[Senate Hearing 110-291]
[From the U.S. Government Publishing Office]
S. Hrg. 110-291
UNDERSTANDING THE REALITIES OF REAL ID: A REVIEW OF EFFORTS TO SECURE
DRIVERS' LICENSES AND IDENTIFICATION CARDS
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HEARING
before the
OVERSIGHT OF GOVERNMENT MANAGEMENT,
THE FEDERAL WORKFORCE, AND THE
DISTRICT OF COLUMBIA SUBCOMMITTEE
of the
COMMITTEE ON
HOMELAND SECURITY AND
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
MARCH 26, 2007
__________
Available via http://www.access.gpo.gov/congress/senate
Printed for the use of the Committee on Homeland Security
and Governmental Affairs
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34-415 PDF WASHINGTON DC: 2007
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COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii TED STEVENS, Alaska
THOMAS R. CARPER, Delaware GEORGE V. VOINOVICH, Ohio
MARK L. PRYOR, Arkansas NORM COLEMAN, Minnesota
MARY L. LANDRIEU, Louisiana TOM COBURN, Oklahoma
BARACK OBAMA, Illinois PETE V. DOMENICI, New Mexico
CLAIRE McCASKILL, Missouri JOHN WARNER, Virginia
JON TESTER, Montana JOHN E. SUNUNU, New Hampshire
Michael L. Alexander, Staff Director
Brandon L. Milhorn, Minority Staff Director and Chief Counsel
Trina Driessnack Tyrer, Chief Clerk
OVERSIGHT OF GOVERNMENT MANAGEMENT, THE FEDERAL WORKFORCE, AND THE
DISTRICT OF COLUMBIA SUBCOMMITTEE
DANIEL K. AKAKA, Hawaii, Chairman
CARL LEVIN, Michigan GEORGE V. VOINOVICH, Ohio
THOMAS R. CARPER, Delaware TED STEVENS, Alaska
MARK L. PRYOR, Arkansas TOM COBURN, Oklahoma
MARY L. LANDRIEU, Louisiana JOHN WARNER, Virginia
Richard J. Kessler, Staff Director
Jennifer Tyree, Chief Counsel
Jennifer A. Hemingway, Minority Staff Director
David Cole, Minority Professional Staff Member
Emily Marthaler, Chief Clerk
C O N T E N T S
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Opening statements:
Page
Senator Akaka................................................ 1
Senator Voinovich............................................ 3
Senator Collins.............................................. 5
Senator Warner............................................... 6
Prepared statements:
Senator Lieberman............................................ 45
Senator Sununu............................................... 47
WITNESSES
Monday, March 26, 2007
Hon. Richard C. Barth, Ph.D., Assistant Secretary, Office of
Policy Development, U.S. Department of Homeland Security....... 7
Hon. Leticia Van de Putte, Texas State Senator, and President,
National Conference of State Legislatures...................... 22
Hon. Mufi Hannemann, Mayor, City and County of Honolulu, Hawaii;
accompanied by Dennis Kamimura, Licensing Administrator, City
and County of Honolulu, Hawaii................................. 23
David Quam, Director, Federal Relations, National Governors
Association.................................................... 25
Timothy Sparapani, Legislative Council, American Civil Liberties
Union.......................................................... 36
Jim Harper, Director, Information Policy Studies, The Cato
Institute...................................................... 38
Alphabetical List of Witnesses
Barth, Hon. Richard C., Ph.D.:
Testimony.................................................... 7
Prepared statement with an attachment........................ 48
Hannemann, Hon. Mufi:
Testimony.................................................... 23
Prepared statement........................................... 65
Harper, Jim:
Testimony.................................................... 38
Prepared statement with attachments.......................... 89
Quam, David:
Testimony.................................................... 25
Prepared statement........................................... 69
Sparapani, Timothy D.:
Testimony.................................................... 36
Prepared statement with an attachment........................ 74
Van de Putte, Hon. Leticia:
Testimony.................................................... 21
Prepared statement with an attachment........................ 57
APPENDIX
Background....................................................... 108
September 2006 Report, ``The Real ID Act: National Impact
Analysis,'' presented by the National Governors Association,
National Conference of State Legislatures, and the American
Association of Motor Vehicle Administrators.................... 119
``New Federal Regulations Get an `F' in Addressing Issues with
the Real ID Act,'' report submitted by the American Civil
Liberties Union (ACLU)......................................... 179
Additional prepared statements submitted for the Record from:
Jay Maxwell, President and CEO of Clerus Solutions........... 198
Wendy R. Weiser, Deputy Director of the Democracy Program and
Myrna Perez, Counsel at the Brennan Center for Justice at
NYU School of Law.......................................... 206
Melissa Ngo, Director of the Identification and Surveillance
Project, Electronic Privacy Information Center............. 210
Sophia Cope, Staff Attorney/Ron Plesser Fellow, Center for
Democracy and Technology................................... 223
Hon. Mark Sanford, Governor, State of South Carolina......... 240
George Valverde, Director, Office of the Director, Department
of Motor Vehicles, Sacramento, California, with an
attachment................................................. 243
Questions and responses submitted for the Record:
Mr. Barth.................................................... 246
Ms. Van de Putte............................................. 260
Mr. Hanneman and Mr. Kamimura................................ 262
Mr. Quam..................................................... 267
UNDERSTANDING THE REALITIES OF REAL ID: A REVIEW OF EFFORTS TO SECURE
DRIVERS' LICENSES AND IDENTIFICATION CARDS
----------
MONDAY, MARCH 26, 2007
U.S. Senate,
Subcommittee on Oversight of Government
Management, the Federal Workforce,
and the District of Columbia,
of the Committee on Homeland Security
and Governmental Affairs,
Washington, DC.
The Subcommittee met, pursuant to notice, at 2:30 p.m., in
room 342, Dirksen Senate Office Building, Hon. Daniel Akaka,
Chairman of the Subcommittee, presiding.
Present: Senators Akaka, Voinovich, Collins, and Warner.
OPENING STATEMENT OF SENATOR AKAKA
Senator Akaka. I call the Subcommittee on Oversight of
Government Management, the Federal Workforce, and the District
of Columbia to order.
I want to welcome Senator Collins here. It seems as though
our border States are vitally interested in the issue before us
today.
Before we begin, I want to extend a warm welcome to all of
our witnesses today and especially to Honolulu Mayor Mufi
Hannemann, who presented me this lei, and who is accompanied by
Dennis Kamimura, the Licensing Administrator for the City and
County of Honolulu. I greatly appreciate you coming all the way
from Hawaii, Mufi, and I look forward to discussing how REAL ID
impacts the State of Hawaii and the County of Honolulu.
Today's hearing, ``Understanding the Realities of REAL ID:
A Review of Efforts to Secure Drivers' Licenses and
Identification Cards,'' will review the REAL ID Act of 2005 and
the proposed regulations implementing the Act recently issued
by the Department of Homeland Security.
In 2004, the 9/11 Commission reported that all but one of
the September 11 hijackers acquired some form of U.S.
identification, some by fraudulent means, which assisted them
in boarding commercial flights, renting cars, and other
activities. As a result, the Commission recommended the Federal
Government set standards for issuing sources of identification
such as drivers' licenses.
In December 2004, Congress passed the Intelligence Reform
and Terrorism Prevention Act to establish a negotiated
rulemaking process among the Federal Government, State, and
local governments, privacy groups, and other stakeholders to
develop standards for drivers' licenses and identification
cards. However, the Act provided States with flexibility for
complying with Federal requirements and ensured privacy
protections.
Without the benefit of Congressional hearings and before
the negotiated rulemaking committee held its second meeting,
the REAL ID Act was included in the 2005 Emergency Supplemental
Conference Report, thus replacing the collective effort to
address the 9/11 Commission's recommendation.
From its inception, REAL ID has been controversial and
criticized by both ends of the political spectrum. The Act
places a significant unfunded mandate on States and poses a
real threat to privacy and civil liberties.
In issuing the REAL ID regulations, DHS has acknowledged
the implementation problems and the need to address the burdens
placed on the States. Secretary Chertoff announced that States
could easily apply for a waiver for the compliance deadline and
could use up to 20 percent of the States' Homeland Security
Grant Program (SHSGP) funds to pay for REAL ID implementation.
To me, this proposal does nothing to address the cost of REAL
ID which DHS makes estimates to be anywhere from $17.2 billion
to $23.1 billion. Moreover, the President's fiscal year 2008
budget proposes to cut SHSGP by 52 percent. On top of this,
States have already designated SHSGP funds for particular
homeland security projects, such as interoperability equipment,
physical security structures, training, and evacuation
planning.
My other concern is a serious threat by REAL ID to the
privacy of Americans' personal information. The massive amounts
of personal information that would be stored in State databases
that are to be shared electronically with other States, as well
as unencrypted data on the card, could provide one-stop
shopping for identity thieves.
In addition, the DHS regulations failed to address redress
mechanisms for individuals whose data is lost or stolen in
another State or guidance on how States are to secure source
documents.
As a result, REAL ID may make us less secure by giving us a
false sense of security. Unfunded mandates and the lack of
privacy and security requirements are real problems that
deserve serious consideration and workable solutions.
Congress has a responsibility to ensure that drivers'
licenses and ID cards issued in the United States are
affordable, practical, and secure, both from would-be
terrorists and identity thieves.
Over half of our Nation's State Legislatures, 28, have
acted to introduce or to pass legislation expressing concern or
calling for repeal of REAL ID. Two States, Maine and Idaho,
have passed legislation to opt out of complying with REAL ID.
In Hawaii, a resolution passed the State Senate which calls for
repeal of those provisions of REAL ID that violate the rights
and liberties guaranteed under the Hawaii State Constitution
and the Constitution of the United States and create unfunded
mandates for the State without any plan for financial
subsidization for implementation.
To address these concerns, I reintroduced the Identity
Security Enhancement Act, S. 717, with Senators Sununu, Leahy,
and Tester, to repeal REAL ID and replace it with a negotiated
rulemaking process and the more reasonable guidelines
established in the Intelligence Reform and Terrorism Prevention
Act of 2004. It is in the interest of Americans that this
hearing shed light on the problems with REAL ID and provide a
forum to discuss solutions that both protect the Nation and
Americans' privacy and civil liberties.
I now turn to my good friend and partner on so many issues
to improve government programs, Senator Voinovich, for any
opening statement he may want to make. Senator Voinovich.
OPENING STATEMENT OF SENATOR VOINOVICH
Senator Voinovich. Thank you, Mr. Chairman, for holding
this important hearing today to discuss the proposed
regulations for implementation of REAL ID. The statutory
requirement to issue 245 million--245 million--secure drivers'
licenses in 5 years places a significant burden on our States,
which bear the bulk of the responsibility for meeting the
mandate.
The long-awaited draft regulation to implement REAL ID was
released earlier this month. I want to begin by commending the
Department of Homeland Security for its outreach process. The
draft regulation clearly reflects a number of common sense
recommendations that have been made by the States.
I had the opportunity to meet Secretary Chertoff last month
to discuss REAL ID and was heartened by his sincere commitment
to make full use of the flexibilities provided in the draft
regulation. Secretary Chertoff is firmly committed to waiving
the May 2008 compliance deadline until the end of 2009 for any
State that makes a reasonable request.
However, I am concerned by the number of hurdles that stand
in the way, including the cost to States and the lack of
availability of electronic verification systems. It is
important that we work together to find solutions to these
challenges before us. The relationship between the Federal
Government, State, and local governments should be one of
partnership. Sadly, that is not always the case as the Federal
Government has a tendency to force new responsibilities on
State and local governments without providing adequate funding
to cover the true cost.
As Governor of Ohio, I became particularly concerned with
the cost of Federal mandates. During my tenure, I worked
tirelessly with State and local government groups to pass the
Unfunded Mandates Reform Act. As a matter of fact, the first
time in my life that I set foot on the floor of the U.S. Senate
was when the unfunded mandates relief legislation passed. I was
in the Rose Garden representing State and local governments
when President Clinton signed the legislation in 1995 and that
pen is proudly displayed in my office today.
DHS estimates that the cost for States to comply with REAL
ID will exceed $14 billion, and that most of these costs will
be incurred in the first 5 years. Ohio, my State, estimates
that it will need $45 million to comply and $11 million
annually to run the program. As someone who has been
responsible for balancing a public budget, I can assure you
these are significant costs that require tough choices.
This unfunded mandate poses a significant financial burden
on States, many of whom are facing tight budgets. Though I am
pleased the Department will allow States to use 20 percent of
their State Homeland Security Grant Program funds to help
implement REAL ID, I worry about the unmet homeland security
needs that will be put on the back burner if States select this
option.
For example, last month, I was in Cuyahoga County, the
largest county in Ohio, to discuss the cost of implementing
their interoperability program, which is $114 million. It is
ridiculous to ask States to use 20 percent of their State
homeland grant programs, which in most cases have already been
allocated, to implement REAL ID.
I question whether Congress understands the huge cost
burden we are placing on States, and I believe that the Federal
Government should provide the necessary funding to aid States
as they reconfigure their drivers' license requirements to meet
their new Federal responsibility.
Technology will also be a key factor in the successful
implementation of REAL ID. States will need functional access
to a number of databases for verification of an individual's
identity. Given the limited time frame, our Federal Government
must move quickly to ensure nationwide access to the required
databases. As we ask States to do their part, we must be sure
the Federal Government is also meeting its responsibility in a
timely manner.
The implementation of REAL ID comes at a time when the
Federal Government is developing a number of new identification
documents, including the Pass card, biometric passports, the
TWIC card, and the Fast card. It seems to me that we ought to
take a fresh look at the various identification requirements
and consider whether or not some of these documents could be
used for multiple purposes. For example, common sense would
suggest that residents could use their REAL ID cards to cross
our Northern land border instead of having to also apply for
either a Pass card or a passport.
My concern should not suggest that I am opposed to REAL ID.
Rather, I want to be sure that as we move forward with
implementation, we are honest about the true cost of
compliance. DHS must also redouble its efforts to work closely
with States to help ensure a seamless implementation. This
partnership is essential to the success of REAL ID, and more
importantly, to securing our homeland from another terrorist
attack.
Mr. Chairman, today's hearing marks an important first step
in our oversight of REAL ID. As implementation moves forward, I
would suggest that we invite some of our witnesses today,
including DHS, to report back to us in 3 months on their
progress.
Senator Akaka. Thank you very much, Senator Voinovich.
Now I will ask for the statement from the Senator from
Maine, Senator Susan Collins, who has been a great leader in
the Senate and especially with the Homeland Security Committee
here. As I mentioned earlier, her State has already taken
action on REAL ID, so, we are glad to have you here, Senator
Collins.
OPENING STATEMENT OF SENATOR COLLINS
Senator Collins. Thank you very much, Mr. Chairman. I must
say, I am very envious of the gift that the Honolulu Mayor
brought to you. You look quite festive decked out in your lei
there.
Mr. Chairman, I am very pleased to join today in the
discussion of the REAL ID Act of 2005 and the draft regulations
that the Department of Homeland Security has recently issued to
implement this program and I very much appreciate the comments
that both the Chairman and Senator Voinovich have been making
on this issue.
I first became involved in this issue back in 2004 when
Senator Lieberman and I were working on legislation to
implement the recommendations of the 9/11 Commission, which
included recommendations for more secure identity documents,
including drivers' licenses. The Commission pointed to the fact
that several of the hijackers used drivers' licenses to gain
access to airplanes and that they had obtained them in some
cases through fraudulent documents.
