Democrats’ big win on Election Day, which saw them take control of both the House and Senate, has ramifications for the Cybersecurity and Infrastructure Security Agency, artificial intelligence, surveillance policy and much more.

Here’s what lawmakers and cybersecurity experts have to say about the short-term and long-term prospects on Capitol Hill.

Leadership plans ahead

Maggie Hassan, D-N.H. is in line to take the gavel on the Senate Homeland Security and Governmental Affairs Committee, with Sen. Gary Peters, Mich., retiring.

“Our government’s number one job is to keep people safe, and the Senate Homeland Security and Governmental Affairs Committee must work to ensure that our country remains safe, secure and free from all kinds of threats,” Hassan said in a statement to CyberScoop. “That work involves protecting against terrorism and fentanyl trafficking, but it also includes guarding against emerging threats like artificial intelligence security risks and strengthening our cybersecurity.”

“The Trump-Vance administration has undermined our security on these fronts, including by diverting resources away from combatting fentanyl trafficking and gutting CISA,” she continued. “We need to reverse these cuts, confront these challenges and put public safety first.”

Rep. Bennie Thompson, D-Miss., is poised to return once again as chair of the House Homeland Security Committee, said Democrats are taking over at a “pivotal time for CISA,” with it looking to add staff after cutting back by nearly one-third.

“First and foremost, we will aim to work with CISA to expedite its critical re-staffing effort and to ensure it has the expertise necessary to support stakeholders as they defend against the scale and velocity of AI-enabled cyber-attacks,” he said in a statement to CyberScoop. “Advances in AI can help defenders, but it will also accelerate the consequences of deferred investments in security and CISA must be well-positioned to help critical infrastructure owners and operators rapidly improve their cybersecurity posture.”

“We will prioritize getting resources straight into the hands for defenders — by extending the State and Local Cybersecurity Grant Program and improving support of under-resourced sectors, especially water,” he continued. “We will work to ensure CISA re-establishes its cross-sector coordination capacity, which was diminished when the Trump administration- terminated CIPAC, by making sure the Anchor-CI is eventually up and running and meets the needs of stakeholders. Finally, we will make sure CISA is well-positioned to support the secure development and deployment of AI.”

What happens in the lame-duck session

Before the GOP relinquishes control of the House and Senate to Democrats, though, there’s a lame-duck session ahead. 

Long-term renewal of the Cybersecurity Information Sharing Act of 2015 (CISA 2015) is a bipartisan and industry priority, with it set to expire Dec. 11. Current Senate Homeland Security and Governmental Affairs Chairman Rand Paul, R-Ky., has been the biggest obstacle to reauthorization, but he could get “rolled” by GOP leadership on an extension, said Michael Garcia, a former government cyber official and vice president of the cybersecurity practice at Monument Advocacy. Possible vehicles for CISA 2015 to hitch a ride include an omnibus funding bill or the annual defense policy bill.

The Department of Homeland Security, and its subagency CISA, are currently operating on a continuing resolution that’s also set to expire Dec. 11, where lawmakers could temporarily extend CISA 2015 if a long-term solution can’t be reached in the lame duck. Another continuing resolution before Dec. 11 in lieu of an omnibus spending bill is an option for the lame duck. Both a CR and omnibus spending bill would theoretically include DHS funding, although the agency’s funding has been made more difficult in the past by the presence of Immigration and Customs Enforcement within the department.

Republicans have talked about wanting to get the fiscal 2027 National Defense Authorization Act done in the lame duck. Besides the possibilities of CISA 2015 being included in the bill, Nicholas Leiserson, senior vice president for policy at the Institute for Security and Technology, said the Senate version of the legislation has a pair of very noteworthy cyber provisions: a “very broad” authorization for contractor-owned, contractor-operated offensive cyber operations, and a requirement that every artificial intelligence product sold to the Defense Department have an AI bill of materials.   

Additional leadership shuffle

While Paul is losing his gavel, he’s shown he can be a disruptive force on passing cybersecurity legislation through the Senate in the minority. That makes what he does next possibly determinative for cyber bills, Leiserson and Garcia said. “If he leaves HSGAC, let a thousand cyber bills flourish!” Garia quipped on social media. Paul could opt to become the top Republican on the Senate Health, Education, Labor and Pensions Committee instead of HSGAC.

Nebraska Sen. James Lankford would take over for Paul as top HSGAC Republican in that scenario, and an industry source said he’s viewed as a supporter of CISA 2015.

On Senate Intelligence, the panel’s leadership goes to a lawmaker who has placed a big emphasis on cybersecurity in his congressional career: Mark Warner, D-Va. 

On the House side, while Rep. Andrew Garbarino, R-N.Y., moves to the minority on the Homeland Security panel, he has proven willing to collaborate with Democrats on cybersecurity issues. Rep. Delia Ramirez, D-Ill., is poised to take the gavel of the panel’s cybersecurity subcommittee, and Rep. Vince Fong, R-of California looks set to become the subcommittee’s top Republican and has his own history of bipartisanship. Fong would replace current subcommittee chair Andy Ogles, the far-right Tennessee Republican who lost in the primaries.

One thing to watch in the House, Leiserson said, is how the House looks to tackle AI — through existing committees, a select committee or some other structure. Democrats haven’t put forward a unified front on AI guardrails yet.

With AI models uncovering as many vulnerabilities as they are, “highly capable frontier models are going to drive a lot of discussion” about AI and cybersecurity, said Craig Albright, the Business Software Alliance’s senior vice president for U.S. government relations.

Appropriations, oversight, legislation

If the NDAA or a CISA 2015 extension don’t pass in the lame duck, they’d be priorities in 2027, too.

“CISA 2015 has to happen, and if we can’t get it done, then we can’t move to the next thing,”  said Henry Young, BSA’s policy director. “Once we get it done, there’s an open question about which of these priorities that we’ve talked about gets to be number one. Is it post-quantum cryptography? Is it government IT modernization? Is it frontier AI cybersecurity systems? We don’t know that yet, and we can’t know until we pass this law.”

How damaged the agency CISA is by Trump administration’s budget cuts is something Democrats are expected to scrutinize closely. Another top budget issue is what to do with the expired State and Local Cybersecurity Grants Program housed at DHS, since even if it’s reauthorized, it will require appropriators taking steps to invest in it.

Democrats could take a look at a variety of other Trump administration changes at DHS and CISA, on topics like election security, the Cyber Safety Review Board, the Joint Cyber Defense Collaborative and more. 

More broadly, Leiserson said an area of Democratic cyber oversight is likely to be the Department of Government Efficiency that cut cyber personnel at agencies at and beyond CISA, and “particularly the integrity of systems that DOGE touched when they were given very high privileged access to federal systems.”

If the White House puts forward a permanent nominee for director of CISA, Democrats would be poised to vet that person. They also would have a say in who leads the Office of the National Cyber Director, should the incumbent, Sean Cairncross, depart.

So far, Democrats haven’t put forward a unified posture on expired surveillance authorities known as Section 702, although both Warner and incoming House Intelligence Chairman Jim Himes, D-Conn., have fought in the past for its renewal. The surveillance program is operating similarly still due to a court order, but that order only lasts through next spring.

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The Office of the National Cyber Director has rolled out its second regional cyber pilot program, this one focused on rural hospitals.

National Cyber Director Sean Cairncross visited South Carolina on Monday to debut the six-month program, Project Lifeline 250, which connects industry with rural hospitals. The concept is similar to the first pilot program in Texas that connected industry with the water sector.

“Project Lifeline 250 connects the world-leading American industry with rural hospitals and uses the greatest American tools and capabilities to defend hospital networks; deploy physical back up devices after an initial incident to ensure an impacted hospital can still provide critical care; and identify high-risk and legacy devices and replace them,” Cairncross said in a statement.

The health care sector had a record year for breaches last year, with 804 large breaches reported to the Health and Human Services Department’s Office for Civil Rights that affected more than 140 million people. The FBI identified the sector as the top target for ransomware and other hackers in 2025.

Rural hospitals, like the water sector, lack resources compared to other kinds of critical infrastructure.

Besides industry and the ONCD, the effort is a project that draws in the South Carolina Critical Infrastructure Cybersecurity program, the South Carolina Law Enforcement Division and local governments in the state.

