New York Governor Hochul signs RAISE Act as state AI safety laws face federal challenge

New York Advances AI Safety with RAISE Act

Governor Kathy Hochul signed the RAISE Act on Friday, positioning New York as the second U.S. state to enact comprehensive AI safety legislation 1

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. The law targets AI developers with more than $500 million in annual revenue, requiring them to draft, publish, and follow formalized safety protocols aimed at preventing critical harm 3

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. Companies must report safety incidents to the state within 72 hours of determining one occurred, a stricter timeline than California's 15-day requirement 3

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. State lawmakers passed the bill in June, but following lobbying from the tech industry, Hochul proposed changes to scale it back. The New York Times reports that Hochul ultimately agreed to sign the original bill, while lawmakers agreed to make her requested changes next year 1

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Penalties and Oversight Structure

The penalties under the final version represent a significant reduction from the initial proposal. While the June version included fines of up to $10 million for a first violation and up to $30 million for subsequent violations, the signed version sets penalties at up to $1 million for the first violation and $3 million for any violations after that 2

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. Companies that fail to submit safety reports or make false statements face these financial consequences. The RAISE Act also creates a new oversight office within the Department of Financial Services to monitor AI development and issue annual reports assessing large AI developers 1

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Building on California's Framework

Hochul explicitly referenced California Governor Gavin Newsom's similar safety bill signed in September, positioning New York's law as part of a broader state-level movement. "This law builds on California's recently adopted framework, creating a unified benchmark among the country's leading tech states as the federal government lags behind, failing to implement common-sense regulations that protect the public," Hochul said 1

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. Tech and AI lobbyists negotiated changes so the bill more closely resembled California's SB 53, arguing that state bills should be uniform for industry certainty 4

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. However, bill sponsors secured changes to strengthen requirements around reporting critical safety incidents in the final version.

Industry Response and Political Tensions

Both OpenAI and Anthropic expressed support for New York's bill while calling for federal legislation. Anthropic's head of external affairs Sarah Heck told the New York Times, "The fact that two of the largest states in the country have now enacted AI transparency legislation signals the critical importance of safety and should inspire Congress to build on them" 1

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. Yet opposition remains fierce in some tech circles. A super PAC backed by Andreessen Horowitz and OpenAI President Greg Brockman is looking to challenge Assemblyman Alex Bores, who co-sponsored the bill with state Senator Andrew Gounardes 1

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. Gounardes posted, "Big Tech thought they could weasel their way into killing our bill. We shut them down and passed the strongest AI safety law in the country" 1

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Legal Collision with Trump Executive Order

The RAISE Act arrives just days after President Trump signed an executive order on December 11 titled "Ensuring a National Policy Framework for Artificial Intelligence," which directs federal agencies to challenge state AI laws 1

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. The executive order, backed by Trump's AI czar David Sacks, outlines an "AI Litigation Task Force" at the Department of Justice to challenge state AI laws determined to be in violation of the federal program on AI regulation 3

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. Legal experts speaking to Axios suggested that Trump's executive order relies on a questionable reading of parts of the Constitution, such as the Dormant Commerce Clause, which is typically interpreted as preventing states from writing self-dealing laws unfair to other states—not laws meant to fill a legal vacuum left by the federal government 3

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. New York and California are setting de facto safety rules for frontier AI companies as Congress struggles to settle on federal standards, and the legal battle ahead will likely determine whether states retain authority to regulate AI within their borders 4

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