To respond to that legitimate concern, Senator Lieberman
and I drafted negotiated rulemaking provisions that were put
into the Intelligence Reform Act of 2004 that called upon the
Department of Transportation to convene a group to work with
State officials, privacy advocates, and technological experts
to come up with a workable, practical solution to the problem
identified by the 9/11 Commission.
And indeed, this committee, this rulemaking committee, was
appointed. Maine's Secretary of State was one of the members
and they were working along, making progress, doing exactly
what they were charged with when, unfortunately, the House
moved ahead and tacked on the REAL ID Act to an emergency war
supplemental bill. This Act repealed the negotiated rulemaking
provisions of the Intelligence Reform Act, and proceeded to
direct the Department to unilaterally draft regulations.
Well, now we find ourselves 2 years from the passage of the
REAL ID Act, which repealed these 2004 provisions before they
were given a chance to work, and only a year from the statutory
deadline for compliance. I am very pleased that in response to
concerns that many of us raised, the Department of Homeland
Security has responded by extending the compliance deadline
considerably and by trying to put back in place the negotiated
rulemaking process, albeit as a response to the preliminary
regulations rather than starting from scratch, and those
provisions are similar to the bill that Senator Akaka and
Senator Sununu have introduced to try to reintroduce negotiated
rulemaking. I think that is going to greatly improve the
process.
We need to make sure that in the pursuit of more secure
drivers' licenses that we are not jeopardizing the fundamental
liberties of our citizens and that we are not simply handing
the bill, an enormous bill, over to the states that requires
them to divert funds from other vital homeland security
activities. In that regard, I want to associate myself with the
comments made by the Senator from Ohio, who is both a former
governor and a former mayor and has a special appreciation for
unfunded mandates.
The State of Maine has estimated that the cost of complying
with the REAL ID Act would be six times the cost of the entire
budget for the Bureau of Motor Vehicles. So the cost of this
remains a concern, and while I appreciate the Department trying
to introduce flexibility, the fact is that the need for
Homeland Security grant monies for a host of other vital and
urgent needs remains, and I think it is going to be very
difficult for States to use 20 percent of those funds to pay
for compliance with the REAL ID Act.
So I think this is an issue that we are going to have to do
more work on, on the cost issues, on the privacy issues, and on
the technology issues. This is not an easy task to make sure
that States can tap into databases of other States and it
raises many security concerns.
So, Mr. Chairman, I thank you for holding this hearing, a
hearing that had the normal course been followed with the REAL
ID Act, we would have held years ago and I think we would have
ended up with more reasonable legislation. So thank you.
Senator Akaka. Thank you very much, Senator Collins.
Now, before we move on, I would like to ask Senator Warner
for any statement that he may have.
OPENING STATEMENT OF SENATOR WARNER
Senator Warner. Thank you, Mr. Chairman. I am pleased to be
here because I am quite interested in this whole concept. I
really think America needs to explore this particular concept
in the national security interest. This is where my primary
concern arises.
We have now learned that the duplication and the
falsification of drivers' licenses is quite feasible. Our
security here at home is highly dependent in certain areas,
like when boarding aircraft and otherwise, to have some sense
of confidence that the individual that displays the card is, in
fact, the rightful owner of it. And this card, because of
technical advances, can be produced in such a way as to greatly
increase the security as associated with any type of
identification individual proffers, whether it is for the
airlines or other purposes.
So I approach this with an open mind, leaning hard towards
seeing what we can do to help the States facilitate the law as
it is now written, and if necessary, to change the law that is
written to try to further help our States. But the bottom line
is we have got to come to the recognition that the life before
us is different than the life behind us and that we are faced
with very serious threats from abroad and perhaps, regrettably,
some internally, and this type of identification will go a long
way to, I think, make us more secure here at home.
I thank the Chairman.
Senator Akaka. Thank you very much, Senator Warner.
Senator Warner. I would ask to put the balance of my
remarks in the record.
Senator Akaka. It will be included in the record.
[The prepared statement of Senator Warner follows:]
PREPARED STATEMENT OF SENATOR WARNER
Thank you for calling today's hearing as I feel it is one that
deserves greater attention in this Committee and indeed the entire
Senate. Since the passage of the Real ID Act many have criticized the
program for reasons of cost, inefficiency, and privacy. It is my hope
that we may today explore these concerns and some potential solutions.
I believe that standardized identification criteria among the
States will make for a more secure country. We can eliminate fraud,
provide a barrier to crime, and ultimately protect the American public
better if we can rely on the authenticity of state issued drivers'
licenses and identification cards. I believe that the sooner we have
Real ID in place, the better. However, I have one significant concern
with the program as it has been proposed--the passing of an unfunded
mandate onto the States.
It is my firmly held belief that the primary responsibility of the
Federal Government is to provide for the national defense. And I also
believe that the Real ID program is a part of this responsibility. What
I do not understand is why this federal responsibility is not being
funded by the Federal Government.
The National Governors Association has estimated that the cost of
compliance to the States with Real ID will be approximately $11
billion. The Administration has argued that the costs should simply be
passed on to the users in the form of increased fees for drivers
licenses. Certainly larger states that issue millions of licenses can
absorb these costs much easier than smaller states that may only issue
a few hundred thousand.
I am pleased that the Department of Homeland Security has
recognized this issue and intends to help the States with some of the
costs of compliance by paying for the network build-out but am
concerned that this only represents a fraction of the costs to the
States.
I look forward to hearing more from our witnesses about their
concerns and am hopeful that we may come together on some common ground
on this important issue.
Senator Akaka. I want to welcome the Hon. Richard Barth,
Assistant Secretary for the Office of Policy Development at the
Department of Homeland Security, to this Subcommittee hearing
today.
Mr. Barth, it is the custom of this Subcommittee to swear
in all witnesses, so please stand and raise your right hand.
Do you solemnly swear that the testimony you are about to
give this Subcommittee is the truth, the whole truth, and
nothing but the truth, so help you, God?
Mr. Barth. I do.
Senator Akaka. Let the record note that the witness
answered in the affirmative.
Thank you. While statements are limited to 5 minutes, I
want all of our witnesses to know that their entire statements
will be included in the record.
Mr. Barth, will you please proceed with your statement.
TESTIMONY OF HON. RICHARD C. BARTH,\1\ ASSISTANT SECRETARY,
OFFICE OF POLICY DEVELOPMENT, U.S. DEPARTMENT OF HOMELAND
SECURITY
Mr. Barth. Chairman Akaka, Senator Voinovich, and
distinguished Members of the Committee, thank you for the
opportunity to appear before you today to discuss REAL ID.
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\1\ The prepared statement of Mr. Barth with an attachment appears
in the Appendix on page 48.
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I also want to take this opportunity to thank you for
introducing S. Res. 94 earlier this month to honor the
employees of the Department of Homeland Security on the
Department's fourth anniversary. It was gratifying to the
employees to receive this recognition by the Senate.
Your subject for this hearing, ``Understanding the
Realities of REAL ID,'' is highly appropriate and timely. This
is a very challenging program for both the States and the
Federal Government to implement, with many complexities ranging
from cost to technically integrating various data links while
imposing strong data security and privacy protections.
Let me be clear at the outset. Effectively implementing a
REAL ID program is a top priority for DHS. REAL ID is
fundamental to our security as a Nation. We can debate the
costs. We can fret about the time to implement and time waiting
in line to obtain a REAL ID. But the inextricable link to
ensuring that people are who they say they are when someone
gets on an airplane and sits next to you is of paramount
importance to preventing another September 11.
All but one of the September 11 hijackers acquired some
form of U.S. identification document. Eighteen hijackers
fraudulently obtained 17 drivers' licenses and 13 State-issued
identifications and some even possessed duplicate licenses. The
pilot who crashed American Airlines Flight 77 into the
Pentagon, Hani Hanjour, had ID cards from three States. The
drivers' licenses and State IDs enabled the hijackers to
maneuver throughout the United States in order to plan and
execute critical elements of their mission. Using these
documents, they were able to rent cars, take flying lessons,
and board airplanes. The hijackers believed that holding
drivers' licenses and ID cards would allow them to operate
freely in our country, and they were right.
So again, as I will repeat over and over again today, our
security as a people and collectively as a Nation relies on
valid identification documents.
Counsel to the 9/11 Commission, Janice Kephart, said the
REAL ID recommendation was ``perhaps the single most effective
measure the United States can accomplish to lay the necessary
framework for sustainable national and economic security and
public safety.'' Said another way, identity document security
is a prerequisite for overall security in the United States. If
we cannot verify that people are who they say they are and if
we allow loopholes in obtaining drivers' licenses and IDs to
exist, DHS's job and that of law enforcement becomes
exponentially more difficult. Sadly, four of the hijackers had
been stopped for traffic violations in various States while out
of legal immigration status, a condition that should have
resulted in their drivers' licenses expiring.
Key features of the proposed rule include the following.
Individuals seeking drivers' licenses or personal ID cards will
need to establish their identity, U.S. nationality or lawful
immigration status, date of birth, Social Security number, and
principal residence. States would verify the issuance validity
and completeness of the document presented. As you can see by
the chart,\1\ which is also included in my testimony,
electronic verification of these documents is a work in
progress. But in some areas, we can quickly get the States
online. For example, birth certificate information can be
brought online for all States for about $4 million, and we hope
to be able to use existing DHS grant money to facilitate that
over the next year or so.
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\1\ The chart submitted by Mr. Barth appears in the Appendix on
page 56.
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Standard information will be required to appear on the
cards, including full legal name, date of birth, gender, a
unique identification number, a full facial digital photograph,
address of principal residence, issuance and expiration dates,
and signature. The cards would also have physical security
features and a common machine-readable technology.
Each State must prepare a comprehensive security plan for
all State DMV offices, storage and production facilities,
databases, and systems. Employee background checks would be
required to decrease the probability of criminal collusion with
DMV employees.
Further details on the floor that we are establishing for
more secure IDs is in my written testimony, and it is important
to note that the States are not precluded from requiring
additional security features.
The September 11 attacks cost 3,000 lives and $64 billion
in immediate losses followed by longer-term financial losses of
$375 billion. The potential for further loss of life and
property far outweighs the financial burdens to States and
territories in implementing REAL ID. As the Secretary noted
when he held his press conference when we published the rule,
these new cards will cost less than $20 additional each time
you renew your license.
I personally believe that any further delay in implementing
REAL ID would significantly increase our vulnerabilities as a
Nation, and as long as I have responsibility for this program,
I intend to do everything possible to make sure that fake IDs
are not part of the scenario in the next terrorist plot
successfully carried out in this country.
To echo the words of the 9/11 Commission, for terrorists,
travel documents are as important as weapons. Our security, as
a Nation, is at stake, and I hope you will support the full
implementation of REAL ID. It is a national problem and demands
a national solution.
Thank you, Mr. Chairman, for the opportunity to testify
today and I look forward to your questions.
Senator Akaka. Thank you very much, Mr. Barth.
Hawaii is an island State whose residents depend on air
travel to travel within the State. If the State decides not to
comply with the requirements of the REAL ID or if individuals
in Hawaii cannot obtain a REAL ID-compliant driver's license,
will DHS grant a waiver for inter-island travel so that our
residents will be able to travel within the State to visit
family and friends on other islands?
Mr. Barth. That is a very good question, Mr. Chairman, and
we are looking at various solutions for that question that
would not prevent the residents of Hawaii from getting around
the islands. One of the obvious solutions is that a passport,
for those who hold a passport, is an easy alternative for
getting on an airplane even if Hawaii decides to opt out of
REAL ID.
In addition, we are looking at alternative documentation
like a Federal Government-issued ID out of the Department of
Homeland Security to deal with citizens of States who want to
be able to travel freely and easily on airplanes and provide an
alternative to the REAL ID that would be equally validated and
equally difficult to make fraudulent cards from.
And finally, I would note that in virtually all cases where
DHS has security, whether it is Customs coming into the country
or TSA and airports for controlling security in airports, there
is a secondary referral process that you can go to and present
other kinds of documentation that will help inform the
inspector to make a decision as to whether or not to let you
onto the airplane without a REAL ID. So there are multiple
scenarios that we think will effectively address your concern.
Thank you.
Senator Akaka. As you know, Mr. Barth, many people are
worried about the REAL ID's impact on privacy and civil
liberties. Because of this, did the White House Privacy and
Civil Liberties Board review the regulations, and did DHS make
any changes to the regulations based on their comments? If so,
would you please describe those changes?
Mr. Barth. Thank you, sir. I am not aware that the White
House Privacy Board looked at the regulation before it went
out. There is a White House circulation process and I am not
aware of all the details of it. However, we were very concerned
with the privacy issue. I think the regulation and the preamble
to it goes into it at great length about our concerns to make
sure the databases are secure. Certainly the background checks
on DMV employees are a big part of protecting privacy.
But we also issued at the time that the regulation came out
or shortly thereafter a 25-page privacy impact analysis that
our own Privacy Office did for DHS and it clearly addresses a
lot of the different concerns, even beyond the regulation
itself. We are looking forward to receiving comments from the
privacy civil rights and civil liberties communities on the
regulation during this 60-day comment period and we will do
everything within our ability to try to make sure that their
concerns are fully taken care of.
No one wants to be a subject of identity theft, and so we
want this document to be as secure as possible to become an
added advantage in a world where identity theft is becoming a
multi-billion-dollar problem for citizens across the country.
Senator Akaka. As you know, Mr. Barth, REAL ID is going to
cost State and local governments billions of dollars. Although
DHS has approximately $40 million in grant funding to provide
States and has authorized the use of State Homeland Security
Grants, this is not enough. What are DHS's plans for helping
States pay for REAL ID?
Mr. Barth. Mr. Chairman, I think that the $40 million is
something that we are looking at to become a keystone of doing
one particular factor or technology link that needs to be
accomplished to make REAL ID work and we are working with our
grants and training folks in the Department and consulting with
States on trying to find a way of funding the interconnectivity
of all of those databases that you see up there while paying
close attention to privacy and data security issues. So we are
working to try to get the most significant impact out of that
$40 million that has already been appropriated.
Beyond that, I have expressed to our friends at the
National Governors Association, National Council of State
Legislatures, that they have significant lobbying powers and
that we will not in any way, shape, or form try to object to
them acquiring other money through appropriations and
authorization by the Congress, but we just don't feel like that
is necessarily our role at this time.
The finalization of interoperable, interconnected networks
of networks, which is what that chart represents, is something
that we believe will cost probably more than $40 million and we
are right now working with our various technology groups in the
Department of Homeland Security, the CIO's Office, for example,
to identify the way to link up these databases securely and
with due process for identity theft and other problems, and
when we conclude the preliminary work-up of that, we will be
submitting to Congress, hopefully for the 2009 fiscal year
budget, a proposal to have the Federal Government take on the
responsibility of networking those networks effectively and
securely.
Senator Akaka. Mr. Barth, you have repeatedly said that the
States will use a pointer system, which is based on the
Commercial Driver's License Information System, to verify
information from other States. However, the regulations do not
state this and instead leave open how States are to share
information with each other. This may be one reason why
Americans fear this is becoming a national ID card. Why didn't
DHS just require the use of CDLIS for REAL ID?
Mr. Barth. Mr. Chairman, that is a very good question and
there is a ready answer for it. The CDLIS system handles in the
tens of millions of commercial drivers' licenses each year and
it does so very effectively, and I might point out that to the
Department of Transportation's knowledge, which has been
managing the funding and the establishment of the Commercial
Driver's License System since, I think, 1986 when they started
the roll-out of that system, there have been no Privacy Act
violations, so there is an additional reason, perhaps, to use
that system, as you have suggested.
