Why is CT DMV Marketing Our Driving Records?

January 27, 2014

(The attached article appeared in the Jan. 26, 2014 edition of the Waterbury Republican-American.)

Brake for DMV data sales?
Miner, Kane concerned about marketing of drivers’ records

The idea of the state Department of Motor Vehicles marketing drivers’ records for sale makes Rep. Craig Miner, R-Litchfield, and Sen. Robert Kane, R-Watertown, uneasy. The DMV already sells approximately 1.5 million drivers’ records to insurance companies each year at $15 a pop.

What concerns Miner and Kane is that the department will soon be marketing these records to other businesses, and they worry about what the purchasers will do with all that personal information. “The insurance companies come to DMV looking for this data already, so why do we need to market it?” Kane asked. Miner said he wonders how businesses outside of the insurance industry would make use of driver histories. “When I hear the word ‘marketing,’ I’m thinking commercial operation, and then I am trying to imagine what circumstance would we be engaged in where we would market DMV information,” Miner said. “Insurance companies want it. It is not like we have to advertise that they can get it from us. So, what other venues are there where someone might make use of that information?”

The uncertainty led Miner and Kane to vote earlier this month, as members of the Finance Advisory Committee, against adding a $3 administrative fee to the $15 charge for obtaining driver histories from DMV. The $3 administrative fee will be used to support a new state web portal that businesses will use to obtain driver records online. The DMV will also impose an annual subscription fee of $100. The fees will only apply to for-profit businesses. The Finance Advisory Committee approved the DMV fees three weeks ago. The committee of state officials and legislators must approve all fee increases.

THE PLANNED MARKETING CAMPAIGN is part of a wider e-government initiative that the legislature and Gov. Dannel P. Malloy approved in 2012. The governor’s Office of Policy and Management has been empowered to authorize state agencies to enter into agreements with private businesses and nonprofit organizations to make more government services and programs available electronically to the public. The plan is to modify each state agency’s website by creating new interactive services previously unavailable on the state’s portal. “I want a website that people can actually do business on and save themselves from having to go to an office to do some of those transactions. What we are trying to do is build a modern and transparent system that people can conduct business on as well as get information,” Malloy said. The Department of Administrative Services received permission to issue a contract for providing e-government services to the executive branch. After bidding the contract, the department entered into a $2.5 million agreement this month with Connecticut Interactive LLC to design and manage the upgraded web portal. The three-year contract also includes renewal options that the state can exercise to extend the contract to 2020. Connecticut Interactive is a subsidiary of NIC Inc., a leading provider of official government websites, online services, and secure payment processing. The family of NIC companies works with more than 3,500 federal, state, and local agencies across the United States.

The objectives that the contract sets out for Connecticut Interactive include:

Improve the public’s interactions with the state.

Make government information easier to access.

Maintain security of the state’s existing information systems.

Increase business in Connecticut.

Raise more state revenue.

Connecticut Interactive agreed to develop a business plan and launch a marketing campaign to promote the state’s websites and online services. A steering committee of top state officials must approve the business and marketing plans and their annual updates.

THE STATE CONTRACT SPECIFICALLY TASKED Connecticut Interactive with establishing an online application to provide driving histories to companies that purchase the records in bulk, and with marketing the records to other potential bulk purchasers.

The expectation is that businesses will be willing to pay the $3 administrative fee and the $100 subscription fee for expedited and enhanced service.

Miner and Kane said they question how that will work out. The fees will go to Connecticut Interactive to support the state’s upgraded web portal. The administrative fee can be expected to generate $4.5 million based on the number of driver records that DMV sells annually.

At this time, 29 other states employ this self-funding approach to pay for their e-government programs, according to state officials.

Miner and Kane said they also continue to question the state’s ability to limit the purchases and control the uses of the driver histories that DMV sells.

Mark Raymond, the state’s chief information officer, advised the Finance Advisory Committee that DMV retains the right to approve the recipients of the data. Raymond reported large insurance companies are the primary purchasers of driver records. He also stated buyers also include companies that resell information. He cited the LexisNexis Group as an example. The mention of LexisNexis made Kane and Miner uneasy.

The two lawmakers said they are concerned state controls will not apply to driver histories purchased from businesses that provide computer-assisted research services. State and federal law limit the uses of driver records.

State law permits the DMV commissioner to disclose personal information for nine permitted uses. It is illegal to resell or otherwise disclose the information outside of those limited purposes. Anybody who commits such an act can be charged criminally with a misdemeanor.