Texas Sets AI Policy Agenda: Key Bills from the 89th Legislative Session - and What Businesses Should Do Now

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In its 89th legislative session, Texas enacted a comprehensive package of new laws that place the state at the forefront of artificial intelligence (AI) and media regulation. These laws cover AI development and deployment, deepfake accountability, and age-related controls for digital platforms. Below is a summary of the new legislation, along with practical considerations for organizations operating in Texas or offering services to Texas residents.

1. H.B. 149 – Texas Responsible Artificial Intelligence Governance Act

Effective Date: Jan. 1, 2026

This landmark bill establishes a framework for responsible AI use in Texas and applies to any person or entity that develops, deploys or offers AI systems in the state.

Key Provisions:

  • Requires affirmative disclosures when AI is used in healthcare-related consumer interactions, even if the AI is obviously nonhuman.
  • Prohibits government use of AI for profiling based on biometric data or social behavior.
  • Criminalizes the development or distribution of AI designed to produce child sexual abuse material.
  • Creates a regulatory sandbox for testing innovative AI systems without full regulatory compliance.
  • Establishes the Texas Artificial Intelligence Council to monitor and advise on AI-related policy.
  • Enforcement authority is vested solely in the Texas attorney general; there is no private right of action.

Key Definitions:

  • Artificial Intelligence System: A machine-based system that infers from inputs how to generate outputs, such as decisions, predictions or recommendations, that influence physical or digital environments.
  • Developer: A person or entity that creates an AI system for sale, lease or distribution in Texas.
  • Deployer: A person or entity that uses an AI system in the state.
  • Consumer: A Texas resident acting in a personal or a household capacity.

Practical Considerations:

  • Conduct an enterprise-wide AI inventory and identify roles as “developer” or “deployer.”
  • Healthcare providers must ensure compliance with disclosure requirements in all consumer-facing AI tools (e.g., chatbots, intake systems).
  • Organizations should review biometric AI use and implement bias-testing protocols.
  • Designate internal personnel to oversee AI compliance and prepare a regulatory response plan in case of inquiry.

2. H.B. 3512 – Mandatory AI Training for Government Officials

Effective Date: Sept. 1, 2025

This bill requires designated state and local officials to complete annual AI training, aimed at improving oversight and ethical AI use in the public sector.

Practical Considerations:

  • Companies seeking government contracts involving AI systems may need to demonstrate training protocols.
  • Vendors should prepare to address AI literacy and governance standards in procurement responses.

3. H.B. 3133 – Deepfake Reporting System for Social Media Platforms

Effective Date: Sept. 1, 2025

This law requires social media platforms to implement a clear and accessible process for reporting sexually explicit deepfake content. Verified content must be removed, and users must be notified of the outcome.

Practical Considerations:

  • Platforms must stand up or enhance trust-and-safety workflows to support prompt deepfake review.
  • Retain audit trails for complaint handling, investigations and takedown actions.
  • Noncompliance may constitute a deceptive trade practice under Texas law.

4. H.B. 783 – Civil Liability for Harmful Online Impersonation

Effective Date: Sept. 1, 2025

This bill creates a civil cause of action for individuals impersonated online using AI in a way that is virtually indistinguishable from reality and intended to cause harm.

Notable Exemptions: Satire, parody and law enforcement activities.

Practical Considerations:

  • Public figures, executives and influencers should consider proactive monitoring of voice and likeness misuse.
  • Companies may want to review impersonation protections in terms of service and content moderation policies.
  • Legal and crisis response teams should include AI-driven impersonation in incident response planning.

5. H.B. 581 – Age Verification for AI Image Generation Tools

Effective Date: Sept. 1, 2025

This bill applies to commercial websites that provide tools capable of generating synthetic sexual imagery. Operators must either:

  • Use reasonable age verification methods to ensure users are over 18 or
  • Implement technical restrictions to prevent generation of sexually explicit content.

Practical Considerations:

  • Websites should integrate third-party age verification tools or restrict content generation through keyword filtering and output review.
  • Websites must maintain minimal logs of verification activity to limit exposure while meeting compliance obligations.

6. S.B. 2420 – App Store Accountability Act

Effective Date: Jan. 1, 2026

This law requires app store operators to:

  • Verify account-holder age using commercially reasonable methods.
  • Categorize users into four age tiers: under 13, 13–15, 16–17, and 18+.
  • Obtain verifiable parental consent for minors under 18.

App developers must assign age ratings and disclose data practices. Noncompliance is treated as a deceptive trade practice.

Practical Considerations:

  • App stores should update onboarding workflows to capture and verify user age at account creation.
  • Developers should align app content with declared age tier and monitor for enforcement triggers.
  • Both developers and platform owners should review data collection and parental consent workflows for compliance.

Conclusion

Texas is now one of the most active U.S. jurisdictions in regulating AI, synthetic media and digital safety. With the effective dates staggered between September 2025 and January 2026, businesses have a short runway to align with these new obligations. The emphasis on enforcement by the attorney general – alongside potential Deceptive Trade Practices Act and civil liability exposure – makes early compliance planning essential.

Organizations should begin now by conducting an internal readiness assessment, prioritizing high-risk AI applications and aligning policies with the new legal landscape.

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