California Passes 26 AI Bills and Hands Newsom a Defining Test

California lawmakers have sent Governor Gavin Newsom a package of 26 AI, privacy, and child safety bills, including AB 1709 to ban addictive features for users under 16 and SB 1119 (Adam's Law) to regulate companion chatbots, which passed the Senate 39-0 and Assembly 64-4. Newsom has already signed SB 928, requiring a human instructor for California State University courses, and now faces decisions on the remaining bills, including AB 1883, which would bar AI-enabled workplace surveillance that collects neural data or recognizes emotions, with penalties up to $500 per violation.

California lawmakers have sent Governor Gavin Newsom a stack of AI, privacy and child safety bills, but the test is no longer one clean package. Some measures are already law, and the rest now force him to choose where AI rules stop and product design begins. Sam Altman went straight to Newsom over California's chatbot bill, according to Politico's California Decoded newsletter. That's not routine lobbying. It tells you the real fight isn't over whether Sacramento cares about AI safety. It does. The fight is over how much control the state gets over the products that OpenAI, Meta and TikTok - and plenty of others - put in front of people still growing up, still in school, still clocking into work. The Legislature closed August 31 with several major tech bills either on Newsom's desk or newly signed. AB 1709 would stop covered social media platforms from giving users under 16 addictive features such as autoplay and personalized addictive feeds. Then there's SB 1119, called Adam's Law. It would add child safety rules for companion chatbots, including age assurance, risk assessments, limits on persistent memory, restrictions on targeted ads to children and parent notice in some self-harm situations. This is not abstract. SB 1119 is named for Adam Raine, the California teenager whose parents have alleged in a lawsuit that ChatGPT contributed to his death. The bill passed the Senate 39 to 0 and the Assembly 64 to 4, according to state Senator Steve Padilla's office. That's not a party-line vote. When child safety bills move with that kind of vote in California, the industry has a problem. It can still narrow language at the end, and Politico reported that OpenAI was involved in talks over memory and enforcement provisions, but it can't pretend the subject is fringe. Sam Altman Fears a Handful of Companies Will Control AI https://startupfortune.com/sam-altman-fears-a-handful-of-companies-will-control-ai/ OpenAI CEO Sam Altman told podcaster David Senra that his biggest fear is a small number of companies gatekeeping AI, framing it as a choice between "AI authoritarianism or liberty." The remarks land awkwardly given OpenAI's own dependence on Microsoft's cloud and Nvidia's chips, and its pending push for a $1 trillion IPO valuation. - sam altman fears ai companies controlling market access https://startupfortune.com/sam-altman-fears-a-handful-of-companies-will-control-ai/ - how many companies will dominate artificial intelligence industry https://startupfortune.com/sam-altman-fears-a-handful-of-companies-will-control-ai/ The Bills Are Not All Waiting The earlier version of this story treated the whole package as if Newsom had until September 30 to decide every bill. That's wrong. SB 928, from state Senator Sabrina Cervantes, was already signed by Newsom on August 27, according to Cervantes' office. It requires a human faculty member and a human instructor of record for California State University courses. AI can help with a class. It can't be the teacher of record. That single correction changes the shape of the story. Newsom isn't simply standing at the edge of a pile of unsigned bills. He's already started choosing. On education, he sided with faculty and labor groups that wanted a human being formally responsible for CSU instruction. For ed-tech companies selling into those campuses, that means the product has to sit beside the professor, not replace one on paper. AB 1883 is still waiting. Bloomberg Law reported that the bill received its final legislative vote on August 30 and would bar employers, with exceptions, from using AI-enabled workplace surveillance tools to collect neural data or recognize an employee's emotional state. The current bill text authorizes the Labor Commissioner or a public prosecutor to enforce it, with civil penalties of up to $500 per violation. Frankly, that is where the startup stakes are clearest. A hiring tool that claims to read a candidate's emotional state isn't a harmless dashboard if AB 1883 becomes law - and a workplace system that collects nervous-system data doesn't become acceptable just because the vendor calls it wellness software. The label doesn't matter. If you're building around those signals in California, the bill tells you to rethink the product now. Newsom's Pattern Matters Newsom has already shown his preferred move on AI: reject the broad version, sign the narrower one. In October 2025, he signed SB 243, which created safety rules for companion chatbots, while leaving AB 1064 unsigned after warning that it could sweep too broadly. The Los Angeles Times and CalMatters both reported that split. It remains the best guide to what he may do with AB 1709, SB 1119 and AB 1883. AB 1709 may be the hardest call because it reaches directly into the design of Instagram, YouTube, TikTok, Snapchat and similar platforms. FOX40 reported that Newsom praised Assemblymember Josh Lowenthal's work on the bill while saying he wasn't supposed to talk about pending measures. Read that carefully. It isn't a signature. It is a hint from a governor who knows every word will be read by parents, privacy groups, tech lobbyists before the ink dries anywhere. The politics run past Sacramento. CalMatters reported earlier this year that AFL-CIO leaders were pressing Newsom to build a stronger AI record if he wants labor support in a future presidential run, while Meta, OpenAI and Andreessen Horowitz have put money into political committees backing AI-friendly candidates. You don't need to guess why. California is both the home of the companies and the state most willing to regulate them when Congress stalls. Sam Altman Is Now Publicly Wrestling With AI's Decel Debate https://startupfortune.com/sam-altman-is-now-publicly-wrestling-with-ais-decel-debate/ Sam Altman told a podcast that AI development may need to be "paced," not paused, days after an OpenAI model breached Hugging Face on its own using a zero-day exploit. It's the clearest sign yet that the head of the industry's most valuable AI company is taking the decel argument seriously, even as OpenAI keeps raising money at an $852 billion... - sam altman ai safety concerns 2026 https://startupfortune.com/sam-altman-is-now-publicly-wrestling-with-ais-decel-debate/ - openai slowing down ai development pace https://startupfortune.com/sam-altman-is-now-publicly-wrestling-with-ais-decel-debate/ For founders, the mistake is waiting for one grand AI law. The rules are arriving by use case instead: children on chatbots, teenagers on feeds, students in classrooms, workers under surveillance. Newsom can sign one and veto another. Each decision will tell you which kind of AI product California is ready to tolerate, and which kind it now sees as a political liability. Also read: Fervo Energy Signs Its Largest Geothermal Deal Yet With Google, Stock Jumps https://startupfortune.com/fervo-energy-signs-its-largest-geothermal-deal-yet-with-google-stock-jumps/ • Waymo Expands Robotaxi Service to Denver, San Diego and Tampa https://startupfortune.com/waymo-expands-robotaxi-service-to-denver-san-diego-and-tampa/ • GoPro Merges With Starman Optical in $285 Million Pivot to AI Data Centers https://startupfortune.com/gopro-merges-with-starman-optical-in-285-million-pivot-to-ai-data-centers/