Study Regarding Implementation of a Uniform Statewide System to Allow for Electronic Transactions for the Registration and Titling of Motor Vehicles

LEGISLATIVE STUDY – The 83rd General Assembly of the Iowa Legislature, in Senate File 2273, directed the Iowa Department of Transportation (DOT) to conduct a study of how to implement a uniform statewide system to allow for electronic transactions for the registration and titling of motor vehicles. PARTICIPANTS IN STUDY – As directed by Senate File 2273, the DOT formed a working group to conduct the study that included representatives from the Consumer Protection Division of the Office of the Attorney General, the Department of Public Safety, the Department of Revenue, the Iowa State County Treasurer’s Association, the Iowa Automobile Dealers Association, and the Iowa Independent Automobile Dealers Association. CONDUCT OF THE STUDY – The working group met eight times between June 17, 2010, and October 1, 2010. The group discussed the costs and benefits of electronic titling from the perspectives of new and used motor vehicle dealers, county treasurers, the DOT, lending institutions, consumers and consumer protection, and law enforcement. Security concerns, legislative implications, and implementation timelines were also considered. In the course of the meetings the group: 1. Reviewed the specific goals of S.F. 2273, and viewed a demonstration of Iowa’s current vehicle registration and titling system so participants that were not users of the system could gain an understanding of its current functionality and capabilities. 2. Reviewed the results of a survey of county treasurers conducted by the DOT to determine the extent to which county treasurers had processing backlogs and the extent to which county treasurers limited the number of dealer registration and titling transactions that they would process in a single day and while the dealer waited. Only eight reported placing a limit on the number of dealer transactions that would be processed while the dealer waited (with the number ranging from one to four), and only 11 reported a backlog in processing registration and titling transactions as of June 11, 2010, with most backlogs being reported in the range of one to three days. 3. Conducted conference calls with representatives of the American Association of Motor Vehicle Administrators (AAMVA) and representatives of three states -- Kansas, which has an electronic lien and titling (ELT) program, and Wisconsin and Florida, each of which have both an ELT program and an electronic registration and titling (ERT) program – to assess current and best practices for electronic transactions. In addition, the DOT (through AAMVA) submitted a survey to all U.S. jurisdictions to determine how, if at all, other states implemented electronic transactions for the registration and titling of motor vehicles. Twenty-eight states responded to the survey; of the 28 states that responded, only 13 allowed liens to be added or released electronically, and only five indicated allowing applications for registration and titling to be submitted electronically. DOT staff also heard a presentation from South Dakota on its ERT system at an AAMVA regional meeting. ELT information that emerged suggests a multi-vendor approach, in which vendors that meet state specifications for participation are authorized to interface with the state’s system to serve as a portal between lenders and the state system, will facilitate electronic lien releases and additions by offering lenders more choices and the opportunity to use the same vendor in multiple states. The ERT information that emerged indicates a multi-interface approach that offers an interface with existing dealer management software (DMS) systems and through a separate internet site will facilitate ERT by offering access that meets a variety of business needs and models. In both instances, information that emerged indicates that, in the long-term, adoption rates are positively affected by making participation above a certain minimum threshold mandatory. 4. To assess and compare functions or services that might be offered by or through a vendor, the group heard presentations from vendors that offer products or services that facilitate some aspect of ELT or ERT. 5. To assess the concerns, needs and interest of Iowa motor vehicle dealers, the group surveyed dealers to assess registration and titling difficulties experienced by dealers, the types of DMS systems (if any) used by dealers, and the dealers’ interest and preference in using an electronic interface to submit applications for registration and titling. Overall, 40% of the dealers that responded indicated interest and 57% indicated no interest, but interest was pronounced among new car dealers (75% were interested) and dealers with a high number of monthly transactions (85% of dealers averaging more than 50 sales per month were interested). The majority of dealers responding to the dealer survey ranked delays in processing and problems with daily limits on transaction as ―minor difficulty or ―no difficulty. RECOMMENDATIONS -- At the conclusion of the meetings, the working group discussed possible approaches for implementation of electronic transactions in Iowa and reached a consensus that a phased implementation of electronic titling that addressed first electronic lien and title transactions (ELT) and electronic fund transfers (EFT), and then electronic applications for registration and titling (ERT) is recommended. The recommendation of a phased implementation is based upon recognition that aspects of ELT and EFT are foundational to ERT, and that ELT and EFT solutions are more readily and easily attained than the ERT solution, which will take longer and be somewhat more difficult to develop and will require federal approval of an electronic odometer statement to fully implement. ELT – A multi-vendor approach is proposed for ELT. No direct costs to the state, counties, consumers, or dealers are anticipated under this approach. The vendor charges participating lenders user or transaction fees for the service, and it appears the lenders typically absorb those costs due to the savings offered by ELT. Existing staff can complete the programming necessary to interface the state system with vendors’ systems. The estimated time to implement ELT is six to nine months. Mandatory participation is not recommended initially, but should be considered after ELT has been implemented and a suitable number of vendors have enrolled to provide a fair assessment of participation rates and opportunities. EFT – A previous attempt to implement ELT and EFT was terminated