Last fall, Gov. Greg Abbott deemed Texas "the epicenter of AI development" during an event about Google's data center investments in the state.
Since making that remark, the Republican governor has issued several directives aimed at regulating AI-powered data centers. Meanwhile, state agencies are expanding their use of artificial intelligence in government services.
Here's what to know about how that technology is being used in state government.
The big picture
Tony Sauerhoff, executive director of the Texas Department of Information Resources and the agency's chief AI officer, spoke at an AI-focused conference hosted by Reuters Sept. 24 in Austin. At the state level, one of the primary uses of artificial intelligence is to improve government efficiency, Sauerhoff said.
"We have over 31 million Texans, and probably the majority of them would like us to deliver government services to them in the most efficient way that we can," he said. "In my 30-plus-year career, we've had new technologies come along—AI is by far the most transformational, but there have been new technologies that come along and change how we deliver the services that our organization exists to deliver, and we will continue to look to do a better job of delivering those services."
Down the road, that will likely mean reducing the number of staff members at state agencies, Sauerhoff said, noting that agency leaders are being "intentional" about those changes.
"What I've been talking about with our agency and other agencies, is that if we can start doing that today and start thinking about that in an intentional and deliberate way today, we can get there in a more humane way, meaning letting attrition help us get there," Sauerhoff said Sept. 24. "We also have [fewer] folks that are interested today in coming into state government than we had years ago, so it's a little bit of a looking to AI to also help with that problem."
When asked which state agencies will be most impacted by AI in the coming years, Sauerhoff pointed to the Texas Department of Transportation.
"They're out in front from just an overall AI use standpoint," he said. "There are a lot of uses in [the transportation] space for AI technologies being able to automate, like reducing crash rates."
TxDOT released its AI Strategic Plan in late 2024. The agency uses artificial intelligence in a variety of forms, including to analyze transportation infrastructure, determine which construction projects should be prioritized, optimize road safety plans and manage the flow of traffic, according to the plan.
Government agencies such as the Texas Workforce Commission and the Texas Health and Human Services Commission are also looking to use AI "on the fraud prevention side of things," he said.
More details
In late 2025, the DIR created an AI code of ethics, as required by a law passed by the legislature earlier that year. The code of ethics must be adopted by all state agencies and local governments that "procure, develop, deploy, or use artificial intelligence systems," according to state law.
The code covers human oversight and control of AI; fairness; accuracy; transparency; data privacy; security; accountability and liability; evaluation of changing AI systems; documentation of AI use; and redress for those impacted when a decision made by an AI system "results in unlawful harm about their rights or access to governmental services."
Sauerhoff said individual government entities can determine how to implement their redress policies, but "the idea is that if an AI system is making a decision for a Texan that turns out to be the wrong decision, that Texan ought to be able to—must be able to—quickly have that fixed."
The goal of the Department of Information Resources is to provide the "best and most efficient" digital government services to Texans," he said Sept. 24.
"It always goes back to maintaining public trust. For-profit entities can have a mistake caused by AI, and ... after damage caused by the AI system is taken care of, if there's still a profit at the end of the day, then it's OK," Sauerhoff said. "We can't have that on the government side—state, local or otherwise. If we lose [public trust], it's very, very difficult to get back."
Stay tuned
Ahead of Texas' next legislative session, which begins in mid-January, lawmakers are considering tightening regulations related to artificial intelligence, with a particular focus on data centers. According to previous Community Impact reporting, legislative committees have held recent hearings on:
Abbott has also asked lawmakers to ensure that data center companies cover their own grid infrastructure costs, help boost Texas' power generation capacity, use water-efficient technology in their facilities and manage impacts on the communities they're based in.
