Virginia Is Using AI To Identify Illegal and Redundant Regulations
While other states are focused on regulating AI, Virginia is using the technology to repeal regulations.
Virginia Gov. Glenn Youngkin (R) signed Executive Order 51 earlier this month, establishing the nation's first statewide regulatory review powered by artificial intelligence (AI). The governor's office announced that the state will use AI to scan all of the remaining regulations in the Virginia Administrative Code and Virginia Register of Regulations to "flag any areas in which the regulation contradicts the statute, identify redundancies, and highlight areas in which the regulatory language can be streamlined."
Since taking office in January 2022, Youngkin has prioritized improving government efficiency and easing regulatory burdens on businesses. Executive Directive Number One directed "all Executive Branch entities under [the governor's] authority to initiate regulatory processes to reduce by at least 25 percent the number of regulations not mandated by federal or state statute." Youngkin established the Office of Regulatory Management (ORM) in June 2022 to achieve this end.
The governor's office announced on July 8 that it had met the 25 percent goal by approving changes "that collectively streamline over 26.8% of [its] regulatory requirements," saving Virginia citizens over $1.2 billion per year. Peter Finocchio, Youngkin's press secretary, tells Reason that the office arrived at this figure by "ask[ing] each agency to calculate the savings to them associated with any action that is taken." The governor's office attributed $700 million of these savings to the regulatory changes made by the Department of Housing and Community Development that "shave $24,000 off the construction cost of a new house."
On July 8, Youngkin said that his government is on track to reach a 33 percent reduction in regulation by "examining every regulation, every requirement, and every process that was adding unnecessary costs to business activities." Executive Order 51 leverages AI to achieve this end by "scan[ning] all of the regulations and guidance documents on the books and identify[ing] ways they can be streamlined," per a July 11 press release.
The order requires executive agencies to respond to the regulatory reduction report that the ORM is producing with the help of "third party, AI-generated analysis of all regulations and guidance documents issued by the Commonwealth's executive branch agencies." The third party in question is Vulcan Technologies, a Y Combinator-backed AI regulatory review company founded in December 2024, with which ORM contracted in April to conduct its AI Regulatory Reduction Pilot.
Tanner Jones, the CEO of Vulcan Technologies, spoke to Reason about its $150,000, three-month-long pilot trial with ORM from May 1 to August 1. Jones explains that Vulcan Technologies helped ORM identify which regulations an agency may cut by using thousands of AI agents to review regulatory provisions and compare them to the entire body of federal and state statutory and case law to determine which regulations are statutorily mandated and which are outside their purview. Jones explains that the "tool is neutral: it's an administrative lawyer in a box that finds the law behind the regulation and discerns if that authorization is still valid."
Jonathan Wolfson, senior advisor to Vulcan Technologies and Labor Department Regulatory Reform Officer during President Trump's first administration, tells Reason that, before the AI pilot program, "Virginia went line by line through the regulatory code" to determine what to cut. Jones says that "what Virginia did by hand was the gold standard" and that Vulcan Technologies is "introducing a new gold standard" with its agentic AI regulatory review software.
The order also mandates that each agency leverage AI to determine the extent to which its regulations are statutorily sanctioned; redundant or in conflict with other statutes; similar to regulations in surrounding states; and how they "might be streamlined to eliminate excess verbiage while accomplishing the same purpose and goals" for all periodic regulatory reviews required by the Virginia Administrative Process Act after December 31, 2025.
While other states are focused on regulating AI, Virginia is leveraging it to repeal regulations. Though it's possible to review the 24 million words of Virginian regulations, it's painstaking. The Virginia model of using agentic AI to parse through and analyze regulation may put an end to this toil.