At the time when we wanted to bring the regulation to
closure and get it published, we were in intense dialogue with
AAMVA, which manages the CDLIS system for the Transportation
Department, as to their system and particularly whether it had
the ability to scale up in time to handle the 240 million non-
commercial drivers' licenses that need to be renewed over a 5-
year period as part of this program.
So we are getting closer and closer to having the kind of
assurance for that exact pointer system, which has not had
privacy problems since 1986, might be exactly the solution that
we want. We are not ready to say that yet. It may be several
more months. But to the extent we can possibly put that in the
final regulation as our pathway forward, I will certainly take
your comments on board, also, because we are inclined towards
that.
Senator Akaka. While the REAL ID Act requires States to
verify information against certain databases, I understand that
some databases do not exist and others are only in the pilot
phase. Can you provide us specific data on the status of each
database and their estimated time of availability on a national
basis?
Mr. Barth. Yes, sir. Mr. Chairman, again, I will refer to
the chart that we provided up here. If you look at the far
right, it is a column that shows absolutely no check-marks for
States being able to access the Passport Office records for
your individual passport to confirm that you are who you say
you are. Interestingly, that database exists, it is highly
accurate and very robust, and the only thing that is missing is
the interconnectivity between the State DMV offices and the
State Department Passport Office. We, for example, query that
passport database all the time as part of the DHS's mission.
So the chart, while it shows significant gaps, as you are
suggesting, I think it also, when you dig deeper into
explaining each of those links, it is not as bad as it looks.
The next column over, which is the birth certificate
confirmation, I am informed by the Department of Health and
Human Services that 85 percent of all birth certificates dating
back to 1935 have already been digitized. Those checks there
show the pilot program that is effectively linking the birth
records with DMV offices, and as I said in my oral testimony
and the written testimony, for only $4 million, we can have
that total column there have checks for that interconnectivity
that we require.
So each one is a different story and it would--perhaps in
questions for the record we can give you all the details you
wish.
Senator Akaka. Thank you so much for your responses. Let me
now call on Senator Voinovich for his questions.
Senator Voinovich. Thank you.
Dr. Barth, the proposed regulations state that DHS will
require the use of several databases to electronically verify
lawful status and Social Security numbers of individuals. They
include Social Security Online Verification.
The Department of State's Consolidated Consular Database,
Electronic Verification and Vital Events System (EVVE), and the
Systematic Alien Verification for Entitlement (SAVE), I
understand, all 50 States have Memorandums of Understanding or
access to SAVE. However, only 20 are currently using it to
verify lawful status. States will also need to access U.S.
Immigration and Customs Enforcement Student and Exchange
Visitor Information (SEVIS).
The question I have is how far in advance are you going to
be able to have all these databases up and working?
Mr. Barth. Thank you, Senator, for the question. If I could
answer with the precise date, I would be thrilled to do so. I
can tell you that we have teams working very hard to provide
all that connectivity and all that verification capability that
we share with you in wanting to provide to the States.
If, for example, the State Department for funding reasons
or manpower reasons or priority reasons is unable to provide 50
States plus 7 territories linkage to their passport database,
we will look very closely at finding some waiver authority
within the Secretary's authority that would allow us to defer
bringing the passports online until it is technologically
feasible, funded, and has actually been accomplished by the
State Department. In making sure that we don't create a
loophole for further fraudulent activity, we could
significantly increase the training for DMV officials on
spotting fraudulent passports.
So we think that there are tradeoffs there between
fraudulent document review and actual exceptional digital
verification that we can make in the early years of the roll-
out of REAL ID.
Senator Voinovich. I think you have answered the second
question that I was going to ask, and that is if the databases
are not up and working by the May 2008 deadline, do you have
the authority through regulation to extend that period beyond
that date?
Mr. Barth. My understanding is that we will have the
authority to extend beyond that date, yes, and we will be--our
hard target, if you will, for filling in that entire chart with
check-marks for all 50 States and all five databases would be
the December 31, 2009 deadline for which the Secretary has
indicated he will issue waivers. But for those states that have
indicated to us they want to be early adopters, if you will, we
believe we have the authority to give them alternatives to
electronic verification of a passport.
Senator Voinovich. Is there any effort being made to
coordinate the technology that is going to be implemented by
the various States?
Mr. Barth. Yes. We have considered that issue and have
actually raised it in the regulation, and at this point in
time, the proposed rule would not require the 50 States to use
the connectivity that we provide. However, in order to ensure
that data passes back and forth through the network
efficiently, that is one of the reasons why we believe it
should be a Federal responsibility to pay for the build-out of
that network of networks to remove the incentive for a State to
perhaps go down a different path. If it is paid for, built out
faster than anything else, etc., we think that will be a
powerful incentive to the States coming online, a single system
rather than creating a panoply of systems, as you suggest.
Senator Voinovich. You are developing technology that you
will share with the States?
Mr. Barth. We would not develop technology. We would seek a
technology solution funded by the Federal Government that the
States would have a large stakehold in. We have not yet defined
in a high level of granularity what that will look like, but I
will draw an analogy to the Department of Transportation, which
funds the development of this CDLIS system that the Chairman
was referring to, but the States own the system and have funded
AAMVA, the American Association of Motor Vehicle
Administrators, to build out this CDLIS system.
And if that system proves to be, as I certainly hope it
does, the framework for a significantly scaled up civilian
driver's license verification network, it will have the
advantages that the Chairman mentioned of being a pointer
system, not a lot of data flowing. It won't retain a lot of
data in a central database, which poses its own risks. And it
will give us a platform on which to build without having to
invent new technology.
Senator Voinovich. Are you going to be able to guarantee
that information is going to remain private?
Mr. Barth. To the extent that we can provide the
safeguards, we believe that this system will be vastly an
improvement over the current 50-plus-7 territories systems that
are built out now. Whether it is the documented cases last week
in North Dakota of fraudulent driver's license activity,
whether it is the $4,000-per-license cost to collude with an
internal DMV person in New Jersey, or some Connecticut similar
fraud cases in the past, I think wherever you have human beings
involved and the capability to bribe them to do things that are
wrong, you can't say there is zero risk.
Senator Voinovich. Could somebody break into the system and
get the information?
Mr. Barth. They are likely to be under the age of 20, not
to be glib, sir. But I think that we are going to provide the
safeguards to do everything possible to prevent that from
happening.
Senator Voinovich. One concern of the NGA is that 24 States
have a driver's license renewal period that is longer than 5
years, many have 10 years. I understand that in the regulations
you have ruled out 10 years and have said States have to do it
in 5 years. I would like you to explain why DNS has chosen the
5-year renewal date?
Mr. Barth. In the consultation we did with the States,
which have a very wide ranging number of years before renewals
are required, we certainly didn't arbitrarily choose, but in
consultation with them chose about an 8-year period for
renewals as the maximum that we would allow. States that
currently have 4-year renewals, they can continue their 4-year
renewals. states that have 8-year renewals would have to--the
individual applying for the driver's license would have to
reappear every 16 years, so every other cycle, in person to
revalidate their data, their place of--their documentation----
Senator Voinovich. It is not 5 years?
Mr. Barth. It is not 5 years, sir.
Senator Voinovich. I thought that was in the regulation.
Mr. Barth. I don't believe so. Yes. You are referring to
the 5-year implementation period for the very first cycle of
everyone in America who has a driver's license who lives in a
State that opts into REAL ID, they have to move through that
first cycle in 5 years. The second cycle is 8 years, and every
cycle after that is a maximum of 8 years, but States can choose
a shorter cycle.
Senator Voinovich. Ambassador Wilson came in to see me last
week and we talked about the Western Hemisphere Travel
Initiative. As I mentioned in my opening statement, I want to
ensure that DNS is taking into consideration the
interoperability between the various screening tools and ID
documents?
Mr. Barth. Yes, it is, sir. Governor Gregoire of Washington
State approached us some months ago with a proposal that we
partner with Washington State on a dual-use Western Hemisphere
Travel Card, WHTC, we call it, and REAL ID, and we fairly
quickly sent back from Secretary Chertoff to the governor a
letter saying we would definitely like to explore this with
you. The ``too many cards out there'' problem is something we
would like to try to get under control.
Senator Voinovich. I would suggest that you stay on top of
it. DNS should work with what they are doing there and
individuals so they don't have to get multiple sources of ID in
order to travel back and forth between Canada and the United
States. There is real concern about moving people back and
forth in the border States.
I know in Ohio, we have many Canadian tourist visiting. We
would like to make sure that they continue to visit our great
State.
Mr. Barth. We are piloting this in Washington State, and we
expect to roll it out January 1, 2008, which I think is a very
efficient way forward, and in many ways, that will show us the
way forward for a lot of the border States, but any State, Ohio
included, or Florida, if they want a dual-use card for, say, a
snowbird from Ontario or somewhere, we would be very happy to
try to accommodate that.
Senator Voinovich. That would be wonderful. Stay on top of
it and do what you can to make sure they get it done on the
date that they say they are going to get it done.
Mr. Barth. Thank you, sir. I will do that.
Senator Akaka. Thank you very much, Senator Voinovich.
Senator Collins.
Senator Collins. Thank you, Mr. Chairman.
Mr. Barth, in responding to a question from Senator
Voinovich, you referred to states that choose to opt in to the
REAL ID. But, in fact, States have very little choice but to
participate in this new system. If they don't participate, then
their citizens cannot board airplanes, they cannot gain access
to certain Federal buildings. There are all sorts of practical
ramifications. So do you really think that there is an
alternative for any State but to opt in?
Mr. Barth. Senator Collins, the 9/11 Commission was very
clear as to the fundamental nature of clarifying this ID thing
to prevent a future terrorist attack. I think that legislation
reflects exactly what you just said, which was drafted by the
Congress and we are trying to implement it.
I think that with the alternative documentation, as I have
already explained, a federally-issued other ID, for example,
military ID, the military residents of Maine will be able to
travel around without a REAL ID, we expect. Passport holders,
which is some 30, and growing, percent of the American
population, will be able to use that document. And if we, and I
am expecting we will come up with a Federal alternative, a
Maine farmer who never wants to leave the State or get on an
airplane will be happy without his REAL ID and a Maine citizen
who wants to travel will have multiple alternative documents to
acquire to travel freely like anyone who has opted into the
system.
So I believe that there are strong incentives to come into
the REAL ID program and opt in, but I believe that the
disincentives are relatively low given the potential risk and
vulnerability that it presents to the whole country. For states
that continue to issue documents that are not as secure as
other States--if you are a terrorist, you will very quickly
find online that State X is where you go to get your fraudulent
document to get on an airplane and drive it into a building.
Senator Collins. I guess my point is that we need to face
the practical reality that States almost certainly are going to
have to participate in this program because of the practical
consequences of not doing so for their citizens, which brings
me back to the cost issue. The Department, when it issued its
draft regulations, estimated that the cost to States of
compliance with the REAL ID Act would be $14.6 billion over 10
years. The NGA has estimated $11 billion over 5 years. Really,
those are very similar estimates because a lot of the costs
would be in the first 5 years, so I think it is fair to say
that there is substantial agreement that we are talking about
billions of dollars over a 5- and 10-year period for
compliance.
If the Federal Government is imposing this mandate,
shouldn't we go beyond the $40 million that you have mentioned
that could be used to set up a very useful interstate database
that would allow for States to check each other's databases? I
mean, isn't that just a drop in the bucket when you are talking
about costs of this magnitude?
Mr. Barth. Yes, that is a drop in the bucket, and even if
it costs a couple hundred million--and we don't know the number
yet--to fully integrate the databases securely and with data
privacy protections installed, it is still a small portion of
the cost compared to hiring people, in some cases, building
additional lanes, bricks and mortar kinds of facilities,
obtaining the equipment necessary.
We are doing everything we can to mitigate those costs. For
example, one of the things that we are going to do is work with
GSA to have a single contract procurement activity for the
cardstock and the card issuance equipment and allow GSA to put
up on their procurement site enablement for all States to come
in and buy, I presume, at lowest possible cost all the
equipment and all the cardstock they need. This would save not
only costs on the direct acquisition of those items with just a
direct procurement from that list, but it would also save 50
different State procurements. We are seriously looking at the
cost issue and doing everything we possibly can to reduce it.
But I think you have to look at it in a way of also
evaluating which ones have already made a substantial
investment to become, if not REAL ID compliant, but to improve
their security. The State of Virginia has put an enormous
amount of money into getting there already. The State of
Michigan told us that they have spent roughly $30 million and
they are a few million dollars from becoming REAL ID compliant.
That is a fairly sizeable State with a fairly large population.
So the numbers, frankly, are all over the map and we have
instructed the economists in DHS to very closely pick apart the
numbers that were in our proposed rule economic analysis and
see if those costs are really that high. Even with that,
though, I agree with you the costs are substantial and I
believe, unfortunately, it would be very difficult for us to
determine on a State-by-State basis how much they really need
for this purpose.
So I would finally note that Alabama, maybe, has provided
the ultimate solution. I was talking to their DMV a few weeks
ago. They have a zero-cost to the State implementation of REAL
ID, or very close to that, depending on a final regulation.
They entered into a contract with a service, an equipment
provider, whereby that service and equipment provider is
tacking on a fee to the issuance of the driver's license, and
for no capital investment and I believe no operating investment
by the State, they can and will be, when they rewrite the
contract in light of REAL ID, compliant.
So there are great models out there for mitigating the
costs, for lowering the costs, and we are working with the
States to----
Senator Collins. I would say to you that paying perhaps
double for your driver's license, most people would not
consider to be no cost. But we will put that issue aside.
I want to raise just one other issue in the brief time that
I have remaining. State officials have repeatedly made the
point to me that this system is only as good as the source
documents and they are very concerned about training DMV
personnel to evaluate the validity of a birth certificate, a
baptismal certificate, a visa, or a passport. People working in
the DMV offices are excellent public servants. They are very
committed to the security of our country. But they are not
trained to distinguish whether or not these source documents
are valid and should be accepted.
Are you going to assist States with training their
personnel to different standards? There must be a huge degree
of difference among the various States on birth certificates,
for example. Someone coming into Maine who has moved from
Virginia or Ohio or Hawaii, I am sure they have a birth
certificate that looks different from Maine's. How are you
going to deal with this? How are you going to train, to help
the States train DMV personnel so that they can accurately
assess source documents, because if they can't do that, the
whole system on which REAL ID is based falls apart?
Mr. Barth. Senator, there are several answers to your
question, actually, so if you will bear with me, I will try to
identify them.
First off, in your passport files, once that data link is
connected, and depending on how it is connected, you might be
able to pull up the digital photograph of the person and
literally match it to the person sitting in front of you. That
biometric confirmation of who you are and that you got a
passport, maybe all using fraudulent documents, but I hope not,
is a very powerful confirmation of who you are.
But more to your point specifically of training for the DMV
officials, we have taken that into account. We have forensic
document labs in the Department of Homeland Security. We have
already been working with them on various aspects of this rule
and we expect, I would say, to develop a package, a training
package that the States could build on. The rule itself and the
$14 billion that we highlight as the cost factors in a $300
training cost for each and every DMV employee across the land.
So that cost is factored in. It is not funded by the Federal
Government, but it is factored in as one very important item,
as you suggest.
Senator Collins. Thank you, Mr. Chairman.
Senator Akaka. Thank you very much, Senator Collins.
Senator Warner.
Senator Warner. Thank you, Mr. Chairman.
