The act specifies that the Department of Revenue shall establish by rule a process for the voluntary suspension of motor vehicle registration for vehicles which are inoperable or being stored and not in operation. The owner or nonresident shall not further operate the vehicle until notifying the Department that the vehicle will be in use, and the Department shall reinstate the registration upon receipt of proof of financial responsibility. Owners or nonresidents who operate a motor vehicle during a period of inoperability or storage claimed under the act shall be guilty of a Class B misdemeanor, and may additionally be guilty of a violation of The Motor Vehicle Financial Responsibility Law.

The act also provides that the Department of Revenue may verify motor vehicle financial responsibility as provided by law, but shall not otherwise take enforcement action unless the Director determines a violation has occurred as described in the act. (Section 303.025.1)

Currently, a first violation of The Motor Vehicle Financial Responsibility Law is punishable as a Class D misdemeanor, meaning a fine may be imposed of up to $500; a second or subsequent offense is punishable by up to 15 days in jail and/or a fine not to exceed $500. Under the act, a second or subsequent offense may be punished by up to 15 days in jail and shall be punished by a fine not less than $200 but not to exceed $500. (Section 303.025.3) Fines owed to the state for violations of the Motor Vehicle Financial Responsibility Law may be eligible for payment in installments. Rules for the application of payment plans shall take into account individuals' ability to pay. (Section 303.025.6)

This act establishes the "Motor Vehicle Financial Responsibility Verification and Enforcement Fund" to be used by the Department of Revenue for the administration of the act. (Section 303.422)

This act creates, within the Department of Revenue, the Motor Vehicle Financial Responsibility Enforcement and Compliance Incentive Program ("the program") for the purpose of enforcing The Motor Vehicle Financial Responsibility Law. The Department of Revenue shall have the authority to contract with third-party vendors to facilitate the program. The Department of Revenue or its third-party vendor shall utilize technology to compare vehicle registration information with the information accessible through the motor vehicle financial responsibility verification system established under the act ("the verification system"), and the Department shall use this information to identify motorists who are in violation of The Motor Vehicle Financial Responsibility Law. All fees paid to the third-party vendors may come from violator diversion fees generated by the pretrial diversion option established under the act as an alternative to statutory fines and reinstatement fees prescribed under The Motor Vehicle Financial Responsibility Law. (Section 303.425.1)

The Department of Revenue may authorize law enforcement agencies or third-party vendors to use technology to collect data for purposes of the program. (Section 303.425.2) The Department may authorize traffic enforcement officers or third-party vendors to administer the processing and issuance of notices of violation and the collection of fees under the program. (Section 303.425.3) Access to the verification system shall be restricted to authorized parties as provided in the act. (Section 303.425.4) For purposes of the program, certain data specified in the act may be used to identify vehicles as being in violation of The Motor Vehicle Financial Responsibility Law, and shall constitute evidence of the violation. (Section 303.425.5)

Except as otherwise provided in the act, the Department of Revenue shall suspend, as provided by law (see section 303.041), the registration of any motor vehicle that is determined under the program to be in violation of The Motor Vehicle Financial Responsibility Law. (Section 303.425.6)

The Department of Revenue shall send to an owner whose vehicle is identified under the program as being in violation of The Motor Vehicle Financial Responsibility Law a notice that the vehicle's registration may be suspended unless the owner, within 30 days, provides proof of financial responsibility or proof of a pending criminal charge for a violation of The Motor Vehicle Financial Responsibility Law. The notice shall include information on obtaining proof of financial responsibility, as provided in the act. If proof of financial responsibility or a pending criminal charge is not provided within the time allotted, the Department shall suspend the vehicle's registration in accordance with current law, or shall send a notice of vehicle registration suspension, clearly specifying the grounds for and effective date of the suspension, the right to and procedure for requesting a hearing, and the date by which the request for hearing must be made, as well as informing the owner that the matter will be referred for prosecution, informing the owner that the minimum penalty for the violation is $300 and 4 license points, and offering the owner participation in a pretrial diversion option to preclude referral for prosecution and registration suspension under the act. The notice of vehicle registration suspension shall give a period of 3 days from mailing for the vehicle owner to respond, and shall be deemed received 3 days after mailing.

