S. 4495, Promoting Responsible Evaluation and Procurement to Advance Readiness for Enterprise-wide Deployment for Artificial Intelligence Act

S. 4495 would authorize federal agencies to research and implement new processes to accelerate the development and acquisition of artificial intelligence (AI) systems. The bill would require federal agencies to assess the safety of their AI systems and to incorporate protections for data privacy and cybersecurity into AI procurement regulations. S. 4495 also would require agencies and the Government Accountability Office to report to the Congress on the effectiveness and security of federal AI systems.

Spending Subject to Appropriation. S. 4495 would authorize two pilot programs for acquiring AI systems. The authority for each program would expire five years after regulations governing its use are promulgated. CBO expects agencies would need two years to update their acquisition procedures before entering into the authorized contracts. First, S. 4495 would authorize federal agencies to procure AI systems through a new Commercial Technology Test Program. Under the program, agencies could enter contracts to develop new technologies in phases so that private sector entities could test and demonstrate the feasibility of such technology. Individual contracts under that authority would be limited to a maximum of $25 million. Assuming that one new contract is signed per year at the maximum funding limit under S. 4495 and using historical rates of spending for similar activities, CBO estimates that operating the test program would cost $55 million over the 2025-2029 period.

Second, S. 4495 would authorize federal agencies to conduct research and acquire prototypes of new AI systems. Individual contracts under that authority would be limited to a maximum of $10 million. Assuming that one new program is created per year at the maximum funding limit under S. 4495 and using historical rates of spending for similar activities, CBO estimates that implementing the research and development program would cost $22 million over the 2025-2029 period.

S. 4495 also would require agencies to update acquisition governance and information technology policy procedures before acquiring new AI systems. In addition, agencies would have to regularly update the Congress on their adoption of AI systems and adherence to safety guidelines. On the basis of costs for similar activities, CBO estimates that satisfying the policy development and reporting requirements of S. 4495 would cost $9 million over the 2025-2029 period.

The costs of the legislation, detailed in Table 1, fall within budget function 800 (general government). Such spending would be subject to the availability of appropriated funds.

Direct Spending. Enacting the bill could affect direct spending by some agencies that are allowed to use fees, receipts from the sale of goods, and other collections to cover operating costs. CBO estimates that any net changes in direct spending by those agencies would be negligible because most of them can adjust amounts collected to reflect changes in operating costs.

The CBO staff contact for this estimate is Aldo Prosperi. The estimate was reviewed by Christina Hawley Anthony, Deputy Director of Budget Analysis.

Phillip L. Swagel

Director, Congressional Budget Office