Amended in Senate June 12, 2014

Amended in Assembly May 23, 2014

California Legislature—2013–14 Regular Session

Assembly Bill No. 2200

Introduced by Assembly Member John A. Pérez

February 20, 2014

An act to add and repeal Chapter 5.8 (commencing with Section 11549.50) of Part 1 of Division 3 of Title 2 of the Government Code, relating to cyber security.

LEGISLATIVE COUNSEL’S DIGEST

AB 2200, as amended, John A. Pérez. California Cyber Security Commission.

Existing law establishes various advisory boards and commissions in state government with specified duties and responsibilities. Existing law until January 1, 2015, establishes in state government the Department of Technology within the Government Operations supervised by the Director of Technology.

This bill would create the California Cyber Security Commission in the Department of Technology consisting of 12 members comprised of representatives from state government, appointed representatives from the private sectors in the technology or cybersecurity industry and utility, energy, or telecommunications industry, and an appointed representative of California’s critical infrastructure interests. The bill would also authorize the commission to appoint representatives from state, local, federal, and private entities to form an advisory board in order to receive input or advice concerning the implementation of the duties of the commission. The duties of the commission would include establishing cyber-attack response strategies and begin delete defining a hierarchy of command within the state for this purpose end delete begin insert performing risk assessments on state information technology systems end insert . The bill would require the commission to meet on a quarterly basis, or as specified, and would require the commission to issue a report on begin delete a quarterly end delete begin insert at least an annual end insert basis to the Governor’s Office and the Legislature that details begin delete the cyber security status and progress of the state and makes recommendations on how to improve the cyber security of the state end delete begin insert the activities of the commission and makes recommendations to improve California’s cybersecurity preparedness end insert .

The bill would abolish the commission, and repeal these provisions, on January 1, 2019.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Chapter 5.8 (commencing with Section 11549.50)
is added to Part 1 of Division 3 of Title 2 of the Government Code,
to read:

 

Chapter  5.8. California Cyber Security Commission

 

11549.50.  

The Legislature finds and declares all of the
following:

(a) The State of California’s growing dependence on technology
has made it increasingly vulnerable to both foreign and domestic
cyber security attacks. Thus far, there has been a fragmented
approach to this issue with independent efforts occurring through
federal, state, and local government, as well as in the state’s
universities and within private industry. For the purposes of public
safety and protection of public assets, the state has a role in
coordinating and improving its overall security and response
capabilities.

(b) The market for cyber security is estimated to be more than
seventy billion dollars ($70,000,000,000) in 2014. Of that amount,
sixty-seven billion dollars ($67,000,000,000) is estimated to be
spent nationally by private companies for computer and network
security and the United States Department of Defense is planning
to spend four billion six hundred million dollars ($4,600,000,000).
The United States Department of Defense is planning on spending
twenty-three billion dollars ($23,000,000,000) over the next five
years. Overall spending is expected to increase rapidly as
recognition of threats becomes more ubiquitous. The California
economy stands to greatly benefit from this industry growth.

(c) The State of California has already made investments for
the purpose of cyber security; examples of which are research
funding for the Lawrence Livermore National Laboratory and
funding to augment a cyber security assessment and response team
within the California National Guard.

(d) The California Cyber Security Task Force was initiated in
May 2013 for the purposes of identifying critical threats,
assembling primary stakeholders, and highlighting the growing
importance of the issue. Among other things, this has increased
awareness of the state’s compliance with the new federal National
Institute of Standards and Technology (NIST) standards and the
Office of Emergency Services establishing Emergency Function
18, created particularly for cyber security.

(e) Over 50,000 new malicious online activities are identified
every day, according to the United States Department of Defense.
Incidents of sophisticated and well-coordinated attacks and data
breaches are occurring more regularly, the average cost of which
amounts to more than ten million dollars ($10,000,000). In 2012,
a data breach to the state of South Carolina required more than
twenty million dollars ($20,000,000) in response and restitution.
The State of California is vulnerable technically, legally, and
financially to these threats.

11549.51.  

(a) There is in the Department of Technology the
California Cyber Security Commission. The commission shall
consist of the following members:

(1) The Director of the Department of Technology, or his or her
designee with knowledge, expertise, and decisionmaking authority
with respect to the director’s information technology and
information security duties set forth in Chapter 5.6 (commencing
with Section 11545).