This has been a good hearing and I am impressed with the
amount of work that you individually and members of your
Department have done to try and resolve this. I just hope
Congress adopts an attitude that we have got to be a working
partner and not get into an adversarial process and also that
the States can be working partners.
In the preparation of your regulations, to what extent did
the several States participate and come forward with ideas and
concepts to improve the regulations?
Mr. Barth. That is a very good question and the answer, I
think, should be very comforting to you, which is that we ran
an open phone call with at least four States every Thursday
since, I believe, last August to consult with the States on
various aspects of this regulation and the economic analysis.
That, in part, is why, as Senator Collins suggested, our costs
and their costs line up fairly well. We have been talking
extensively.
Four States in particular I want to commend for being on
virtually every one of those calls. California, Iowa, New York,
and Massachusetts sort of formed a core group that were
extremely interested, had the capability within their DMV
organizations, and participated weekly, came to Washington for
a face-to-face meeting with Deputy Secretary Jackson, really
doing everything possible to make exactly what you said, a
partnership with the States for this important program.
And I am very pleased to say that my project manager for
this, Darrell Williams, just spent the entire last week on a 5-
day, four-city tour with the American Association of Motor
Vehicle Administrators, pulling in regionally DMV
administration people from many different States around the
country. So not only has our consultation process been rigorous
leading up to the issuance of the NPRM, it is going to continue
to be rigorous as we move towards the final rule, and as we
build out that network of networks, it is going to continue,
sir.
Senator Warner. Was part of that dialogue to discuss costs
to the individual States?
Mr. Barth. Yes. The States came in towards the end of
developing their cost analysis, their $11 billion cost
analysis. They came in jointly as the National Governors
Association, the National Council of State Legislatures, and
AAMVA, and they presented their document and they asked us to
help them sort through the funding issue.
Senator Warner. Is there any standardization of the
criteria by which several States did make their estimates?
Mr. Barth. No, sir, there was not. AAMVA, actually, I
believe it was, developed the data from the States on which
their figure and much of our figure is based. So each State had
a different approach towards the funding and there is no
standardization of that.
Senator Warner. Was the thought given to trying to
standardize it, because these estimates which were thrown out
here, $23 billion by OMB, that, I understand, even involved the
transportation of an individual to and from their home or
workplace to the DMV, which strikes me as an odd way to compute
things, but anyway DHS was at $14 billion, and $11 billion from
the NGA. There is quite a disparity here. And then I also,
based on the fragments that I have been able to collect, see
where some States came in with a cost estimate, but almost
uniformly all of them are coming down in the estimates. Would
that be a correct assumption?
Mr. Barth. Yes, sir, that is a correct assumption, I think
in part because while we have been negotiating the regulation
and getting it out, States have continued to make good, solid
investments in many cases in their existing networks, and we
hope that continues as we move toward a final rule, which we
hope to announce in August. So I think that as we scrub the
costs going forward, which as I have already said our
economists are doing, I think that figure could be ultimately
viewed as being very high.
Senator Warner. What figure? I threw three out here. I
don't know what figure you are talking about.
Mr. Barth. The three key ones are the $23 billion includes
if you are a disorganized person and it takes you an hour and a
half to find your birth certificate, driver's license,
passport, to go to the DMV. It even includes the cost of
spending time at home finding your documents. That is the
highest cost estimate----
Senator Warner. I don't know which government clerk figured
that one out.
Mr. Barth. Well, required by OMB rules, sir.
Senator Warner. Oh, is that it? All right. That is
extraordinary to me. I can't believe that. Anyway, it took 2
years to put this set of regulations together?
Mr. Barth. It did, and I think in large part it was due to
the extensive consultation, including, as I said, the Deputy
Secretary, before he would sign off on the regulation, convened
a meeting with AAMVA and the four states that I mentioned
before that were our close partners in developing the
regulation. So it is regrettable that it took so long, but the
consultation process was at least as intense as it would have
been under a negotiated rulemaking process.
Senator Warner. Well, Congress is faced with this and we
are getting a lot of understandable pressure. I have always
identified myself here in my years as being one who fought
against the compulsory mandating of legislation--I mean that
then in turn made the States required to come up with the
funds. I have always sort of been on the side of protecting the
States from being subjected to this by the Congress and I am
more than likely to continue in that vein. On the other hand, I
am really concerned about the security elements of this.
Where are we, do you think, in this process? Suppose
somebody goes out here on an appropriations bill or elsewhere
and attaches an amendment to further modify the existing law on
this issue? Now, we have got the extension period in there.
That is safely ensconced, would that not be correct, Mr.
Chairman?
Senator Akaka. Yes, the initial enrollment period has been
extended but not the reenrollment deadline.
Senator Warner. But I am concerned that others may have
reason for further attack, which I want to have a convergence
of all the information that should be brought to bear and any
further action by the Congress to impede the progress of this
program. Where is another time when there is going to be a
considerable amount of data out there to try and begin to show
the States as to how to alleviate their cost projections today?
Mr. Barth. Yes. I think that the time frame of August-
September is when we are targeting issuing the final
regulation, and to the extent we can, renewing our evaluation
of the costs. So that is when I think you will find all the
stakeholders will have something hard to shoot at rather than
something soft, which is a proposed rule.
Senator Warner. So it would be wise for the Congress now to
withhold any further action until that time period?
Mr. Barth. Except for the funding issue, which the Congress
will consider separately----
Senator Warner. As to whether we are going to step up and
fund----
Mr. Barth. Correct. There is the $40 million that has been
appropriated for the grants to the States, but there has been
no funding for the DHS or any department of the government for
this program, nor, of course, for all the other costs of the
State. So to that extent, I think that the cost issue is just a
significant one. But until then, we won't be able to tell you
even how much it is going to cost to build out that network of
networks up there. So there is not a hard target to even fund,
in my view, at this point in time.
Senator Warner. Well, that is, I guess, my point. You
really can't begin to ask Congress to give us so much money to
try and defer some of the percentages of the State costs when
each State is putting together their cost formula by different
methods----
Mr. Barth. And until, sir, they see the final regulation,
they are not even----
Senator Warner. That is correct.
Mr. Barth [continuing]. Going to be able to put a final-
final cost figure per State on it, which I regret that is after
some States even go out of legislative session.
Senator Warner. So it is in the best interest of Congress
to ride through this thing until early fall?
Mr. Barth. With the amount of time and effort I and my team
are putting into this, I would greatly appreciate that, sir.
Senator Warner. Well, I am only one. There are many here,
but I certainly would hope that we would proceed on this on a
partnership concept of States and the Federal Government
working together and the Congress to try and achieve some type
of identification that will help America feel a little more
secure in our daily requirements to identify ourselves and to
otherwise conduct our life here at home. I thank you.
Mr. Barth. Thank you for your support, Senator.
Senator Akaka. Thank you very much, Senator Warner.
Just to follow up on Senator Warner's questioning, Mr.
Barth, you testified that we shouldn't act to change REAL ID.
The proposed regulations state that DHS sought to provide for
privacy and security to ``the extent of its authority.''
However, the regulations ask for comments as to whether the
privacy protections are adequate. Given that DHS has acted to
the extent of its authority, what statutory changes to the REAL
ID Act do you believe are necessary to protect privacy?
Mr. Barth. At some point, Mr. Chairman, I think that the
Congress should take seriously a concern that I believe we
share with the privacy community, and that is that probably the
biggest significant risk for identity theft, for issuing
fraudulent cards, for collusion with bad actors in the DMVs,
the biggest risk is those bad actors in the DMVs. There is
currently law on the books that identifies penalties at the
Federal level, penalties for collusion of DMV workers with
someone outside the DMV in acquiring a fraudulent document. I
would invite the Congress to look carefully as to whether or
not those penalties are high enough.
If it only costs $4,000 to get a fake ID and lifetime
employment in New Jersey, for example, not even committing bad
acts, the penalty must not be stiff enough. If the cost goes up
to about $50,000 or $100,000 per fake ID, then you might be
getting close. So I make that sort of in jest, but I think that
the penalties there should be looked at closely.
I also think that one of the threats to privacy that has
been identified is the lack of encryption of the machine-
readable technology that is used on the back of many cards
issued today. I think that the technology issues and the
encryption issues will be well vetted in the regulation, but
the Congress could also consider coming up with substantially
higher penalties for fraudulent use of information obtained
from drivers' licenses, REAL ID drivers' licenses. That should
be a real linchpin of the cost of making an error here, or
intentionally stealing data and using it fraudulently from a
license is so high that I don't think I am going to do it.
Those are two very specific things that won't slow down our
implementation of the rule, but will significantly enhance the
effectiveness of whatever privacy protections we put into the
rule.
Senator Akaka. If Congress holds off on legislation, Mr.
Barth, until the end of 2007, States will commit more and more
funding towards REAL ID only to have the requirements modified
if Congress acts on it later. Well, I want to thank you very
much, Mr. Barth, for your responses to this Subcommittee and I
want to tell you that we may have further questions for you
that we will place into the record. Again, I want to thank you
so much for being here with us.
Mr. Barth. Thank you, Mr. Chairman.
Senator Akaka. Now, I would like to call the second panel
forward and welcome you to this Subcommittee.
Testifying on the second panel are: State Senator Leticia
Van de Putte, who represents the 26th District of Texas in the
State Legislature and is the President of the National
Conference of State Legislatures. Welcome.
The Hon. Mufi Hannemann, Mayor of the City and County of
Honolulu, who is accompanied by Dennis Kamimura, the Licensing
Administrator for the City and County of Honolulu. Aloha and
welcome, Mufi.
David Quam is the Director of Federal Relations for the
National Governors Association. Welcome, Mr. Quam.
As you know, the custom of this Subcommittee is to swear in
all witnesses, so will you please stand and raise your right
hand.
Do you swear that the testimony you are about to give this
Subcommittee is the truth, the whole truth, and nothing but the
truth, so help you, God?
Ms. Van de Putte. I do.
Mr. Hannemann. I do.
Mr. Kamimura. I do.
Mr. Quam. I do.
Senator Akaka. Thank you. Let the record note that all
witnesses answered in the affirmative.
I want to thank you again for your presence and we are
looking forward to hearing from you. Senator Van de Putte
please proceed with your statement.
TESTIMONY OF HON. LETICIA VAN DE PUTTE,\1\ TEXAS STATE SENATOR,
AND PRESIDENT, NATIONAL CONFERENCE OF STATE LEGISLATURES
Ms. Van de Putte. Thank you, Chairman Akaka, Ranking Member
Voinovich. I am Leticia Van de Putte, President of the National
Conference of State Legislatures and a member of the Texas
State Senate. I appear before you today on behalf of the
National Conference of State Legislatures (NCSL), a bipartisan
organization representing the legislatures of our Nation's 50
States, its Commonwealths, territories, possessions, and the
District of Columbia.
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\1\ The prepared statement of Ms. Van de Putte with an attachment
appears in the Appendix on page 57.
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Mr. Chairman, thank you very much for your leadership on
this important issue, not just today with this hearing, but
with your introduction of legislation in both the 109th and
110th Congresses to fix the REAL ID Act. It is imperative that
this hearing be the first step toward a successful, cost-
effective implementation of the Act.
Legislators across the country share the goal of improving
the integrity and the security of drivers' licenses and
identification cards, but we want to make sure that it is done
right. Mr. Chairman, as you know, NCSL will call for the repeal
of the Act if the recommendations made in the September 2006
report,\2\ ``The Real ID Act: National Impact Analysis,''
issued by NCSL, the National Governors Association, and the
American Association of Motor Vehicle Administrators, are not
implemented and the mandate fully funded by December 31, 2007.
---------------------------------------------------------------------------
\2\ The Real ID Act: National Impact Analysis,'' report submitted
by Ms. Van de Putte appears in the Appendix on page 119.
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Mr. Chairman, I respectfully request that a copy of this
report and the NCSL policy,\3\ ``Funds in the Fiscal Year 2008
Budget Resolution for Implementation of the REAL ID,'' be
submitted for the record with my full testimony.
---------------------------------------------------------------------------
\3\ ``Funds in the Fiscal Year 2008 Budget Resoulution for
Implementation of the REAL ID,'' submitted by Ms. Van de Putte appears
in the Appendix on page 63.
---------------------------------------------------------------------------
Senator Akaka. It will be included in the record.
Ms. Van de Putte. Thank you, Mr. Chairman. NCSL
acknowledges that the draft regulations incorporate a number of
our recommendations made in the September 2006 report. However,
they do not address several major recommendations, or more
accurately stated, solutions needed for the successful cost-
effective implementation of the Act. These solutions would
ensure that the verification systems are available nationally,
allow States to adopt up to a 10-year progressive re-enrollment
process, exempt certain populations from the REAL ID process,
and provide the necessary Federal funds.
Successful implementation of the Act with such a limited
time frame largely depends on the availability of certain
electronic systems to verify the validity of the identification
documents. It appears that a number of these systems are not
likely to be available on May 11, 2008, and given this fact, it
is critical that the May 11 deadline be moved to a future date
when the verification systems are available on a national
level. Without this change, the States will spend billions of
dollars to have a real pretty new card, but will have done
nothing to actually improve security.
States need to be able to adopt up to a 10-year progressive
re-enrollment process. This solution would provide States the
ability to manage enrollment over a greater length of time,
would meet the objectives of the Act, reduce the fiscal effect
on States and, on the Federal Government, and minimize service
disruptions for customers. Mr. Chairman, in my State alone,
without the 10-year progressive, reenrollment even hiring 900
new FTEs, which we would be required to do, and running our 27
new offices and our offices that are in effect right now 24
hours a day, we could not re-enroll 11.8 million drivers and ID
holders. It is impossible to do.
Certain populations should be exempt from the REAL ID
process. This exemption could be based on characteristics
related to applicable risk, such as the year of birth or
duration of the continuous relationship with the State. For
example, under our draft regulations, an 82-year-old person who
has lived in Texas his or her entire life would still have to
make a visit to his or her local DMV. Is this really necessary?
The verification requirements should be waived for applicants
who have completed an identity verification process conducted
by the Federal Government.
Finally, I would like to talk about funding. Whether one
uses the NCSL, NGA, and AAMVA estimate for State implementation
costs, of at least $11 billion over 5 years or the DHS figure
of $10 billion to $14 billion over 10 years, the REAL ID is an
enormous unfunded mandate. For Texas, our start-up costs will
be $142.6 million for the first year with an ongoing
operational expense of $67 million. It is critical that new
Federal funds, and I emphasize new, be provided for State
implementation of the REAL ID. States should not be required to
use their diminishing State Homeland Security grants and should
not be required to pay for access to the verification systems.
NCSL also recommends instituting a legislative trigger that
would automatically release States from complying in any fiscal
year that Congress fails to appropriate these funds.
Mr. Chairman, in closing, NCSL remains steadfast in its
resolve to work with Federal policy makers to fix, fund, and
implement the REAL ID Act before December 31, 2007, as stated
in our policy, and I encourage you to consider legislative
action to adopt the solutions I have proposed today. This will
provide the States with the necessary certainty to move
forward.
Thank you very much for this opportunity to testify.
Senator Akaka. Thank you for your testimony. Mayor
Hannemann.
TESTIMONY OF HON. MUFI HANNEMANN,\1\ MAYOR, CITY AND COUNTY OF
HONOLULU, HAWAII, ACCOMPANIED BY DENNIS KAMIMURA, LICENSING
ADMINISTRATOR, CITY AND COUNTY OF HONOLULU, HAWAII
Mr. Hannemann. Good afternoon, Chairman Akaka and Ranking
Member Senator Voinovich. Thank you very much for this
opportunity to testify on the impact of REAL ID on the City and
County of Honolulu, the capital city of the State of Hawaii,
where three-fourths of our population resides.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Hannemann appears in the Appendix
on page 65.