due to concern that it would negatively impact county revenues by reducing interest income earned on state funds collected by the county and held until the monthly transfer to the state. To avoid that problem in this implementation, the EFT solution should remain revenue neutral to the counties, by allowing fees submitted by EFT to be immediately directed to the proper county account. Because ARTS was designed and has the capacity to accommodate EFT, a vendor is not needed to implement EFT. The estimated time to implement EFT is six to nine months. It is expected that EFT development will overlap ELT development. ERT – ERT itself must be developed in phases. It will not be possible to quickly implement a fully functioning, paperless ERT system, because federal law requires that transfer of title be accompanied by a written odometer statement unless approval for an alternate electronic statement is granted by the National Highway Traffic Safety Administration (NHTSA). It is expected that it will take as much as a year or more to obtain NHTSA approval, and that NHTSA approval will require design of a system that requires the seller to electronically confirm the seller’s identity, make the required disclosure to the buyer, and then transfer the disclosure to the buyer, who must also electronically confirm the buyer’s identity and electronically review and accept the disclosure to complete and submit the transaction. Given the time that it will take to develop and gain approval for this solution, initial ERT implementation will focus on completing and submitting applications and issuing registration applied for cards electronically, with the understanding that this process will still require submission of paper documents until an electronic odometer solution is developed. Because continued submission of paper documents undermines the efficiencies sought, ―full‖ ERT – that is, all documents necessary for registration and titling should be capable of approval and/or acceptance by all parties, and should be capable of submission without transmittal or delivery of duplicate paper documents .– should remain the ultimate goal. ERT is not recommended as a means to eliminate review and approval of registration and titling transactions by the county treasurers, or to place registration and titling approval in the hands of the dealers, as county treasurers perform an important role in deterring fraud and promoting accuracy by determining the genuineness and regularity of each application. Authorizing dealers to act as registration agents that approve registration and title applications, issue registration receipts, and maintain and deliver permanent metal license plates is not recommended. Although distribution of permanent plates by dealers is not recommended, it is recommended that dealers participating in ERT generate and print registration applied for cards electronically. Unlike the manually-issued cards currently in use, cards issued in this fashion may be queried by law enforcement and are less susceptible to misuse by customers and dealers. The estimated time to implement the electronic application and registration applied for cards is 12 to 18 months, to begin after ELT and EFT have been implemented. It is recommended that focus during this time be on facilitating transfers through motor vehicle dealers, with initial deployment focused on higher-volume dealers that use DMS systems. In the long term an internet option for access to ERT must also be developed and maintained to allow participation for lower-volume dealers that do not use a DMS system. This option will also lay the ground work for an ERT option for sales between private individuals. Mandatory participation in Iowa is not recommended initially. As with ELT, it is recommended that mandatory participation be considered after at least an initial phase of ERT has been implemented and a suitable number of dealers have enrolled to provide a fair assessment of participation rates and opportunities. The use of vendors to facilitate ERT is not initially proposed because 1) DOT IT support staff is capable of developing a system that will interact with DMS systems and will still have to develop a dealer and public interface regardless of whether a vendor acts as intermediary between the DMS systems, and 2) there is concern that the cost of the vendor-based system, which is funded by transaction-based payments from the dealer to the vendor, will be passed to the consumer in the form of additional documentation or conveyance fees. However, the DOT recommends flexibility on this point, as development and pilot of the system may indicate that a multi-vendor approach similar to that recommended for ELT may increase the adoption rate by larger dealers and may ultimately decrease the user management to be exercised by DOT staff. If vendors are used in the process, additional legislation or administrative rules may be needed to control the fees that may be passed to the consumer. No direct cost to the DOT or county treasurers is expected, as the DOT expects that it may complete necessary programming with existing staff. Use of vendors to facilitate ERT transactions by dealers using DMS systems would result in transaction fees that may ultimately be passed to consumers. LEGISLATION – As a result of the changes implemented in 2004 under Senate File 2070, the only changes to Iowa statutes proposed are to section 321.69 of the Iowa Code, ―Damage disclosure statement,and section 321.71, ―Odometer requirements.‖ In each instance, authority to execute these statements by electronic means would be clarified by authorizing language similar to that used in section 321.20, subsections ―2‖ and ―3,‖ which allows for electronic applications and directs the department to ―adopt rules on the method for providing signatures for applications made by electronic means.‖ In these sections, the authorizing language might read as follows: Notwithstanding contrary provisions of this section, the department may develop and implement a program to allow for any statement required by this section to be made electronically. The department shall adopt rules on the method for providing signatures for statements made by electronic means. Some changes to DOT administrative rules will be useful but only to enable changes to work processes that would be desirable in the long term. Examples of long term work processes that would be enabled by rule changes include allowing for signatures created through electronic means and electronic odometer certifications. The DOT rules, as currently written, do not hinder the ability to proceed with ELT, EFT, and ERT.

