Driver licenses have become widely accepted identity documents because they generally include features that make them difficult to counterfeit or alter and may contain identifying information such as the licensees’ legal name, photograph, physical description, and signature. Currently, about 188 million drivers are licensed in the United States, and states issue an additional 73 million licenses and identification cards each year. Individuals can apply to obtain licenses at about 3,800 locations across the United States. Authority for designing and administering driver licensing programs, as well as for verifying the identity information of licensees, lies with individual states. Accordingly, driver licensing agencies face the challenge of determining whether the identity documents individuals provide (1) are authentic and contain information that agrees with the issuing agency’s records and (2) actually belong to the person presenting them. To promote uniformity among driver licensing programs, AAMVA provides states with guidance on documents it recommends as acceptable proof of identity, as well as best practices for verifying the documents. Not surprisingly, the SSN is key to any verification process because each SSN is unique to its owner. In February 2002, we reported that 45 states collect SSN information from driver license applicants. Individuals obtain SSNs by applying to SSA and providing evidence of their age, identity, and U.S. citizenship or lawful alien status. As the agency responsible for assigning SSNs and issuing social security cards, SSA provides a service to the states to verify those numbers. SSA provides two methods for driver licensing agencies to verify SSNs: batch and on-line. States use the batch method to submit an aggregate group of SSN requests directly to SSA, and SSA generally responds within 24 to 48 hours. Those states using the on-line method submit individual SSN requests and receive immediate “real time” responses from SSA. On-line users transmit and receive information to and from SSA through a network maintained by AAMVA. SSA charges states a fee to cover its costs (basically system processing and personnel) for providing this service. Batch users pay $0.0015 per transaction while on-line users are charged $0.03 per transaction. For fiscal year 2002, the total billings for batch and on-line users were about $39,000 and $193,000, respectively. SSA collects payments directly from the batch users, while it bills and collects payments from the on-line users through AAMVA. SSA followed Privacy Act requirements in deciding what information it would disclose to driver licensing agencies. Under its current disclosure policy, if the SSN, name, and date of birth submitted to SSA by a driver licensing agency match SSA’s records, SSA will verify the match to the state driver licensing agency. If one or more elements do not match, SSA will inform the agency of the nonmatch but will not disclose further information. match only establishes that the information agrees with SSA’s records and is not proof that the individual using the SSN is the person to whom SSA assigned the number. Beyond SSA’s verification service, the federal government plays a role in several other key areas of states’ driver licensing programs. For example, within the Department of Transportation (DOT), the National Highway Traffic Safety Administration (NHTSA) operates the National Driver Register (NDR), a national database containing identity information on 39 million problem drivers that states are required to use when making licensing decisions. Also, to remove unsafe commercial drivers from the highways, the federal government established the Commercial Drivers License Information System (CDLIS), a nationwide database of 11 million records that states must use to exchange information on applicants who may hold commercial licenses in other states or have driving infractions that make them ineligible for licensing. DOT, the federal agency charged with establishing the CDLIS database, contracts with AAMVA to operate it. The federal government also provides grants to help states improve their highway safety programs. Furthermore, states’ receipt of federal funds for their state child support enforcement programs are contingent on the collection of individuals’ SSNs during the driver licensing process. This provision enables licensing agencies to assist states in locating and obtaining child support payments from noncustodial parents. Twenty-five states have used either the batch or on-line verification method and the extent to which they regularly use the on-line service varies. States that used the batch method generally use it for a short period then switch to the on-line process exclusively. Although states’ use of SSA’s on-line service has increased steadily over the last several years, 5 states submitted over 70 percent of all on-line verification requests. Factors such as cost, system performance, and individual state priorities play a role in determining whether states opt to use SSA’s verification service and the frequency in which it is used. As of March 2003, driver licensing agencies in 25 states have used the batch or on-line method to verify SSNs with SSA. States generally use the batch method for a short-term period, but states are more likely to use the on-line service on a continuous basis. About three-fourths of the states that rely on SSA’s verification service used the on-line method or a combination of the on-line and batch method, while the remaining states used the batch method exclusively. (See fig. 1.) Over the last several years, states estimated submitting over 84 million requests to SSA using the batch method. Similarly, states submitted a total of 13 million requests using the on-line method. Two-thirds of these on-line requests were submitted in the last 2 fiscal years. SSA officials told us that the batch method offers advantages in circumstances where a real-time verification response is unnecessary. For example, some states have used the batch method to “clean-up” SSNs in their existing records and address any discrepancies prior to the license coming due for renewal at a later date. A number of states that have used the batch method in this manner subsequently used the on-line method exclusively. For example, one state that used the batch method in 2001 to verify over 8.3 million existing records has since used the on-line method exclusively. SSA officials noted that only one state currently uses the batch method on a continuous basis to verify SSNs for all of its customers. For states that issue permanent licenses on the spot, the on-line service also offers an advantage, namely, the ability to instantly verify the SSN and other key information submitted by individuals seeking initial licenses, as well as those converting out-of-state licenses. Between fiscal years 1998 and 2002, the number of states participating in SSA’s on-line service grew by about 3 states each year. As shown in figure 2, the volume of on- line verification requests processed by SSA has also increased significantly from 300,000 in fiscal year 1998 to 5.5 million in fiscal year 2002. Although the volume of on-line requests grew between 1998 and 2002, usage varied significantly among states and within individual states from year to year. As shown in figure 3, 5 states accounted for over 70 percent of the total transactions over a 5-year period, and a single state was responsible for submitting about one-third of the total transactions. In addition, in some states, the use of the on-line service varied from year to year. For example, one state sent in about 250,000 requests in 1 year and about half that number the following year. Various factors—such as costs, performance problems, and state priorities—may affect states’ decisions about whether or not to use SSA’s verification service. The nonverifying states we contacted frequently cited cost as a reason why they did not use SSA’s verification service. In addition to the per-transaction fees that SSA charges, states may incur additional costs to set up and use SSA’s service, including the cost for computer programming, equipment, staffing, training, and so forth. State estimates associated with establishing an on-line SSN verification process with SSA varied considerably based on factors such as the system modifications they planned to make. For example, one state we contacted estimated that it would cost approximately $770,000 to implement the on- line service. Another state estimated that using the on-line service would have a start-up cost of about $230,000. Many nonverifying states we contacted expressed a reluctance to use SSA’s verification service based on performance problems they had heard were encountered by other states. Some states cited concerns about frequent outages and slowness of the on-line system. Other states mentioned that the extra time to verify and resolve SSN problems could increase customer waiting times because a driver license would not be issued until verification was complete. States’ decisions about whether to use SSA’s service, or the extent to which to use it, are also driven by internal policies, priorities, and other concerns. For example, some of the states we visited have policies requiring their driving licensing agencies to verify all customers’ SSNs. Officials in one of these states acknowledged that the growing prevalence of identity theft and the events of September 11, 2001, directly affected their decision to begin using SSA’s service. Conversely, another state we visited that had submitted only 51 transactions over a 3-year period told us that it was delaying full use of SSA’s service until spring 2003 to coincide with the roll-out of its new driver-license issuance system. Finally, we found that states may limit their use of the on-line method to certain targeted populations. For example, one state reported that its policy was to use the on-line method only if fraud was suspected, while another used the service only for initial licenses and out-of-state conversions, but not for renewals of in-state licenses.