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What's Next On The Federal ID Front?
by Chris Strohm
The Homeland Security Department's proposed regulations for new identification documents leave some of the toughest questions unanswered, such as how their implementation will be funded and what technology states will use to communicate with each other, observers say.
The department will give states an extension until December 2009 to satisfy the so-called REAL ID Act, a concession that officials said was made largely in response to pressure from lawmakers led by Sen. Susan Collins, R-Maine. "This will give us some breathing room," Collins said of the proposed regulations, which were issued March 1 and are open for 60 days of public comment.
But it only took hours after the regulations were published for critics, such as the National Conference of State Legislatures and National Governors Association, to tear into them.
"While NGA and NCSL appreciate the initial compliance extension through 2009 called for by members of Congress and provided by [the department], these regulations do nothing to address the unreasonable five-year, full-compliance deadline or offset the large costs to states," the two organizations said in a joint statement.
The department estimates that the total cost of implementation could reach $23.1 billion. Lawmakers acknowledged the magnitude of the cost to states, especially those that have antiquated information technology systems.
"I will be, as I know my colleagues will be, militant in watching to make sure this doesn't, in the end, become a huge unfunded federal mandate," said Senate Appropriations Committee member Lamar Alexander, R-Tenn. "Those are fancy words for higher tuition, higher property taxes, and less money for healthcare and education in the states. We have no business imposing a big cost ... on the states of this kind unless we pay for it."
Building The Back End
The biggest challenge for states is not producing and issuing new identification cards but ensuring that their backend IT systems can handle the workload, says Harold Kocken, a technology expert with BearingPoint's Public Services practice.
"The key issue truly is the back end and the IT requirements," he says. "The vast majority of states will have to do something to the back end of their systems to fulfill the requirements that REAL ID is putting on them."
First, states have to engineer their own systems for IT management, ID verification, data access controls, document storage, and physical and cyber security, Kocken says. But the proposed regulations also would require each state to verify that people applying for driver's license under REAL ID have not already been given them by other states. That would require states to communicate with each other.
States now use two centralized databases: the Commercial Driver's License Information System, or CDLIS, and the National Driver Register Problem-Driver Pointer System. But neither system is currently adequate to meet the requirements of REAL ID.
There currently are about 245 million people with state licenses. Homeland Security estimates that as many as 813 million people will get licenses under the new law over a 10-year period. But the CDLIS only contains about 13 million records and the National Driver Register only a few million, Kocken says.
The proposed regulations do not specify what centralized system would be used to meet the requirements or how privacy would be protected. Homeland Security "contemplates" that states will work out the necessary business processes and data-access rules necessary "to implement these provisions prior to May 11, 2008, by means of a collective governance structure," according to the regulations.
The department "intends to work closely" with the Transportation Department, American Association of Motor Vehicle Administrators and states to achieve state-to-state data exchange, the regulations say. "It has not been determined whether CDLIS or some other service will be the platform for the state-to-state exchange, but ... it will be necessary for states, working with [the Homeland Security and Transportation departments], to define the privacy protections."
The regulations note that the motor-vehicle departments of California, Iowa, Massachusetts and New York formed a federation in July 2006 to identify a collective governance structure for state-to-state data exchange, along with privacy protections. "It is important that whoever works with the states understand the motor-vehicle business," Kocken adds. "It is a unique environment where one size does not fit all."
Who Will Foot The REAL ID Bill?
The department did not request any funding for REAL ID in its fiscal 2008 budget, and Congress has only allocated $40 million for the effort to date. Instead, Homeland Security says states can use 20 percent of their homeland security grants to achieve compliance.
That plan, however, does not appear to be going over well in the states or on Capitol Hill. The governors and state legislators said via their groups that the plan "will do little to offset the burden of this massive unfunded mandate.
Senate Homeland Security and Governmental Affairs Committee member John Sununu, R-N.H., was equally critical. "This sounds like a hastily thought-up way to try to show an interest in covering some of the costs associated with the mandate," he said. "My goal would be to see regulations developed that don't place huge costs on states and motor-vehicle departments."
Sununu added that because of the deadline extension, lawmakers have time to consider whether additional legislation is needed to address the shortfalls.
The department acknowledged the huge costs to states but kicked the responsibility for more funding to Congress. The department's Web site bluntly says lawmakers "can appropriate additional funds to help states meet their compliance obligations."
Sen. Saxby Chambliss, R-Ga, seemed to agree. "We, as federal legislators, have the obligation to make sure that when we do come forward with good, meaningful, substantive issues relative to the global war on terrorism that we fund them from the federal level," he said.
Still, frustration over how REAL ID became law boiled over late last week. Collins said the act was created by House lawmakers by being attached to an emergency spending bill in 2005.
"One of the problems with the REAL ID Act ... is that it did not go through the normal process. It was not subject to hearings; it did not have a debate on the Senate floor; it didn't have a vote on the Senate floor," she said. "I have to believe that if the REAL ID Act had gone through the normal legislative process, it would not have been passed in the form that it was."
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