---------------------------------------------------------------------------
I am here, as you indicated earlier, with Dennis Kamimura,
who has over 30 years' experience of running our licensing
program, and the City and County of Honolulu licenses 70
percent of the 867,000 drivers in the State of Hawaii.
Moreover, all of the State's drivers' computer records are
stored in Honolulu's computer system.
We, wholeheartedly, agree that the tragic events of
September 11 require the strengthening of our security
standards, procedures, and requirements for the issuance of
drivers' licenses and identification cards, but we have several
major concerns with the implementation of this law and they
basically fall in four areas, Mr. Chairman, with respect to
funding, the verification process, re-enrollment, and waivers.
It will cost us $25.55 million over a 5-year period if this
law were implemented. About 90 percent of this $25.55 million
will be incurred by the City and County of Honolulu, and
although the Department of Homeland Security announced that 20
percent of the States' Homeland Security Grant Program funds
could be made available during the 2007 grant cycle, most of
these funds have already been dedicated.
I would also add that we have recently upgraded the status
of our Civil Defense Agency now to a full-fledged cabinet-level
department called the Department of Emergency Management. That
Department will be charged with securing other types of
Homeland Security grants into areas that Senator Voinovich had
already indicated, like interoperability, the pandemic flu, and
other areas there that we would like that department to focus
in. So therefore, we would be hard-pressed to tap into this 20
percent for this particular program.
With respect to the verification process, the Act requires
that we refuse to issue a driver's license or identification
card to a person holding a license or card issued by another
jurisdiction. This is similar to a provision of the Commercial
Motor Vehicle Safety Act, which requires commercial drivers to
have one and only one license at any given time. This
requirement is supported by CDLIS.
CDLIS consists of a central site and nodes in each
jurisdiction. Access to CDLIS is provided through a secure
private network operated by the American Association of Motor
Vehicle Administrators and cannot be accessed through the
public Internet. Each site connected to the private network has
its access controlled by several security mechanisms. Neither
the State of Hawaii or AAMVA is aware of any privacy breaches
of CDLIS since it went into development in 1989.
In 2005, Congress passed the transportation reauthorization
bill, SAFETEA-LU, which authorized $28 million to modernize
CDLIS. Our recommendation is that we leverage this project and
its Federal funding to expand the scope of the CDLIS
modernization effort to support an all-driver pointer system
for non-commercial drivers' licenses and identification cards,
inasmuch as all jurisdictions are familiar with the CDLIS
program, and the all-driver pointer system would use the same
principles as CDLIS. Use of this technology would be more
efficient than expending public money to create a new system.
The Act would also require us to have access to five
additional national databases, SSOLV for Social Security cards,
Department of State for passport and consular report of birth
abroads, EVVE for birth and marriage certificates, and SAVE for
permanent resident status, employment authorization, or U.S.
certificate of citizenship or naturalization, and SEVIS to
verify the duration of lawful status for student aliens.
Obviously, we have challenges with all the aforementioned.
At present, almost all jurisdictions are using the SSOLV,
which requires enhancements due to its unreliability. Several
States are also using SAVE, but that system requires major
improvements to ensure appropriate functionality to operate in
real time with accessibility and reliability. Several States
are testing EVVE. However, the system will not be fully
operational until December 2009. There is no electronic
accessibility to SEVIS and/or the Department of State database.
We should not be required to use systems that are
unreliable or under development. These systems should be
developed and tested before placing the burden on local
jurisdictions and the public that we serve. Additionally, we
believe that Federal agencies operating these systems should be
prohibited from charging jurisdictions transaction fees that
only increase our operating cost.
With respect to re-enrollment, the majority of our licensed
drivers in the State of Hawaii are issued State identification
cards over a 6-year expiration period, so therefore the 5-year
re-enrollment as called for in the REAL ID Act will present
some challenges there. We recommend that the period be at least
7 years.
Finally, with respect to the waivers, to facilitate the
processing of all applicants, we recommend that applicants who
are 72 years old or older be granted waivers from the
verification requirements of the Act. Similarly, individuals
who are required to undergo the same or more stringent
verification process for Federal identification be granted
waivers. Last, if an applicant has undergone the verification
process in one jurisdiction and has been issued a REAL ID-
compliant driver's license or identification card, the
verification process by the gaining jurisdiction should be
waived.
In conclusion, we support the intent of the REAL ID Act,
but practical considerations aside, Mr. Chairman, the City and
County of Honolulu cannot afford to implement the requirements
of the Act without initial and continuing Federal funding. If
funding is provided, the time limits for implementation of the
program without the required electronic verification systems
will place an enormous burden on the driver's licensing staff
and be a tremendous inconvenience to the public. To ensure
long-term success, a more realistic implementation plan should
be developed with input from the jurisdictions who bear the
burden of issuing drivers' licenses and identification cards.
Thank you for granting me the opportunity to provide our
perspective on this issue, Mr. Chairman.
Senator Akaka. Thank you very much, Mr. Mayor. Mr. Quam.
TESTIMONY OF DAVID QUAM,\1\ DIRECTOR, FEDERAL RELATIONS,
NATIONAL GOVERNORS ASSOCIATION
Mr. Quam. Chairman Akaka, Senator Voinovich, thank you very
much for holding this hearing. I note as you did in your
opening statement this is one of the first real hearings on
REAL ID and that may be the most important thing that is
happening today: Congress is taking an honest look at what this
law means both to the States and the Federal Government, and
probably more importantly, to our citizens.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Quam appears in the Appendix on
page 69.
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I do not know of a single governor who is not a homeland
security governor. Every one is very concerned about the
security and integrity of their driver's license systems. Most
States after 9/11 were already in the process of improving
their systems when REAL ID came about. NGA supported the
negotiated rulemaking process that was put together by this
Subcommittee in the Intelligence Reform Act. It is both
unfortunate and ironic to note that if that process had been
allowed to continue, we probably would be done today.
While several other folks here have noted some of the
problems with REAL ID, I am going to focus really on solutions.
I will note that NGA and governors have not called for the
repeal of REAL ID. What we have done is try to work--governors
have tried to work with their States, with motor vehicle
association administrators, and also with legislators to find a
fix, and that is going to require three things: More time, more
flexibility, and additional funds.
The most important message I can give to this Subcommittee
and to Congress today is that REAL ID cannot be fixed without
Congressional action. It cannot be fixed without legislative
action by Congress.
First and foremost, provide adequate time. Certainly,
everyone recognized, including DHS, that May of next year was
not enough time for States to prepare. NGA recommends that this
Subcommittee adopt specific statutory deadlines. Alter the
deadlines of REAL ID and set them to the later of December 31,
2009, which is the extension granted under the proposed
regulations, or a date that is 2 years after the publication of
final regulations, whichever is later. That deadline should be
set to when States actually know the rules.
Grant all States a 10-year window in which to re-enroll all
of their citizens. Moving the deadline on the front end but not
giving a corresponding extension on the back end only means
that States have to enroll more people in a shorter amount of
time. That maximizes cost, minimizes efficiencies, and hinders
States' ability to implement this Act.
And finally, what several other witnesses here have cited,
allow us to manage the line. Certain populations can be pushed
to the end of the line while we give REAL ID to other folks up
front. That allows States to keep some of the efficiencies that
are so important to customer service.
Second, the verification systems. I thought Secretary Barth
did an excellent job of stating how critical electronic
verification is. Without it, REAL ID doesn't work. Until it is
online, States should not have to comply. It is that simple.
Congress should amend REAL ID to specifically allow States to
use existing verification practices until all necessary Federal
and State systems are fully operational and deployed. The
States won't hesitate to put them in place, but they can't be
expected to use them until they are in place.
Next, encourage State innovation. I was happy to hear that
the Secretary may be willing to use his waiver authority and
extension authority if States are making progress towards
implementing REAL ID. These are extraordinarily complex
systems. It will take time to build these systems and to
prepare them and fund them, especially considering some State
legislatures are going out of session. Budgeting time and
planning time needs to accommodate State schedules.
I will note, however, that even with the extensions of
time, the proposed regulations are going to require all States
to submit a complete certification package by February 10,
2008. That is ahead of the original statutory deadline. That
plan must include milestones, schedules, and estimated
resources needed to meet all the requirements of the rule. If
we don't finish this rule until August, September, or October
of this year, that is a very short turnaround for States to do
complete planning and go to DHS and say, this is how we are
going to implement. That deadline should be pushed at least 1
year by statute past the time of Federal regulations. That is
adequate time for the States to plan. States aren't asking to
put it off indefinitely, just give them time to plan.
Finally, sufficient funding, which it has been discussed
here repeatedly. It cannot be underscored enough. Congress must
provide specific authorization of funds to cover the cost of
REAL ID over the next 10 years. Specifically, it should also
appropriate at least $1 billion in fiscal year 2008 to fund the
initial cost.
One thing I would like to point out, the cost estimates
that were done by States were very carefully done. Phone calls
were made to make sure that all States were comparing apples to
apples, oranges to oranges. Not to contradict the Secretary,
but I am going to contradict him. That was a very careful study
and the $11 billion that States came up with is a minimum and a
hard minimum that it is going to cost States to implement.
Governors are very concerned with REAL ID. Governors want
to make it work. If DHS wants to give States the flexibility to
run with it, then they should give it to us completely. States
can get the job done, but we are going to need time. Thank you.
Senator Akaka. Thank you very much.
I know Senator Voinovich, being a former governor and
mayor, is very anxious to ask some questions here, so I will
try to be brief.
My first question is for the entire panel. If the final
regulations for the REAL ID Act are issued this fall and remain
substantially similar to the proposed regulations, when would
your States or a majority of States and localities
realistically be able to comply with the Act?
Ms. Van de Putte. Thank you, Mr. Chairman. Our problem is
not the wanting to comply, it is that we are going to have
difficulty complying if the verification systems aren't ready.
We can't set a date on which we can comply until the Federal
Government itself has those verification systems operational.
What we will have is a pretty card with no way to verify a
person's identity. So I think that we really need to look at
the budget process and the Federal Government and how much it
is willing to put into the verification systems because we
can't comply unless those systems are in place.
Senator Akaka. Mayor Hannemann.
Mr. Hannemann. Mr. Chairman, as indicated earlier, counties
and cities are at the mercy of many of these mandates that come
from the Congress or the Federal Government or the State. Right
now, our legislative session is due to end in May. There is no
vehicle for any type of funding. They recently, as you pointed
out in your opening statement, issued a resolution basically
expressing their concerns. We will not be able to comply at all
for the following reasons that I indicated in my testimony. So
not only is the funding not there, but even if we had the
funding, there still are some concerns with respect to the
verification process, the re-enrollment, and obviously the
waivers. So it is very unrealistic for us to even figure out a
way in which to comply given the concerns we continue to have.
Senator Akaka. Mr. Quam.
Mr. Quam. Just to echo that, REAL ID cannot be solved by
any single issue. Money alone will not do it. An extension will
not do it. It has got to be a comprehensive solution using both
Congressional power and regulatory power at DHS to give States
what they need. Until we know that picture, we are basically
being handed a Monopoly board without instructions and saying,
go play. You have no idea what the objective of the game is or
how to play. We need the final rules and then we need the time
to implement them and understand them to move forward. So
unfortunately, at this time, it is one of the reasons we say
REAL ID is unrealistic as planned.
My other concern, Senator, is that the regulations may not
look as they currently do. I will give DHS its due. The first
time we really understood how much DHS had listened to States
was when the draft regulations came out. I was very pleased to
hear they had been talking to four States, but there are 50
States and five territories that are going to be involved in
this process and it is going to take time for us to move
forward and understand exactly what is going to be required of
States.
Senator Akaka. Thank you. As you know, the regulations do
not address what someone can do if another State loses or
mishandles their personal information. Could each of you
address how different States would handle this situation?
Mr. Hannemann. Let me defer to Dennis Kamimura, who, as I
said, he has 30 years of running this operation for our State.
He is also a very active member of AAMVA. And I just wanted to,
if I may before I turn it to him, Mr. Chairman, just echo what
was said earlier. We want to participate. We want to be able to
give our input, and so far, we have been doing it through
AAMVA, but we would like to see more of a reaching out process
on the part of the Department of Homeland Security as opposed
to cities or counties or States petitioning them for input and
the like. We think it should be a two-way street. As I said, we
have been able to do most of our input through AAMVA, but we
really believe that this is part of our petition here today, is
to get a little more of a reaching out process from them.
Senator Akaka. Mr. Kamimura.
Mr. Kamimura. Mr. Chairman, essentially, the REAL ID Act
does, in fact, provide for Federal penalties involved in
misinformation or handling of information or release of data,
personal data, that is not supposed to go out. Speaking for
Hawaii, Hawaii does have penalties involved with release of
personal information and I think what happens is that under the
REAL ID, we would have to comply with whatever the Federal
requirements are. But I don't believe that Hawaii would, in
fact, loosen its requirements on any penalties for stolen
identity, for example.
Senator Akaka. Mr. Quam.
Mr. Quam. What we have heard on the privacy front is a
great concern for how these databases will be managed, and now
that we have a better sense with regard to the regulations,
there is some additional comfort in the States. However, I
would note that there are several States who have privacy laws
that are probably stronger than anything that the Federal
Government would actually impose. One of my fears is that the
privacy regulations will come out and actually loosen State
standards with regard to privacy.
I think addressing privacy may be one of the real critical
missing links in moving forward. The negotiated rulemaking
would have addressed that. It would have brought a lot of
different players to the table. It is unfortunate that was not
allowed to finish, but I think addressing the different
standards States have and not lessening those standards will be
critical moving forward.
Senator Akaka. Senator Voinovich.
Senator Voinovich. Thank you, Mr. Chairman.
This is typical of the Federal Government, REAL ID was put
into the emergency supplemental bill in 2005, with no hearings
and no consideration about how it is to be implemented.
Senator, you are from Texas, as you know first hand, we have a
problem with the border, an immigration problem. If the
Congress had given money to Customs and Border Patrol to do the
job, we wouldn't have the problem today, but we didn't.
Finally, Congress has recognized the problem and is funding
CBP. This is typical of what we do here in the Congress.
I would like your respective organizations, the National
Council of State Legislatures, the NGA, to get back to this
Subcommittee on what you are being asked to do with the State
Homeland Security Grant Programs. I think it is ridiculous that
they are saying to you, take the money and use up to 20 percent
of it to offset the costs REAL ID. This money has already been
spent or allocated by the States to pay for other programs like
interoperability.
I would like to get into some specifics about timing. Now,
how much time after the final rule comes out, assuming that you
feel that they are decent and proper, would you need to
implement REAL ID?
How much time would you think would be reasonable to give
people in each State the ability to sign up? Much of the cost
is going to happen during the intial phases of REAL ID as
States bring people into the program. States are going to have
to hire many more people to handle the registration. Ms. Van de
Putte, how many new people did you say Texas would need to
hire.
Ms. Van de Putte. Minimally, our statistics say that we
have to hire 741 new FTEs, but we are reshifting close to 200
that are already in the department. So we have achieved some
cost savings in other areas, but new hires will be 741 FTES.
Senator, that was a very conservative estimate.
Senator Voinovich. So you are working harder and smarter
and you shifted 200 people over that were doing something else,
but you need 700 to get the job done?