“Cyber threats are a rising challenge to our nation’s security, and we must remain vigilant to protect the systems our communities depend on,” said South Carolina Gov. Henry McMaster. “Project Lifeline 250 is another important step toward ensuring South Carolina’s rural hospitals have the resources they need to defend against cyberattacks and continue providing critical care.”

Some of the same companies involved in providing free services in the Texas pilot are involved in the South Carolina pilot, too, along with some new participants. Among the participating firms: Abnormal AI, Cisco, Cyera, Microsoft, Rilian Partners, Trellix and Zscaler.

“The stakes for critical infrastructure are getting higher and higher,” said Yotam Segev, cofounder and CEO of Cyera. “There’s real urgency in bringing cyber expertise from some of the world’s largest and most complex enterprises to rural hospitals through Project Lifeline 250. When a hospital knows where its patient data lives and who can reach it, it can reduce the leverage behind ransomware. Every community should have that clarity, no matter the size of the hospital or its IT team.”

Members of Congress also have introduced legislation designed to aid rural hospital cybersecurity.

The ONCD hasn’t said what will happen at the end of the six-month pilots. And so far it has only partnered, or publicly discussed partnering with, GOP-led states.

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Hundreds of federal agencies should adopt an encryption tool to protect whistleblowers, veterans suffering from mental health crises and others from hackers who might target them when they reach out via agency websites, Sen. Ron Wyden said Monday.

The Oregon Democrat urged the Cybersecurity and Infrastructure Security Agency and Office of Management and Budget to take steps to adopt Encrypted Client Hello — a cybersecurity technology that protects the name of the website visited by a user — in a letter to the two agencies. His office identified at least 350 sites that don’t use its protections.

While almost all federal agency websites are encrypted, standard web encryption doesn’t secure some website names, Wyden said, using reportfraud.ftc.gov as an example.

“As data travels across the internet, hackers and foreign actors monitoring network connections can easily see these exposed website names,” he wrote. “This visibility could lead to malicious eavesdroppers identifying whistleblowers, profiling cleared federal personnel, tracking Americans seeking crisis support, and mapping interactions between agencies.”

Wyden wrote that Encrypted Client Hello (ECH) is especially effective with Content Delivery Networks (CDNs) that connect hundreds of thousands of websites to the internet. For websites delivered by a CDN, ECH makes it so anyone intercepting user web traffic can view the network delivering the content but not the specific site.

Agencies using CDN infrastructure without Encrypted Client Hello include an FBI tipline that supports ECH but doesn’t enable it and a Department of Veteran Affairs online suicide prevention hotline that isn’t protected by ECH because Amazon doesn’t support it, as well as agencies offering things like national security personnel services and whistleblower channels.

Because of the lack of ECH protection, foreign adversaries might be able to identify someone submitting crime tips to the FBI, Wyden warned.

Wyden made two recommendations to the leaders of CISA and the OMB.

“CISA should require that civilian federal agencies enable the protections of ECH across all public-facing websites and inter-agency web systems,” he said. “OMB, in coordination with the Office of the National Cyber Director and CISA, should establish support for ECH protections as a mandatory condition for commercial cloud and network vendors seeking federal contracts.”

CISA and OMB didn’t immediately respond to a request for comment on the letter, first reported by NextGov/FCW.

Wyden’s Monday missive is his most recent aimed at improving security technology at federal agencies, following on the heels of a letter in July first reported by CyberScoop that urged feds to get rid of older, insecure, public-facing VPNs.

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A coalition of cyber firms and critical infrastructure operators on Tuesday spelled out its views on the tasks that the Cybersecurity and Infrastructure Security Agency should assign federal agencies to protect operational technology systems after this summer’s attacks on water utilities.

The Operational Technology Cybersecurity Coalition said a CISA binding operational directive (BOD) for OT should specify who is responsible for protecting these systems at each agency,, draw on existing federal guidelines and set minimum cybersecurity practices.

The coalition said the BOD would address a need to act based on CISA’s lack of visibility into the spectrum of OT devices in federal agencies, a lack of consistent across-the-board OT security policies and the severity of the consequences that an attack on federal OT could produce.

Just last month, the Government Accountability Office published a report which concluded that most federal civilian executive branch agencies (FCEBs) haven’t enacted Office of Management and Budget requirements released in 2023 for networked Internet of Things and OT devices.

Putting forward recommendations for a CISA directive has two goals, said Michael Garcia, policy director of the coalition.

“One, it does make sure that the government is taking its own medicine,” said Garcia, who until recently worked at the agency. “You should practice what you preach. … Second, it sends a very strong signal to the private sector that, ‘This is what we think is important: As an OT partner, owner or operator or critical infrastructure owner or operator, [this is what] you should ask other providers to do.’”

There are 8,000 General Services Administration-owned and -leased properties, many of which would have OT involved in everything from power supply to heating, ventilation and air conditioning systems. Some of those OT systems might be “trivial,” Garcia acknowledged, but the coalition paper notes that CISA “does not currently have a holistic view of the assets managed by the FCEB and the potential risks, such as connected programmable logic controllers, to which the government may be exposed.”

With OT falling into a “government gray zone” between chief information officers and facilities managers, CISA should tell agencies to formally designate an officer in charge of cybersecurity for OT, the coalition recommends.

The directive should examine past OT guidelines the National Security Agency issued to see if they should apply to federal civilian agencies, and align any requirements in the hypothetical BOD with cybersecurity performance goals that CISA first issued in 2022, according to the coalition.

The coalition doesn’t assert that such a BOD would have headed off the attacks this summer on the water sector, and is focused on federal OT, something where CISA has done some work.

“To be fair, CISA has incorporated OT security requirements into prior directives (such as BODs 23-01, 23-02, and 26-04) alongside a host of technical guidance,” the paper reads. “But as AI reduces the technical barriers to sophisticated cyber operations, enabling adversaries to identify weaknesses, accelerate reconnaissance, and move laterally through poorly segmented operational environments with greater speed and scale, it is time for an encompassing BOD solely focused on OT security.”

CISA didn’t respond to a request for comment Monday in advance of the coalition publishing its paper.

But Garcia said that in discussions with CISA, “increasingly, I think they understand that there might be a need” for an OT BOD.

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The summer’s cyberattacks by Iranian hackers on water systems in 12 states underscored how vulnerable U.S. water systems are to foreign adversaries. A broad attack on water infrastructure could have consequences comparable to a public health crisis that impacts the country’s entire population.

The threat to water has long been clear. As the 2026 Annual Threat Assessment from the U.S. intelligence community states “Cyber actors from China, Russia, Iran, North Korea, and ransomware groups . . .  pose critical threats to U.S. networks and critical infrastructure.”

Advances in artificial intelligence have heightened those vulnerabilities. Advanced AI models, such as Anthropic’s Claude Mythos, have demonstrated the ability to identify thousands of zero-day vulnerabilities in critical software systems, including major operating systems and browsers. Other systems, including some developed in China, are demonstrating similar capabilities. AI systems can now “plan, test, and execute attacks in rapid cycles,” ranging from minutes down to seconds.

U.S. water systems are vulnerable to cyberattacks for technical, legal and practical reasons.

Technical: About 80% of U.S. water systems lack even basic cyber hygiene, a weakness exploited in the summer attacks. Even systems that serve most of the population (approximately 450 large and 4500 medium-sized water systems) have not adopted advanced cybersecurity capabilities used in other sectors where failure can have catastrophic consequences, including aviation, rail, mass transit, medical devices, finance, and nuclear power.

Legal: The Environmental Protection Agency lacks clear statutory authority to impose broad cybersecurity requirements on water systems. In 2023, EPA issued a memo interpreting existing regulations to strengthen the cybersecurity of water systems. The action met widespread opposition from the water sector as well as formal legal challenges, and the EPA ultimately withdrew the memo. The agency retains limited authority. It can require water systems to complete  risk and resilience assessments, maintain emergency response plans and, in emergencies, address critical cybersecurity flaws.  

Practical: Most U.S. water systems are small.  Some 45,000 serve 3,300 persons or fewer. Because of their size, many fall outside the EPA’s regulatory authority and below the “cyber poverty line,” lacking the funding, staff and expertise necessary for effective cybersecurity.

