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AB-13 Public contracts: automated decision systems. (2021-2022)

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Date Published: 07/15/2021 09:00 PM
AB13:v95#DOCUMENT

Amended  IN  Senate  July 15, 2021
Amended  IN  Senate  June 24, 2021
Amended  IN  Assembly  May 24, 2021
Amended  IN  Assembly  March 25, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 13


Introduced by Assembly Member Chau

December 07, 2020


An act to add Chapter 3.3 (commencing with Section 12114) to Part 2 of Division 2 of, and to add and repeal Section 12115.4 of, the Public Contract Code, relating to automatic decision systems.


LEGISLATIVE COUNSEL'S DIGEST


AB 13, as amended, Chau. Public contracts: automated decision systems.
Existing law generally requires all contracts entered into by a state agency for the acquisition of goods or services to be approved by the Department of General Services, except as specified. Existing law requires all contracts entered into by a state agency for the acquisition of information technology goods and services related to information technology projects, as defined, to be made by, or under the supervision of, the Department of Technology, as prescribed.
This bill would enact the Automated Decision Systems Accountability Act and state the intent of the Legislature that state agencies use an acquisition method that minimizes the risk of adverse and discriminatory impacts resulting from the design and application of automated decision systems. The bill would define “automated decision system” to mean a computational process, including one derived from machine learning, statistical modeling, data analytics, or artificial intelligence, that issues simplified output, including a score, classification, or recommendation, that is used to support substantially assist or replace human discretionary decisionmaking and materially impacts natural persons.
The bill would require the Department of Technology, on or before January 1, 2023, in consultation with the Department of General Services and with stakeholder input, to establish and make public guidelines for identifying automated decision systems that are subject to the bill’s requirements, as specified. The bill would require the Department of Technology, by June 30, 2023, to conduct a comprehensive inventory of all high-risk automated decision systems that have been proposed for, or are being used, developed, or procured by state agencies, and to submit a report to the Legislature by July 31, 2023. The bill would require the Department of Technology to repeat this inventory and report process in 2025 and 2027. The bill, on and after January 1, 2023, would require a state agency seeking to award a contract for goods or services that includes the use, licensing, or development of an automated decision system for a high-risk application to encourage a bid response submitted by a prospective contractor to include an automated decision system impact assessment report that makes specified disclosures. The bill, on and after January 1, 2023, would require a state agency, within 30 days of awarding a contract that includes an automated decision system for a high-risk application, to submit to the department a high-risk automated decision system impact assessment report, if included in the bid response. The bill would authorize the department, within 30 days of a state agency’s submission of an automated decision system impact assessment report, to publish the report on its internet website, but exclude any proprietary information or intellectual property. The bill would require the department, on or before January 1, 2023, to develop a sample automated decision system impact assessment report for prospective contractors, and would authorize require the department to adopt regulations and publish guidelines as necessary to effectuate the purposes of the bill.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Chapter 3.3 (commencing with Section 12114) is added to Part 2 of Division 2 of the Public Contract Code, to read:
CHAPTER  3.3. Acquisition of Automated Decision Systems for High-Risk Applications

12114.
 This chapter shall be known and may be cited as the Automated Decision Systems Accountability Act.

12114.5.
 It is the intent of the Legislature that agencies of the state use an acquisition method that minimizes the risk of adverse and discriminatory impacts resulting from the design and application of automated decision systems.

12115.
 For purposes of this chapter, the following shall apply:
(a) (1) “Automated decision system” means a computational process, including one derived from machine learning, statistical modeling, data analytics, or artificial intelligence, that issues simplified output, including a score, classification, or recommendation, that is used to support substantially assist or replace human discretionary decisionmaking and materially impacts natural persons.
(2) “Automated decision system” does not include a tool that does not automate, support, substantially assist or replace human discretionary decisionmaking processes, processes and that does not materially impact natural persons, including, but not limited to, a junk email filter, firewall, antivirus software, calculator, spreadsheet, database, data set, or other compilation of data.
(b) “High-risk application” means a use of an automated decision system for which any of the following apply: the use of an automated decision system that meets either of the following criteria:

(1)Poses a significant risk to the privacy or security of personal information or is likely to result in inaccurate, unfair, biased, or discriminatory decisions impacting natural persons, taking into account the novelty of the technology used and the nature, scope, context, and purpose of the automated decision system.

(2)Affects the legal rights, health and well-being, or economic, property, or employment interests of a natural person.

(1) The use of the automated decision system is likely to have a high impact on the legal rights, health, or economic interests of a natural person.

(3)Involves

(2) The use of the automated decision system is likely to pose a material risk of harm from the use of the personal information of a significant number of individuals with regard to race, color, national origin, political opinions, religion, trade union membership, genetic data, biometric data, health, gender, gender identity, sexuality, sexual orientation, criminal record, or any other characteristic identified in the Unruh Civil Rights Act (Section 51 of the Civil Code).

(4)Meets any other criteria established by the Department of Technology in regulations issued pursuant to Section 12117.

(c) “Simplified output” means output composed of fewer dimensions than the respective inputs used to generate it.

