The Anti-Car Theft Act was designed to reduce automobile theft by making the selling of stolen cars and parts more difficult. According to 1992 congressional testimony, thieves turned stolen cars into money in three ways. They (1) took the stolen car to a chop shop where the car was dismantled and its parts were sold as replacement parts for other vehicles, (2) obtained an apparently valid title for the car and then sold it to a third party (the area that NMVTIS is expected to address), or (3) exported the vehicle for sale abroad. In 1995, the National Insurance Crime Bureau (NICB) estimated that the value of stolen vehicles, which are subsequently titled each year, amounted to over $240 million. NICB estimated that the loss associated with total vehicle theft and fraud was in excess of $7.6 billion, annually. The Anti-Car Theft Act originally required DOT to develop a national motor vehicle title information system by designating an existing system or establishing a new system. The act was amended by the Anti-Car Theft Improvements Act of 1996, which, among other things, transferred responsibility for development and implementation of NMVTIS from DOT to Justice. In an August 22, 1996, memorandum, the Deputy Attorney General delegated responsibility for implementing the NMVTIS project to the Federal Bureau of Investigation (FBI). According to Justice, the FBI’s role with respect to NMVTIS is to ensure that the system meets the intent of the act as it pertains to the FBI and law enforcement activity; ensure that the system meets the law enforcement needs of state, local, and federal law enforcement agencies; provide guidance to AAMVA, the system administrator, concerning law enforcement issues and items related to system testing and national implementation; and analyze the issue of the use and dissemination of vehicle theft data. Justice’s Office of Justice Programs provides funding for NMVTIS. According to Justice and DOT officials, Congress has provided, through appropriation acts and congressional guidance in conference reports, about $8 million to conduct the test of NMVTIS during fiscal years 1996 through 1999. DOT awarded $890,000 in fiscal year 1996 to AAMVA. After receiving responsibility for NMVTIS in 1996, Justice awarded $1 million in fiscal year 1997 Byrne Discretionary Grant Program funding to AAMVA. According to AAMVA, it has passed the $1.89 million it has received from DOT and Justice to the seven participating states. In June 1999, Justice awarded $2.8 million in fiscal year 1998 funds to AAMVA to (1) continue funding the participating states, (2) add new states, and (3) recover some of its costs as a technical assistance provider to the seven participating states. According to AAMVA, $2 million is for the states and $800,000 is for AAMVA. Justice added that AAMVA cannot draw on these funds until a memorandum of understanding between it and the FBI is executed. The conference report accompanying the fiscal year 1999 appropriations states that Justice is to spend $3.15 million for NMVTIS. NMVTIS is being designed and tested by AAMVA and is intended to, if fully implemented, deter trafficking in stolen vehicles by making it harder for thieves to obtain seemingly valid titles for stolen vehicles by retitling them in another state. This is because, using NMVTIS, the copy of the motor vehicle title presented for retitling would be electronically validated against the database of the state that originally titled the vehicle. Thus, NMVTIS would help prevent thieves from obtaining good titles to vehicles that they intend to resell. In addition, when the title is reissued in another state, NMVTIS would electronically cancel the motor vehicle title in the originating state. Presently, retitling between states is done manually, with states mailing information about a vehicle being retitled. According to AAMVA officials, NMVTIS would also prevent fraudulent use of duplicate motor vehicle titles. NMVTIS is also intended to protect prospective purchasers by accomplishing the following: Make “title washing” more difficult. Title washing is a type of title fraud in which vehicle brand history is removed from the title by retitling the vehicle in another state that does not carry a particular brand. This is done to make it easier to pass the vehicle to a third party who is otherwise unaware of the brand. Provide access to brand data that would help purchasers to determine the market value and safety of the vehicle prior to purchase. Provide odometer readings, which would help purchasers determine if the vehicle mileage has been improperly rolled back to a lower number. AAMVA expects titling states, law enforcement agencies, car dealers, insurance companies, and individual prospective purchasers to use NMVTIS. According to AAMVA, private companies and individuals would be able to access NMVTIS to verify titles and check vehicle history