Iowa Pseudoephedrine Control Law, March 22, 2005

This law is intended to reduce the number of hazardous methamphetamine labs in Iowa, by controlling meth cooks’ access to the key meth-making ingredient: pseudoephedrine. In 2004, Iowa law enforcement agencies responded to a record 1,472 meth lab incidents. Below, please find links to: Senate File 169 (Iowa’s pseudoephedrine control law); an Iowa meth fact sheet; a brief overview of the law; and general compliance guidelines for consumers, pharmacies, retailers and law enforcement. Most provisions of this law, pertaining to pseudoephedrine sales, are effective May 21, 2005. However, two other provisions were effective immediately—March 22, 2005—upon the Governor’s signing of this measure into law: (1) removal of exceptions on the Schedule V Controlled Substance status for ephedrine [all ephedrine products now may only be sold in licensed pharmacies…no retail sales of ephedrine permitted]; and (2) addition of a requirement that bailable defendants charged with manufacture, delivery, possession with the intent to deliver, or distribution of methamphetamine, shall, in addition to a substance abuse evaluation, remain under supervision and be required to undergo random drug tests as a condition of release.

Evaluation of Mitigation for Safety Concerns on Low-Volume, Unpaved Rural Roads, 2013.

The Institute for Transportation (InTrans) at Iowa State University completed work on an in-depth study of crash history on lowvolume, rural roads in Iowa in December 2010. Results indicated that unpaved roads with traffic volumes greater than 100 vehicles per day (vpd) exhibit significantly higher crash frequencies, rates, and densities than any other class of low-volume road examined, paved or unpaved. The total mileage for this class of roadway in Iowa is only about 4,400 miles, spread over 99 counties in the state, which is certainly a manageable number of miles for individual rural agencies. The purpose of this study was to identify and examine several unpaved, local road segments with higher than average crash frequencies, select and undertake potentially-beneficial mitigation, and evaluate the results as time allowed. A variety of low-cost options were considered, including engineering improvements, enhanced efforts by law enforcement, and educational initiatives. Using input, active support, and participation from local agencies and state and Federal safety advocates, the study afforded a unique opportunity to examine useful tools for local rural agencies to utilize in addressing safety on this particular type of roadway.

Evaluation of Mitigation for Safety Concerns on Low-Volume, Unpaved Rural Roads: Tech Transfer Summary, 2013.

The Institute for Transportation (InTrans) at Iowa State University completed work on an in-depth study of crash history on lowvolume, rural roads in Iowa in December 2010. Results indicated that unpaved roads with traffic volumes greater than 100 vehicles per day (vpd) exhibit significantly higher crash frequencies, rates, and densities than any other class of low-volume road examined, paved or unpaved. The total mileage for this class of roadway in Iowa is only about 4,400 miles, spread over 99 counties in the state, which is certainly a manageable number of miles for individual rural agencies. The purpose of this study was to identify and examine several unpaved, local road segments with higher than average crash frequencies, select and undertake potentially-beneficial mitigation, and evaluate the results as time allowed. A variety of low-cost options were considered, including engineering improvements, enhanced efforts by law enforcement, and educational initiatives. Using input, active support, and participation from local agencies and state and Federal safety advocates, the study afforded a unique opportunity to examine useful tools for local rural agencies to utilize in addressing safety on this particular type of roadway.

