Governor Hochul Highlights First Statewide Moratorium on New Hyperscale Data Centers as Support Continues to Grow

Additionally, the Governor is directing DPS to consider creating a New York Grid Acceleration Fund to require data centers to invest in the state's aging grid infrastructure and energy needs so all New Yorkers benefit from responsible development. The fund could support the procurement of new clean energy supply and establishment of an insurance pool to which developers may need to contribute to protect against speculative large loads that create uncertainty and increase costs. DPS will also consider approaches to require data centers to fund new clean electric generation dedicated to their operations, including but not limited to customer-sited distributed energy resources and battery storage.

Finally, Governor Hochul is pursuing legislation to repeal sales tax exemptions for massive data centers across the state.

Since taking office, Governor Hochul has ensured New York is leading the nation in AI innovation and development. As part of her FY25 Budget, the Governor launched Empire AI, a nation-leading initiative to advance AI research for public good. This year, she launched the FutureWorks Commission to advise on policy and private sector actions to protect the security of workers while harnessing the economic benefits of AI for all New Yorkers. This blue ribbon Commission is composed of nation-leading experts, workers' advocates, and business leaders, and will be charged with advising Governor Hochul on how to navigate the AI transition, so that the benefits of AI can be shared among New York's families, workers, and small businesses - not just large corporations.

Governor Hochul also implemented nation-leading safeguards to keep New Yorkers safe online and to ensure safe and responsible AI use in New York State. Initiatives include:

· The SAFE for Kids Act and Child Data Protection Act that restrict addictive feeds for kids and prevent online operators from collecting and monetizing children's data without informed consent.

· AI Companion legislation which set first-in-the-nation safeguards, diverting user conversations about self-harm to mental health resources and interrupting unhealthy addictive behaviors. The Governor also outlawed AI-Generated Child Sexual Abuse Material.

· The recently signed Warning Labels bill that will require social media companies post warnings about the platform's potential impact on mental health.

· AI Deceptive Practices Act, which enhances protections against unauthorized use of likeness/voice and the unauthorized dissemination of intimate images.

This year, the Governor's Safe by Design Act was enacted in the FY27 State Budget. Safe by Design ensures that parental controls for kids are set at the highest protections on common social and gaming platforms, which means that non-connections above the age of 18 cannot privately communicate with kids, view their full profile, or tag them in content. Location settings will also be turned off by default, and children under 13 must receive parental approval for new connections. It also disables certain AI chatbot features on online platforms for kids and parents must be able to set limits on children's financial transactions on online gaming platforms and view their child's transaction history. While many of these platforms have increased their security features for kids, in New York it is now the law, and cannot be relaxed by these platforms over time.

Additionally, Governor Hochul is creating a first-of-its kind Office of Digital Innovation, Governance, Integrity, and Trust (DIGIT). DIGIT will serve as a central, authoritative body for digital safety and technological governance, devising new approaches and ensuring consistent enforcement to keep New Yorkers safe online while protecting New York's position as a state that values and invests in cutting-edge innovation. The DIGIT Office will first focus on regulating large frontier AI developers as outlined in the RAISE Act, enabling greater transparency into their safety measures and establishing a reporting mechanism for developers to report critical safety incidents. The effective date of the law is January 1, 2027.