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Concern Over Business Impact

Conn. Senate OKs Privacy Law Update; Dem Leaders Support AI Bill

The Connecticut Senate passed legislation to update the state's comprehensive privacy law. After a 26-9 vote Wednesday, SB-1356 goes to the House.

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“We have had some learning since” the privacy law was signed in 2022, “and so this bill attempts to update that,” said its author Sen. James Maroney (D), who also wrote the original Connecticut Data Privacy Act.

During Senate floor sessions, amendments by Maroney and Sen. Tony Hwang (R) were approved to address cyberbullying. Bill language requires social media platforms and websites aimed at children include a cyberbullying and mental health resources page. In addition, targeted advertising aimed at children would be prohibited, along with addictive features.

Financial account data was added to the definition of sensitive data. Moreover, the right to know which businesses are buying a consumer's data was added, helping people exercise their right to opt-out. The amendment also added “clarity” to the data-minimization requirement, Maroney said, which was somewhat inspired by Maryland’s data privacy bill (see 2504220040).

Sen. Heather Somers (R) proposed an amendment to exclude hospitals from the bill, as they are exempt from the Connecticut Data Privacy Act, which she said would make for an easier transition. Sen. Jeff Gordan (R) also supported the amendment. It failed on an 11-24 vote.

Despite much support for the bill’s intent and the time Maroney spent working on it, some Republicans had concerns. “There's obviously a delicate balance between protecting the data privacy of individuals across Connecticut and also impacting businesses in a way that might be burdensome or prevent them from being able to easily be compliant,” said Sen. Rob Sampson (R). “This is a balancing act. Are we trying to protect consumers and their data? Certainly. And I'm very much in favor of that, but not at the expense of exposing people that have no … dangerous motivation from being able to conduct business.”

Hwang worried that adding too many regulations could ruin an otherwise good bill. “I'm concerned that sometimes we're missing the point: that it could have [a] devastating impact on businesses and our ability in Connecticut to compete, to attract, recruit and build businesses,” he said.

A Connecticut business association previously opposed the bill, contending it would make it difficult for companies to grow (see 2504110030).

Earlier in the day, Senate Democratic leaders held a press conference to discuss Maroney's separate AI bill. SB-2 is meant to build on the state’s comprehensive privacy law (see 2412200047). Maroney introduced a similar bill last year that stalled in the House (see 2502260035).

The Senate was expected to vote on SB-2 later on Wednesday, but didn't take up the bill by our deadline. Connecticut lawmakers are moving the bill while the U.S. House considers a 10-year moratorium on enforcing state AI laws (see 2505140059).

“We are ever more concerned about both the wonderful possibilities of AI, but also the severe threats of AI,” said President Pro Tempore Martin Looney (D). “We all know that the internet was really under-regulated when it first exploded into the world 30 years ago, [and] we'd rather not see history repeat itself.”

SB-2 addresses concerns about using automated decision-making technology (ADMT) in hiring, housing and other important decisions, and sets guardrails using transparency. In addition, it has a narrower scope and adjusted definitions compared to last year's bill.

“We want to be thoughtful and promote the use of AI ... and give everyone an opportunity to succeed equally,” said Maroney. “But we also need to protect people.”

“If you talk to constituents ... they will say to you that they want to have regulations, they want to have parameters around artificial intelligence,” said Sen. Bob Duff (D). “It's up to us to make sure that we're providing those parameters."

Sen. Gary Winfield (D) said, “There's a way to do what we need to do to protect the people of this state without ... unjustly impacting the industry.”

David Zboray, operations manager at training firm VRSim, also spoke in favor of the bill. “The protection measures included are thoughtful regulations to ensure we are aligned with standards that safeguard privacy and also protect us from harm,” he said. “Such clear regulations help create a solid base for any AI explorations. Promoting this legislation lets companies both in and outside of Connecticut know that Connecticut is open for business for AI and both integration and development.”

Some Republican lawmakers expressed concern about the AI bill earlier in the session (see 2503210065), instead supporting different AI legislation, SB-1249, backed by Gov. Ned Lamont (D). However, consumer advocates, including the Electronic Privacy Information Center, opposed SB-1249 for its lack of guardrails, and encouraged passage of SB-2 instead (see 2504080056). In late March, an AI caucus was formed by Maroney and Rep. Hubert Delany (D) to push for SB-2's passage (see 2503270023).