Not surprisingly, the summer attacks drew attention from the administration and Congress. The EPA ,in partnership with the FBI, and CISA each issued guidance on remedial actions, including disconnecting operational technology, from the internet where feasible and adopting robust password practices.

Sens. Amy Klobuchar, D-Minn., and Adam Schiff (D-Calif., introduced the Water Safety Shield Act, a bill that would require tiered cybersecurity standards for the water sector and dedicate a proposed $600 million annually to water cybersecurity. It would go beyond earlier, less prescriptive efforts to improve resilience in the sector.  

The administration has also established a pilot program with Texas and private-sector cybersecurity companies to identify and address water-system vulnerabilities at no cost to utilities. These efforts are well intentioned, but they do not address the underlying causes of the problem.

Large and midsize U.S. water systems have long been targets of sophisticated adversaries. China’s Volt Typhoon revealed deep Chinese penetration of critical infrastructure, including water systems, that support national security, economic security, and civil society. Those systems remain vulnerable because many have not adopted well-known protections, such as zero-trust architecture. More fundamentally, the software on which they depend remains vulnerable to exploitation.

Policymakers have struggled to respond for two reasons: the cost and complexity of adopting stronger technical defenses, and the highly fragmented nature of the water sector. A relatively small number of large systems serve about half the U.S. population. Roughly 49,000 systems serve the rest, including the 80% of the systems serving 3,300 people or fewer. Those smaller systems serve about 7% of the population.

Despite these challenges, the capabilities needed to significantly strengthen U.S. water-system security are well known and widely used in other sectors where failure can be devastating, including those listed above.

A five-part federal program could provide high-level cybersecurity for U.S. water systems.

Establish stronger technical capabilities. Water systems should adopt zero-trust architecture, which permits only authenticated, minimum-necessary access to resources and segments networks so that a breach in one area does not compromise the entire system. Such architecture could have blocked the unauthorized intrusions used in the summer attacks. Zero-trust systems are already widely used across multiple sectors, and commercial providers can support their adoption. The Department of Defense has certified several companies to provide zero-trust architecture for department components.

Water systems should also use formal methods to reduce or eliminate vulnerabilities in software that cannot safely fail.  Although the summer attackers did not appear to exploit flaws in the water systems’ code, a high-level adversary such as China would be likely to do so.

Formal methods range from “memory-safe” programming languages, which prevent coding errors that leave computer memory open to attack, to rigorous mathematical proofs that verify that software behaves as intended. They also support secure “microkernels,” which strictly separate software functions and make it far more difficult for an attacker to move laterally through a system.

Safe code development draws on the principles of formal methods but is a more practical, semi-formal approach. AI tools developed by companies including Google and CrowdStrike can identify and help repair software vulnerabilities, a process sometimes called “code mending.” Water systems should use such tools to defend against advanced adversaries.

Developing formally verified code for water systems would not be simple. But much of the software that directs the mechanical operations of water utilities comes from a small group of companies, including Siemens, Schneider, and Rockwell Automation. Those companies have the technical expertise to develop more secure code where it is necessary. Secure microkernels are also commercially available.

Support large water systems.  Congress should require large water systems to adopt zero-trust architecture, code-mending tools, and formal methods for critical software. The requirements should be phased in over time.  The legislation should also provide tax credits to help cover the costs of developing, implementing, and maintaining these protections.

Assist midsize water systems. The federal government should establish a program that provides technical expertise and financial support to midsize water systems, including municipal utilities. The program should help them adopt zero-trust architecture, code-mending tools, and formal methods for software development.

Midsize systems will likely need a longer phase-in period than large utilities.  A federally funded cohort of experts drawn from government and the private sector could provide the necessary support. Regional teams, organized by geography or technical specialty, could address the different needs of different water systems.

Create a safe operations posture for small water systems. Few, if any, systems serving 3,300 people or fewer are run by organization with substantial cybersecurity resources. Many cash-strapped systems rely on remote monitoring because on-site service is beyond their budgets. But remote monitoring can create serious risk when industrial devices are exposed directly to the public internet without proper firewalls or virtual private networks. 

The summer attacks primarily exploited such exposed devices. The EPA, FBI, and CISA guidance said the affected systems could be protected by locking them into “run” mode, which prevents remote reprogramming. That step may reduce immediate risk, but it also requires systems to be operated in person.

Small utilities therefore need either the staff and funding for manual operations or secure remote-access systems operated by trained personnel.

A voluntary cybersecurity corps could help address the budget and staffing challenges facing small water systems.  One model would follow the National Guard approach: State governors would oversee the effort, while the federal government would provide funding. A state-led program could begin with water systems and later expand to other vulnerable critical-infrastructure sectors.

The Texas pilot, which brings together the state, the federal government and private-sector companies, could serve as a model. It could also serve as a test for a regional approach, something we suggested in a prior op-ed.  

Build an AI-capable cybersecurity cohort. The proposed cohort should include specialists in artificial intelligence, including experts from leading AI companies. They could use AI tools to develop and deploy cybersecurity programs, including zero-trust architectures and code-mending systems, for utilities of all sizes. AI is advancing rapidly and applying it to protect water systems should be a national priority. The AI specialists should work with major industrial-technology companies, including Siemens, Schneider, and Rockwell, as well as directly with the water systems, both larger and smaller.

U.S. water systems face a significant and growing threat. The Trump administration, Congress, states and private sector should work together urgently to ensure that every American can rely on safe, clean water.

Franklin D. Kramer is a former assistant secretary of defense for international security affairs.

Robert J. Butler is the co-founder and managing director of Cyber Strategies LLC, served as the first deputy assistant secretary of defense for space and cyber policy, and served as the Chief Security Officer for IO Data Centers, a global data center enterprise, among other cybersecurity-related roles in both corporate and government organizations.

Melanie J. Teplinsky is an adjunct professor and senior fellow in the Technology, Law and Security Program at American University (AU), Washington College of Law.  She previously practiced technology law at Steptoe & Jonson LLP and served on the pre-IPO advisory board for CrowdStrike.

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Collaboration with industry is key to balancing AI security risks and benefits, as well as staying ahead of China and other adversarial nations, National Cyber Director Sean Cairncross said Thursday.

The Trump administration is facing pressure from some quarters of Capitol Hill and even some artificial intelligence executives to establish regulations or embrace legislation to guard against the technology’s risks, something the president himself has rejected.

“We’ve never faced a world where our adversaries have the frontier in this space, and so our attempts to optimize that innovation and security is is something that is ongoing, but is increasingly efficient, and it depends on our relationship with industry and our ability to work collaboratively among the the interagency,” Cairncross said at the AI Edge event hosted by The Washington Post.

That collaboration is ever-increasing, he said, such as with the National Institute of Standards and Technology’s Center for Advancing Innovation and Standards for Super Intelligence (CAISSI).

“Industry coordination on this, across critical infrastructure sectors, is improving both on industry-to-government and within industry,” he said. “There is collaboration with CAISSI and others as well to do evaluation and testing on these models. That includes work on guardrailing, sandboxing, et cetera.”

But “we’ve seen in the past, once the government is introduced into this space directly, there is a tendency for the government to start to want to adjust the dials directly, and it is difficult to reverse that,” he said. “I think that would slow, at this point, the innovation cycle that is to our benefit.”

One of the things that has increased the calls for stronger government action is when OpenAI acknowledged that its AI agents went outside testing to hack Hugging Face in July.

“Since that incident,” Cairncross said, “the engineering work that’s gone into improving systems awareness of that has increased by an order of magnitude.”

But the AI companies need to secure themselves against China for the United States to stay in the lead, he said.

“Both on the hardware side and on the computer science side and engineering, we’re in the lead. I think our lead is significant,” Cairncross said. “The Chinese have designed a sort of fast follow that relies quite a bit on distillation efforts … And I think industry is increasingly aware of this: that their systems are secure, that the technology, as it’s being developed, is protected.”

Other administration officials have called out China for allegedly using distillation to train its models. In July, Michael Kratsios, who leads the White House Office of Science and Technology Policy, claimed that Moonshot AI, a Beijing, China-based AI company, had distilled Anthropic’s recently released Fable model to develop its own K3 model.

