SENATE BILL NO. 34 "An Act relating to the implementation of the federal REAL ID Act of 2005; and relating to issuance of identification cards and driver's licenses; and providing for an effective date." 10:06:32 AM Co-Chair MacKinnon relayed that there was a letter of explanation from the Department of Administration dated May 11, 2017 (copy on file). The letter was in response to questions from the committee. 10:07:16 AM LESLIE RIDLE, DEPUTY COMMISSIONER, DEPARTMENT OF ADMINISTRATION, discussed the aforementioned letter from the department. She explicated that the questions concerning the process of obtaining a driver's license or identification. She stated that Alaskans would not need anything new in order to obtain Real I.D. The change involved verification of the proof of identity. The division was a member of AAMVA [American Association of Motor Vehicle Administrators]. The system ensured that the applicant only carried one driver's license. The DMV from other states cannot access documents on the state system. Documents are not shared with other entities, other than to check for pre-existing driver's licenses in other states. For this process, the name, date of birth, and last four digits of the social security number (SSN). Some information was shared via subpoena with Department of Public Safety for the purposes of working on cold cases and I.D. fraud. 10:11:04 AM Co-Chair MacKinnon asked if all states had "one driver's license in one state" rule, or whether that was a federal law. Ms. Ridle informed that all states had the rule but that it was a federal law. 10:11:37 AM AT EASE 10:31:44 AM RECONVENED Co-Chair MacKinnon MOVED to ADOPT Amendment 1: Page 3, line 5, following "15 years" Delete "after the expiration of the identification card" Insert "after the date of application" Page 3, line 8, following "retain" Insert "only" Page 6, line 8, following "years" Delete "after the expiration of the license" Insert "after the date of application" Page 6, line 10, following "retain" Insert "only" Vice-Chair Bishop OBJECTED for discussion. JULI LUCKY, STAFF, SENATOR ANNA MACKINNON, explained Amendment 1. She detailed that the amendment should be starting on page 3, line 5 and the last change should be on page 6, line 10. These were technical fixes within the bill. She specified that it was always the intent to have a 15-year retention period; however, currently it contained a retention period ending after the date of the expiration of the I.D. card, which would have been 23 years. Additional changes specified that only minimum documentation was required. Vice-Chair Bishop WITHDREW his OBJECTION. There being NO OBJECTION, Amendment 1 was ADOPTED. 10:33:30 AM Co-Chair MacKinnon MOVED to ADOPT Amendment 2. Vice-Chair Bishop OBJECTED for discussion. Ms. Lucky explained Amendment 2: The intent of this amendment is to require the department, should attempts to discontinue use of the social security number as a means of verifying identity in order to comply with federal law requiring that states confirm that an applicant is not licensed to drive in another state, to work to reduce the number of digits of the social security number required and to limit the department to sharing the minimum number of digits required, instead of specifying a number of digits. Page 4, line 19, following "steps" Delete "necessary" Insert "available" Page 4, line 29 through page 5, line 8 Delete all material Insert "(d) If the department has complied with (b) and (c) of this section and been unable to secure a means of compliance with P.L. 109-13, Division B (REAL ID Act of 2005) that does not involve the storage or sharing of social security numbers, in whole or in part, the department shall take all steps necessary to minimize the number of digits of a social security= number required to be stored or shared. (e) The department may not share more than fewest number of digits of a person's social security number necessary to comply with federal law requiring the department to determine whether a person has been issued a driver's license in another state." Ms. Lucky elaborated that there had been concern expressed regarding the digits from a SSN for verification of identity. The amendment would limit the use to three digits of the SSN. She continued that the amendment would allow for use of the fewest digits. Consistent with the language in the bill, the amendment directed the department to try not to use the SSN. The new provision would state that if the department was unsuccessful in not using the SSN, it should take all steps to minimize the number required and use the fewest number of digits required. She added that this would be adopted as a conceptual amendment. Senator Micciche asked if Ms. Lucky had the opportunity to discuss the amendments with the department to determine whether the amendment compromised its ability to comply with Real I.D. Ms. Lucky relayed that she had discussed the amendments with the department, and they were available to confirm. 