Moving Beyond Teen Crash Fatality Statistics: The Go-Team Study, GOTM-000, 2013

Despite a trend of decreasing teen fatalities due to motor vehicle crashes over the past decade, they remain the leading cause of adolescent fatalities in Iowa. The purpose of this study was to create detailed case studies of each fatal motor vehicle crash involving a driver under the age of 20 that occurred in Iowa in 2009, 2010, and 2011. Data for each crash were gathered from media sources, law enforcement agencies, and the Iowa Department of Transportation. The driving records of the teens, which included their licensure history, prior traffic citations, and prior crashes, were also acquired. In addition, data about the charges filed against a teen as a result of being involved in a fatal crash were obtained. A total of 126 crashes involving 131 teen drivers that resulted in 143 fatalities were analyzed. Many findings for fatal crashes involving teen drivers in Iowa are consistent with national trends, including the overrepresentation of male drivers, crash involvement that increases with age, crash involvement per vehicle miles traveled that decreases with age, and prevalence of single-vehicle road departure crashes. Relative to national statistics, teen fatalities from crashes in Iowa are more likely to occur from midnight to 6am and from 9am to noon. Crash type varied by driver age and county population level. Teen drivers contributed to the fatal crashes at a rate of 74%; contribution of the teen driver was unknown for 11% of crashes. Speed was a factor for about 25% of the crashes for which a teen driver was at fault. The same was also true of alcohol/drug impairment. Only 20% of the rear-seat occupants of the teen drivers’ vehicles wore seat belts compared to 60% use for the front-seat occupants. Analysis of the teens’ driving records prior to the fatal crash suggests at-fault crashes and speeding violations are associated with contributing to the fatal crash.

How a Bill Becomes a Law, September 18, 2008

A legislative bill is a written proposal for a law. Ideas for bills come from many sources: a legislator’s constituents, businesses, government agencies, professional associations, interest groups and other state legislatures. When a legislator recognizes or is made aware of a problem which could be pursued through legislation, that idea is put into the form of a bill. In Iowa, only legislators are able to sponsor and introduce bills. Bills may be sponsored by a Senator or Representative, or by a Senate or House committee. All bills must be approved by both the Senate and the House before being sent to the Governor for final approval. When a bill is introduced by members of a legislative chamber, it must follow a process and, if passed, be sent to members in the other legislative chamber where this process is repeated. The bill and its language must be in identical form from both chambers before being sent to the Governor.

How An Idea Becomes a Law, 2008

A flow chart of how an idea becomes a law.

Iowa Department of Public Safety Annual Report, FY2013

The Iowa Department of Public Safety (DPS) has a history of dedication and service to the citizens of Iowa and those who visit our state. Since it was first established in 1939, DPS has been the chief law enforcement agency in the State of Iowa. DPS is headquartered in Des Moines, Iowa in the Wallace State Office Building on the Capitol Complex, along with a statewide presence.

Iowa Department of Public Safety Annual Report, FY2012

The Iowa Department of Public Safety (DPS) has a history of dedication and service to the citizens of Iowa and those who visit our state. Since it was first established in 1939, DPS has been the chief law enforcement agency in the State of Iowa. DPS is headquartered in Des Moines, Iowa in the Wallace State Office Building on the Capitol Complex, along with a statewide presence.

Iowa Department of Public Safety Annual Report, FY2014

The Iowa Department of Public Safety (DPS) has a history of dedication and service to the citizens of Iowa and those who visit our state. Since it was first established in 1939, DPS has been the chief law enforcement agency in the State of Iowa. DPS is headquartered in Des Moines, Iowa in the Wallace State Office Building on the Capitol Complex, along with a statewide presence.

Road Safety Audit for US 6 from the ECL of Iowa City to the WCL of West Liberty in Johnson and Muscatine Counties, Iowa, 2008

Approximately 13.2 miles of US 6 in eastern Iowa extends from the east corporate limits of Iowa City, Iowa, to the west corporate limits of West Liberty, Iowa. This segment of US 6 is a service level B primary highway, with an annual daily traffic volume varying from 3,480 vehicles per day (vpd) to 5,700 vpd. According to 2001–2007 crash density data from the Iowa Department of Transportation (Iowa DOT), the corridor is currently listed among the top 5% of non-freeway Iowa DOT roads in several crash categories, including crashes involving excessive speed, impaired drivers, single-vehicle run-off-road, and multiple-vehicle crossed centerline. A road safety audit of this corridor was deemed appropriate by the Iowa Department of Transportation’s Office of Traffic and Safety. Staff and officials from the Iowa DOT, Iowa State Patrol, Governor’s Traffic Safety Bureau, Federal Highway Administration, Center for Transportation Research and Education, and several local law enforcement and transportation agencies met to review crash data and discuss potential safety improvements to this segment of US 6. This report outlines the findings and recommendations of the road safety audit team to address the safety concerns on this US 6 corridor and explains several selected mitigation strategies.