On Wednesday, OpenAI said clusters of activity tied to Moonshot AI were part of a “coordinated” distillation campaign.

Cairncross said earlier this week that the U.S. government is collaborating with industry to integrate AI into critical infrastructure for security purposes. 

Cairncross said the Trump administration wants to make sure national security systems do the same. One of his office’s pilot programs is with the Defense Department and the Cybersecurity and Infrastructure Security Agency “that touches on the defense infrastructure in particular,” in addition to a pilot on rural hospitals.

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The computers that automate water treatment systems across the country were built for durability, not for an internet-connected world. Many still accomplish their fundamental function, but as cyberattacks on the sector mounted this summer, water industry officials say those aging systems, especially internet-exposed operational technology and programmable logic controllers, remain among the easiest ways for adversaries to break in.

Tom Dobbins, executive director of the Water Information Sharing and Analysis Center or WaterISAC, told CyberScoop the sector’s biggest ongoing weaknesses include exposed OT, vulnerable PLCs, insecure connections through integrators and poor cyber hygiene at smaller utilities, which have pushed the center to make threat sharing faster across the sector.

“We have been under attack, and our enemies, the threat actors, are stepping up their activity as the U.S. is involved in a number of conflicts around the world,” Dobbins said.

That includes not only threats from Iran, the nation the U.S. government reportedly believes is behind this summer’s water facility attacks, but also China and Russia, he said.

WaterISAC is announcing a partnership with Cyware Wednesday to use its threat intelligence platform, selecting the company in part because of its existing relationships with other industry ISACs, Dobbins said. The ISAC already has a partnership with the National Rural Water Association to serve 20,000 of the water sector’s smallest utilities, and Dobbins said Cyware would help its analysts further.

It’s a sector that faces myriad challenges, seen by many as further behind on protecting its systems due to financial and technological constraints.

“OT systems that are exposed to the internet are a major challenge, and many of these systems that are older generation need to be not accessible to the internet,” Dobbins said.

Furthermore, programmable logic controllers (PLCs) are “obviously” a “vulnerability point,” he said. 

Those two vulnerabilities were the ones most commonly linked to this summer’s attacks.

Across the sector, PLCs have been the “main point of entry” for hackers, in part because they date back to a “simpler, gentler time,” Dobbins said.

“A lot of the equipment was developed pre-cyber threats and activities,” he said. “The equipment, it’s still valuable, it still is operational, so there’s not a huge reason for or incentive for utilities to upgrade it.”

President Donald Trump has disputed the notion that Iran was behind this summer’s attacks, despite alerts from the Cybersecurity and Infrastructure Security Agency.

“Let’s put it this way: I saw a recent CISA release that pointed to Iran as threat actors, and I know that the president kind of implied that it was not Iran, but I’ll say that CISA maybe is more expert in this area than maybe the president,” Dobbins said. “The president may not have been fully briefed when he made that comment.”

But CISA has also warned of potential threats from Russia and China, he said.

Two other sources of vulnerability for the sector are external — integrators — and internal — employees.

“If those integrators are working and they have a connection into an OT system that’s not managed discretely, then a threat actor can come in through an integrator and get into a system,” he said. 

Then there’s someone “who’s actually a good employee who’s tried to do the right thing and opens an email that has a malicious link in it, so they become subject to a phishing attack,” Dobbins said.

At smaller utilities, it can be difficult to keep up with basic cyber hygiene as well, he said: changing passwords, implementing multifactor authentication.

One way that Cyware might be able to help is by leveraging its relationships with other ISACs, said Tom Stockmeyer, managing director of government and critical infrastructure at Cyware.

“We’re thrilled to add water to the portfolio and start enabling cross-sector sharing,” he said.

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The U.S. government is working with critical infrastructure operators to integrate artificial intelligence into the nation’s most vital systems and strengthen cyber defenses, National Cyber Director Sean Cairncross said Tuesday.

“We have been working closely, and I believe it is functioning well to get models deployed throughout sectors as quickly as possible, and they can be used to secure systems,” he said at a USTelecom event. But he said business leaders need to pay close attention to how AI is being used.

“What CEOs should be thinking about is the agents that run on these systems and in your supply chain — having insight and visibility into who has authorization, what they are authorized to access, and where they are running in your system…  it is an important thing to be on the radar,” he said.

Cairncross made his comments before attending a lunch at the White House featuring top AI tech leaders along with President Donald Trump, Vice President J.D. Vance, and House Speaker Mike Johnson, R-La. The expected discussion topics included weighing the necessity of regulatory guardrails that AI executives have been discussing versus voluntary measures that Trump and Johnson have favored.

Some lawmakers have proposed stricter rules.

“What we’re looking for are pathways where our systems and the services they provide, the daily life that is supported by these systems, can be protected, can be upscaled, can use the the best in class technology as quickly as possible,” Cairncross said about the administration’s approach to regulation and innovation.

“The Mythos moment” in the spring, when that AI model debuted, “crystallized” the administration’s work since, he said: “I think there’s been an enormous amount of work that’s gone in across the interagency, working with industry to get those pathways in place.”

Another key component in AI and cybersecurity is less “sexy,” Cairncross said, which is creating incentives to replace aging, unsupported systems.

Cairncross made his remarks in response to questions from Jonathan Spalter, CEO of USTelecom.

“We know that just in the last six months, the effectiveness of AI models being embedded in much of our critical infrastructure has increased to a stunning degree,” Spalter said.

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A House Democrat tapped to lead his party’s efforts on artificial intelligence has introduced legislation that would establish a test program within the Cybersecurity and Infrastructure Security Agency to give critical infrastructure operators free access to frontier AI models to protect their systems.

Rep. Josh Gottheimer, D-N.J., introduced the AI Cyber Defense Act Monday, inspired by the series of cyberattacks on water facilities in recent months. “If we don’t get ahead of it, it can mean a disaster for our families,” he said at a news conference when he first announced the measure and others tackling water cybersecurity.

Gottheimer holds a couple of posts relevant to the legislation: He’s one of three co-chairs of the House Democratic Commission on Artificial Intelligence, and the top Democrat on the House Intelligence Committee’s cyber subcommittee. He also has bipartisan support for the bill, with co-sponsors Reps. Don Bacon, R-Neb., Zach Nunn, R-Iowa, Hillary Scholten, D-Mich., and Greg Landsman, D-Ohio.

The bill directs the Department of Homeland Security, through CISA, to create a program “through which owners and operators of critical infrastructure that participate in the Program are able to securely utilize artificial intelligence procured through the Secretary and technical assistance provided by the Secretary to protect against, detect, test for, and remediate vulnerabilities in the cybersecurity of such critical infrastructure.”

AI-tinged, water-focused cybersecurity pilot programs are all the rage lately. The introduction of Gottheimer’s legislation is adjacent to, but different from, a test program that the Office of the National Cyber Director recently announced in Texas.

One criticism of that program is that private sector companies offered their cyber and AI services through it on a purely voluntary basis, with no significant budget to bolster the pilot. Gottheimer’s bill would authorize $100 million for the pilot program from 2027 to 2031 before it ends, although appropriators would have to follow through on providing the actual dollars. The Trump administration has significantly cut CISA funding in its second term.

“Right now federal funding for critical infrastructure has an uncertain future and many of our local communities just don’t have the resources they need to pay for AI tokens to do the patching they need,” Gottheimer said when he introduced the bill. “It’s expensive to bring the AI in to analyze your system and find those vulnerabilities.”

Critical infrastructure owners and operators could apply for the pilot program, which the bill directs to give priority to nonprofit, publicly owned, rural and small-sized organizations.

“The same technology that can help a small town’s IT guy find and patch a gap in cybersecurity can also help a hostile government find a hundred more it hasn’t even discovered yet,” Gottheimer said when he announced the bill. “AI didn’t create this threat, but it’s accelerated it, and our defenses have to keep up.”

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Nearly two of every 10 U.S. water and wastewater organizations have identity data actively exposed from infostealers harvesting their credentials, according to research published Tuesday.

The study from identity risk firm SpyCloud follows months of reports about a wave of cyberattacks hitting targets in the sector, which U.S. government officials suspect are tied to Iran.

