Artificial intelligence is rapidly proliferating, Utah lawmakers said Wednesday, bringing with it the potential for innovation and technological advancement, as well as new forms of fraud and other crimes of deception.

"AI is going to be transformative," said Sen. Ann Millner, R-Ogden. "We all need to understand that, much like the internet was transformative—but it's going to be much faster.

Among a slew of proposed legislation on the topic, one bill by Draper Republican Sen. Kirk Cullimore seeks to establish "guard rails" around AI technology, while maintaining an environment where businesses can experiment with the new approaches that AI facilitates.

Cullimore said his bill, SB149, was developed by a working group of industry stakeholders and state regulators. It seeks to create a voluntary "AI Laboratory" under the state Department of Commerce, through which participating firms could operate under relaxed regulations while generating test cases for how AI is deployed in the private sector and what updates to state law are necessary as the technology advances.

"It was an attempt to say 'AI is coming, it’s going to penetrate every industry under the sun, what should the sate do about this?'" Cullimore said. "We want to promote innovation. We don't want to stifle that."

Cullimore compared his bill to the state's "Regulatory Sandbox," a program created in recent years that allows for similar flexibility from regulatory codes to various private interests. But while firms that participate in the AI Laboratory would be shielded from some level of risk when they enter into "gray areas," his bill also codifies that fraud perpetuated through artificially intelligent means—like deepfakes and other disingenuous AI applications—would be a criminal offense under the Deceptive Practices Act.

"It's not a defense to say 'The AI bot did it'," Cullimore said. "Whoever prompted it is still liable under the Act."

State and federal code has often struggled to keep pace with emerging technologies, particularly as the pace of advancement accelerates. Cullimore said that his bill would allow firms to work with the state, addressing issues as they arise and producing recommendations and data to aid lawmakers and regulators.

"We're hoping that this promotes innovation and new startups in Utah," he said.

SB149 has yet to receive an initial committee hearing. It is currently held by the Senate's Business and Labor committee.