Road Safety Audit Report for US 61 from the ECL of Muscatine to the WCL of, 2008

U.S. Highway 61 between Muscatine and Davenport, Iowa, is a four-lane divided section of road approximately 21 miles in length. This section was found to be among the top 5% of Iowa roadways for single-vehicle run-off-road, impaired driver, unbelted driver, and speed-related crashes for the period of 2001 through 2005. A road safety audit of this corridor was deemed appropriate by the Iowa Department of Transportation’s Office of Traffic and Safety. Staff and officials from the Iowa Department of Transportation (Iowa DOT), Iowa State Patrol, Governor’s Traffic Safety Bureau, Federal Highway Administration, Center for Transportation Research and Education, and several local law enforcement and transportation agencies met to review crash data and discuss potential safety improvements to US 61. This report outlines the findings and recommendations of the road safety audit team to address the safety concerns on this US 61 corridor and explains several selected mitigation strategies.

Road Safety Audit for County Road X-37, from the Intersection of G-62 to the East Corporate Limits of Columbus City in Louisa County, Iowa, 2009

A road safety audit was conducted for a 7.75 mile section of County Road X-37 in Louisa County, Iowa. In 2006, the average annual daily traffic on this roadway was found to be 680 vehicles per day. Using crash data from 2001 to 2007, the Iowa Department of Transportation (Iowa DOT) has identified this roadway as being in the highest 5% of local rural roads in Iowa for single-vehicle runoff- road crashes. Considering these safety data, the Louisa County Engineer requested that a road safety audit be conducted to identify areas of safety concerns and recommend low-cost mitigation to address those concerns. Staff and officials from the Iowa DOT, Governor’s Traffic Safety Bureau, Federal Highway Administration, Institute for Transportation, and local law enforcement and transportation agencies met to review crash data and discuss potential safety improvements to this segment of X-37. This report outlines the findings and recommendations of the road safety audit team to address the safety concerns on this X-37 corridor and explain several selected mitigation strategies.

Road Safety Audit for County Road W-55 in Washington County, Iowa, 2009

A road safety audit was conducted for a seven-mile section of County Road W-55 in Washington County, Iowa. In 2006, the average annual daily traffic on this roadway was found to be 1,290 vehicles per day. Using crash data from 2001 to 2007, the Iowa Department of Transportation (Iowa DOT) has identified this roadway as being in the top 5% of Iowa secondary rural roads with the highest density of serious (fatal and major injury) crashes for single-vehicle run-off-road incidents. Considering these safety data, the Washington County Engineer requested that a road safety audit be conducted to identify areas with safety concerns and to recommend low-cost mitigation to address those concerns. Staff and officials from the Iowa DOT, Iowa State Patrol, Governor’s Traffic Safety Bureau, Federal Highway Administration, Institute for Transportation, and local law enforcement and transportation agencies met to review crash data and discuss potential safety improvements to this segment of W-55. This report outlines the findings and recommendations of the road safety audit team to address the safety concerns on this W-55 corridor and explain several selected mitigation strategies.

Road Safety Audit for I-380 through the Cities of Cedar Rapids and Hiawatha in Linn County, Iowa, 2009

Interstate 380 (I-380) through Cedar Rapids and Hiawatha, Iowa, is a multilane divided urban freeway that was constructed in 1976 to the Cedar River and in 1981 from that point northerly. Traffic volumes vary from 47,000 to 83,500 vehicles per day, with about 8%–15% trucks and buses. Based on concern for the high number of crash incidents, particularly serious crashes, and increased traffic volumes on this roadway, the City of Cedar Rapids and the Iowa Department of Transportation (Iowa DOT) District 6 Office requested that a road safety audit be conducted for this roadway section. Representatives from the Iowa DOT, Federal Highway Administration, Center for Transportation Research and Education, local law enforcement, local government, and area businesses met to review crash data and discuss potential safety improvements to this segment of I-380. This report outlines the findings and recommendations of the road safety audit team for addressing the safety concerns on this I-380 corridor and explains several selected mitigation strategies.