The company built a database of 66,845 Environmental Protection Agency-registered systems, examined internet domains and ultimately analyzed 10,000 organizations, finding that 1,787 showed active infostealer exposure.

In one case, a single infected device at a smart meter technology provider that SpyCloud didn’t name contained saved logins linked to roughly 167 different U.S. utility metering tenants — meaning that one exposure opened the door to many more. 

That “cascading supply chain exposure” was one of the biggest findings of the report that SpyCloud shared exclusively with CyberScoop, said Jason Lancaster, chief investigations officer at the cyber firm, along with the quantitative approach” to measure exposure overall.

“We talk about it a lot,” Lancaster said of the exponential risk that one exposure can present. “There’s examples here and there, but that was a standout example of, here’s a tangible thing that is an exposure right now.”

Generally, “Infostealer exposure means the attacker isn’t guessing anymore, they’ve got legitimate points of entry,” Lancaster said. “In the investigations I’ve worked, that log data usually contains stolen session cookies, credentials, and autofill info pulled straight off the infected device. That’s enough to walk right past [multifactor authentication] by hijacking an already-authenticated session, log into corporate email or VPNs without raising a single alert, and sit there quietly for weeks while they map out the network.”

Still, the study had limitations. It doesn’t address what apparently led to the cyberattacks that unfolded in Minnesota and elsewhere this summer: internet-exposed programmable logic controllers.

It’s “important to note that our research did not focus on OT devices which run the most critical processes within these utilities, and any exposure we cite herein should not be interpreted as exposure of specific OT devices,” the report said. It did, however, find that 258 of the 1,787 organizations with active infostealer exposure carried credentials to operational technology or remote-access systems.

Some of the report’s conclusions were about the limitations of the data itself.

“Exposure concentrated in larger operators and in the vendor supply chain; small utilities were largely underrepresented,” SpyCloud said. “That’s a pattern in the data, not a claim that every water system nationwide carries this risk — and it measures identity exposure, not confirmed intrusion.”

It’s the first study of its kind that SpyCloud has done for a specific industry, so the company doesn’t have comparisons to other industries, Lancaster said. SpyCloud has begun a responsible disclosure process for those affected within its report, he said, beginning with a briefing for the Cybersecurity and Infrastructure Security Agency.

“It’s important to remember, infostealer logs aren’t the end of an incident — they are often the beginning,” Lancaster said. “Access brokers sell these logs specifically because ransomware crews and other fraudsters want exactly this kind of entry point. So, the real question isn’t whether the exposure is dangerous. It’s how much time you have before someone weaponizes that stolen data against you.”

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A group of leading House Democrats introduced legislation Monday requiring the Cybersecurity and Infrastructure Security Agency to conduct an assessment of its workforce to determine whether it’s up to the task after the exit of around 1,000 employees during President Donald Trump’s second term.

The concept of a force structure assessment is more common in military branches, including one that Congress previously ordered for Cyber Command. The CISA Force Structure Assessment Act would order the agency to carry out a review of whether the agency still has the necessary personnel, training and certifications after budget cuts and other Trump-era departures.

“America’s cyber defenses are only as strong as the people behind them,” Rep. James Walkinshaw, the Virginia Democrat serving as lead sponsor of the bill, said in a news release. “As cyber threats grow more sophisticated and technologies like artificial intelligence and quantum computing reshape the threat landscape, Congress needs a clear accounting of whether CISA has the workforce, skills, and resources required to keep Americans safe and enable mission delivery. This legislation will identify critical gaps and give Congress concrete information to address them.”

Also sponsoring the bill are the top Democrat on the House Homeland Security Committee, Bennie Thompson of Mississippi, and the top Democrat on its cybersecurity subcommittee, Delia Ramirez, D-Ill.

Additional elements of the force structure assessmewould include a review of the security of federal IT systems and support for state and local governments; the risks posed by AI, quantum computing and other cutting edge technologies; CISA’s threat-hunting and incident response capabilities; support for critical infrastructure and operating technology, including CISA’s role as a sector risk management agency for a number of industry sectors; the operation of the Joint Cyber Defense Collaborative; and international cooperation.

Some lawmakers and other observers have worried those areas have been greatly impacted by staffing cuts, ultimately hurting CISA’s ability to carry out its core functions.

Ramirez dinged GOP lawmakers for “a lack of interest in safeguarding our nation’s cybersecurity and our residents’ civil rights and privacy” in going along with the CISA cuts and other developments at the Department of Homeland Security.

Lawmakers on both sides of the aisle have voiced concern about the scope of cuts at CISA, but Republicans have approved some of them while pushing back on others. CISA itself is currently seeking to hire hundreds of new personnel, even as its latest budget blueprint calls for yet more funding reductions.

“With Iran targeting our critical infrastructure and frontier AI models creating new cyber risks, we must ensure we have a cybersecurity workforce to counter these growing threats,” Thompson said. “After Trump has spent the past two years targeting and slashing CISA’s workforce, we need the agency to assess if it has [the] right personnel in place to fulfill its mission.”

National Cyber Director Sean Cairncross has discussed White House plans to develop a cybersecurity academy meant to consolidate and enhance existing federal cyber training and education programs, with the aim of addressing cyber workforce shortages. His office has reportedly drafted an executive order that would establish that academy.

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The United States and allied governments are “buying time for our systems to become more secure” as artificial intelligence advances and spreads, National Cyber Director Sean Cairncross said Thursday.

“That is a big deal to be ahead of this, to be ahead of this race, and because it’s an exponential  equation,” he said at the Billington CyberSecurity Summit. “Once you fall behind, it is much more difficult to make it up, and so that is the context in which all this is taking place. We are trying to balance the innovation side of running at speed with securing our systems and handling this technology responsibly, which is to say, not letting it fall into the hands of people who would do us harm, our adversaries.”

Earlier this week, U.S. security agencies accused Chinese AI companies of trying to illegally distill U.S. frontier AI models. Also this week, Anthropic disclosed a fourth AI hacking incident where one of its models broke into third-party systems.

“We all face the same threat picture, and it’s vital that we’re working closely together to secure those systems before that technological cycle catches up on the back end,” Cairncross said.

AI has further exposed long-standing cybersecurity problems that have gone unaddressed, he said.

“In AI development, particularly on the vulnerability discovery side and the coding side, it hasn’t created a new set of problems,” Cairncross said. “What it’s done is it’s dragged to the surface problems that have been latent in this space for decades. There’s been under-resourcing and deprioritization of basic cyber hygiene and cybersecurity.”

Cairncross’s messages echoed those of other Trump administration cyber officials speaking this week at the summit.

A top FBI official, Jason Bilnoski, said the solutions to the difficulties AI poses aren’t new; basic cyber hygiene is key.

And the director of the Cybersecurity and Infrastructure Security Agency, Nick Andersen, said historical neglect of cybersecurity fundamentals poses a serious threat that requires a speedy answer.

“We know the worst that can happen, and if we don’t make some very serious, very significant changes in quick succession … you all are going to have to go home and look your family, look your friends in the eye and explain to them how you knew the worst that could happen and why we didn’t do enough,” he said.

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Editor’s note: Waco bought the network segmentation technology described here from Elisity while Mike Searight was the city’s chief information officer. He is now a senior adviser to Elisity, a cybersecurity company.

I stood in front of a network cabinet at one of Waco’s water treatment plants, tracing what systems could reach which. The plant’s controls were on that network. So was the branch library. So was the register at the municipal golf course. During my time as chief information officer of a city with 145,000 residents, nobody had ever been asked to inventory what was on that network.

In July, intruders compromised water and wastewater treatment equipment.  Most of that equipment was reachable over public cellular networks, which means they were outside the boundary most utilities thought they were defending. None of the asset lists I have reviewed would have caught it.

Two decisions stand between a small utility and that equipment: who is accountable for the whole network, and where the funding comes from. Neither is technical. Both rest with city manager and councils. Both can be resolved this fiscal year with money already in a budget request.

What the July reports actually say

Three accounts tell different stories. CISA identified over 100 compromised systems in the water and wastewater sector during July, typically through controllers connected directly to cellular modems. The FBI and the EPA reported on July 30 that utilities in at least seven states had reported incidents to the FBI since July 27. Press accounts citing unnamed officials put the number of affected states at a dozen or more.

