Missouri Businesses Sue to Stop Fee Increases on Vehicle Records

May 12, 2008

Three businesses sued on Friday, May 9th to halt a state fee increase for obtaining driver’s license and vehicle records, claiming the higher fee violates Missouri’s open-records law as well the state and federal constitutions.

The lawsuit, filed by companies that regularly buy the records to track vehicle histories, for insurance companies and to track traffic violations, seeks a temporary restraining order or an injunction against the department’s new $7 fee for each driver’s license and motor vehicle record.

Filed in the Capitol’s home of Cole County, the suit contends the higher fee violates Missouri’s Sunshine Law, which sets limits on what government entities can charge for public records. It also claims the new fee violates the state and federal constitutions.

Starting May 1, 2008 the Revenue Department increased the price for driver’s license and vehicle title records to $7. Since 1998, that price had been $1.25, and even less for bulk requests. The department charges 43 cents per 100 records for the first 50,000 requested, and after that, the price drops to 3 cents per 100 records.

A spokesman for the Revenue Department declined to comment on the lawsuit Friday.

But Revenue Director Omar Davis, in a letter to the editor sent to The Associated Press late Thursday (May 8th), defended the higher fees.

Davis said the department would use the additional money to upgrade a computer system that has been in place since the mid-1970s. He blamed past administrations for setting driver’s license record prices too low.

“The department’s creation of this information is funded by taxpayer dollars, and this information was not intended to help private companies increase their profit margins,” he wrote.

The suit was filed by R.L. Polk & Co., Explore Information Services and SAMBA Holdings Inc. Representatives from Explore and R.L. Polk, the parent company of CarFax, each complained to lawmakers earlier this week that the higher fee could drive them out of business.

Tim Sowton, a lobbyist for CarFax, said if the higher fees are allowed to stand, “Our business model couldn’t survive.”

Sara Patrick, director of government affairs for Explore, wrote in an affidavit filed with the lawsuit that the new fee would cause the company to pay $344 million per year to get records that cost $24,420 in 2007.

Insurance companies also have said that the higher record fees could cost Missourians millions in higher premiums to insure their vehicles.

Besides paying for a computer system that Davis said is so old the department must use retired former employees to repair it, he said making the records more expensive would keep them more secure because it’s less likely people will buy all 4 million records in the state’s database.

The Revenue Department in October signed a contract worth up to $50 million with Virginia-based BearingPoint Inc. to replace the state computer system for driver’s license records. Davis said the department is paying for the new system with profits from driver’s license and motor vehicle requests and by letting the consulting firm keep $1 from every record sale.

The lawsuit alleges that the deal is illegal because Missouri’s Sunshine Law limits fees for producing public records to copy costs, staff time and the cost of the medium used for the duplication. Those costs, according to the lawsuit, amount to less than 1 cent per record.

The suit also claims that letting BearingPoint keep $1 from every record purchase violates state law because payments for records go into the Department of Revenue Information Fund, which can be used only for certain purposes.

Lawmakers who held a public hearing earlier this week about the fee increase attempted several times to get Davis to reveal the Revenue Department’s estimate for the cost of producing a driver’s license record. He declined to do so.

And after the Tuesday hearing, Davis, who also is an attorney, told reporters that he does not believe the driver’s license records are subject to the state Sunshine Law. He said that’s because there are limits on who can request the information.

“You can’t just call up and get it,” Davis said Tuesday. “That’s a prime indicator it’s not a regular record.”

State law allows access to driver’s license data for researchers, media outlets and certain businesses that need to examine driving histories, such as an insurance company reviewing an applicant’s driving history. The records contain basic information about a motorist such name, address, height and driver’s license number. It also has some details about offenses and point assessments for moving violations.

And even for companies that are allowed to buy the records, Davis argues the Revenue Department is required only to let media outlets buy them in bulk.

The other claims in the companies’ lawsuit are that the fee increase violates state constitutional provisions directing highway user fees to the transportation department, amounts to an unconstitutional government taking because the companies depend on access to the records as part of their business models, and that the increase should have been treated like an executive branch rule.

Administrative rules must be published with public hearings to allow public comment. Lawmakers also can overturn rules if they find them arbitrary or capricious.

Several lawmakers this week indicated they would try to overturn the increased fee before the legislative session ends on Friday.

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