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SECTION 1. SHORT TITLE.

This Act may be cited as the ''Driver's License Improvement and
Security Act of 2004''.

SEC. 2. FINDINGS.

Congress finds the following:
(1) The terrorist attacks of September 11, 2001,
illuminated many flaws in the Nation's domestic security,
especially in its identification system.
(2) Drivers' licenses and identification cards issued by
States have become the favored form of identity verification in
the United States and are used by government agencies and
private entities alike.
(3) Inconsistent requirements between the States for
initial identity verification and insufficient verification of
identity documents have made the identification systems of
States a prime target for fraud and identity theft.
(4) Different designs on drivers' licenses and
identification cards issued by States have created a market,
including sales on the Internet, for fake cards that look real
to those who are unfamiliar with the official designs.
(5) The use of new technologies will improve the security
of State identification systems.
(6) Identification card technologies that accommodate other
government and private applications create a Federal benefit
that justifies Federal assistance.
(7) Improving the security of drivers' licenses and
identification cards issued by the States will eliminate
multiple licensing of individuals who commit fraud, impede the
purchase of alcohol and tobacco products by underage
individuals, and severely reduce identity theft.
(8) The report of the Markle Foundation Task Force on
National Security in the Information Age, published in December
2003, recommended that the Federal Government develop standards
for State drivers' licenses and identification cards and
examine the application of smart card and biometric information
technologies to such drivers' licenses and identification
cards.
(9) The Final Report of the National Commission on
Terrorist Attacks Upon the United States (also known as the
''9/11 Commission'') described the potential for biometric
identifiers in reducing identity fraud and specifically
recommended that the Federal Government set standards for the
issuance of drivers' licenses.

SEC. 3. STATE DRIVER'S LICENSE AND IDENTIFICATION CARD PILOT PROGRAMS.

(a) Definitions.--In this section, the following definitions apply:
(1) Driver's license.--The term ''driver's license'' means
a license issued by the motor vehicle agency of a State to an
individual that authorizes the individual to operate a motor
vehicle on highways.
(2) Identification card.--The term ''identification card''
means an identification card issued by the motor vehicle agency
of a State to an individual.
(3) Participating state.--The term ''participating State''
means a State that is participating in the pilot program
established under this section.
(4) Secretary.--The term ''Secretary'' means the Secretary
of Transportation.
(b) Establishment of Voluntary Pilot Program.--
(1) In general.--The Secretary shall carry out a pilot
program to assist States in developing and implementing a
driver's license and identification card program that meets the
requirements of this section.
(2) Applications.--In order to be eligible to participate
in the pilot program, a State shall submit to the Secretary an
application in such form and containing such information as the
Secretary may require.
(3) Number of participating states.--The Secretary may
select not more than 6 States for participation in the pilot
program.
(c) State Driver's License and Identification Card Programs.--In
order to be eligible to participate in the pilot program, a State shall
provide assurances satisfactory to the Secretary that the State will
develop and implement a driver's license and identification card
program under which the State meets the following requirements:
(1) Computer chips in drivers' licenses and id cards.--
(A) In general.--A participating State shall embed
a computer chip in each new or renewed driver's license
or identification card issued by the State.
(B) Requirements for computer chips.--A computer
chip embedded in a driver's license or identification
card under this paragraph shall--
(i) contain, in electronic form, all text
data written on the license or card;
(ii) contain encoded biometric data
matching the holder of the license or card;
(iii) contain encryption and security
software or hardware (or both) that prevents
access to data stored on the chip without the
express consent of the individual to whom the
data applies, other than access by a Federal,
State, or local agency (including a court or
law enforcement agency) in carrying out its
functions, or by a private entity acting on
behalf of a Federal, State, or local agency in
carrying out its functions;
(iv) accept data or software written to the
license or card by non-governmental devices if
the data transfer is authorized by the holder
of the license or card; and
(v) conform to any other standards issued
by Secretary.
(2) Biometric data.--
(A) In general.--A participating State shall obtain
biometric data for the identification of each
individual to whom the State issues a new or renewed
driver's license or identification card and shall
maintain such data.
(B) Requirement for biometric data.--Biometric data
obtained by a State under this paragraph shall be of a
type that can be matched to the license or card holder
only with the express cooperation of the license or
card holder.
(3) Participation in linking of databases.--
(A) In general.--A participating State shall
participate in a program to link State motor vehicle
databases in order to provide electronic access by a
State to information contained in the motor vehicle
databases of other States. Such program shall be
established by the Secretary, subject to the
consultation requirements contained in subsection
(d)(3).
(B) Requirements for information.--A motor vehicle
database of a participating State shall contain, at a
minimum, the following information:
(i) All data fields printed on drivers'
licenses and identification cards issued by the
State, other than the encoded biometric data
stored on such licenses and cards under
paragraph (1).
(ii) Biometric data obtained under
paragraph (2) from each individual to whom the
State issues a new or renewed driver's license
or identification card.
(iii) Motor vehicle drivers' histories,
including motor vehicle violations,
suspensions, and points on licenses.
(4) Tamper-resistant security features.--A participating
State shall include on each new or renewed driver's license or
identification card issued by the State, multiple tamper-
resistant security features or optical image layers, such as
biometric scans, barcodes, 3D, flip, or motion imaging, to
assist in visual verification that the license or card is
valid.
(5) Documentation.--A participating State shall adopt and
implement procedures for accurately documenting the identity
and residence of an individual before issuing a driver's
license or identification card to the individual.
(d) Guidelines.--
(1) In general.--Not later than 2 years after the date of
enactment of this section, the Secretary shall issue guidelines
to assist participating States in complying with the
requirements of subsection (c).
(2) Contents.--The guidelines issued under this subsection
shall contain, at a minimum, the following:
(A) Standards for the computer chip technology
required for compliance with subsection (c)(1),
including--
(i) standards to ensure interoperability
and the ability to store multiple applications
created by government agencies and private
entities and transmitted to the license or card
with the express consent of the license or card
holder; and
(ii) standards for the encoded biometric
data that must be contained on each computer
chip and requirements to ensure that such
biometric data will be used only for matching
the license or card to the presenter.
(B) Standards for biometric data to be obtained
from applicants for new or renewed State drivers'
licenses and identification cards under subsection
(c)(2) and standards for maintaining such data.
(C) Standards for linking State motor vehicle
databases under subsection (c)(3) and standards for the
information to be contained in the databases.
(D) Standards for security features or optical
image layers to be placed on State drivers' licenses
and identification cards under subsection (c)(4).
(E) Standards for documentation of the identity and
residence of an individual under subsection (c)(5),
including a list of acceptable documents for
establishing the identity and residence of an
individual and procedures for verifying the
authenticity of the documents.
(F) Standards for a numbering system for State
drivers' licenses and identification cards that
prevents duplication between States and does not make
use of the license or card holder's social security
number.
(3) Consultation.--Guidelines issued by the Secretary under
this subsection shall be developed in consultation with the
American Association of Motor Vehicle Administrators, the
General Services Administration, and the National Institute of
Standards and Technology.
(4) Administrative procedures.--The Secretary may issue
guidelines under this subsection without regard to subchapter
II of chapter 5 of title 5, United States Code.
(e) Grants.--
(1) In general.--The Secretary may make grants to each
participating State to assist the State in developing and
implementing a driver's license and identification card program
that meets the requirements of subsections (b) and (c).
(2) Federal share.--The Federal share of the cost of
activities funded using amounts from a grant received by a
State under this subsection shall be 100 percent or a lesser
percentage determined by the Secretary.
(3) Reports.----
(A) State reports.--The Secretary shall require a
State that receives a grant under this subsection to
submit to the Secretary a report on the activities
carried out by the State using amounts from the grant.
(B) Report to congress.--Not later than one year
after the date on which the Secretary first makes
grants under the pilot program, the Secretary shall
transmit to Congress a report on the results of the
program, including an assessment of the technology,
reliability, effectiveness, and cost of the driver's
license and identification card programs of
participating States.
(f) Authorization of Appropriations.--There is authorized to be
appropriated $100,000,000 to carry out this section. Such sums shall
remain available until expended.