No federal agency has attributed the late-July water incidents to anyone, and neither will I. A joint advisory does name Iranian-affiliated actors, but for the broader campaign, which is linked to a separate set of intrusions. The advisory was revised July 22, five days before utilities began reporting. That revision expanded the known targeting from Rockwell Allen-Bradley to Schneider Electric, Siemens and potentially others., So the controller brand on the panel no longer settles anything.

The reported effects were operational: a loss of visibility and, in some cases, function. In Clayton County, Georgia, a pump station failed around 1 a.m. on July 27. The boil-water advisory lifted the next day. In early August, the authority serving more than260,000 people said unauthorized cyber activity may have caused or contributed to the disruption. That hedge is deliberate.

The exposure nobody scanned for

The standard answer: they separated the plant network years ago. That’s legitimate work. But it doesn’t matter. The vulnerable controllers never were on the city network—they ran on public cellular links. A modem installed years ago exists nowhere in the asset list and nowhere on network scans. But every carrier invoice lists every SIM the city pays for. Only accounts payable tracks them. Matching those invoices to actual devices costs nothing and can start Monday. The FBI and the EPA also tell utilities to consider isolated architectures for that equipment, and a private access point name tops their list.

Nobody owns the whole network

Most of these systems sit outside the IT department on the org chart, each with its own budget, vendors, and boss. The plant answers to public works. Cameras and card readers arrived with a building project, and most cities treat them like light fixtures. In every city I’ve worked in, exactly one person in IT understands the whole picture. When that engineer leaves, the security posture leaves with them. And nobody owns accountability for the network they all share.

Reporting rules also miss the point. Texas—my example—requires local governments to report security incidents within 48 hours, but only if they involve personal-information breaches or ransomware. An intrusion that seizes control of a controller while touching either sits outside that trigger., That’s exactly what happened in July.

The federal rule requiring a covered cyber incident to be reported within 72 hours was supposed to be finalized in October 2025; CISA is now targeting this month. But nothing determines who owns the network.

Money the utility already applies for

The second answer is there is no budget. Wrong. The fund mechanics matter more than the size of the check.

For State Fiscal Year 2026, the Texas Water Development Board added cybersecurity to the scoring criteria in its Intended Use Plan for the Drinking Water State Revolving Fund. Two questions on the Project Information Form now carry five priority points between them: Oone asks if the governing body adopted a cybersecurity awareness plan in the last five years; the other asks if a project fixes a deficiency found in a cybersecurity assessment. Five points is modest– I won’t oversell it– but this fund is a ranked competition decided at the margins.

Waco segmented five treatment plants—four drinking water and one wastewater—in 43 days against the 90 I’d promised City Council. No bond. No capital request. The utility director funded it from operating accounts using a contract already on the city’s books, rather than an RFP. They carried it to Council because the network was theirs to own.

Those were budget choices ahead of anything else. An operating line competes with a maintenance contract and can be approved this quarter, while the same money in the capital plan waits for a bond cycle. A smaller city without a CIO will not repeat that schedule. The funding mechanics are the same ones.

Every CIO knows how to segment a network. Almost nobody does it, because they are afraid of taking a plant down. Simulate before you enforce. One operating rule came out of it: being on the network allows a device nothing. Plant controls talk only to their SCADA server. Everything else is denied unless explicitly allowed.

City managers, university presidents, superintendents and chief executives are willing to invest in cybersecurity when they trust the investment will make a measurable difference. These leaders spend taxpayer dollars in public view, and the public’s trust rides on every line item as much as the money does. What earns their approval is transparency: a complete picture of what they are protecting, and evidence that critical infrastructure is defended against threats from the open internet and from inside their own network. That standard—full visibility, provable protection—is what every organization should be working toward.

Microsegmentation protects critical systems without the need for rip-and-replace. It isolates water treatment plants, 911 dispatch, public safety alerts, and traffic management from internal and external threats—all on networks cities already own. Modern platforms deploy in weeks rather than budget cycles, making this control finally achievable. Every CIO and CISO should evaluate it now. Microsegmentation is zero-trust’s foundation and the most direct defense of infrastructure residents depend on.

Somebody to call

None of this reaches a two-person utility that can’t write competitive applications. That’s where states must lean in. New York adopted what it calls the first-in-the-nation water cybersecurity rules in March with grants and free technical support. Texas has stood up a Cyber Command with an explicit water and wastewater mandate. A small city needs a number to call and people who answer.

That number now exists. On Monday, Texas Gov. Greg Abbott and National Cyber Director Sean Cairncross launched Project Watershed 250 in San Antonio — a six-month pilot that puts Texas Cyber Command, the National Cyber Director’s office, the EPA and CISA, and a dozen private cybersecurity and technology companies behind Texas water utilities. Participating systems get red-team testing, vulnerability assessments and help hardening what the assessments find, at no cost, with plans to take the model nationwide after the pilot. If you run a Texas water system, you should be reaching out immediately.

For the smallest systems, DEF CON Franklin and the National Rural Water Association have put volunteers and five managed detection providers behind them.

Where to start

Here are three things CIOs and CISO can do that do not have to wait for a grant or a budget cycle: Name one position accountable for every device on the utility network and put it in writing. Match twelve months of carrier invoices to actual devices and sites. Read your state’s Intended Use Plan scoring criteria before the next application.

Nothing in Waco moved until the first of those was settled. The other two cost nothing more than somebody’s afternoon. Most cities haven’t even put someone in the that position.

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Sen. Ron Wyden, D-Ore., is asking the National Security Agency to update public guidance on the security risks associated with commercial virtual private networks, and to answer questions about foreign surveillance threats against standard VPNs.

In a letter to NSA Director Gen. Joshua Rudd that Wyden sent Wednesday, the senator continued his push to warn about standard, commercial VPNs, following letters to federal agency leaders in March and July.

“While commercial Virtual Private Networks (VPNs) are recommended by federal agencies and widely marketed as shields against online spying, standard consumer VPNs do not sufficiently protect users from sophisticated adversaries,” Wyden wrote in the letter, first reported by CyberScoop. “Other, more secure alternatives are widely available.”

Wyden took aim at “single-hop” VPNs that routes data through one server before arriving at the destination.

He cited a Congressional Research Service paper from last month that said “a single-hop VPN, however strongly encrypted, offers essentially no protection against an adversary who can compel… or infiltrate that one provider,” compared to “multi-hop and mixnet architectures [that] directly target and mitigate this weakness” since a second server only knows the IP address of the first server.

He also cited a letter responding to an earlier missive that Wyden signed with other lawmakers in an exchange with the Office of the Director of National Intelligence. The office offered a note of caution about scrutinizing VPN providers’ privacy and security policies, but Wyden said “it overlooked the importance of the VPN service’s architecture against sophisticated foreign threats.”

Wyden referenced an advisory from the NSA and allied foreign governments last September about a China-sponsored campaign to target telecommunications, government and military networks.

He said that the NSA should update its public guidance on VPN configuration.

“Americans facing advanced foreign threats — including government personnel, defense contractors, journalists, and human rights defenders — deserve clear, honest advice about how best to protect their communications from surveillance by foreign adversaries. 

He also asked Rudd to answer a series of questions in an unclassified reply. Some view single-hop commercial VPNs as sufficient for average internet users, and Wyden asked whether they were strong enough to protect “Americans’ sensitive digital footprints against foreign adversaries capable of monitoring internet backbones.”

And Wyden wants Rudd to weigh in on the importance and effectiveness of multi-hop anti-surveillance systems, like Apple Private Relay, Tor and Nym, as well as how multi-hop proxy systems fare against mixnet architectures.

You can read the full letter below.

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The Trump administration rolled out a six-month test program in Texas on Monday that will draw on volunteer expertise and technology from cyber and artificial intelligence companies to protect the water sector.

“Project Watershed 250” is the first of the state-based, industry-centric pilot projects to cross the finish line that the Office of the National Cyber Director has previewed since the publication of its national cybersecurity strategy earlier this year. Water systems have long been viewed as among the most vulnerable and neediest critical infrastructure sectors, and in recent months the sector has been the victim of a spree of attacks.

