By: Capriglione, Button, Bonnen, Orr, H.B. No. 149       Bhojani     A BILL TO BE ENTITLED   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.          (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; or                (2)  the training, processing, or storage of biometric   identifiers involved in artificial intelligence systems, unless   the training, processing, or storage is performed for the purpose   of uniquely identifying a specific individual.          (f)  If a biometric identifier captured for the purpose of   training an artificial intelligence system is subsequently used for   a commercial purpose, 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 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 machine   learning and related technology that uses data to train statistical   models for the purpose of enabling computer systems to perform   tasks normally associated with human intelligence or perception,   such as computer vision, speech or natural language processing, and   content generation.                (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.          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:                (1)  by using a hyperlink to direct a consumer to a   separate Internet web page; or                (2)  for an artificial intelligence system related to   health care services, as part of any waivers or forms signed by a   patient at the start of service.          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 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.          Sec. 552.056.  UNLAWFUL DISCRIMINATION. (a)  In this   section:                (1)  "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).                (2)  "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.          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 capable of engaging in text-based conversation   that simulates or describes 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 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 description of the categories of data processed   as inputs for the artificial intelligence system;                (4)  a 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 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)  notified the council and, if   technically feasible, the consumer who submitted the complaint   under Section 552.102 that the violation has been addressed;                            (iii)  provided supporting documentation to   show the manner in which the person cured the violation; and                            (iv)  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 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 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 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.   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 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)  investigate and 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)  investigate and 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)  monitor the regulatory sandbox program under   Chapter 553 in coordination with the Texas Department of   Information Resources; and                (11)  make recommendations for improvements to the   regulatory sandbox program under Chapter 553.          (b)  The council is administratively attached to the Texas   Department of Information Resources, and the department shall   provide administrative support to the council as provided by this   section.          (c)  The Texas 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 10 members as follows:                (1)  four members of the public appointed by the   governor;                (2)  two members of the public appointed by the   lieutenant governor;                (3)  two members of the public appointed by the speaker   of the house of representatives;                (4)  one senator appointed by the lieutenant governor   as a nonvoting member; and                (5)  one member of the house of representatives   appointed by the speaker of the house of representatives as a   nonvoting member.          (b)  Voting members of the council serve staggered four-year   terms, with the terms of 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.  This Act takes effect January 1, 2026.