San Jose, California, city leaders vote to make AI coalition an independent nonprofit

City officials in San Jose, California, this week approved an updated policy framework to guide how artificial intelligence and data are managed across departments, with additional plans to spin out its flagship GovAI Coalition into an independent nonprofit.

According to a LinkedIn post from city Chief Information Officer Khaled Tawfik, the new framework aims to formalize how San Jose evaluates and deploys AI tools, reflecting a broader shift from experimentation to operational governance.

The coalition, which includes more than 3,000 members across 900 public agencies, will transition into a nonprofit organization, to help it scale and secure funding.

“This marks a major strategic milestone,” Tawfik wrote on Tuesday. “Moving to a non-profit model ensures long-term sustainability and unlocks access to philanthropic funding, positioning the Coalition to continue growing and supporting government agencies nationwide.”

San Jose launched GovAI Coalition in 2023, as a way to give government leaders, policymakers and private companies a voice in shaping the future of AI in government. The group has created policy templates, procurement guidance and best practices for AI oversight.

By expanding into a nonprofit, supporters said the change would allow the coalition to move beyond a largely volunteer-driven model and establish dedicated staff focused on developing AI guidance around transparency, bias and accountability for governments exploring AI adoption.

“The current model employs very dedicated volunteers and the transition to a nonprofit will remove some of those constraints and allow dedicated staff to devote more time to delivering value for the coalition membership,” San Diego Chief Information Officer Jonathan Behnke, who serves on the coalition’s board, told San Jose Spotlight last week, before the vote.

In recent years, San Jose has rolled out AI pilot programs ranging from service optimization to infrastructure monitoring, including street hazard detection, building permits and employee training programs.

The changes come as San Jose city employees push for stronger safeguards, including limits on how AI is used in hiring and protections against job displacement. In March, AFSCME Local 101, the city’s largest public-sector union, introduced proposals intended to give workers a greater say in how the technology is deployed, including a requirement that the city may not use AI to replace workers. The union’s current contract is set to expire at the end of June.

“Technological systems should enhance public service delivery and support employees in performing their duties safely and effectively,” the union’s proposal reads. “Technology shall not be implemented in a manner that eliminates bargaining unit work, undermines employee professional judgment, or circumvents the City’s bargaining obligations.”

In his announcement, Tawfik acknowledged that due to the speed at which AI capabilities are advancing, this expansion comes at a critical moment for the city: “At a time when the AI landscape is evolving rapidly, this kind of collective effort is more important than ever. And we’re just getting started.”