Legislature(2001 - 2002)
04/02/2002 01:56 PM House FIN
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* first hearing in first committee of referral
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HOUSE BILL NO. 344
An Act increasing fees for driver's licenses,
instruction permits, and identification cards; and
providing for an effective date.
LINDA SYLVESTER, STAFF, REPRESENTATIVE PETE KOTT, HB 344 was
introduced by the House Rules Committee at the request of
the Division of Motor Vehicles. Passage of HB 344 does two
things:
ΠFees for non-commercial drivers licenses and ID cards
will increase by $5.00. Learner's permits will increase
by $10.
Considering the approximate 180,000 original issues and
renewals processed annually, the increase translates into
an additional $750,000 to $900,000 per year. Also,
ΠThe fee increase enables DMV to implement a conversion
to a digital license system. The Division seeks
$500,000 to implement the IT system to support the
digital system. They already have the capital funding
for the equipment.
Ms. Sylvester read a prepared statement:
Alaska is one of 3 remaining states that has yet to
abandon the Polaroid system. By moving beyond 1950's
era technology, Alaska steps up efforts to insure the
integrity of this nation's individual identification
system. Since September 11, considerable attention has
focused on the integrity of this system.
Keep in mind that the driver's license and ID cards are
considered "breeder" documents. Once in hand they can
be parlayed into other documents like airplane tickets,
passports, checking accounts, fire arms permits, credit
cards, among others. Just like that, a new or false
identity is set up. The driver's license is the
cornerstone of the identity theft phenomenon. Last
year, this little problem resulted in losses of over $7
billion dollars.
Less glamorous but indicative of a larger "day to day"
problem for the restricted sales industry is underage
kids fraudulently obtaining or manufacturing id's.
You'll notice resolutions from the Municipality of
Anchorage and from Alcohol Retail Beverage Association
and a letter in support from CHARR that speak to that
issue.
The driver's license is far more than evidence that you
passed your road test. It has become a critical
component to our society's security both personal &
financial.
As such the government has a HUGE responsibility to
ensure the integrity of that system.
Think about how Alaska lives up to that responsibility.
The license you carry in your pocket relies on
technology that is unchanged since 1954.
Think of the ways one might fraudulently obtain a
license. It takes two documents with your name on it
to get a duplicate license. No photo identification is
required. Someone could steal mail, walk into a DMV
office and potentially walk out with a license with
someone else's identifying information is now matched
to their photo. Right now, DMV lacks the ability to
keep an electronic image of the individual. That means
they can get that person's checking account, credit
card, etc., etc., etc.
Another creative idea was shared by a staffer for a
Finance Committee member. In college, their friend,
commercial art major created a large poster of an exact
replica of an Alaska Driver's license. He had people
stand in front, in front of the 'yellow curtain' and
took a Polaroid snapshot, laminated it and a driver's
license was created.
Alaska's license is uniquely old fashioned. I've heard
anecdotal stories about bars or airlines balking at
accepting them because it looks too low tech, too
homemade. The license is a dinosaur. Other problems:
Alaska's DMV cannot electronically transmit a copy of
the driver's license nor can they retain an electronic
image. If you are traveling, have your wallet what
would you do? DMV can only manufacture a duplicate
license with an empty space where your photo should be.
If your not there in person to have your picture taken,
no picture exists. This is a crisis for a traveling
Alaskan negotiating their way through the tough as
nails security and airport agents in the nation's
airports. If Alaska had a digital license, a completely
intact, functional duplicate license could be expressed
to the sorry traveler.
If nothing I've said has impressed you with the
importance of converting to the digital drivers license
system, I've got one more compelling reason for your
consideration. Last year the Polaroid filed for Chapter
11 bankruptcy. In February at the American Association
of Motor Vehicle Administrators was informed that
Chapter 7 Bankruptcy was likely to follow. Chapter 7
meaning selling off of the business assets. Once
digital cameras hit the consumer market, the end of
Polaroid photography became a foregone conclusion.
Already, the cameras used by DMV are no longer
manufactured. It is just a matter of time before the
film can no longer be purchased either.
MARY MARSHBURN, DIRECTOR, DIVISION OF MOTOR VEHICLES,
ANCHORAGE, testified via teleconference in support of the
legislation. She observed that Alaska is one of three
remaining states that does not use digital licensing. The
passage of HB 344 would help to move forward for a much-
needed change in the Alaska system. She observed that Alaska
uses a manual process with preprinted forms, which are
laminated. All of the items are subject to theft, fraud and
alteration, though she did not think it would be as simple
as indicated by the previous testifier. Within the past
four-months, five individuals have been arrested for
fraudulent attempt to alter or obtain a license. Computer
generation are significantly more difficult to alter or
replicate. There are no preprinted forms, pouches or photos.
Computer generation allows more complex and secure features
on the license. A digital picture is stored and used to
verify identity for renewal or law enforcement. She
concluded that digital licenses would benefit consumers. It
is more difficult to alter and more secure. If a current
license were lost it could not be replaced with a picture if
the holder were out of state. Digital licenses could be
reprinted and sent to the consumer. She noted that there is
wide support among law enforcement agencies and industry.
She addressed the fiscal notes, which would provide $500
thousand dollars in capital funds for system development
testing and deployment. Funding would support integration of
the database, license generation and data issuance, image
storage capture, and storage of the transmission for law
enforcement use. It would also test the system and deploy it
statewide, integrate with other users, and provide support
software. Alaska currently has over the counter licensing
issuance. She spoke to centralizing the function. Pictures
would be taken at the Division of Motor Vehicles, which
would take the picture and application, but the license
would be mailed from a central facility.
TAPE HFC 02 - 73, Side A
Ms. Marshburn stated that centralization would be more
expensive than over the counter issuance. Personnel costs
would be the biggest factors. There would be a $5 dollar
increase to the license and duplication fees. Instruction
permits would be increased by $10 dollars. Fees in Alaska
are currently at the low end of the national scale; raising
the fee would bring Alaskan fees to the middle to low end.
The Division does not recommend raising commercial licensing
fees. The last increase to drivers licensing fees was 10 or
more years ago and they think the increase is reasonable.
Licenses should remain affordable to maintain safety and
encourage licensing.
Representative John Davies asked if there would be an
increment to maintain accuracy. Ms. Marshburn emphasized
that they currently require proof of birth and proof of
identity. Previous photos can be retrieved when there are
questions, but they are not instantly recallable.
Representative Lancaster questioned if the Division looked
into any technologies other than Polaroid. Ms. Marshburn
observed that Polaroid would be eligible to bid, but she
thought that it was likely that another vendor would receive
the bid.
Representative Lancaster referred to national identification
cards. Ms. Marshburn noted that discussions on national
identity cards envision a single card issued by a single
agency, such as the federal Department of Transportation.
Improving state licensing could help defer the issue of a
national identity card.
Representative Hudson questioned if the renewal would have
to occur at a division office. Ms. Marshburn observed that
there would be no changes in the basic process of issuing or
renewing licensing. Individuals would still be eligible for
renewal by mail after the initial five-year period.
In response to a question by Co-Chair Williams, Ms Marshburn
explained that the Division estimates $900 thousand dollars
in revenue would be generated with the increase of licenses.
The Division is asking for $500 thousand dollars to be
appropriated to develop the system.
Representative John Davies MOVED to report CSHB 344 (STA)
out of Committee with the accompanying fiscal note. There
being NO OBJECTION, it was so ordered.
CSHB 344 (STA) was REPORTED out of Committee with a "do
pass" recommendation and with previously published fiscal
note: ADM (#1).
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