HB1887.DOC

SECTION 1. Chapter 431:10C, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:

"Part . Uninsured motorist identification database program

§431:10C-A Definitions. As used in this part:

"Database" means the uninsured motorist identification database established in section 431:10C-B.

"Designated agent" means the third party the insurance division contracts with under section 431:10C-B.

"Insurance division" means the insurance division of the department of commerce and consumer affairs.

"Program" means the uninsured motorist identification database program established in section 431:10C-B.

§431:10C-B Uninsured motorist identification database program; establishment, administration, selection of designated agent, duties, rules. (a) The insurance division, in cooperation with the counties, shall establish an uninsured motorist identification database program.

(b) The program shall:

(1) Establish an uninsured motorist identification database to verify compliance with motor vehicle insurance requirements under this article; and

(2) Assist in reducing the number of uninsured motor vehicles on the highways of the State.

(b) The insurance division shall contract with a third party to establish and maintain an uninsured motorist identification database for the purposes established in subsection (a).

The contract may not obligate the insurance division to pay the third party more money than is available in the uninsured motorist identification special fund established under section 431:10C-C.

(c) The third party under contract made pursuant to this section shall be the insurance division's designated agent, and shall develop and maintain the database using information provided by:

(1) Motor vehicle insurers under section 431:10C-D; and

(2) The director of finance of each county.

The database shall be developed and maintained by the designated agent in accordance with guidelines established by the insurance division so that state and local law enforcement agencies can efficiently access the records of the database, including reports useful for the implementation of the provisions of this part.

The reports provided by the designated agent shall be in a form and contain information approved by the insurance division.

The reports may be made available through the Internet or through other electronic medium, if the insurance division determines that there are security measures in place sufficient to ensure compliance regarding limitations on disclosure of information in the database.

(d) The designated agent, at least monthly, shall:

(1) Update the database with the motor vehicle insurance information provided by the insurers in accordance with section 431:10C-D; and

(2) Compare all current motor vehicle registrations against the database.

(e) The director of finance of each county shall provide the designated agent with:

(1) The name, date of birth, address, and driver license number, if available, of all persons having active motor vehicle registrations; and

(2) The make, year, and vehicle identification number for all active motor vehicle registrations.

(f) The commissioner shall adopt rules under chapter 91 implementing this part.

(g) The designated agent shall archive computer data files at least semi-annually for auditing purposes.

(h) The auditor shall audit the program at least every three years. The auditor's report shall include verification of:

(1) Billings made by the designated agent; and

(2) The accuracy of the designated agent's matching of vehicle registration with motor vehicle insurance data.

§431:10C-C Uninsured motorist identification special fund. (a) There is established within the state treasury a special fund to be known as the uninsured motorist identification special fund, into which shall be deposited the motor vehicle registration reinstatement fees collected under section 249-31. All interest accrued on moneys deposited in the fund shall become part of the fund.

(b) The uninsured motorist identification special fund shall be administered by the insurance division and shall be used for developing and administering the program.

§431:10C-D Motor vehicle insurance reporting; penalty. (a) Each insurer that issues a policy that includes motor vehicle liability coverage, uninsured motorist coverage, underinsured motorist coverage, or personal injury coverage under this article, before the seventh day of each calendar month, shall provide to the designated agent a record of each motor vehicle insurance policy in effect for vehicles registered or garaged in the State as of the date of the previous submission that was issued by the insurer.

(b) Nothing in this section shall preclude more frequent reporting by an insurer on a voluntary basis.

(1) The make, year, and vehicle identification number of each insured vehicle;

(2) The policy number, effective date, and expiration date of each policy; and

(3) The name, date of birth, and if available, driver's license number of each insured owner or operator, and the address of the named insured.

Each insurer shall provide this information by an electronic means or by another form the designated agent agrees to accept.

(d) The insurance division may assess a fine against an insurer of no more than $ for each day the insurer fails to comply with this section; provided that the insurance division shall excuse the fine if an insurer shows that the failure to comply with this section was:

(1) Inadvertent;

(2) Accidental; or

(3) The result of excusable neglect.

§431:10C-E Notice; proof; revocation of registration; false statement; penalties. (a) If the comparison under section 431:10C-B shows that a motor vehicle is not insured for three consecutive months, the insurance division shall direct that the designated agent provide notice to the owner of the motor vehicle that the owner has fifteen days to provide to the designated agent:

(1) Proof of owner's or operator's insurance; or

(2) Proof of exemption from the owner's or operator's insurance requirements.