If no request for hearing or agreement to participate in the diversion option is received prior to the date of suspension, the Director shall suspend the registration immediately and refer the case for prosecution.

If an agreement to participate in the diversion option is received prior to the date of suspension, then upon payment of a diversion participation fee not to exceed $200, and agreement to obtain and retain financial responsibility for a period of 2 years, then no points shall be assessed to the owner's driver's license, and the Department shall not take further action against the owner under the act, subject to compliance with the terms of the pretrial diversion option. The Department shall suspend the registration of, and refer cases for prosecution of, participating vehicle owners who violate the terms of the pretrial diversion option.

If a request for hearing is received prior to the date of suspension, then for all purposes other than eligibility for the diversion option, the effective date of suspension shall be stayed until a final order is entered following the hearing. The Department shall suspend the registration of vehicles determined under the final order to have been in violation of The Motor Vehicle Financial Responsibility Law, and shall refer the case for prosecution.

The Department of Revenue or its third-party vendor shall issue receipts for the collection of diversion option participation fees, and the fees shall be paid into the Motor Vehicle Financial Responsibility Verification and Enforcement Fund, established in the act. A vehicle owner whose registration is suspended under the act may obtain reinstatement upon providing proof of financial responsibility and payment to the Department of a nonrefundable reinstatement fee. (Section 303.425.7)

Data collected or retained under the program shall not be used by any entity for purposes other than enforcement of The Motor Vehicle Financial Responsibility Law. Data collected and stored by law enforcement under the program shall be considered evidence if a violation is confirmed. The evidence and a corresponding affidavit as provided in the act shall constitute probable cause for prosecution, and shall be forwarded to the appropriate prosecuting attorney as provided in the act. (Section 303.425.8)

Owners of vehicles identified as being in violation of The Motor Vehicle Financial Responsibility Law shall be provided with options for disputing claims which do not require appearance at any court of law or administrative facility. Any person who provides timely proof that he or she was in compliance with The Motor Vehicle Financial Responsibility Law at the time of the alleged violation shall be entitled to dismissal of the charge with no assessment of fees or fines. Any proof provided that a vehicle was in compliance at the time of the alleged offense shall be recorded in the system established by the Department of Revenue under the act. (Section 303.425.9)

The collection of data or use of technology shall be done in a manner that prohibits bias towards a specific community, race, gender, or socioeconomic status of vehicle owner. (Section 303.425.10). Law enforcement agencies, third-party vendors, or other entities authorized to operate under the program shall not sell data collected or retained under the program for any purpose or share it for any purpose not expressly authorized by law. All data shall be secured and any third-party vendor may be liable for any data security breach. (Section 303.425.11)

The Department of Revenue shall not take action under the act against fleet vehicles, or against vehicles known to the Department of Revenue to be insured under a policy of commercial auto insurance, as defined in the act. (Section 303.425.12)

Following one year after the implementation of the program, and annually thereafter, the Department of Revenue shall provide a report on the program's operations as provided in the act. The Department may, by rule, require the state, counties, and municipalities to provide information in order to complete the report. (Section 303.425.13)

This act requires the Department of Revenue to establish a web-based system for the verification of motor vehicle financial responsibility, and to provide access to insurance reporting data and vehicle registration and financial responsibility data. The Department shall require motor vehicle insurers to establish functionality for it as provided in the act, and the system shall be the sole system used in the state for online verification of financial responsibility. (Section 303.430.1)

