🗺️ AI Laws USA

10 AI policy moves you should know about — week of July 20, 2026

By AI Laws USA ·

Hamilton County, Tennessee confirmed what many were waiting for; New Jersey made ratepayer protection the law; and a federal lawsuit over AI deepfakes quietly expanded to 3 million victims.

AI Laws USA tracks every U.S. federal, state, county, and city AI law on a single live map at ailawsusa.com. The week of July 20, 2026 saw a confirmation wave: laws and moratoriums that had been proposed or pending got their final votes. Hamilton County, Tennessee's County Commission ratified the moratorium Mayor Wamp proposed three weeks ago. Hawaii's AI companion safety law was signed — quietly, without announcement — becoming Act 248. And New Jersey's governor signed the Data Center Fair Share Act, making the state the latest to require large data centers to pay for the electricity they contract. Meanwhile in the courts, the Grok deepfake class action expanded to 3 million alleged victims. Here are the ten moves that mattered most.

  1. MORATORIUM

    1. Hamilton County, Tennessee's County Commission confirmed a one-year data center moratorium

    Hamilton County, TN (county) · Adopted July 15, 2026 — effective through approximately July 15, 2027

    Hamilton County's County Commission voted on July 15, 2026 to pass the one-year moratorium on new data centers proposed by Mayor Weston Wamp. The moratorium covers data centers with more than 1 megawatt of power demand in unincorporated Hamilton County — home to Chattanooga — and runs through approximately July 15, 2027. One exception was carved out for an existing jail-related facility inside Chattanooga city limits. The moratorium gives the county time to develop permanent standards. Hamilton County borders Walker County, Georgia, which also recently enacted a separate moratorium, making the Tennessee-Georgia border one of the most active data center battlegrounds in the country.

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  2. NEW LAW

    2. Hawaii signed its AI companion chatbot safety law — Act 248

    Hawaii (state) · Signed July 14, 2026 — effective on signing

    Hawaii Governor Josh Green signed SB 3001 into law on July 14, 2026 as Act 248, establishing safety requirements for AI companion chatbots — systems designed to simulate a sustained human-like relationship. The law requires AI companions to disclose their AI nature at the start of every session, implement crisis protocols for users expressing suicidal ideation or self-harm intent, and restricts emotionally manipulative engagement mechanics for minor users. Hawaii's law is narrower than Oregon's SB 1546 (which includes a private right of action) and Washington's HB 2225, but makes it the third state to specifically regulate AI companion chatbots. The bill had been pending since May and lapsed into law on July 14 — the final day before it would have expired without action.

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  3. NEW LAW

    3. New Jersey's Governor Sherrill signed the Data Center Fair Share Act

    New Jersey (state) · Signed July 7, 2026

    Governor Sherrill signed S731/A796 — the Data Center Fair Share Act — on July 7, 2026, one week after the legislature gave final approval on July 1. The law requires large data centers with 100 megawatts or more of contracted electricity to pay for the full amount they contract — preventing them from reserving grid capacity that ratepayers then subsidize. Data centers must also implement demand-response and load-shifting measures during peak grid stress events. New Jersey joins Tennessee (HB 1847) and Florida (SB 484) in enacting ratepayer protection laws specifically targeting data center electricity costs.

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  4. MORATORIUM

    4. Lawrence, Kansas enacted a 24-month data center moratorium — the longest in the country by city commission

    Lawrence, KS (city) · Adopted July 14, 2026 — expires July 14, 2028

    The Lawrence, Kansas City Commission voted unanimously on July 14, 2026 to impose a 24-month moratorium on new data center uses within city limits — the longest city-commission-enacted data center moratorium in the United States. Lawrence is the seat of Douglas County and home to the University of Kansas. Under current city code, data centers are permitted in industrial zones by right; the commission extended the originally proposed 12-month term to 24 months to ensure staff had time to develop new standards. The commission also initiated two Land Development Code text amendments that will govern data center siting going forward. A crowd of commenters opposing data centers spilled out of the commission chamber during the public hearing.

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  5. COURT

    5. 26 Meta employees sued the company, alleging its AI system 'Metamate' selected them for layoffs based on protected status

    United States (federal — N.D. Cal.) · Filed July 15, 2026 — emergency injunction denied July 17, 2026

    Twenty-six current and former Meta employees filed a class action lawsuit in the Northern District of California on July 15, 2026, alleging that Meta's internal AI system 'Metamate' disproportionately selected employees on FMLA, ADA, pregnancy, and Pregnant Workers Fairness Act leave for layoffs. The complaint alleges Meta presented Metamate's selections as objective performance metrics while the underlying model reflected discriminatory patterns. An emergency injunction was denied on July 17, 2026. The case is significant as one of the first employment discrimination suits specifically naming an internal corporate AI system as the mechanism of discrimination — rather than as a factor in an otherwise human-led process.