Ms. Van de Putte. Yes, sir.
Senator Voinovich. Could I get your opinion on these
milestones and how you would set the deadlines?
Mr. Quam. Senator, I would be happy to, if I may, and
starting with final regulations as the key date, and why any of
the deadlines were not set from there, I am not sure because
that is the time when States know what is expected of them.
That is when final regulations actually come out. So let us say
that is August.
Senator Voinovich. Why don't we just say that it is
December 31.
Mr. Quam. December 31, excellent. DHS has said from a
regulatory standpoint that it wants--it is going to use a
certification process, which States are familiar with and
States actually recommend it. That certification is to present
the State plan. We would recommend that should be 1 year from
the date of final regulations, that the State submits a plan.
That will allow us time to start putting all the different
pieces in place.
Senator Voinovich. One year to submit a plan of how you are
going to comply?
Mr. Quam. To DHS, correct. We would recommend 2 years from
the date of final regulations before the first REAL ID has to
be issued, the shorter of that date or the extension that was
given under the regulations, which is to the end of 2009,
whichever is later, and part of that is to defend against this
regulation dragging on. I will note that we only got it this
year. We needed this regulation the day the law passed, not 2
weeks ago.
Senator Voinovich. So you are talking 3 years actually
from, say, December 31 of this year? That is 1 year to submit
it and then 2 years thereafter to----
Mr. Quam. I am actually talking 2 years from final
regulations to begin.
Senator Voinovich. OK.
Mr. Quam. I think the States could do that and should
recognize the flexibility DHS has given.
Senator Voinovich. What about if the verification isn't
there?
Mr. Quam. That goes to a different issue, which is what
does it mean to be compliant, and I think a core question is,
States can meet that in 2 years if they have the flexibility to
use whatever is at their means to verify identities. If the
systems are up, running, deployed, working, and populated--that
means they have the data in them--then States might be in a
position to use them. If they don't exist, States have been
verifying this information for several years using best
practices. They should be allowed to continue to do that and
use those verification processes as we transition. That way, 2
years from now, States could begin issuing REAL IDs. So you
have to change the definition of what it means to comply, and I
focus on the verification systems. If they are there, we will
use them. If they are not, best practices.
Finally, the end game. When will we finish this process? We
have called for a 10-year window from that date, from beginning
to end, to bring everybody in. Allowing the States to manage
the line so that people can come in, you can use certain
efficiencies--there are populations, say, born before 1935, or
folks who have been in the State for 20 years----
Senator Voinovich. In other words, what you would do as
part of your application is you would do some kind of a risk
assessment about how States are going to phase-in people based
on your experience, like I think you mentioned somebody who is
83 years old. Give me a break.
Ms. Van de Putte. If a resident had a driver's license for
more than 60 years, exempt some sort of population--sorry for
the interruption, Mr. Quam.
Mr. Quam. No, please.
Ms. Van de Putte. But those are the sort of things, Mr.
Chairman, that we are looking at. But the timing issue--this
couldn't happen at a worse time because most States will be out
of legislative session, and several States are biennial
legislatures, like Texas. And so we will hopefully have left to
go back to our home cities after Memorial Day, and so there is
this time lag. So the quicker that we can get these types of
rules and regulations, we want to do it, we want it done right,
but our fear is that we are going to have a really pretty card
that gives people a false sense of security, but if you don't
have the verification systems, if we are not able to have the
flexibility, then it is really meaningless.
And everyone wants to adhere to the goals. I think what you
have heard from us today is no one doubts the goals and we are
all in agreement with that. It is the ``how to,'' and we have
had real problems with the ``how to'' and it is ironic, in
fact, that had we continued with the negotiated rulemaking, we
would have probably had this solved by now.
Senator Voinovich. Thank you.
Mr. Hannemann. Mr. Chairman, if I just might, just to add a
few comments there. Normally, I would defer to our governor to
make a statement on behalf of our State, but in this particular
case there, as you know, Senator Akaka, in Hawaii, the counties
issue the State drivers' licenses, not only for the County of
Honolulu, but for Maui, Kawaii, and the big island. We would
like as much time as possible. I have heard what our
representative of NGA said, and even at that, we would really
be pushing it. So we need as much flexibility and time.
I heard Senator Voinovich speak about some of the unique
issues he faces with Canadian visitors that come to his State.
Well, we are also particularly concerned with many of the
foreign visitors. As you know, we are a State that is dominated
by tourism. We depend on foreign visitors. Many of them invest
in our economy. That would be another major concern, to get as
much information out that this is all part of national
security, but at the same time, we want to continue to maintain
good relations with our international visitors and the like.
Senator Akaka. Thank you. We will have a second round.
Senator Van de Putte and Mayor Hannemann, we have all heard
of the enormous unfunded mandate and the impact this will have
on the States. Could you both describe exactly how the costs
will break down in your States or counties to describe what the
average American will have to do to get a REAL ID driver's
license under the proposed regulations?
Ms. Van de Putte. Thank you, Mr. Chairman. Our cost
estimates were done very conservatively and we were using the
same methodologies as all the States and the counties in
Hawaii. Very conservatively, for my State, we have a population
of about 24 million, about 18.5 million drivers' and
identification card holders. We would have to, under the
timeline set by this guideline, fit about 13.8 million in that
shortened time frame. We just physically can't do it. Our
implementation total for first-year costs is $142.6 million and
an annual cost of $67 million.
But the real problem in our State, as in a lot of other
jurisdictions, is that we wanted to utilize technology and to
make it easier for our citizens, particularly those who have
had drivers' licenses and identification cards for a long time,
and so we allowed the mechanisms of the Internet for Internet
renewal and mail renewal, and so, in fact, for efficient
government, we closed down lots of offices. We utilize
technology. And we know now that because of these regulations,
we will have to have about 741 new FTEs, and then we have
shifted within the department some that would be able to do
this. But we are going to have to open up 18 new offices and
retrofit about 28 other new offices.
Part of our cost that we don't know will be what the
security requirements are going to be for the physical
locations. Under the draft rules and regulations, all of those
physical requirements of security are for States and
jurisdictions that issue over-the-counter. So, in other words,
the application is made, all the verification is made, and then
they receive the identification there. Some jurisdictions and
States have a central location where they disperse, but
Department of Homeland Security rules are going to require all
of us to have every single office, and even in our rural areas,
you might co-locate in a county clerk's office or in a rural
community in the township's city offices. And so we have a lot
of this sharing. We will not be able to service our rural
citizens because of the security costs that have been mandated
by the Department of Homeland Security for the integrity of the
building itself.
So our costs break out to the majority of FTE. The other
ones are the software and the verification. But many States
were going along that pathway anyway. We were putting in
millions of dollars for enhancing our security. But I think
that what we see is the cost, and with all due respect to our
folks at Homeland Security, when we know it is going to be $11
billion, to offer $40 million was almost an insult. And then
their action to us when we asked them about the funds is that,
oh, it is not our job. Our job is to put out the rules and
regulations and that is Congress's job. So in other words, what
they are telling you is that they are telling us to come talk
to you about the funds. It doesn't make sense that they are
asking us, the Department is asking States and jurisdictions to
try to put the heat on Congress to fund it. Their answer is, it
is not our job.
Senator Akaka. Thank you. Mayor Hannemann.
Mr. Hannemann. Yes. We give out about 867,000 drivers'
licenses, of which 70 percent of that is issued out of the City
and County of Honolulu. We estimated that of the $25.55
million, and once again, it is just a very rough estimate given
what we know at this time, to implement the program in the
first year will be $7.67 million. Over a 5-year period, it
would be $17.88 million.
Mr. Kamimura runs his department with about 85 employees
just to do drivers' licenses. Obviously, we are going to have
to ramp that up. Our satellite city halls and various
distribution points throughout the City and County of Honolulu
will be challenged enormously. I think we will be facing
everything from challenges to over-the-counter type of
application processes to the long lines that everyone will
experience. But I would expect that this number could increase
as we know more about the challenges that we face and the
opportunity that we have to leverage what the other programs
are.
In fact, I talked about some of the databases that we need
to access, the systems that need to be set up, and I know that
my Director of the Department of Information Technology, Gordon
Bruce, who works very closely with Mr. Kamimura's department on
this whole aspect of making sure that we are spending more time
online than waiting in line, he has expressed several major
concerns about the REAL ID.
So these are just initial costs. It is obviously going to
be very complicated, and therefore, if we are going to go
forward, again, I hate to sound like a Johnny one-note, but we
are going to need enormous Federal help, especially in the area
of funding, to be able to even get to first base on this issue.
Senator Akaka. Thank you very much. Senator Voinovich.
Senator Voinovich. Let us talk about Texas again so that
everyone understands how difficult this is and how expensive it
will be. First of all, you are going to have to get 700 more
FTEs.
Ms. Van de Putte. That is correct.
Senator Voinovich. Then you are going to have to open up 18
new offices. Finally you will have to comply with new databases
in order to verify the individuals.
So the real issue is how do we help you get the job done? I
would be interested in your response to some kind of
partnership. What if we paid for the initial, cost all of the
software and other things that you would need to do to
implement this?
Ms. Van de Putte. Yes, sir. The cost estimates that I have
are based on the verification of documents using those five
different systems that were talked about. It is an
implementation cost of $3.4 million and an annual cost of $1.5
million. And so I would imagine that is probably about $5
million when our overall costs to implement are $210 million.
So I guess if you take a percentage of that, that is just the
verification of documents.
I think that what is a bigger cost for us is the minimum
document requirements itself. The implementation cost of that,
again, $15 million for my State with an annual cost of almost
$17 million, and that is requirements for the document itself.
So those two put together might be something that would be
workable for us.
But I think that each State is going to be different. There
are some states that did not utilize technology in the 1990s,
and particularly the late 1990s, and so they may have lots of
physical spaces and offices out there and may not have done as
some of our states that tried to be more efficient.
Senator Voinovich. Could you do me a favor? I would like,
and Mr. Chairman, I think that the Subcommittee would agree, I
would like the NCSL and NGA to give me the details of the
costs. I can tell you that there is no way that the Federal
Government is going to pay for all of this. But I think if you
came back with a proposal with some kind of partnership it
would be easier for this Subcommittee to develop some kind of
funding program for REAL ID.
Senator Akaka. Mayor Hannemann.
Mr. Hannemann. Mr. Chairman and Senator Voinovich, I think
that is an excellent idea, this idea of a partnership that you
are talking about. We would wholeheartedly also recommend the
American Association of Motor Vehicles Association that we work
very closely with to tweak some of the numbers and so forth.
My concern is always not only the implementation, but the
ongoing maintenance costs, so we obviously would be very
willing to participate in that, so we could----
Senator Voinovich. Mr. Chairman, one other thing, and I am
sure this is how OMB works, they figure like even sewer and the
water and the rest of it. Let them raise their rates locally
and pay for it.
Mr. Hannemann. Absolutely. I have risen my sewer rates
twice. [Laughter.]
Senator Voinovich. You are talking about annual cost. How
much more will you have to charge for the new ID? I would like
to get some idea of what those annual costs would be.
Mr. Quam. Senator, if I may, a couple of things that are in
the cost impact study that was done by NGA, AAMVA, and NCSL. I
am very happy to report when the negotiated rulemaking ended,
the three groups came together as the key stakeholders and
basically said, we have to continue this good work. We have to
make sure that our voice is heard in this context. And so we
have worked very cooperatively together and it has been an
excellent partnership and we would love to extend it to the
Federal Government and Congress.
I will note in that report that $1 billion, the $1 billion
I mentioned for an appropriation up front, is one-time cost.
That was actually estimated by the States, one time, get the
systems, buy them, man them, get the software, get everything
up and running, one-time cost was $1 billion. The ongoing cost,
then, over 5 years, you get to $11 billion over five years.
You made a very excellent point and one that is often
missed. It is not stated in the regulations, but it should be
plain to everybody. The Department of Homeland Security sees
this as a fee-based system. In other words, we are going to
pass the cost along to folks getting a driver's license or
identification card.
Senator Voinovich. And by the way, they will raise thunder
with you----
Mr. Quam. Absolutely.
Senator Voinovich [continuing]. And the Members of Congress
will walk away and say, we didn't do it. [Laughter.]
Mr. Quam. That is exactly right. The number we use is the
$11 billion over 5 years divided by 245 million driver's
license holders, because we have to bring everybody back in in
5 years. That is pretty easy math. That is about $45 additional
per card.
Now, I am a Maryland resident. It costs me $30 to renew. An
additional $45 on top of that for my REAL ID. I need to get a
new certified copy of my birth certificate. I went online today
to see what that would cost me. That is another $43 that it is
going to cost me to get Colorado to send me a certified birth
certificate. And just to be safe, so I can get on the airplane
in the meantime, if I want a passport, well, the passport fee
is $96 and you have got to wait 10 weeks to get it. If you want
to expedite that, tack on another $60. You add that list up and
you are at $274.
Now, our citizens personally want to be secure and will
stand in long lines to be secure, but if we don't really add
value to this card as we move forward and do it in a
responsible way, their resolve is going to end at some point,
and you are absolutely right--their patience will run out and
it will run out with local officials first and then with
Congress.
Senator Voinovich. One last point and then I will finish
up. I get weekly reports from my constituency office. The
passport offices are being overwhelmed today because of WHTI.
It is unbelievable, the demand for passports. The passport
offices don't have the people to take care of their customers.
Senator Akaka. I want to thank this panel very much. You
have been very helpful and I want to thank you for being here
and for your responses. I also want to extend my appreciation
to those of you who traveled from out of town to be here today
and I hope you have a safe trip back home.
Ms. Van de Putte. Thank you, Mr. Chairman, and thank you
very much for having us here. I did want to note with Senator
Voinovich's comments that part of our cost estimate is for new
signage. In the Texas statute, we will have signage at each of
the new offices that say that this is a Federal law that the
State did not pass nor did the State fund and it will have the
addresses and phone numbers of our two Senators and the local
Member of Congress. [Laughter.]
Senator Akaka. Thank you very much.
Ms. Van de Putte. Thank you, Mr. Chairman.
Senator Akaka. I now call the third panel to come forward.
On our third panel we have Timothy Sparapani, Legislative
Counsel for Privacy Rights at the American Civil Liberties
Union, and Jim Harper, Director of Information Policy Studies
at the Cato Institute.
As you know, it is the custom of this Subcommittee to swear
in all witnesses. I would ask for you to stand and raise your
right hand.
Do you solemnly swear that the testimony you are about to
give this Subcommittee is the truth, the whole truth, and
nothing but the truth, so help you, God?
Mr. Sparapani. I do.
Mr. Harper. I do.
Senator Akaka. Thank you very much. Let the record note
that the witnesses answered in the affirmative.
Mr. Sparapani please proceed with your statement.
TESTIMONY OF TIMOTHY D. SPARAPANI,\1\ LEGISLATIVE COUNSEL,
AMERICAN CIVIL LIBERTIES UNION
Mr. Sparapani. Thank you, Mr. Chairman. On behalf of the
ACLU and its half-million members, we recommend that this
Subcommittee mark up your legislation, S. 717, the
Identification Security Enhancement Act, to replace Title II of
the unworkable REAL ID Act. Because Senators never considered
REAL ID on its merits, they should be free to vote to replace
it with a licensing scheme that is both achievable and free of
privacy and civil liberties concerns.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Sparapani appears in the Appendix
on page 74.
