying to comply.
Tort law as a backstop
Yale law professor Ketan Ramakrishnan testified that existing tort law-which allows individuals to sue for harm-provides a foundation for AI accountability. Early chatbot lawsuits have been brought under common law in various states.
But lawmakers said this is insufficient. Terms of service often exempt companies from liability for incorrect or harmful information chatbots produce, leaving consumers without recourse.
Businesses navigating early adoption
Many companies are still in early stages of AI adoption, using the technology for marketing, data analysis and supply chain management. Emily Dickens, chief administrative officer for the Society of Human Resource Management, emphasized that responsible AI use in hiring requires human oversight.
"There's a balance between the innovation and making sure that you are not excluding people from the workforce who are talented and want the dignity of work," Dickens said.
She added that HR professionals should act as connectors between technology, education and employment to ensure AI supplements rather than replaces workers.
What comes next
No bills have become law yet. Lawmakers remain in negotiations with industry stakeholders as they weigh competing interests: protecting consumers against the risk of stifling business.
The federal government's approach remains unclear. Trump revoked Biden-era AI policies in January 2025, but the Department of Justice has not sued states over their existing AI regulations.
Government officials working on policy and regulation can strengthen their understanding of AI's capabilities and limitations through targeted training. AI Learning Path for Policy Makers covers governance, policy analysis and data-driven decision-making relevant to these debates.
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