12115.3.
 On or before January 1, 2023, the Department of Technology, in consultation with the Department of General Services and with stakeholder input, shall establish and make public guidelines for identifying automated decision systems that are subject to the requirements set forth in Section 12115.5 in a manner generally consistent, if appropriate, with international high-risk frameworks and standards.

12115.4.
 (a) On or before June 30, 2023, the Department of Technology shall conduct a comprehensive inventory of all high-risk automated decision systems that have been proposed for, or are being used, developed, or procured by, state agencies. The department shall submit a report of the comprehensive inventory to the Legislature by July 31, 2023.
(b) The Department of Technology shall repeat the process specified in subdivision (a) on or before June 30, 2025, and on or before June 30, 2027.

(b)

(c) The report required by this section shall be submitted in compliance with Section 9795 of the Government Code.

(c)

(d) Pursuant to Section 10231.5 of the Government Code, this section is repealed on July 31, 2027.

12115.5.
 Beginning January 1, 2023, the Department of Technology or any other state agency seeking to award a contract for goods or services that includes the use, licensing, or development of an automated decision system for a high-risk application shall encourage a bid response submitted by a prospective contractor to include an automated decision system impact assessment report that makes the following disclosures to the contracting agency:
(a) Specify the name, vendor, and version of the automated decision system and describe its general capabilities, capabilities and limitations, including, but not limited to, reasonably foreseeable capabilities outside the scope of its proposed use.
(b) Describe the purpose of the automated decision system, including, but not limited to, the decision or decisions it can make or support, support and its intended benefits compared to alternatives, including, but not limited to, the results of any research assessing information about its efficacy and relative benefits.
(c) Provide a thorough explanation of how the automated decision system functions, the logical relationship between data inputs and outputs, and how those outputs relate to the decision or decisions made or supported by the system, including, but not limited to, limitations on inferences that can be drawn from those results. outputs.
(d) Describe the affirmative steps the prospective contractor has taken, or any third-party engagement, to conduct legitimate, independent, legitimate and reasonable tests of the automated decision system to help assess any risks posed to the privacy or security of personal information and any risks that may result in inaccurate, unfair, biased, or discriminatory decisions impacting natural persons.
(e) Describe any potential disparate impacts on the basis of characteristics identified in the Unruh Civil Rights Act (Section 51 of the Civil Code) from the proposed use of the automated decision system, including, but not limited to, reasonably foreseeable capabilities outside the scope of its proposed use.
(f) Describe any internal policies the prospective contractor has adopted for identifying potential disparate impacts on the basis of characteristics identified in the Unruh Civil Rights Act (Section 51 of the Civil Code) resulting from the proposed use of the automated decision system.
(g) Provide best practices for the proposed high-risk application of the automated decision system to avoid or minimize any disparate impacts on the basis of characteristics identified in the Unruh Civil Rights Act (Section 51 of the Civil Code), including all of the following:
(1)How how and when the automated decision system should be deployed or used, used and the relevant technical expertise necessary to minimize the potential for inaccurate, unfair, biased, or discriminatory decisions impacting natural persons.

(2)How to limit the collection and retention of information to that which is directly relevant and necessary for the specified purpose.

(3)How automated decision system data should be stored and accessed to mitigate security risks and threats.

(h) Any additional information specified in the solicitation, or otherwise required by the contracting agency for the purpose of effectively evaluating and avoiding or minimizing disparate impacts on the basis of characteristics identified in the Unruh Civil Rights Act (Section 51 of the Civil Code) from the use of the automated decision system.
(i) Any additional information required in accordance with regulations adopted by the Department of Technology pursuant to Section 12117.

12116.
 On and after January 1, 2023, a state agency that awards a contract for goods or services that includes the use, licensing, or development of an automated decision system for a high-risk application shall, within 30 days of awarding that contract, submit to the Department of Technology a copy of the automated decision system impact assessment report, if any, included in the bid response pursuant to Section 12115.5 that also includes a clear and understandable statement of the following:
(a) The extent to which members of the public have access to the results of the automated decision system, including an explanation for the basis of a resulting decision in terms understandable to a layperson, and are able to correct or object to its results, and where and how that information will be made available and any applicable procedures for initiating corrections or objections, as appropriate.
(b) Any other information the Department of Technology determines to be reasonably necessary to carry out the provisions of this chapter.

12116.5.
 (a) Within 30 days of a state agency’s submission of an automated decision system impact assessment report, the Department of Technology may publish the report on its internet website.
(b) This section shall not be construed to require the publication of trade secrets, as defined in Section 3426.1 of the Civil Code. If a prospective contractor or third-party vendor discloses any proprietary information or intellectual property to the Department of Technology, the proprietary information or intellectual property shall be kept strictly confidential and shall not be subject to public disclosure.

12117.
 On or before January 1, 2023, the Department of Technology shall develop a sample automated decision system impact assessment report for prospective contractors and may shall adopt regulations and publish guidelines as necessary to effectuate the purposes of this chapter and shall do so in a manner consistent, where possible, with international high-risk frameworks and impact assessment requirements.