The verification system shall transmit requests to insurers for verification of insurance coverage via web services established in accordance with Insurance Industry Committee on Motor Vehicle Administration ("IICMVA") specifications, and the insurance company system shall respond with a prescribed response upon evaluating the data provided in the request. The system shall include appropriate data security protections, and the Department of Revenue shall maintain a historical record of the system data for up to 12 months from the date of the requests and responses. The system shall be used to verify financial responsibility required by law, and shall be accessible by authorized employees of the Department, the courts, law enforcement, and other entities as authorized by law, and shall be interfaced, wherever appropriate, with existing state systems. The system shall include information enabling the Department to submit inquiries to insurers regarding motor vehicle insurance which are consistent with insurance industry and IICMVA standards by using the insurer's National Association of Insurance Commissioners company code, vehicle identification number, policy number, verification date, or as otherwise described in IICMVA standards. The Department shall promulgate rules to offer insurers of 1,000 or fewer vehicles an alternative method for verifying coverage in lieu of web services, and to provide for the verification of financial responsibility when proof of financial responsibility is provided to the Department by means other than a policy of insurance. Insurers are not required to verify insurance coverage for vehicles registered in other jurisdictions. (Section 303.430.2(1))

The verification system shall respond within a time period established by the Department of Revenue. An insurer's system shall respond within the time period prescribed by the IICMVA's specifications and standards. Insurer systems shall be permitted reasonable system downtime for maintenance and other work with advance notice to the Department. Insurers shall not be subject to enforcement fees or other sanctions under such circumstances, or when their systems are not available because of emergency, outside attack, or other unexpected outages not planned by the insurer and reasonably outside of its control. (Section 303.430.2(2))

The verification system shall assist in the identification of motorists operating in violation of The Motor Vehicle Financial Responsibility Law in the most effective way possible. System responses shall have no effect on the determination of coverage under a claim. Nothing in this act shall prohibit the Department of Revenue from contracting with a third-party vendor or vendors who have successfully implemented similar systems in other states. (Section 303.430.2(3))

The Department of Revenue shall consult with insurance industry representatives and may consult with third-party vendors to determine the objectives, details, and deadlines related to the system by establishing an advisory council with membership as specified in the act. (Section 303.430.2(4))

The Department of Revenue shall publish for comment, and then issue, a detailed implementation guide for its online verification system. (Section 303.430.2(5))

The Department of Revenue and its third-party vendors, if any, shall each maintain a contact person for insurers during the establishment, implementation, and operation of the system. (Section 303.430.2(6))

If the Department of Revenue has reason to believe a vehicle owner does not maintain financial responsibility as required by law, it may also request for the insurer to verify the existence of financial responsibility in a form approved by the Department of Revenue. Insurers shall cooperate with the Department of Revenue in establishing and maintaining the verification system, and shall provide motor vehicle insurance policy status information in accordance with rules promulgated by the Department of Revenue. (Section 303.430.2(7))

Every property and casualty insurer licensed to issue motor vehicle insurance or authorized to do business in this state shall comply with this act for the verification of any vehicle for which the insurer issues a policy in this state. (Section 303.430.2(8))

For purposes of historical verification inquiries, insurers shall maintain a historical record of insurance data for a minimum period of 6 months from the date of a policy's inception or modification. (Section 303.430.2(9))

The act shall not apply with regard to "commercial auto coverage", as defined in the act. However, such insurers may participate on a voluntary basis, and vehicle owners may provide the Department with proof of commercial auto coverage to be recorded in the verification system. (Section 303.430.2(10)) Individuals covered by commercial or fleet automobile policies shall be provided with proof of coverage as described in the act. (Section 303.430.2(11))

Insurers shall be immune from civil and administrative liability for good faith efforts to comply with this act. Nothing in this act shall prohibit an insurer from using the services of a third-party vendor for facilitating the verification system as required under the act. (Section 303.430.2(12)-(13))

The verification system shall be in operation by January 1, 2024, following a testing period of not less than 9 months. No enforcement action shall be taken based on the system until successful completion of the testing period. (Section 303.440)

These provisions are substantially similar to provisions in the truly agreed to and finally passed SS#2/HB 661 (2021), and similar to provisions in HCS/SS/SCS/SB 4 (2021), SB 1086 (2020), and HB 2733 (2020).

ERIC VANDER WEERD