(2) The Chief of the Office of Information Security, or his or
her designee with knowledge, expertise, and decisionmaking
authority with respect to the chief’s information technology and
information security duties set forth in Chapter 5.7 (commencing
with Section 11549).

(3) The Director of Emergency Services, or his or her designee
with knowledge, expertise, and decisionmaking authority with
respect to the Office of Emergency Services’s information
technology and information security.

(4) The Attorney General, or his or her designee with
knowledge, begin delete expertises, end delete begin insert expertise, end insert and decisionmaking authority
with respect to the Department of Justice’s information technology
and information security.

(5) The Adjutant General of the Military Department, or his or
her designee with knowledge, expertise, and decisionmaking
authority with respect to the Military Department’s information
technology and information security.

(6) The Insurance Commissioner, or his or her designee with
knowledge, expertise, and decisionmaking authority with respect
to the Department of Insurance’s information technology and
information security.

(7) The Secretary of Health and Human Services, or his or her
designee with knowledge, expertise, and decisionmaking authority
with respect to the California Health and Human Services Agency’s
information technology and information security.

(8) The Director of Transportation, or his or her designee with
knowledge, expertise, and decisionmaking authority with respect
to the Department of Transportation’s information technology and
information security.

(9) The Controller, or his or her designee with knowledge,
expertise, and decisionmaking authority with respect to the office
of the Controller’s information technology and information
security.

(10) A representative from the private sector in the technology
or cybersecurity industry, who shall be appointed by the Governor.

(11) A representative from the private sector in the utility,
energy, or telecommunications industry, who shall be appointed
by the Speaker of the Assembly.

(12) A representative of California’s critical infrastructure
interests, such as air traffic control, ports, and water systems, who
shall be appointed by the Senate Committee on Rules.

(b) (1) Each representative appointed by the Governor, Speaker
of the Assembly, or Senate Committee on Rules shall be appointed
to serve a two-year term.

(2) Any representative may serve consecutive terms.

(c) Any designee shall serve at the pleasure of the official who
designated them.

(d) Nine members shall constitute a quorum for the transaction
of business, and all official acts of the commission shall require
the affirmative vote of a majority of its members constituting a
quorum.

(e) The members of the commission shall serve without
compensation, except that each member of the commission shall
be entitled to receive his or her actual necessary traveling expenses
while on official business of the commission.

11549.52.  

(a) The commission may appoint representatives
to form an advisory board in order to receive input or advice
concerning the implementation of the duties of the commission.

(b) The advisory board may be comprised of one or more
representatives from the following:

(1) The United States Department of Homeland Security.

(2) The National Institute for Standards and Technology.

(3) State government.

(4) Local government.

(5) California’s utility grid, both private and public.

(6) Technology firms, cybersecurity firms, critical infrastructure
operators, utility providers, financial firms, health care providers,
and other private industries.

(7) California’s cybersecurity law enforcement apparatus, which
includes:

(A) The Attorney General’s eCrimes Unit.

(B) The five regional task forces of the High Technology Theft
Apprehension and Prosecution Program.

(C) The Department of the California Highway Patrol.

(8) Entities operating with the commission to perform its duties,
including:

(A) The State Threat Assessment Center and fusion centers, for
the purpose of sharing information that informs preventive actions.

(B) The California National Guard’s Computer Network Defense
Team, for the purpose of coordinating comprehensive risk
assessments.

(C) California’s public and private universities and laboratories
for the purpose of directing research and best utilizing its results.

(c) The commission shall appoint each representative by a
majority vote of its members constituting a quorum. Each
representative shall serve at the pleasure of the commission.

11549.53.  

The commission shall meet quarterly, or more often
as determined by a majority vote of its members constituting a
quorum, or in the event of an emergency.

begin delete

11549.54.  

(a) The commission shall focus on improving the
state’s cyber security and cyber response capabilities by developing
partnerships with the public and private sector as well as the
academic and nongovernmental world to share cyber security and
cyber threat information to enable state government to protect and
secure important information and data, intellectual property,
financial networks, and critical infrastructure.

(b) The duties of the commission shall include, but not be limited
to, the following:

(1) Working with the United States Department of Homeland
Security to define a system of information sharing regarding cyber
threat monitoring and response.

(2) Recommending minimum security standards for all state
agencies.

(3) Researching in conjunction with academia and others to
expand and improve state cyber security capability.

(4) Expanding public-private cyber security partnerships.

(5) Establishing cyber-attack response strategies and defining
a hierarchy of command within the state for this purpose.

