Law360 (August 10, 2026, 10:14 PM EDT) -- California's governor on Monday rolled out a first-of-its-kind initiative to help state agencies, local governments and critical infrastructure providers use artificial intelligence to detect and respond to increasingly sophisticated cyberthreats and be better prepared for incidents fueled by emerging AI technologies.

Building on a March executive order directing state agencies to implement guardrails for contracting with AI companies and a 2023 executive order to develop a responsible process for the evaluation and deployment of AI within state government, Gov. Gavin Newsom issued a new directive for state agencies to establish an AI Cyber Defense Program, strengthen cybersecurity coordination across the government, expand AI-enabled defenses for critical infrastructure and local governments, and improve preparedness for emerging AI cybersecurity incidents.

"The digital environment is rapidly evolving before our eyes. Attacks are faster, more sophisticated, and more frequent, putting at risk the basic systems families count on," Newsom said in a statement Monday. "California can either wait for the next crisis, or we can build the kind of defenses this moment demands. We are choosing to build."

The establishment of the new statewide AI cyber defense program, which Newsom called the first of its kind in the nation, comes amid growing concerns over the ability of advanced AI systems to identify cybersecurity vulnerabilities and carry out attacks at a scale and sophistication beyond humans' capabilities.

These concerns have been further exacerbated by recent reports from several prominent tech companies of AI models under their control inadvertently hacking into third-party systems.

Anthropic announced July 30 that its Claude model was interacting with a third party and gained unauthorized access to the infrastructure of three different organizations, just days after ChatGPT creator OpenAI disclosed on July 21 that a combination of its models hacked Hugging Face, a third-party AI and machine learning startup that operates an open-source platform for developers and others to share models and datasets.

Meta Platforms Inc. also revealed earlier this month that one of its AI models had hacked another company ​during cybersecurity testing. The social media giant said the incident stemmed from a configuration error that accidentally gave the AI access to the internet.

In addition to these AI-fueled incidents, federal officials have also recently warned that municipal water systems in Minnesota and nearly a dozen other states have been targeted by hackers suspected of being linked to the Iranian government. Federal agencies had previously warned in April that Iranian-affiliated hackers were targeting critical infrastructure, including drinking water and wastewater systems.

The latest initiative launched by California on Monday aims to fortify protections for water systems and other critical infrastructure in the state against a range of sophisticated attacks, while also giving them the necessary resources to leverage these AI tools to combat these threats.

"Artificial intelligence is transforming both the opportunities and the risks in government cybersecurity," said Government Operations Agency Secretary Nick Maduros. "California is taking a proactive approach — harnessing AI to strengthen our defenses while preparing for the emerging threats these technologies can create."

To strengthen California's preparedness, the governor is directing agencies to establish an AI Cyber Defense Program within the California Cybersecurity Integration Center to harness AI for vulnerability detection, network hardening and incident response to elevate the state's cybersecurity posture and protect critical infrastructure.

The latest directive also instructs state agencies to expand access to advanced cybersecurity capabilities for local governments and critical infrastructure partners, including AI-enabled defenses, and to designate an AI cybersecurity officer in every state agency.

"Cyberattacks can disrupt the essential services Californians rely on every day, including water, power, transportation, and emergency communications," said Caroline Thomas Jacobs, the California Governor's Office of Emergency Services director and state Homeland Security Advisor. "This new program will help Cal OES and our partners detect threats sooner, share information more efficiently, strengthen defenses, and respond faster, helping keep these critical services safe and reliable for communities across California."

Newsom said that these actions, along with his prior executive orders, represent "the next phase of California's AI leadership — ensuring that as AI capabilities accelerate, public-sector preparedness keeps pace."

The new initiative also comes as the Trump administration "continues rollbacks of key federal support" in this area, according to California's governor.

While the potential for foreign adversaries to weaponize AI systems prompted the Trump administration to release an executive order in June pushing the developers of advanced AI models to voluntarily share their systems with the federal government for prerelease cybersecurity testing, concerns have been raised about the potential for the government to keep out of public view the framework it's developing detailing the process and benchmarks for such testing.

Additionally, several national programs that state and local governments have relied on to support and fund cybersecurity efforts are being scaled back, according to the California governor's office.

The Trump administration's proposed budget for the 2027 fiscal year would cut funding for the Cybersecurity and Infrastructure Agency by roughly $707 million, reducing capacity for field support, incident response and defensive tools, the governor's office said. Additionally, federal funding for the Multi‑State Information Sharing and Analysis Center ended in late 2025, while the State and Local Cybersecurity Grant Program, created with a $1 billion appropriation under the federal Bipartisan Infrastructure Law, is also nearing the end of its current funding phase, according to the governor's office.

--Editing by Vaqas Asghar.

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