“Project Watershed 250 is a commitment from the states, industry and federal government that we will continue to prioritize our nation’s safety and deliver on America-first policies for the American people,” National Cyber Director Sean Cairncross said at a rollout event in San Antonio Monday.

“U.S. companies are providing world-class cyber capabilities, red teaming that tests utilities’ current defenses, system hardening using the latest private sector cyber tools and AI tooling that helps utilities’ frontier cyber defenders to protect Texas water systems and scale proven solutions across the country,” he said. “This six-month pilot program is designed to make our water and wastewater critical infrastructure more resilient and resistant to cyber attacks by proactively finding and fixing system weaknesses.”

The pilot program, featuring collaboration between federal and state governments, stands in contrast to how the Biden administration tried to tackle the issue, with audit requirements that some GOP states challenged in court, forcing Biden’s Environmental Protection Agency to withdraw its rule.

“For too long, at least on the federal level, the government has admired the problem of cybersecurity in water systems,” Cairncross said. “We are going to find out what works. We’re going to target that, and we are going to scale off of this and learn lessons.”

A dozen companies — Parsons, Microsoft, Fortinet, Google Cloud, Palo Alto Networks, Amazon Web Services, Reflection AI, Cloudflare, Zscaler, Forescout, Abnormal AI and Dragos — appeared at the rollout Monday to praise the initiative and tout their contributions to it.

Not everyone praised the initiative elsewhere, however. One cyber professional who works on water security issues, speaking on condition of anonymity, said the program was “all smoke” and that “there’s no real money behind it.”

“The White House did what it always does — reached out to industry with their hands out asking for industry to pay for things the government should be doing, at least in part,” the person said.

Texas Gov. Greg Abbott said the program would be overseen by Cairncross’s office and Texas Cyber Command, which was established just last year. Abbott cited the need for the program by mentioning “an Iranian-backed cyberattack” on 30 water systems across 12 states and a 2024 attack on the water system in Muleshoe, Texas, suspected to be the work of Russian hackers.

“The need for cyber resilience is overwhelming,” Abbott said. “Many rural providers simply don’t have the resources they need to be able to protect themselves.”

Watershed 250 isn’t the only federal effort to bolster water cybersecurity, with lawmakers introducing legislation in the aftermath of the recent attacks. Past legislation that Congress has enacted also sought to tackle the problem.

Updated 8/31/26: with comment from cyber professional.

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When the Cybersecurity and Infrastructure Security Agency tested defenses for two targets — one in the government sector and the other in the water sector — red teamers were able to get into both of their systems, but the water organization discovered the simulated attack and acted to defend itself, whereas the government organization did neither.

CISA published the breakdown Tuesday in a rare public report on its red-team activities, at a time when attacks on the water sector have a higher profile after revelations of targeting of water facilities across the United States over the past month and numerous government warnings.

The agency didn’t name the organizations it tested through a process that is voluntary and by-request.

“In one organization (Organization A), the team gained initial access to multiple workstations, gained elevated privileges over the domain, and moved laterally to [sensitive business systems] and cloud resources undetected,” CISA’s analysis reads. “In the second organization (Organization B), network defenders quickly detected the initial compromise and quarantined the affected systems.”

For “Organization A,” the government organization, CISA used an internal email address to send phishing emails to gain access to the workstations, probed further to gain elevated privileges, then moved around and compromised targeted sensitive business systems. The red teamers observed that the organization “did not respond effectively to red team activity” by accessing personnel emails at its security operations center, where they saw them receive low- and medium-severity endpoint detection and response alerts, but didn’t respond to them.

False positives by the thousands, including some with higher severity, “obscured the alerts triggered by red team activity,” CISA said. The agency also faulted “organizational silos.”

Meanwhile, at “Organization B,” the water organization, CISA got access via a spearphishing campaign, convincing three users to click on a malicious link to gain access to workstations. This time, the security operations center triaged the alerts and quarantined the work stations in 2, 10 and 20 minutes, respectively.

The red teamers tried another approach with the help of the organization’s IT contacts who were aware of the activity, but were foiled in their follow-ups.

“Because Organization B detected the initial compromise, the red team moved to an ‘assume breach’ model, where Organization B trusted agents (TAs) provided access to a host that replicated the level of access the red team would have had if defenders had not detected their activity,” CISA wrote. “From there, the red team escalated privileges and moved laterally to [sensitive business systems], cloud resources, and a bastion host in the OT [operational technology] demilitarized zone (DMZ), where defenders again detected activity and isolated the system.”

Still, CISA said both organizations had flaws in their defenses: They underestimated cloud risks; they lacked Conditional Access — a Microsoft security tool — for workload identities; and they didn’t have processes in place to revoke compromised access/refresh tokens.

CISA first published an advisory on its red team activity in 2023, but such advisories have been few and far between since. The agency said last year that it had not “laid off” its red team, after stories revealed the exit of contractors that included red-team members.

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As part of its “economic D-Day” against Iran, the Treasury Department designated four Iranians for sanctions Monday stemming from their alleged role in hacking critical infrastructure targets and waging cybertheft against the United States.

It’s the second time in as many weeks that the Trump administration has taken aim at the same group of alleged hackers, following on an indictment recently unsealed against cybercriminals that federal law enforcement authorities say are affiliated with the Tehran-based Mabna Institute.

A Treasury Department release points the finger at three people — Keyvan Fayyaz Ghareh Blagh, Saber Shahbazi Balujeh, Mohammad Reza Kadkhoda’i and Mojtaba Ghal’eh-Kuhi — as specifically conducting the hacks.

“Since at least late 2023, these three individuals have successfully compromised and exfiltrated data from multiple U.S. companies in various critical infrastructure sectors, including energy companies, defense contractors, healthcare institutions, information technology companies, and financial institutions,” the release states.

A fourth individual included in Monday’s sanctions, Mojtaba Ghal’eh-Kuhi, is listed as one of the leaders of the gang carrying out the Ministry of Intelligence and Security (MOIS)-directed attacks. Another listed leader, Behzad Mesri, first faced sanctions in 2018, as part of another round of sanctions focused on the Mabna Institute.

Finally, the Treasury Department designated one additional person Monday over related activity, Arman Kahzadian, for his alleged role in receiving or using business information stolen via cyber-enabled means.

The department said the Iranian hackers sometimes turn their gaze to domestic targets.

“The members of this group are also heavily motivated by personal enrichment and greed, leading some members to prioritize their own profits over operations that benefit the MOIS,” it said. “This has driven some of the group to target Iranian companies.“

Hackers that the U.S. government has identified as Iranian have been behind a spate of attacks on U.S. water facilities, despite denials from President Donald Trump himself about Iranian culpability.  The Treasury Department did not immediately respond to a request for comment Monday about whether the sanctions designees were involved in those attacks, nor has the National Security Agency responded to requests for comment on whether Iran was responsible for attacks at the center of an alert about attacks on water facilities.

Treasury Secretary Scott Bessent announced a fuller list of sanctions Monday as the war with Iran nears its five-month anniversary with no end in apparent sight.

“In the Second World War, D-Day marked the historic beginning of a campaign with our allies to target and drive the enemy from its positions, including those in third countries,” he said. “Today, in that same spirit, we are launching an economic onslaught against Iran’s financial connections around the globe. Our objective is to sever every economic lifeline that sustains this tyrannical regime until Tehran stands alone.”

There are questions about whether the sanctions themselves are likely to change any behavior, particularly based on how they will be enforced. Iran has vowed “consequences” for the United States.

As part of the sanctions announced Monday, according to the department, “Treasury is expanding the categories of Iran-related conduct that may be subject to secondary sanctions in the future, making it easier to take action against those facilitating the regime. Treasury has issued determinations against five critical sectors –– digital assets, technology, gold, aviation, and shipping––  that the Iranian regime uses to try to prop up its failing economy.”

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Hackers are targeting water, food, energy, chemical, manufacturing and commercial facilities by taking aim at Siemens S7 Series programmable logic controllers (PLCs) and making use of artificial intelligence in the attacks, U.S. government agencies warned Wednesday.

It’s the latest government warning about attacks on critical infrastructure as the United States wages war against Iran, which the government blamed for a recent campaign against water and wastewater systems— but doesn’t mention in Wednesday’s alert. 