information, such as previous odometer readings and title brands. However, private companies and individuals currently do not have access to the stolen vehicle file in NMVTIS. According to AAMVA officials, AAMVA is working with Justice and other law enforcement officials who are involved with overseeing and managing the system containing stolen vehicle data to see if these data can be made available to private companies and individuals. The act authorized system users to be charged a fee for obtaining data. AAMVA said that it is constructing the system so that state departments of motor vehicles and law enforcement agencies are to be exempt from the fee. According to AAMVA officials, no fees have been charged to any user, as of July 20, 1999. They added that AAMVA and its contractors have been absorbing all costs associated with NMVTIS’ operations and no federal funds have been used to support its operations, as of July 20, 1999. While the U.S. Customs Service did not provide direct input or coordination to Justice or AAMVA during NMVTIS’ development, it anticipates realizing many benefits from NMVTIS when it becomes fully operational. Customs expects to be able to connect its computer systems to NMVTIS. Customs also expects that NMVTIS will be able to provide it with a greater ability to identify and detect stolen vehicles before they are exported from the United States. According to AAMVA officials, AAMVA expects to work with Customs to test NMVTIS at two ports. AAMVA’s design of NMVTIS includes the following four files: A theft file, which contains information on all vehicles reported stolen nationwide and is a “mirror” image of the FBI’s national stolen vehicle database from its National Crime Information Center. The FBI pointed out that the act does not mandate the use of Center data and the use of the Center mirror image was approved only for the seven participating states. A brand file, which maintains data on vehicle brands from various sources, including insurance companies and junk and salvage yard operators. A manufacturers’ certificate of origin (MCO) file, which contains vehicle origination information from the manufacturer, such as make, model, or color. A vehicle identification number (VIN) pointer file, which electronically directs a NMVTIS user to the state where the vehicle was last titled and would be used to validate the previous title and obtain various vehicle history information. NICB, which is an AAMVA contractor, has developed and is maintaining the theft file, which it received from the National Crime Information Center. AAMVA will provide the brand file. The MCO file and VIN pointer file have been developed and are being maintained by The Polk Company, which is also an AAMVA contractor. To test NMVTIS in operation, AAMVA agreed with seven states to have them develop their computer software to interface with NMVTIS. The test in the seven participating states is to allow for an evaluation of the technical feasibility of NMVTIS, degree of success in meeting the 1992 Act’s requirements, areas that would benefit from federal rulemaking, estimated costs of implementation and operation, and time it will take the remaining states to develop interfaces to NMVTIS. As of March 18, 1999, the seven participating states were developing the capability to interface with NMVTIS files and were in various stages of testing the interface. AAMVA expects completion of the test within the first quarter of calendar year 2000 and its evaluation of the results shortly thereafter. AAMVA has prepared an evaluation plan for testing NMVTIS. The evaluation plan includes an assessment of NMVTIS’ ability to meet the act’s requirements. According to AAMVA officials, AAMVA expected to complete its preliminary evaluation of NMVTIS by the end of July 1999. AAMVA’s March 19, 1999, cost estimate for a fully implemented NMVTIS is $33.9 million—that is, $24.2 million for states to develop new systems or adapt existing ones to link with NMVTIS and $9.7 million for AAMVA and its contractors to develop and implement NMVTIS. AAMVA expects the federal government to fund $22.2 million, which is to be used to offset $16.5 million of the states’ costs and to reimburse AAMVA for $5.7 million in its role as the technical assistance provider. AAMVA and its contractors will be responsible for the additional $4 million. AAMVA expects the states to fund their remaining costs ($7.7 million). NMVTIS’ operation and maintenance costs will be the responsibility of the states and AAMVA and its contractors. As previously mentioned, the states and AAMVA and its contractors can charge system users a fee for information provided. According to AAMVA, its estimate of the costs the states would incur is based on the participating states’ actual costs plus other factors, such as inflation. AAMVA estimated that the development costs for other states would average about $425,000 per state.