10:36:27 AM MICHAEL STANKER, DEPARTMENT OF LAW, ANCHORAGE (via teleconference), testified that he had reviewed the conceptual amendment. He did not see any issue with the amendment. Ms. Ridle stated that conceptual Amendment 2 would not affect compliance with Real I.D. Senator Micciche thanked Ms. Ridle for supplying the document to the committee. Vice-Chair Bishop WITHDREW his OBJECTION. There being NO OBJECTION, conceptual Amendment 2 was ADOPTED. Vice-Chair Bishop discussed two zero fiscal notes, FN2, Department of Military and Veterans Affairs, OMB component number 2657; and FN3, Department of Public Safety, OMB component number 523. He stated that the department would be providing a new fiscal note. Ms. Lucky commented that the Department of Administration (DOA) fiscal note no longer applied. The department would be providing a new fiscal note. 10:39:30 AM MINTA MONTALBO, DEPARTMENT OF ADMINISTRATION, JUNEAU, explained that the fiscal note would be updated to reflect the reduction in cost because the CS from [Senate] State Affairs required the cards to be produced in-state. The requirement was not in the present version of the bill so would be removed. There would be increase in revenue due to a fee increase in the current version from $15 to $20 for compliant driver's licenses. 10:40:24 AM Senator Hughes asked if Ms. Montalbo was aware of any discussion across the states to members of Congress regarding federal funding for the initiative. Ms. Montalbo was not aware of any funds coming forward. The division had been working with the congressional delegation but had not heard of any funds being made available. Co-Chair MacKinnon asked if there was going to be an unforeseen cost to the state as a result of passing the bill. Ms. Montalbo explained that the costs were reflected in the current fiscal note and would remain the same in the forthcoming fiscal note. The $1.5 million implementation cost would remain the same. Co-Chair MacKinnon referred to the $1.5 million and verified that was for improvements in technology. Ms. Montalbo replied in the affirmative. She added that it was a one-time cost to update their systems. Co-Chair MacKinnon asked about additional positions. Ms. Montalbo stated no new positions would be needed. Co-Chair MacKinnon asked if the committee could expect a fiscal note with zero expenditures for operating costs and a one-time capital appropriation for the upgrade in technology. Ms. Montalbo stated that there was an ongoing production cost to make the compliant cards of approximately $5 per card. There would be an increase in receipt authority, and in FY 19 there would be a $528.7 thousand in the services line of the fiscal note. That was anticipated to increase in out years. Co-Chair MacKinnon expected that the revenues collected for the program would exceed the costs. Ms. Montalbo answered in the affirmative. Co-Chair MacKinnon asked if there was a need to rewrite regulation. Ms. Montalbo answered in the affirmative. 10:43:31 AM Co-Chair MacKinnon asked if DMV would absorb that cost. Ms. Montalbo replied in the affirmative. Co-Chair MacKinnon asked whether there would be additional fiscal notes. Ms. Montalbo replied there should be no additional fiscal notes. MARLA THOMPSON, DIRECTOR, DIVISION OF MOTOR VEHICLES, DEPARTMENT OF ADMINISTRATION (via teleconference), stated that everything mentioned would be in the forthcoming fiscal note. Co-Chair MacKinnon asked if DMV would issue a zero fiscal note on the operational cost side and on the capital cost side. Ms. Thompson stated that those would be on the same fiscal note. Co-Chair clarified there would be no additional note to the one submitted by DOA. Vice-Chair Bishop MOVED to report CSSB 34(FIN) out of Committee with individual recommendations and the accompanying and forthcoming fiscal notes. There being NO OBJECTION, it was so ordered. CSSB 34(FIN) was REPORTED out of committee with a "no recommendation" and with one new fiscal impact note from the Department of Administration, and with two previously published zero fiscal notes: FN2(MVA), FN3(DPS). 10:45:16 AM AT EASE 10:47:17 AM RECONVENED Co-Chair MacKinnon stated that the committee would be recessed to a call of the chair and would take up HB 111 in the afternoon. 10:48:06 AM RECESSED 3:07:34 PM RECONVENED