Colorado governor vetoes bill restricting surveillance pricing for wages and consumer goods

Colorado’s governor vetoed a bill on Tuesday that would have banned companies from using surveillance pricing to set workers’ wages and prices for consumer goods. The measure would have been the strongest in the nation against algorithmic pricing. While Maryland became the first state to approve a law banning surveillance pricing in grocery stores in April, Colorado’s proposed measure was more expansive.

Governor Jared Polis wrote in a public letter explaining his veto that he found the legislation to be overly broad, and said it would “inadvertently capture innocuous uses of technology that in no way harms – and indeed benefits – consumers and workers”, echoing business owners’ major concern with the bill, which was supported by progressive groups.

Bill provisions and exemptions Colorado’s bill proposed banning companies from using algorithms, powered by artificial intelligence or other data-processing techniques, to set custom prices or wages based on the collection of an individual’s information.

This data could include everything from where an individual lives and what they have bought in the past, to their financial status, travel habits and affiliations. The bill also included exemptions for certain discounts tied to loyalty programs and transparent markdowns for students and senior citizens.

Other states’ actions Many states, including Illinois, California, Massachusetts and New Jersey, are also considering bills that would regulate surveillance pricing. Connecticut’s legislature approved a sweeping consumer privacy bill that included new rules for surveillance pricing in May.

In New York, the state attorney general is rallying support for a ban on surveillance pricing, and a bill that would do so has passed the state senate, but not the assembly. Maryland became the first state to ban surveillance pricing in April, though that measure was limited to prices for grocery store items and was criticized by many consumer advocates for being riddled with industry carveouts.

Reactions to the veto Consumer advocates are unhappy with the veto. “Governor Polis had an opportunity to stand with working Coloradans, but instead chose to side with the dominant corporations using invasive surveillance data to pick their pockets,” said Pat Garofalo, director of state and local policy at the American Economic Liberties Project.

The Travel Technology Association, which represents online travel agencies and short-term rental platforms, called for a narrower definition of “surveillance data” and testified through written comment that the measure would “prohibit pricing practices that are transparent, pro-competitive, and beneficial to consumers – while exposing travel platforms to litigation exposure that bears no relationship to the harms the bill identifies”.

This is the second time in 12 months that the governor has blocked a bill focused on surveillance pricing; in 2025, a measure that would have banned landlords from using rent-setting algorithms was also vetoed.