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Newsom orders government to consider AI harm in contract rules

The order requires agencies to set AI contract standards and guide employees on vetted tools, watermarking and risks tied to discrimination and surveillance.

  • On Monday, Gov. Gavin Newsom signed an executive order requiring California agencies to review federal supply-chain risk designations before contracting with AI vendors, while implementing new safety guardrails on state AI use.
  • This directive follows a dispute between San Francisco-based Anthropic and the Defense Department over surveillance terms, which led the department to label the firm a supply-chain risk; a judge recently blocked that designation.
  • State agencies must now develop contract standards addressing AI-related discrimination, civil liberties, and child sexual abuse material, while updating the State Digital Strategy to guide watermarking of AI-generated imagery and video.
  • Newsom's office stated the state remains committed to preventing AI misuse, contrasting with President Donald Trump and Republicans in Washington, who officials claim have rolled back protections or ignored potential AI harms.
  • More than 20 California departments are currently using or developing Poppy, a generative AI assistant, as the state balances accelerated technology adoption with the need for guardrails amid intense political scrutiny.
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Associated Press News broke the news in United States on Thursday, April 2, 2026.
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