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  6. NEW LAW

    6. Virginia's statewide facial recognition law for law enforcement took effect July 1

    Virginia (state) · Effective July 1, 2026

    Virginia Code § 15.2-1723.2, enacted in 2025, took effect July 1, 2026. It creates binding statewide rules for all Virginia local law enforcement agencies using facial recognition technology: agencies must post their facial recognition policies publicly, file annual use reports by April 1, provide 30 days' notice before procuring new systems, and log every search. The law bans real-time public tracking using facial recognition and live-video facial recognition databases. Violations are a Class 3 misdemeanor. A companion statute (§ 23.1-815.1) applies the same framework to Virginia public universities. Virginia is home to more data center square footage than anywhere else in the world; its facial recognition law applies to all localities in Northern Virginia's data center corridor.

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  7. NEW LAW

    7. Jackson County, Florida became one of the first U.S. counties to permanently ban data centers countywide

    Jackson County, FL (county) · Effective June 23, 2026 — permanent (no expiration)

    The Jackson County, Florida Board of County Commissioners voted unanimously in June 2026 to permanently ban data centers in unincorporated Jackson County — one of the first outright permanent bans by any U.S. county. The action was triggered by a proposed Compass Lake AI data center project. Unlike moratoriums, which pause approvals while rules are written, Jackson County's ordinance categorically prohibits data center land uses with no sunset date. Jackson County is a rural Florida panhandle county bordering Alabama. The ban was newly indexed in the AI Laws USA dataset this week and takes its place alongside San Marcos, TX and Summit, NJ as among the first jurisdictions in the country to move beyond moratoriums to permanent bans.

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  8. PROPOSED

    8. U.S. Senators introduced the Stop Spying Bosses Act — the most comprehensive federal worker surveillance bill yet

    United States (federal — Senate) · Introduced June 18, 2026 — pending Senate action

    Senators Markey (MA), Schatz (HI), Booker (NJ), Baldwin (WI), Blumenthal (CT), Fetterman (PA), Sanders (VT), and Warren (MA) introduced the Stop Spying Bosses Act on June 18, 2026. The bill would bar employers from collecting or using worker data except where strictly necessary for a defined legitimate work purpose. It prohibits monitoring of union activity, immigration status, political or religious views, off-duty conduct, and health information. Biometric data collection — fingerprints, voiceprints, facial maps — would require express written consent. The bill also bars using AI to infer or predict worker emotions, beliefs, or behavior unrelated to job performance. With a Republican Senate majority, the bill faces long odds, but it represents the most detailed proposed federal framework yet for limiting how AI systems can be used to surveil workers. A companion bill — the Senate No Robot Bosses Act — was introduced the same day.

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  9. COURT

    9. The Grok deepfake class action expanded: 3 million alleged NCII images in 11 days, now including CSAM allegations

    United States (federal — N.D. Cal.) · Amended complaint filed July 7, 2026 — litigation ongoing

    Plaintiffs in Doe v. X.AI Corp. (N.D. Cal., No. 5:26-cv-00772) filed an amended complaint on July 7, 2026 expanding the class action against xAI (the company behind Grok) and adding Stability AI as a co-defendant. The original complaint alleged Grok generated more than 3 million sexualized deepfake images — including of minors — in just 11 days when a safety guardrail was briefly disabled in early 2026. The amended complaint added two new plaintiffs, including one who alleges approximately 7,000 AI-generated child sexual abuse material images depicting them were created using the Grok system. Claims include product liability, negligence, and public nuisance. A companion case (Doe 1 v. X.AI Corp., 5:26-cv-02246) was filed in March 2026. xAI has since rebranded as SpaceXAI. The case is one of the first U.S. class actions to name an AI model's safety failures as the direct mechanism of NCII creation.

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  10. NEW LAW

    10. Pennsylvania signed mandatory annual water and energy reporting for large data centers into law

    Pennsylvania (state) · Signed July 12, 2026 (as part of state budget package)

    Pennsylvania Governor Josh Shapiro signed HB 1924 into law on July 12, 2026 as part of the state budget package. The law requires large data centers in Pennsylvania to file annual reports disclosing their water consumption and energy demand. Data centers that fail to comply face civil penalties of $10,000 per day. Pennsylvania has become one of the nation's fastest-growing data center markets due to its proximity to New York and Washington, D.C. and available land; HB 1924 is the state's first AI-adjacent law directly targeting data center resource consumption. It is similar in structure to Virginia's annual data center reporting requirements, but adds the $10,000 daily penalty provision that Virginia's law lacks.

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The pattern this week is confirmation: laws proposed or voted on weeks ago reached their final form. Tennessee's data center wave is now confirmed across multiple counties; Hawaii quietly became the third state to regulate AI companion chatbots; and New Jersey made ratepayer protection the law of the land for large data centers. Meanwhile, the courts are building a body of AI-specific case law that didn't exist two years ago — both for employment discrimination via AI and for AI-generated intimate imagery. Every one of these developments is tracked and updated in real time at ailawsusa.com. New posts every Monday.

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