Bloomberg Law

New AI training law raises the stakes for entrepreneurs: Dr Lance Eliot

Sometimes something seemingly small can have a big impact. Here is a striking example for entrepreneurs.

A benign bill that has now become law, the AI ​​Training Act, will have significant ramifications for federal contractors who sell AI-related services or products to the federal government or who leverage the ‘IA to provide their services or products in the federal domain.

President Joe Biden signed the bipartisan measure (Public Law 117-207) October 17, 2022. While generally uncontroversial, it took about a year to enact. Senators Gary Peters (D–Mich.) and Rob Portman (R–Ohio) introduced the bill in the Senate last year with unanimous consent. Throughout 2022, Representatives Carolyn Maloney (D–NY) and James Comer (R–Ky.) lobbied diligently in the House, and that chamber passed Bill 393–29 in September.

The clear goal of the new law is to make sure federal agencies get their act together when it comes to procuring any kind of service or product that might rely on AI. A new specialized training program for agency personnel will cover the essence of what AI is, how it works, and the ways in which AI can benefit the US government. The program will also warn agencies to beware of AI-related risks such as invasions of privacy, discriminatory algorithms, or factors that could harm national and national security.

The law specifically states that federal employees who play a role in purchasing, contracting, logistics, cost estimating, systems development, quality control, and program management will be eligible for the training program in AI. The idea is that a fully informed federal workforce will more judiciously review any AI touted by the private sector or in contracts already underway that involve direct or indirect use of AI.

Until now, federal contractors had relatively free rein when it came to making claims about how AI enhanced their products or services. The AI ​​bandwagon has garnered a lot of attention, with some telling feds that their deals were extraordinary because of AI.

Chances were few federal employees could discern whether these claims were valid or bluster. No more.

If federal agencies jump on the AI ​​training bonanza the law dictates, federal employees will be able to ask pointed questions every time a federal contractor brags about their AI. More free rides on the AI ​​Sauce Train. Instead, government workers will cautiously monitor what AI is being used for and the downsides it might present.

Also imagine that sourcing officers will do a severe slicing of proposals that claim AI is powering a bid for services or goods. Like a motorist learning about car engines, procurement officers will delve into the smallest details instead of simply pressing the accelerator pedal to get the car moving.

This may seem daunting to federal contractors who have so far chosen to flaunt AI without having the substance to fully back up their AI-infused claims.

Here’s what you need to do:

  • keep watching. The Office of Management and Budget is responsible for setting up the AI ​​training program, so it would be wise to keep your eyes and ears open as to what AI training actually consists of. You will then know what federal employees will know about AI once the training is complete.
  • Do the same. Make sure your workers know what federal employees know. You need to train your teams to be at a level of AI proficiency comparable to federal authorities. You don’t need everyone on your team to do this, just those who are instrumental in the AI ​​elements underlying your services or products.
  • Focus. If your existing services or products use AI, double-check to make sure the AI ​​will stand up to eagle-eye scrutiny from the federal government. Trying to peddle fragile AI risks getting spotted and could land you in the supply niche.
  • Rise up. If your existing services or products do not not are currently using AI, your days could be numbered. Chances are, an outpouring of this widespread AI training from federal workers will be a huge surge of interest in federal programs to acquire AI-related services and products. As a federal contractor, you are going to be left in the dust if you lack AI capabilities. Better jump in and start figuring out your AI strategy and infusion plan before you miss the boat.

The good news is that you have some time to calibrate your AI situation.

The law gives the OMB up to one year to develop the AI ​​training program. Once deployed, we don’t know how quickly the formation will be adopted by federal agencies. That being said, the OMB could act much faster and get things done sooner, and there could be huge pent-up demand that will drive federal procurement officers to quickly and fervently catch up on AI. .

While the time factor might seem like a sign that you can be nonchalant about it, perhaps there’s another piece of sage advice worth considering. When it comes to winning federal contracts, often the early bird catches the worm. Anticipate AI coming into federal programs and get your house in order. Train your staff in AI and ensure that your services and products are sensible and carefully leverage the latest AI facilities.

It’s a small piece of advice based on a small law that can notably pay significant dividends.

Subscribers can find related content at Bloomberg Government.

Author Information

Dr. Lance Eliot is a world renowned expert in AI and law and is founder and CEO of Techbrium Inc. Additionally, he is a Stanford Fellow affiliated with Stanford Law School and the Stanford Computer Science Department through the Center for Legal Informatics. A former senior executive at a major venture capital firm and partner at a leading consulting firm, he is a successful entrepreneur who has launched, run and sold several high-tech companies. His hugely popular books on AI and law are highly regarded and are available on Amazon and other online booksellers.

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