The official, who was briefed on the investigation, spoke to the AP yesterday on condition of anonymity because the official was not authorized to speak publicly about the ongoing criminal investigation.
In 2013, hackers accessed the control system at the Bowman Avenue Dam, a small structure in Rye Brook, about 20 miles north of New York City, that's used for flood control.
The intrusion allowed the hackers to probe the system, prompting a federal investigation.
It wasn't clear whether the indictment would charge specific people within the Iranian government or publicly name Iran as being behind the attack.
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A formal announcement was expected to be made as soon as mid-April, the official said.
Officials in Rye said in December that they had been alerted by the US Department of Homeland Security about unauthorized access to the city's computer system.
At a news briefing yesterday, State Department spokesman Mark Toner declined to specifically comment on the prospects that Iran would be charged in the cyberattack, but said: "I would say broadly that we obviously take all, seriously all such malicious activity in cyberspace. We're going to continue to use all the tools at our disposal to deter, detect, counter, and mitigate that kind of activity."