SEC. 4. NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGY.

(a) Study.--The Director of the National Institute of Standards and
Technology, in consultation with the States and the American
Association of Motor Vehicle Administrators, shall conduct a study of
on-card biometric technologies to determine which technology is most
effective and usable for purposes of the pilot program established
under section 3.
(b) Determinations.--In conducting the study, the Director shall
shall determine--
(1) what type of biometric identifier, or combination of
biometric identifiers, when captured and stored on the card in
the form of a numeric algorithm is least prone to error; and
(2) what combination of technologies and information
sharing arrangements will prevent individuals from possessing
multiple concurrent State drivers' licenses or identification
cards.
(c) Report.--Not later than 1 year after the date of enactment of
this Act, the Director shall submit to the Secretary of Transportation
a report on the results of the study.
(d) Authorization of Appropriations.--There are authorized to be
appropriated such sums as may be necessary to carry out this section.
Driver's License Improvement and Security Act of 2004 - Directs the Secretary of Transportation to carry out a pilot program to assist States in developing and implementing a driver's license and identification card program that meets certain requirements.

Requires a State to: (1) embed computer chips in licenses and cards it issues; (2) obtain biometric data for the identification of individuals to whom the State issues a new or renewed driver's license or identification card; (3) participate in a program to link State motor vehicle databases in order to provide electronic access by a State to information contained in the motor vehicle databases of other States; (4) include on each new or renewed driver's license or identification card multiple tamper-resistant security features or optical image layers, such as biometric scans, barcodes, 3D, flip, or motion imaging; and (5) adopt and implement procedures to document accurately the identity and residence of an individual before issuing him or her a driver's license or identification card.

Authorizes the Secretary to make a grant to assist a State in developing and implementing a driver's license and identification card program that meets the requirements of this Act.

Requires the Director of the National Institute of Standards and Technology to study and report to the Secretary of Transportation on which on-card biometric technology is most effective and usable for the pilot program.