(6) Providing training for state employees and others to produce
credentialed cyber security employees.

(7) Developing with the Department of Insurance a strategy to
acquire cyber insurance for state agencies and assets.

(8) Proposing potential governmental reorganization to enhance
the state’s cyber security and response capabilities.

(9) Exploring fiscal options to fund the commission and its
various activities, including the activities of some of its specific
members, including the California National Guard’s computer
network defense team (CND).

(c) The commission shall issue a report on a quarterly basis to
the Governor’s Office and the Legislature that details the cyber
security status and progress of the state and makes
recommendations on how to improve the cyber security of the
state. The reports shall be submitted in compliance with Section
9795.

end delete begin insert

begin insert 11549.54. end insert   

The duties of the commission shall include the
following:

(a) Developing within state government cyber prevention,
defense, and response strategies and defining a hierarchy of
command within the state for this purpose. This duty includes, but
is not limited to, the following activities:

(1) Performing comprehensive risk assessments on state
information technology systems. The Chief Information Security
Officer shall coordinate the process of performing risk assessments
and the assessments shall be performed by such entities as the
California National Guard’s Computer Defense Network Team
and the State Threat Assessment Center, in addition to other public
and private sector entities.

(2) Creating a risk profile of public assets, critical
infrastructure, public networks, and private operations susceptible
to cyber attacks.

(3) Coordinating efforts to reduce state information technology
risks and gaps in existing service.

(b) Partnering with the United States Department of Homeland
Security to develop an appropriate information sharing system
that allows for a controlled and secure process to effectively
disseminate cyber threat and response information and data to
relevant private and public sector entities. This information sharing
system shall reflect state priorities and target identified threat and
capability gaps.

(c) Providing recommendations for information technology
security standards for all state agencies using, among other things,
protocols established by the National Institute for Standards and
Technology and reflective of appropriate state priorities.

(d) Compiling and integrating, as appropriate, the research
conducted by academic institutions, federal laboratories, and other
cybersecurity experts into state operations and functions.

(e) Expanding the state’s public-private cybersecurity
partnership network both domestically and internationally to assist
in the state’s efforts to prevent and respond to cyber threats and
cyber-attacks as well as enhance overall cyber detection capability.

(f) Developing and providing a training program to produce a
credentialed and qualified state cybersecurity workforce. This
program should include training based in whole or in part on the
requirements and protocols outlined in Department of Defense
Directive 8570. The commission shall work with state workforce
and labor entities as well as the state’s higher education systems,
federal agencies, and others to provide training and develop
curriculum.

(g) Developing, in conjunction with the Department of
Insurance, a strategy to acquire and incorporate cyber insurance
into the procurement and administrative processes of state agencies
to protect state assets and information.

(h) Expanding collaboration with the state’s law enforcement
apparatus assigned jurisdiction to prevent, deter, investigate, and
prosecute cyber-attacks and information technology crime,
including collaboration with entities like the High-Tech Theft
Apprehension Program, and its five regional task forces, the
Department of the California Highway Patrol, and the Attorney
General’s eCrimes unit. Collaboration will include information
sharing that will enhance their capabilities including assistance
to better align their activities with federal and local resources,
provide additional resources, and extend their efforts into regions
of the state not currently represented.

(i) Proposing, where appropriate, potential governmental
reorganization options to enhance the state’s cybersecurity
assessment and response capabilities.

(j) Coordinating the pursuit of fiscal resources including federal
grants and other funding opportunities to enhance the state’s
cybersecurity, information technology, data privacy, cyber
research, and technology-based emergency response capabilities.

end insert begin insert

begin insert 11549.55. end insert   

The commission shall take all necessary steps to
protect personal information, public and private sector data, as
well as ensure consumer privacy, when implementing its duties.

end insert begin insert

begin insert 11549.56. end insert   

(a) The commission shall issue an annual report to
the Governor’s office and the Legislature, or more often if needed
due to an emergency situation or time sensitive nature of a cyber
event, that contains the following information:

(1) Details on the activities of the commission, including, but
not limited to, progress on the commission’s various tasks and
actions taken and recommended in response to an incident, as
appropriate.

(2) Policy, organizational, and investment recommendations to
improve the cybersecurity preparedness of the state.

(b) The reports shall be submitted in compliance with Section
9795.

end insert

11549.57.  

This chapter shall become inoperative on January
1, 2019, and shall be repealed as of that date.