Federal and California officials are increasingly using procurement policy to impose Artificial Intelligence rules in the absence of broad legislation. The White House and the U.S. General Services Administration are pushing contract requirements focused on neutrality and opposition to ideological bias, while California is moving in the opposite direction by requiring vendors to show safeguards against harmful bias and protections for civil rights. The result is a growing risk of conflicting standards for companies that want to sell Artificial Intelligence systems to government buyers.
The U.S. General Services Administration, which manages government purchasing, released Artificial Intelligence procurement rules March 6 that include a “no dogmas” Artificial Intelligence approach. The nine-page GSA proposal requires, among other things, the use of Artificial Intelligence systems developed and produced in the U.S. It prevents vendors from using government data to train or improve Artificial Intelligence models for other customers. The proposal requires bias monitoring and government-run benchmarking but does not define numeric thresholds for bias or specify which metrics to use. In contrast, the Equal Employment Opportunity Commission uses the four-fifths, or 80%, rule. If a selection rate for any race, sex or ethnic group is less than 80% of the rate for the group with the highest selection rate, it may indicate disparate impact.
California’s response came through a March 30 executive order from Gov. Gavin Newsom, which directs state agencies to develop contracting guidelines that preserve bias safeguards and civil rights protections. The order gives California’s Department of General Services and Department of Technology four months to come up with contracting guidelines. California has not yet issued specific data governance rules, and its approach may be temporary because a future governor can rescind executive orders. Newsom leaves office in January 2027. Even so, the state’s economic weight gives it significant leverage to set procurement-based standards that can counter federal influence.
Legal and compliance experts say procurement has become a powerful regulatory tool because access to government contracts can directly affect revenue. Industry groups continue lobbying lawmakers to limit formal regulation, but procurement rules bypass the legislative process by setting conditions for vendors that want public-sector business. Specialists in governance and compliance argue that organizations will still need strong internal controls for bias testing, explainability, monitoring, and reporting, regardless of political shifts. Procurement may also become a testing ground for different state-level approaches as broader federal regulation remains unsettled.