The National Security Agency didn’t immediately respond to a request for comment about who was behind the attacks on the PLCs, which are used to control manufacturing processes.

The agencies said the attacks were an “active threat,” rather than a theoretical one. The attacks could disrupt critical industrial processes, cause safety incidents or lead to the compromise of sensitive data.

Wednesday’s alert from the NSA, Cybersecurity and Infrastructure Security Agency, FBI, Energy Department and Environmental Protection Agency makes special note of the hackers using AI-generated exploitation scripts in the attacks.

“Using AI to generate exploitation scripts represents an evolution in threat actor capabilities, dramatically reducing the technical expertise and time required to develop working ICS exploitation scripts and malicious tools,” the alert states. “In addition, AI enables adversaries to rapidly leverage additional attack vectors and adapt to defensive measures. Threat actors can easily collect public information about vulnerabilities and weaknesses, find exposed and exploitable PLCs, and use AI-generated scripts to act on that information.”

A former top CISA official, Michael Garcia, thought that it was a first for the agency in one of its cybersecurity advisories (CSAs) about operational technology (OT).

“It is the first alert I have seen where CISA is saying in a CSA that a malicious actor is using AI scripts to target OT systems,” Garcia, now vice president of the cybersecurity practice at Monument Policy Advocacy, said on LinkedIn. But the advisory doesn’t recommend using AI in response, instead focusing on well-known, traditional defensive measures, he added.

Frenos, an OT penetration testing company, found another element of the alert troubling: The method by which the attackers could use the approach beyond Siemens-made PLCs.

“Siemens S7 is the subject here, but the exposure pattern is not brand specific,” Brian Proctor, CEO of the company, said in an email. “An adversary who has mapped your data blocks understands your process. They know what normal looks like, which means they know what an operator would fail to notice.”

The AI-generated scripts are disguised as legitimate monitoring tools, the advisory said of the hackers behind them.

“The actors leverage Internet scanning services to find Internet-exposed PLCs running outdated software or that are otherwise poorly protected,” the advisory reads.

Siemens said it was “aware” of the alert and “is coordinating closely with CISA.”

“This advisory does not describe new vulnerabilities within the S7 Series programmable logic controllers (PLC). Instead, this reflects threat actors employing new techniques to exploit potential misconfigurations,” the company continued, noting a security bulletin it issued last month.

“Siemens will provide updates around this issue to potentially affected customers through our ProductCERT team,” it said. “At this point in time, we have not identified increased attack levels or unknown vulnerabilities in Siemens ICS products.”

Updated 8/20/2026: to include Siemens comment.

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The Trump administration executive order on artificial intelligence tried to strike the balance between responsible use, security and mutual benefit, all with an eye toward not making it regulatory in nature, National Cyber Director Sean Cairncross said Tuesday.

“Everyone is working towards the same goal in terms of protecting the country and securing our systems, and we are trying to ensure that defenders have this technology as quickly and at scale as possible, but there are obviously specific security concerns, and industry has been very sensitive to this as well,” Cairncross said at the Black Hat 2026 conference in Las Vegas.

The security concerns about AI have moved to the forefront of discussions about the technology after OpenAI models escaped a test environment to hack the company Hugging Face last month.

“The design of this is that when there is something that happens, when there is a breach, when there is an event, that that system, that network of connections can exist, adapt to that, and seek to remedy that as quickly as possible, so that form follows function rather than turning that upside down, and as usual with the government pen just proceeding in a vacuum,” Cairncross said.

The Trump administration has drawn criticism over whether it has struck the right balance on AI rules. Trump’s AI executive order notably got pulled just before its scheduled release, with the final version signed in June missing some aspects that had drawn industry opposition.

“What needs to be built is a flexible, adaptable structure that enables information sharing between industry and government, so we can guarantee that this technology benefits everyone it’s going to benefit, but is used responsibly and securely,” Cairncross said.

He said the administration is working with industry during implementation of the executive order.

“A regulatory regime would not only strangle growth, development, and innovation, and be enormously harmful to the industry, but it would be obsolete 48 hours after it was gone through whatever process it had gone through,” Cairncross said.

Open source will play a “vital” role in the U.S. spreading its vision for AI across the globe, he said.

“We are extremely interested in looking at ways to build U.S. open source, make it competitive, make it the preferential adoption by planet Earth,” Cairncross said. “We understand and appreciate the value to the ecosystem that it has, the innovation, the startups who rely on it, the leap forward it makes possible in ways that otherwise would never happen. And so I think it’s an incredibly thriving ecosystem in AI right now, and we are looking to do what we can to grow, foster, and push that U.S. open source model.” 

Speaking at the same conference, Nick Andersen, the acting director of the Cybersecurity and Infrastructure Security Agency, seconded Cairncross’s comments about AI executive order implementation. He touted the Gold Eagle clearinghouse as one example.

“Those are fantastic opportunities we have to really provide a unifying function around the way that we’re going to do AI-enabled vulnerability reporting and disclosure at scale in a way that we haven’t had to do before with some of our legacy platforms, and just continue to expand out those opportunities,” he said. “That access — to build off the director’s point earlier — to really enable that industry collaboration, that’s so key and critical to us as we move forward.”

Matt Kapko contributed reporting to this story.

Updated 8/5/2026: to include comments from Andersen.

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The Trump administration’s haphazard and opaque interventions into artificial intelligence security matters could catapult Chinese alternatives into broader acceptance, posing new security risks altogether, a group of Democratic senators wrote to top administration officials Monday.

The five senators said that the administration’s handling has alternated between too passive, such as when OpenAI models escaped testing in the Hugging Face hack last month, and overstepping, such as when the Commerce Department suspended access for any foreign national to Anthropic’s Fable 5 and Mythos 5 in June.

“The Administration’s ad hoc and unpredictable approach undermines U.S. competitiveness, heightening market incentives to adopt open weight models from vendors based in the People’s Republic of China (PRC),” wrote Sens. Kristen Gillibrand of New York, Adam Schiff of California, Mark Warner of Virginia, Chris Coons of Delaware and Mark Kelly of Arizona.

In the Hugging Face hack, the senators wrote that “the Federal Government cannot be passive as these capabilities emerge.”

In the case of the Fable 5 and Mythos 5 suspensions, the senators said that the administration “utilized an infrequently used authority to direct Anthropic to suspend all access to its Fable 5 and Mythos 5 models for foreign nationals (including foreign national employees inside the United States) citing an undisclosed national security concern later described as a narrow jailbreak finding.”

Because Anthropic couldn’t immediately assess users’ nationality, the firm had to disable both models for everyone. The administration and Anthropic negotiated for 18 days behind closed doors before reaching an agreement, the lawmakers complained.

“While the Administration may have been responding to real security concerns to protect the United States, even justifiable interventions can create broader harm if the standards and decision-making processes are opaque, ad hoc, or unpredictable,” they said in their letter to leaders in the White House, Office of the National Cyber Director and departments of State, Treasury and Commerce. “Moreover, when the Executive Branch exercises authority delegated from Congress, such as in the conduct of export control administration, it is essential that it keep Congress fully apprised of its actions and procedures.”

During the time Anthropic was under export controls, the stock price of “an entity-listed Chinese lab” nearly doubled, the senators said. And while Hugging Face was breached, the company “had to” rely on a Chinese open-weight model due to guardrails on U.S. frontier models.

“If American models are perceived as subject to sudden access disruptions based on a black-box U.S. Government process, or as unreliable because U.S. AI labs are overcorrecting in the face of this black-box process, companies and governments in the United States and abroad may hedge by adopting Chinese or other foreign models instead,” the senators contended. “That outcome would undermine U.S. technological leadership while increasing exposure to systems that may carry risks of PRC or otherwise directed censorship, espionage, IP theft, and other supply chain security risks.”

Their letter asked for answers to questions about the standards the administration uses to determine the national security risks a frontier model presents, what legal authorities it will use to invoke restrictions, which agencies are responsible for which decisions and more.

None of the offices or departments the letter was addressed to immediately responded to a request for comment.

The letter follows inquiries at the state level, where 15 attorneys general asked OpenAI for more information regarding the security incident at Hugging Face.

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