---------------------------------------------------------------------------
As you can see from the map, the REAL ID rebellion is
sweeping the country. As of today, 30 States are moving to
reject REAL ID and calling for Congress to replace it. Maine
and Idaho have enacted legislation to completely opt out.
Driven equally by the extraordinary threat the Act poses to
privacy and civil liberties and its prohibitively expensive
cost, States are telling Congress that no matter the
consequences, they will not participate. Drivers and DMV
officials are telling Senators to expect lines at every DMV,
not just out the door, but around the block, every day.
Congress must respond to this outcry, and I believe your
legislation does that.
Therefore, the ACLU recommends three things. One, Congress
should replace Title II of the REAL ID Act by enacting S. 717,
which reestablishes a more workable process for improving
drivers' licenses.
Two, members should submit comments calling on DHS to
withdraw its Notice of Proposed Rulemaking.
Three, Congress should refrain from appropriating any funds
to implement the REAL ID Act. Quite simply, there is no point
in throwing good money after bad.
Because time is short, I will just mention that REAL ID
raises intractable constitutional problems. It threatens First
Amendment rights and arguably violates the constitutional
principles of federalism by usurping State authority.
Make no mistake, REAL ID will be the national ID card.
Since the Act's passage, legislators have proposed requiring
everyone present a REAL ID to vote, get a job, obtain Medicaid,
open a bank account, and travel on interstate busses, trains,
and planes. In short, no person would be able to function in
our society without providing a REAL ID.
Additionally, REAL ID and DHS regulations pose
unprecedented threats to privacy in four areas. Those four are
data on the face of the ID card, data in the machine-readable
zone on the card's back, data in the interlinked national ID
database supporting the cards.
And four, regarding transmissions of data between users. I
will just mention a few of these privacy problems.
First, data on the face of the ID card. REAL ID wipes out
in States what are called address confidentiality laws by
requiring that an individual's principal address be stated on
the face of the license versus having a post office box.
Consequently, police officers, elected officials, judges, and
others will have their home address readily available to anyone
who would want to see it. More importantly, an actual address
endangers people like victims of domestic violence and sexual
assault who are trying to flee their abusers.
Unencrypted data in the machine-readable zone creates an
enormous threat, a new threat, Senator, of private sector
third-party skimming of data and resale of data contained in
that machine-readable zone. DHS's proposed regulations failed
to close the loophole because they do not require encryption.
Contrary to DHS's assertions, it will become increasingly
profitable for private sector retailers to skim each customer's
data because the format of data collected will be standardized
nationwide. This creates a huge new threat. Retailers will
demand that customers provide these licenses for anti-fraud or
customer loyalty purposes and then they are going to retain all
the data. And then, of course, these companies can then resell
it in two different ways. One, they can sell it for highly
targeted and highly invasive direct marketing back to the
people, or two, they can sell it to what we call data brokers,
companies like ChoicePoint or Axciom or Lexis-Nexis, who in
turn can sell it to other companies and to the Federal, State,
and local governments. In short, Senator, everyone is going to
know in the future what we bought and when we bought it,
including books, magazines, medications, contraception,
anything you can imagine. So, essentially, we have got some
significant problems there.
There are also problems with data in the National ID
Database. And again, contrary to DHS's assertions, this
unprecedented data aggregation imposed by REAL ID will actually
make America, I believe, more vulnerable to terrorism and
crime, not less vulnerable, and that is because we are going to
have, I think, massive identity theft and fraud. That is
because the Act is going to require that, at a minimum, a huge
new set of data along with biometric information and these
documents, the source documents you have heard about, be
aggregated in one place. And then, of course, we are going to
make this data set available to hundreds of thousands if not
millions of Federal, State, and local employees.
In addition, the identity theft and document fraud are
going to be far more serious. Instead of obtaining just one
password, an ID thief is going to have a treasure trove of
data, and that is because DHS failed to build in basic computer
security and safeguards.
I will mention one final data privacy problem, and that is
that the REAL ID database, I believe, is going to lead to
significant new data mining, and that is because, again, DHS
refuses to prohibit data mining of this data set, not only by
itself, but by any other Federal, State, or local agency. And
prior to REAL ID, it was impractical to do this data mining.
But when you aggregate and link the data sets, sir, you are
going to end up with the easy kind of data mining that I think
many of us would want to avoid.
So in closing, I just want to say, Senator, for this
Subcommittee, it is your first opportunity to stop these
abusive intrusions into America's privacy by DHS, and again, we
would like to call on Congress to replace Title II of the REAL
ID Act with an achievable licensing plan that does not threaten
personal privacy or civil liberties.
Thank you, Senator.
Senator Akaka. Thank you very much. Mr. Harper.
TESTIMONY OF JIM HARPER,\1\ DIRECTOR, INFORMATION POLICY
STUDIES, THE CATO INSTITUTE
Mr. Harper. Thank you, Chairman Akaka. Thank you for
inviting me to be here today, and congratulations to you on
your leadership on this issue, along with Senator Sununu,
introducing legislation to repeal REAL ID and restore the
identity provisions in the Intelligence Reform Act that
preceded it.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Harper with attachments appears
in the Appendix on page 89.
---------------------------------------------------------------------------
I am Director of Information Policy Studies at the Cato
Institute, which is a research foundation dedicated to
preserving limited government, individual liberty, free
markets, and peace. I also serve as an advisor to the
Department of Homeland Security through the Data Privacy and
Integrity Advisory Committee, which advises the Privacy Office
and the Secretary of Homeland Security on privacy issues.
Today, I speak only for myself, not for the committee or for my
Institute.
I have written a book on identification and identity issues
that includes REAL ID. It is called, ``Identity Crisis: How
Identification is Overused and Misunderstood,'' so I think I am
well-studied on this issue and hope to share some of my
knowledge with you today.
I am going to be a little bit plainspoken at the outset
here. We have done a lot of green-eyeshade stuff on previous
panels about where the dollars come from and where they go. But
I think the best conclusion is that the REAL ID Act is a dead
letter and all that remains is for Congress to declare it so.
Let me make three points and then offer one recommendation,
if I can, regarding your legislation.
First, on privacy, I think Tim Sparapani and the ACLU have
done a great job of articulating the privacy concerns and I
join them in their concerns. The Department of Homeland
Security's regulation punted on some of REAL ID's most
important technology, security, and privacy problems.
I want to emphasize briefly why concerns with the card are
so substantial. Economists know that standards create
efficiencies and economies of scale. When railroads in the
United States moved to a single track width, much more
transportation occurred on the railroads because there was a
single standard.
I realize that is not a good example to use with a Senator
from Hawaii, but understand that standards, a national standard
in an ID card, means that ID cards will be used a lot more. You
will have economies of scale in building the card readers, in
the software and the databases to capture and use the
information from the cards. Americans will inevitably be asked
more and more often to produce their REAL ID and share the data
from it when they engage in every kind of governmental and
business transaction.
Others will use the information collected in State
databases and harvested from REAL ID cards. Ann Collins, who is
the Registrar of Motor Vehicles in the State of Massachusetts,
spoke to the DHS Privacy Committee last week and she said, ``if
you build it, they will come.'' What she meant is that masses
of personal information will be an irresistible attraction to
the Department of Homeland Security and to others to dip into
for an endless array of different purposes.
For good or bad, an ID card system is a sort of
surveillance system and it is becoming increasingly clear that
REAL ID is a surveillance system focused on the law-abiding as
much as the wrong-doer.
I want to briefly talk about national security issues,
because the privacy and dollar costs of REAL ID would be worth
it if REAL ID got us any measure of security. If it improved
the protections we have now, I think we would all be in favor
of REAL ID, but it doesn't. You have heard the cost figures, so
I won't belabor them.
I was very concerned about the lack of risk management-
oriented discussion I heard even today from Assistant Secretary
Barth. Creating a national identification scheme does not just
attach a known accurate identity to everyone in the country. It
causes the wrongdoers to change their behavior. Sometimes this
will control risk. Sometimes this shifts the risk from one
place to another. And other times it can create even greater
risks.
I want to give you an illustration about how a system like
this works from a report that was released just last week in
the United Kingdom. The U.K. home secretary's office released a
report saying that about .5 percent of all U.K. passports are
based on fraud. That means about 10,000 per year are issued
based on fraud. Now, what kind of security do you get from that
system, if you have a .5 percent fraudulent error rate? That is
not a security system for purposes of national security. That
is not a security system against committed terrorists. Perhaps
the U.K. should have a national ID so we in America don't have
to.
In my written testimony, I have submitted a better cost-
benefit estimate than DHS did, and I am disappointed that they
did not--they have not done better risk analysis up to this
point. But all the money that goes into REAL ID is, as Senator
Voinovich emphasized, coming away from other programs that are
just as important.
Finally and briefly, I want to emphasize an issue that I
think is very important that has not been considered yet, one
that I realized was quite prominent when I went through the
regulations and the specifications in the regulations. The
specifications called for by DHS to go on REAL ID-compliant
cards has race and ethnicity as one of its key data elements.
DHS does not specifically require inclusion of this
information, but States are likely to adopt the entire standard
when they do get in compliance. Thus, in May 2008, many
Americans may start carrying nationally uniform cards that
include race or ethnicity in machine-readable formats. This
will be available for scanning and collection by anyone with a
bar code reader. Government agencies and corporations alike may
affiliate racial and ethnic data more closely than ever before
with information about our travels through the economy and
society.
On this poster, I have reproduced the design
specifications, which indicate race and ethnicity, and here is
how they would be indicated on a card. This is an example of
what a card may look like, the two-D bar code. And I have
included here, because this is such an important issue, an ID
card from Rwanda.\1\ In Rwanda, a national identification
system that included ethnicity was very useful in the
unfortunate, horrible genocide that occurred there. I do not
believe that this was intentional on the part of DHS or anyone
in Congress to have this kind of system. It is a product of
error and it is a product of this system and REAL ID not being
carefully considered in Congress before the law was passed.
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\1\ The ID card from Rwanda appears in the Appendix on page 107.
---------------------------------------------------------------------------
With that, I have taken up quite a bit of your time. I have
recommendations in my written testimony that I would refer you
to. Thank you very much for hearing me out and taking my
testimony.
Senator Akaka. Thank you very much for your testimony.
Both of you have discussed how the REAL ID Act infringes on
Americans' privacy rights and civil liberties and have spoken
in support of my legislation which would repeal REAL ID and
replace it with the negotiated rulemaking process in the
Intelligence Reform Act. Other than a straight repeal and
replace, are there any changes that can be made to the REAL ID
Act that would specifically address the concerns you both
raised today? Mr. Sparapani.
Mr. Sparapani. Yes, Senator, I think there are a couple
that could be made. I mentioned one, or at least alluded to it
in my testimony. I am really quite concerned, and the whole
privacy world is concerned about this new threat about third-
party skimming of data off the back of the card. Congress
really needs to do what it did in part back in 1994 when it
passed the Drivers' Privacy Protection Act in closing down
privacy loopholes involving this important data. Congress
should specifically prohibit the resale of that data, or the
sharing of data with an additional third party beyond the party
that is collecting it.
Additionally, I would just like to say on the
constitutional standpoint, there are some intractable
constitutional problems and I think you would have to rewrite
large portions of the Act to get to that point and I think your
legislation understands that. But clearly, we have got some
First Amendment concerns here that won't be addressed unless
there is a specific statutory exception created for some of
those well-respected Supreme Court-protected rights.
Senator Akaka. Mr. Harper.
Mr. Harper. I don't believe that REAL ID can be fixed. I
don't believe it can be improved and made to work. The Chairman
of the full Committee, Senator Lieberman, said when REAL ID
passed that the law was unworkable. It remains unworkable today
and the proof of it is borne out on the earlier panels.
I don't think that a national ID system of any stripe or
character can provide the security that a lot of people assume
it does. So it is important to have a conversation about this,
to learn how ID actually works, how it breaks, what it is
useful for, and what it is not useful for.
In my written testimony, I have suggested considering some
of the emerging digital identity management systems that are
coming online. There are systems that exist today that can
prove, for example, to the TSA that you are a member of the
Registered Traveler Program but that don't tell the TSA who you
are, and that is an important, narrow anti-surveillance
feature. Prove to the TSA that you have been secured by their
processes, but don't give them the opportunity to record where
you have been and where you have gone and that kind of thing.
These systems are coming online now. They are a little bit
future-oriented. We should look down the horizon to these
systems. But the last thing we want to do is build a government
system, spend these millions and even maybe billions of dollars
to build these government systems that ultimately are dead
ends, very expensive dead ends. We need to integrate with the
systems of the future, and so I think the whole thing needs to
be reconsidered and this hearing is a good start.
Senator Akaka. Mr. Harper, in your testimony, you mentioned
how by creating REAL ID the Federal Government and the private
sector will find creative uses for the data outside of the
reason for which REAL ID was intended. Can you discuss some of
these other ways the information on a REAL ID card or in a REAL
ID database can be used?
Mr. Harper. Well, it is interesting to travel in homeland
security circles sometimes because you hear lots of talk about
different plans that people have for REAL ID once it is in
place. Let us do this with it. Let us do that with it. Frankly,
the Department of Homeland Security itself has retreated
somewhat from the idea that this provides security benefits.
Secretary Stuart Baker came and spoke to the DHS Privacy
Committee and suggested how strongly it would prevent against
identity fraud. I proceeded to go to the regulatory docket and
found that the estimate there is that it would prevent $1.6
billion worth of fraud. That is a $17 billion cost to save $1.6
billion. It doesn't quite balance out.
But other proposals, we would use this to prevent underage
drinking. We would use it to prevent underage smoking and that
kind of thing. A terrific regulatory system, a terrific police
state system for controlling all of our personal behavior. But
that is inconsistent with the way we are supposed to live in
the United States. It is inconsistent with having a free
country. We do indulge a little unlawfulness along the margins,
and many people who went to college understand that in terms of
ID. When you are 20 years old, you really want to hang around
with your 21-year-old friends. Do we want to make a $50,000 or
$100,000 penalty come down on that kind of person? I think that
is going the wrong direction.
So there are lots of different ways to regulate and control
the generally law-abiding populace and REAL ID would help with
that, but I don't think that is what we want to do.
Senator Akaka. Mr. Sparapani and Mr. Harper, as you know,
the proposed regulations leave open the question of how States
are to share drivers' information with each other. However, DHS
repeatedly claims that the system will resemble the Commercial
Drivers' License Information System. What is your opinion of
CDLIS and the privacy protection that is in place? Mr.
Sparapani.
Mr. Sparapani. It is a good question, Senator. If you
listen to Mr. Barth's statement earlier today, and in your
question and answer period with him afterwards, I think he went
at great length to talk to you about interconnectivity between
systems of systems and networks. I think we are talking about a
maximal sharing of data, not a minimal sharing of data. And so,
in fact, I am really quite concerned about the volume. I mean,
he showed the chart with all of the systems that would come
online and that they would all need to talk to each other.
This isn't going to look like CDLIS. This is going to look
like CDLIS on steroids, if you will. So we are really talking
about a plussed-up maximum sharing of all of our most sensitive
personally identifiable information, and that is exactly the
information that we don't want to have get in the hands of
terrorists, immigrant smugglers, sophisticated criminals, and
it will be easy and ripe for the taking and we will put it all
in one place and then we will transmit it widely for anyone to
intercept. I think it is the worst choice we could have made.
Mr. Harper. Allow me to speak about CDLIS in terms of data
security. Security turns out to be not a function of what you
do to protect a thing, it turns out to be a function of how
motivated your attacker is. I have got a shoebox at home that
has never been breached. It has never been the subject of a
breach. If I put information in there, a business card, no one
would ever look at it. If I started to store bars of gold in
that shoebox, it would be much more likely that that system
would be breached.