(b) If an owner of a motor vehicle fails to provide satisfactory proof of owner's or operator's insurance to the designated agent, the designated agent shall provide a second notice to the owner of the motor vehicle that the owner now has fifteen days to provide:

(1) Proof of owner's or operator's insurance; or

(2) Proof of exemption from the owner's or operator's insurance requirements.

(1) Indicate information relating to the owner's failure to provide proof of owner's or operator's insurance in the database; and

(2) Provide this information to the finance director of the county where the motor vehicle is registered.

(d) If the designated agent notifies the finance director of a county that an owner of a motor vehicle failed to provide satisfactory proof of owner's or operator's security to the designated agent, the finance director of the county shall:

(1) Revoke the registration; and

(2) Provide appropriate notices of the revocation, the legal consequences of operating a vehicle with revoked registration and without owner's or operator's insurance, and instructions on how to get the registration reinstated.

(e) A registration that has been revoked under this section shall not be reinstated and a new registration shall not be issued to the holder of the revoked registration until the person:

(1) Pays to the county finance director an administrative reinstatement fee of $ ; and

(2) Complies with the other requirements of this part;

provided that the fee imposed by this section is in addition to any other fees or penalties imposed by law.

(f) The insurance division may direct the designated agent to provide the notices required under subsection (d)(2).

(g) Any action to revoke the registration of a motor vehicle under this section may be in addition to an action by a law enforcement agency to impose the penalties.

(h) It shall be unlawful for a person to provide a false or fraudulent statement to the insurance division or designated agent.

In addition to any other penalties, a person who violates this subsection shall be guilty of a misdemeanor.

(i) Nothing in this section limits other actions or penalties that may be taken or imposed for violation of the insurance requirements of this article.

§431:10C-F Disclosure of insurance information; penalty. (a) Information in the database provided by a person to the designated agent is considered to be the property of the person providing the information.

(b) The information may not be disclosed from the database, except as follows:

(1) For the purpose of investigating, litigating, or enforcing the owner's or operator's insurance requirement, the designated agent shall verify insurance information through the state computer network for a state or local government agency or court;

(2) For the purpose of investigating, litigating, or enforcing the owner's or operator's insurance requirement, the designated agent shall, upon request, issue to any state or local government agency or court a certificate documenting the insurance information, according to the database, of a specific individual or motor vehicle for the time period designated by the government agency;

(3) Upon request, the insurance division or its designated agent shall disclose whether or not a person is an insured individual and the insurance company name to:

(A) That individual or, if that individual is deceased, any legal representative of that individual;

(B) The parent or legal guardian of that individual if the individual is an unemancipated minor;

(D) A person who has power of attorney from the insured individual;

(E) A person who submits a notarized release from the insured individual dated no more than ninety days before the date the request is made; or

(F) A person suffering loss or injury in a motor vehicle accident in which the insured individual is involved, but only as part of an accident report;

(4) For the purpose of investigating, enforcing, or prosecuting laws or issuing citations by state or local law enforcement agencies related to the:

(A) Registration and renewal of registration of a motor vehicle;

(B) Purchase of a motor vehicle; and

(5) Upon request of a law enforcement officer acting in an official capacity, the insurance division or the designated agent, upon request, shall disclose relevant information for investigation, enforcement, or prosecution;

(6) For the purpose of the auditor's required audits of the program under section 431:10C-B;

(7) Upon the request of a state or local law enforcement agency for the purpose of investigating and prosecuting identity theft and other crimes.

(c) The insurance division may allow the designated agent to prepare and deliver upon request a report on the insurance information of a person or motor vehicle in accordance with this section.

The report may be in the form of:

(1) A certified copy that is considered admissible in any court proceeding in the same manner as the original; or

(2) Information accessible through the Internet or through other electronic medium if the insurance division determines that sufficient security is provided to ensure compliance with this section.

The department may allow the designated agent to charge a fee established by the division of motor vehicles for each report.

(d) A person who knowingly releases or discloses information from the database for a purpose other than those authorized in this section or to a person who is not entitled to it is guilty of a class C felony.

(e) An insurer is not liable to any person for complying with section 431:10C-D by providing information to the designated agent.

(f) Neither the insurance division nor the designated agent shall be liable to any person for gathering, managing, or using the information in the database as provided in section 431:10C-B and this part.

