BILL ANALYSIS Ó SENATE COMMITTEE ON APPROPRIATIONS Senator Ricardo Lara, Chair 2015 - 2016 Regular Session AB 1841 (Irwin) - Cybersecurity incident response plan and standards ----------------------------------------------------------------- | | | | | | ----------------------------------------------------------------- |--------------------------------+--------------------------------| | | | |Version: April 14, 2016 |Policy Vote: G.O. 12 - 0, JUD. | | | 7 - 0 | | | | |--------------------------------+--------------------------------| | | | |Urgency: No |Mandate: No | | | | |--------------------------------+--------------------------------| | | | |Hearing Date: August 8, 2016 |Consultant: Debra Cooper | | | | ----------------------------------------------------------------- This bill meets the criteria for referral to the Suspense File. Bill Summary: AB 1841 would require the Office of Emergency Services (OES), in conjunction with the Department of Technology (CDT) to transmit a cybersecurity incident response plan to the Legislature by July 1, 2017. This bill would also require development of cybersecurity incident response standards for state agencies by January 1, 2018. Fiscal Impact: Estimated costs to OES of $2.9 million in fiscal year 2016-17, $1.5 million in 2017-18, and ongoing costs of $1.3 million per year. (GF) These costs include: - One-time costs to OES for hardware, software, and AB 1841 (Irwin) Page 1 of ? personnel costs for development of a secure database. - Properly retaining Protected Critical Infrastructure Information transmitted to Cal OES by state agencies. - On-going database maintenance. - Developing standards for state agencies that maintain critical infrastructure. - Oversight to ensure that state agencies are meeting the standards. - Six PY of staff in the Information Technology Services Division and the Critical Infrastructure Protection Unit to maintain, monitor, and manage system infrastructure. Ongoing, potentially significant cost pressure for state entities to adopt cybersecurity incident response standards developed by OES and to make necessary changes to address any issues identified by OES concerning compliance with the standards. (GF and/or Special Funds). Background: In 2013, the Governor administratively directed OES and CDT to create a Cyber Security Task Force composed of specified stakeholders, subject matter experts, and cyber security professionals from public, private, academic, and law enforcement sectors. The mission of the Task Force is to enhance the security of California's digital infrastructure and to create a culture of cybersecurity through collaboration, information sharing, and education and awareness. The State Emergency Plan (SEP) addresses the state's response to extraordinary emergency situations associated with natural disasters or human-caused emergencies. The most recent SEP, prepared by OES in 2009 outlined a state-level strategy to support local government efforts during large scale emergencies. The 2009 SEP established 18 Emergency Functions (EF 18) that are primary activities essential for state entities to work together to address emergency management needs. According to OES's AB 1841 (Irwin) Page 2 of ? website, EF 18 is the only incomplete component of the SEP. One of the 18 incomplete EF 18 functions is cybersecurity. According to the California Military Department, California's size and importance makes it vulnerable to cyber incidents that disrupt business, shutdown critical infrastructure, and compromise intellectual property or national security. The owners and operators of California's infrastructure such as power plants, water distribution systems, refineries, and communications equipment have largely replaced analog control systems with digital controls, often connected through computer networks. These updated systems make management of critical infrastructure more efficient but also more vulnerable to cyber-attack. According to the author, the State Emergency Plan does not currently have an established cybersecurity strategy or an incident response plan to account for cybersecurity risks imposed on the state and general public. Proposed Law: This bill would: Require OES, in conjunction with CDT, on or before July 1, 2017, to transmit to the Legislature, a cybersecurity plan that includes, but is not limited to: - Methods for providing emergency services; - Command structure for statewide coordinated emergency services; - Emergency service roles of appropriate state agencies; - Identification of resources to be mobilized; - Public information plans; - Continuity of government services. Require OES, on or before January 1, 2018, in conjunction with CDT, to develop cybersecurity incident response standards for state agencies to prepare for cybersecurity interference with, or the compromise or incapacitation of, critical infrastructure and for the development and transmission of critical infrastructure information to OES. In development of AB 1841 (Irwin) Page 3 of ? the standards, OES shall consider the following: - Costs to implement the standards; - Security of critical infrastructure information; - Centralized management of risk; - Industry best practices; - Continuity of operations; - Protection of personal information. Require each state agency to report on its compliance with the standards by January 1, 2019, and directs OES, in conjunction with CDT, to provide suggestions for state agencies to improve compliance with the standards. Specify that the report and communications required under this provision are confidential and shall not be disclosed pursuant to any state law including the California Public Records Act. Related Legislation: SB 949 (Jackson, 2016) would have authorized the Governor to require owners and operators of critical infrastructure, as defined to submit critical infrastructure information to OES. This bill was referred to the Senate Governmental Organization Committee but never heard. AB 1346 (Gray, 2016) would require OES to update the SEP on or before January 1, 2018 and every 5 years thereafter and would require the plan to be consistent with specified state climate adaptation strategies. This bill is pending in the Senate Appropriations Committee. AB 2595 (Linder, 2016) would have established the California Cybersecurity Integration Center within OES to develop a cybersecurity strategy for California in coordination with the Cybersecurity Task Force. This bill was held in the Assembly Appropriations Committee. AB 670 (Irwin, Chapter 518, Statutes of 2015) requires CDT to conduct, or require to be conducted, no fewer than 35 independent security assessments of state agencies, departments, AB 1841 (Irwin) Page 4 of ? or offices annually. AB 1172 (Chau, 2015) would have continued in existence the California Cybersecurity Task Force, created in 2013, by OES and CDT. This bill was ordered to the Senate Inactive File. Staff Comments: This bill would require OES to collect protected critical infrastructure information from all state agencies, which OES does not currently do. In order to do this, OES would have to create and maintain a secure "virtual infrastructure" system that is appropriate for retaining this critical information. The main source of costs in fiscal year 2016-17 would be development of such a system. An initial $1.5 million would be needed for licensing and two limited term positions for building the database and launching the system. The virtual infrastructure system would require an ongoing $300,000 per year for licensing and maintaining the system. OES estimates they would also need an additional 6 PY of staffing for ongoing IT demands, critical infrastructure analysis, and data entry and resolution. -- END --