So if you take the CDLIS model and expand it out to records
about politicians, law enforcement officials, Paris Hilton, if
you make that system the security that terrorists want to
break, well, that is a much more attractive system and it is
much more likely to fail than the CDLIS of the past, which has
information about 13 million truck drivers.
Senator Akaka. I have another question for both of you.
Although the REAL ID Act replaced the negotiated rulemaking
under the Intelligence Reform and Terrorism Prevention Act of
2004, I understand that DHS has been working with the privacy
community to protect personal information. Can you tell me how
you have been working with DHS and what recommendations you
made to the Department that you see reflected in the proposed
regulations?
Mr. Harper. Well, Tim Sparapani was good enough to convene
a couple of meetings with the regulators, and they were good to
hear from us. It was welcome to have that input. So there is no
fault in terms of the process or the people at DHS.
I recommended that these databases, which are created
subject to Federal law for Federal purposes, basically using a
Federal mandate, should also be subjected to Federal laws like
the Privacy Act. Condition compliance with REAL ID for States.
Condition their certification of compliance on the fact that
they have met Privacy Act standards. Condition that compliance
on the fact that they have met FISMA, the information security
law.
DHS chose not to do that, citing federalism concerns that I
think are a little stretched. Given the fact that the REAL ID
Act was designed to eviscerate the distinction between the
State and Federal Governments, and I think that is
inappropriate, being especially carefully and following
Marquise of Queensbury Rules when it comes to privacy and data
security is a little bit off.
Senator Akaka. Thank you.
Mr. Sparapani. Senator, if I could respond very briefly,
indeed, we were invited in to come and meet with DHS, but what
I have heard over and over again over the last 2 years, and it
is a remarkably long period of time, is something that is
baffling to me. Here is the justification DHS is using for
having a minimal approach to privacy in these regulations. They
say that because the word ``privacy'' does not appear in the
statute, they don't feel that they have sufficient authority to
grant maximal protection to this information that we know,
frankly, is more valuable than the gold in your bank account
because it can be used for all sorts of other purposes besides
just financial fraud.
So with respect to the DHS Office, they have been good
about meeting with us, but they have turned a deaf ear to the
fact that in the information age, personal information is more
valuable than gold and has to be protected at a much higher
standard. We have to treat this like a bank vault.
Senator Akaka. Thank you for that. Mr. Sparapani, you
mentioned several constitutional concerns with the REAL ID Act
in your testimony. Would you please elaborate on those issues?
Mr. Sparapani. Senator, they are really unprecedented, as I
said, and as my written statement elaborates on. I see at least
four different First Amendment concerns, a Second Amendment
concern, a derivative Sixth Amendment concern, and probably a
Tenth Amendment concern, as well as significant due process
concerns. Let me just touch on one of the due process concerns
very briefly.
If the government begins to demand that people produce a
REAL ID-compliant driver's license to get all sorts of
benefits, to enter a Social Security office, etc., many people
in our society, lawful, law-abiding Americans, won't be able to
produce the documents they need to get a REAL ID. And then when
they need to get certain benefits, whether they be Medicaid or
Social Security disability, etc., they won't even be able to
get into the room to meet with the government officials to
obtain those benefits.
Similarly, if we begin to say that people who don't have a
REAL ID license can't enter certain Federal buildings, they
will not be able to exercise, I think, their First Amendment-
protected right to petition their government for redress. Now,
in Washington, everybody knows nothing is more important than
having a face-to-face meeting with your elected official so you
can actually ask to have your concerns addressed. Again, when
ID becomes a barrier to people exercising their
constitutionally-protected rights, we have extraordinary
problems.
I think it is these kind of constitutional weaknesses in
the law which are going to require a complete rewriting of
certain sections of the Act. I think that is why S. 717, the
bill that you have introduced, is really the appropriate
direction to head.
Senator Akaka. I want to thank you both so much for your
responses. This has been a very interesting hearing and your
testimony will help the Subcommittee with our work.
Several of the problems with the regulations that have been
identified are the direct result of the strict statutory
language of the REAL ID Act. Based on our discussion today, it
is evident that, at a minimum, Federal funding is needed to
help State Governments enhance the security of drivers'
licenses and legislative action is required to ensure that
Americans' privacy and civil liberties are protected. I look
forward to working with my colleagues and stakeholders to
address these vital issues and look forward to working with
you, also.
The hearing record will be open for 1 week for additional
statements or questions from other Members.
Again, this has been an excellent hearing. This hearing is
adjourned.
[Whereupon, at 5:05 p.m., the Subcommittee was adjourned.]
A P P E N D I X
----------
PREPARED STATEMENT OF SENATOR LIEBERMAN
I want to thank Chairman Akaka for convening this hearing today
which will provide the Committee an opportunity to finally shine much
needed light on the REAL ID Act of 2005 by reviewing the rules that
have been proposed for this program in an open forum.
Earlier this month, the Department of Homeland Security (DHS)
issued a Notice of Proposed Rulemaking (NPRM) implementing the REAL ID
Act. The NPRM, which took the Department almost 2 years to issue, does
little to alleviate the concerns that I, and many of my colleagues,
expressed 2 years ago when the REAL ID Act was attached to an emergency
spending bill and forced through Congress without debate or substantive
consideration.
The proposed regulations will cost approximately $23 billion
according to the Office of Management and Budget, will bring Department
of Motor Vehicle offices across the United States to a stand still, and
may actually jeopardize security. We should not cause undue burden to
the American public if security can be achieved in a more sensible way.
I remain fully committed to increasing the security of drivers'
licenses and identification cards, which should be a top priority for
this country. However, I am concerned, as I was 2 years ago, that the
REAL ID Act impedes rather than facilitates the achievement of that
goal.
In 2004, Congress passed the Intelligence Reform and Terrorism
Prevention Act to implement the recommendations of the 9/11 Commission.
Senators McCain, Collins and I worked together closely to produce
reasonable, bi-partisan solutions based on the Commissioners'
recommendations. One recommendation required the Federal Government to
set national standards for the issuance of drivers' licenses and
identification cards. This was based on the Commission's finding that
many of the 9/11 hijackers obtained U.S. identification documents, some
by fraud. We took this recommendation seriously and carefully crafted
provisions--with input from both sides of the aisle and all interested
constituencies--to increase the security and reliability of drivers'
licenses and identification cards. Our provisions were endorsed by
state and local governments, the Administration, and a range of
immigration, privacy, and civil liberties advocacy groups.
Regrettably, the REAL ID Act repealed those balanced provisions and
replaced them with an unworkable, burdensome mandate. I opposed the
REAL ID Act because I believed it imposed such unrealistic requirements
that without substantial time and resources, it would not be
implemented, making the Nation less safe as a result. If the original
Intelligence Reform Act provisions had not been repealed, States would
be well on their way to securing drivers' licenses today. Instead, DHS
was saddled with implementing such a controversial and complex law that
the Department took 2 years to issue regulations.
After reviewing the NPRM, I remain concerned about REAL ID
implementation because it does not appear that DHS has addressed many
of the problems and concerns identified 2 years ago.
First, the REAL ID Act requires States to verify all documents used
to obtain a REAL ID, such as a birth certificate. To do so, States must
rely on a series of electronic systems and federal databases. Yet some
of these databases don't exist or are incomplete. Others are known to
contain inaccurate data. One of the most egregious examples is the
Electronic Verification of Vital Events (EVVE) system, which was
developed by the National Association for Public Health Statistics and
Information Systems (NAPHSIS) to provide a single interface for
verification of birth and death records. EVVE is currently in pilot
form, and only seven States have access. Even if all fifty States had
access to the EVVE system, it would not allow for credible electronic
verification of birth and death records because the database will not
contain records from all the States. NAPHSIS issued a report in January
2006 stating that the EVVE system could take as long as 7 years to be
fully operational. The report specifically noted that the system must
be implemented nationwide before it will be beneficial for REAL ID. A
valid, verified birth certificate is at the heart of REAL ID, yet the
timelines for these two programs are completely incompatible.
In addition to the EVVE system, REAL ID relies upon a non-existent
State Department system to verify U.S. passports and the DHS Systemic
Alienation Verification for Entitlements (SAVE) system, which is
notorious for containing erroneous, incomplete, or outdated
information. Moreover, even though the success of REAL ID depends on
these systems, there is no requirement in the REAL ID Act or in the
NPRM that the federal agencies provide these systems in a timely or
accurate manner. The States will be left holding the bag if the Federal
Government fails to deliver.
I am also troubled by the incomplete nature of the proposed
regulations. There is virtually no guidance in the NPRM regarding what
type of electronic system will be used to share information between
States. This detail is critical to understanding the security and
privacy vulnerabilities that may be created by REAL ID. Assistant
Secretary Barth has said that the Department of Transportation's
Commercial Driver's License Information System (CDLIS) will likely be
the model used for REAL ID. CDLIS allows information on licensed
commercial drivers to be shared between States on a limited basis--
commonly referred to as a ``pointer system.'' However, the NPRM does
not specify a pointer system will be used for REAL ID, leaving the
realization of a de facto national database as a distinct possibility
under the regulations.
Given the inevitable incompleteness and inaccuracies of the REAL ID
databases, it is shocking to me that the NPRM does not call for a
redress system. This is not a function that can be left to the States
because REAL ID and the information it relies upon are bigger than the
individual States. What happens if one state passes erroneous
information about an individual to another state? Chances are there
will be cases where both States claim it's the responsibility of the
other state to adjudicate the complaint. Where does an individual turn
if a state DMV and a federal agency cannot agree on who should correct
an incomplete record? DHS needs to mandate a redress process and make
it clear where that responsibility lies to ensure errors and oversights
are resolved promptly.
Also notably absent from the NPRM is a requirement to encrypt the
data held electronically on the actual ID card. Without encryption it
will be substantially easier to steal critical personal information,
making all Americans more vulnerable to identity theft. Equipment
capable of reading the Machine Readable Zone on the back of most
drivers' licenses is readily available. If we're going to spend
billions of dollars enhancing the security of the rest of the
identification system, why leave this gaping hole?
DHS has chosen to pass the responsibility for privacy protection to
the States. This is inherently problematic because REAL ID requires
States, and more importantly the individual citizen, to provide and
share additional personal information in the name of security. Because
REAL ID is a federal mandate, the Federal Government has an obligation
to ensure the law is implemented appropriately and that information
shared under REAL ID is secure. States deserve some flexibility in
implementing REAL ID as they are the ones who understand the drivers'
licensing process. However, given the security implications of
widespread identity theft, the Federal Government cannot remain silent
on this issue.
Most troubling is that DHS has elected to hide behind what is not
said in the REAL ID Act as a means to avoid addressing privacy. The
NPRM States, ``DHS has sought to address these privacy concerns within
the limits of its authority under the Act. The Act does not include
language authorizing DHS to prescribe privacy requirements for state-
controlled databases or data exchange necessary to implement the Act.''
The concept that federal agencies need explicit Congressional
authorization to protect Americans' privacy is just plain wrong. In
fact, our government is obligated to ensure that programs and
regulations do not unduly jeopardize an individual's right to privacy.
Privacy is inherently tied to security. Secretary Chertoff made
this argument earlier this month when he told the Northern Virginia
Technology Council that ``Security and privacy are very much the same
type of value. I don't think they're mutually exclusive, they're
mutually reinforced.'' As Secretary Chertoff argued, executed
correctly, better standards for drivers' license issuance will
strengthen privacy safeguards and help prevent identity theft. However,
we must remember that if this process is executed poorly, it will have
the opposite effect.
Finally, it should be noted that States across the country are
moving to opt out of REAL ID. Because of the program's structure, it is
only as strong as its weakest member. If we create a system so onerous
that it precludes full participation, any security benefit is lost.
While I regret the repeal of the common sense provisions in the
Intelligence Reform Act, which I believe has made identification
security much more difficult, I am committed to ensuring this job is
done right. We must find a way to make the driver's license a trusted
document, and the road the Department is now on is not the way. Secure
identification is at the very heart of our homeland security. I
strongly encourage the Department to consider the concerns expressed by
Congress and others in formulation of the regulations. And I look
forward to working with Chairman Akaka, Senator Collins, the Department
of Homeland Security, and others to solve this critical and complex
problem.
__________
PREPARED STATEMENT OF SENATOR SUNUNU
Nearly 2 years ago, the REAL ID Act was inserted into an emergency
spending bill without holding a single hearing or a substantive debate
on the Senate floor. At that time, a number of my Senate colleagues and
I sent a letter to then Senate Majority Leader Bill Frist voicing
strong opposition to its inclusion. It was and still is my position
this legislation was too significant to be included as an extraneous
``rider'' on a spending bill and it needed to be debated before the
Senate over a period of several weeks. For that reason, I commend
Senator Akaka for convening this Subcommittee hearing--albeit 2 years
too late--to review the REAL ID Act and to carefully consider ways to
improve the security and eligibility standards for drivers' licenses in
a manner that does not require a National ID or federal data base to
track all drivers.
This Committee appropriately and completely addressed the concerns
first outlined by the 9/11 Commission's report to Congress regarding
terrorists use of falsely obtained forms of identification to access
sensitive security areas. The Commission recommended, ``The Federal
Government should set standards for the issuance of sources of
identification, such as drivers' licenses.'' (pg. 390) During the
summer and fall of 2004, I worked with many of the current members of
this committee to craft and pass legislation that included a
collaborative process for developing minimum standards for drivers'
licenses, such as name, address, phone and signature. This bipartisan
legislation--The Intelligence Reform and Terrorist Prevention Act of
2004 (IRTPA)--subsequently passed both Houses of Congress and was
signed into law by President Bush in December of 2004.
The IRTPA was mindful of States' rights through the inclusion of
governors, State legislators and motor vehicle administrators in the
negotiated rulemaking process. Equally important, it avoided the
creation of a national ID, massive databases and billions of dollars in
unfunded mandates. As we all know, this common-sense solution to a
legitimate problem was eliminated and replaced by an unnecessary,
unfunded, and unlikely to make you safer federal mandate: REAL ID.
States understand this and have started to take action. Across the
country, State Legislatures are introducing, debating and, in some
cases, passing legislation outlawing the Federal Government
implementing REAL ID. In this instance, the Senate needs to follow the
example being set by the States.
Most recently, the Department of Homeland Security (DHS) released a
notice of proposed rulemaking. Included in these regulations is an
agreement to give States a 2 year extension to implement new standards,
as well as, the understanding that DHS will bring States, technology
experts, and privacy advocates back to the table to ensure these
standards are crafted in a way that respects States' rights and
minimizes costs. It is important to note this would not have been
possible without the efforts of Senator Collins and others who
recognize the unreasonable burden REAL ID places on the States.
Although this agreement is far superior to immediate implementation of
REAL ID, more must be done to protect taxpayers, States' rights, and
the privacy of all Americans.
That is why Senator Akaka and I have reintroduced the
``Identification Security Enhancement Act.'' Our legislation would
repeal Title II of the REAL ID Act and replace it with the negotiated
rulemaking process originally passed as part of the Intelligence Reform
and Terrorist Prevention Act of 2004. These provisions would enhance
privacy protections by ensuring procedures and requirements are in
place to protect civil liberties, as well as, privacy and
constitutional rights. I look forward to continuing my efforts to
combat this unnecessary, unfunded mandate with Senator Akaka and my
fellow colleagues on the Homeland Security and Government Affairs
Committee.
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