How SB 735 changes current law

AI-generated reading aid from the bill's amendatory text — verify against the official bill.

This bill establishes the North Carolina Artificial Intelligence Innovation Trust Fund to support responsible AI development and governance.

• Article 10 of Chapter 143B

  Part 18A. Artificial Intelligence Innovation. § 143B-472.83A. Artificial Intelligence Innovation Trust Fund. (a) Fund. – There is established a special, nonreverting fund to be known as the North Carolina Artificial Intelligence Innovation Trust Fund. The Secretary of Commerce shall be the trustee of the fund and shall expend money from the fund to (i) provide grants or other financial assistance to companies developing or deploying artificial intelligence models in key industry sectors or (ii) establish or promote artificial intelligence entrepreneurship programs, which may include partnerships with research institutions in the State or other entrepreneur support organizations. The fund shall consist of appropriations to the Department of Commerce to be allocated to the fund, interest earned on money in the fund, and any other grants, premiums, gifts, reimbursements or other contributions received by the State from any source for or in support of the purposes described in this subsection. Funds in the fund are hereby appropriated to the Department for the purposes set forth in this section, and, except as otherwise expressly provided, the provisions of this section apply to persons receiving a grant or assistance from the fund. Funds provided under this Part shall not support projects involving artificial intelligence intended for mass surveillance infringing constitutional rights, unlawful social scoring, discriminatory profiling based on protected characteristics, or generating deceptive digital content intended for fraudulent or electoral interference purposes.

  This creates a new fund specifically for AI innovation in North Carolina, detailing its purpose, oversight, and restrictions on how funds can be used.

• § 143B-472.83A

  (b) Definitions. – The following definitions apply in this section: (1) Advanced persistent threat. – An adversary with sophisticated levels of expertise and significant resources that allow it, through the use of multiple different attack vectors including, but not limited to, cyber, physical or deception, to generate opportunities to achieve objectives including, but not limited to, (i) establishing or extending its presence within the information technology infrastructure of an organization for the purpose of exfiltrating information; (ii) undermining or impeding critical aspects of a mission, program or organization; or (iii) placing itself in a position to do so in the future. (2) Artificial intelligence. – An engineered or machine-based system that varies in its level of autonomy and which may, for explicit or implicit objectives, infer from the input it receives how to generate outputs that may influence physical or virtual environments. (3) Artificial intelligence safety incident. – An incident that demonstrably increases the risk of a critical harm occurring by means of any of the following...

  The bill provides definitions related to artificial intelligence to clarify terms used in governing the fund.

• § 143B-472.83A

  (c) Oversight. – The Secretary may convene an AI Innovation and Safety Advisory Panel composed of representatives from industry, academia, civil liberties and consumer advocacy groups, and relevant state agencies. This Panel may provide recommendations, best practices, and advice regarding AI technologies, compliance proportionality, and ethical AI-human collaboration. Recommendations of this Panel shall be publicly accessible and may inform future regulatory proposals.

  This establishes an advisory panel to enhance oversight and input on AI governance.

• § 143B-472.83A

  (d) Standards. – The Secretary may consider relevant provisions, guidelines, frameworks, and standards established by the U.S. National Institute of Standards and Technology (NIST), and comparable frameworks, such as the EU AI Act, when developing proposals and recommendations pursuant to this Part.

  This provision allows the Secretary to align state AI regulation with national and international standards.