§431:10C-G Compliance. Every insurer that is licensed to issue motor vehicle insurance policies or is authorized to do business in the State shall comply with this part for verification of evidence of motor vehicle insurance for every motor vehicle insured by that insurer in the State, as required by the rules adopted by the insurance division.

§431:10C-H Civil and administrative immunity. Insurers and the designated agent shall be immune from civil and administrative liability for good faith efforts to comply with the terms of this part.

§431:10C-I Commercial vehicle exemption. This part shall not apply to commercial vehicles and fleet vehicles.

§431:10C-J Use of information. Information provided to the designated agent by the insurance division or any insurance company shall not be further disclosed or disseminated by the designated agent without the express written consent of the insurance division and the insurance company. The designated agent shall enter into contractual relationships with insurers to further protect the confidentiality and security of information under this section."

SECTION 2. Section 36-27, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Except as provided in this section, and notwithstanding any other law to the contrary, from time to time, the director of finance, for the purpose of defraying the prorated estimate of central service expenses of government in relation to all special funds, except the:

(1) Special out-of-school time instructional program fund under section 302A-1310;

(2) School cafeteria special funds of the department of education;

(3) Special funds of the University of Hawaii;

(4) State educational facilities improvement special fund;

(5) Convention center enterprise special fund under section 201B-8;

(6) Special funds established by section 206E-6;

(7) Housing loan program revenue bond special fund;

(8) Housing project bond special fund;

(9) Aloha Tower fund created by section 206J-17;

(10) Funds of the employees' retirement system created by section 88-109;

(11) Hawaii hurricane relief fund established under chapter 431P;

(12) Hawaii health systems corporation special funds and the subaccounts of its regional system boards;

(13) Tourism special fund established under section 201B-11;

(14) Universal service fund established under section 269-42;

(15) Emergency and budget reserve fund under section 328L-3;

(16) Public schools special fees and charges fund under section 302A-1130;

(17) Sport fish special fund under section 187A-9.5;

(18) Glass advance disposal fee established by section 342G-82;

(19) Center for nursing special fund under section 304A-2163;

(20) Passenger facility charge special fund established by section 261-5.5;

(21) Court interpreting services revolving fund under section 607-1.5;

(22) Hawaii cancer research special fund;

(23) Community health centers special fund;

(24) Emergency medical services special fund;

(25) Rental motor vehicle customer facility charge special fund established under section 261-5.6;

(26) Shared services technology special fund under section 27-43;

(27) Automated victim information and notification system special fund established under section 353-136; [~~and~~

[](28)[]] Deposit beverage container deposit special fund under section 342G-104[,]; and

(29) Uninsured motorist identification special fund under section 431:10C-C;

shall deduct five per cent of all receipts of all special funds, which deduction shall be transferred to the general fund of the State and become general realizations of the State. All officers of the State and other persons having power to allocate or disburse any special funds shall cooperate with the director in effecting these transfers. To determine the proper revenue base upon which the central service assessment is to be calculated, the director shall adopt rules pursuant to chapter 91 for the purpose of suspending or limiting the application of the central service assessment of any fund. No later than twenty days prior to the convening of each regular session of the legislature, the director shall report all central service assessments made during the preceding fiscal year."

SECTION 3. Section 36-30, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Each special fund, except the:

(1) Transportation use special fund established by section 261D-1;

(2) Special out-of-school time instructional program fund under section 302A-1310;

(3) School cafeteria special funds of the department of education;

(4) Special funds of the University of Hawaii;

(5) State educational facilities improvement special fund;

(6) Special funds established by section 206E-6;

(7) Aloha Tower fund created by section 206J-17;

(8) Funds of the employees' retirement system created by section 88-109;

(9) Hawaii hurricane relief fund established under section 431P-2;

(10) Convention center enterprise special fund established under section 201B-8;

(11) Hawaii health systems corporation special funds and the subaccounts of its regional system boards;

(12) Tourism special fund established under section 201B-11;

(13) Universal service fund established under section 269-42;

(14) Emergency and budget reserve fund under section 328L-3;

(15) Public schools special fees and charges fund under section 302A-1130;

(16) Sport fish special fund under section 187A-9.5;

(17) Center for nursing special fund under section 304A-2163;

(18) Passenger facility charge special fund established by section 261-5.5;

(19) Court interpreting services revolving fund under section 607-1.5;

(20) Hawaii cancer research special fund;

(21) Community health centers special fund;

(22) Emergency medical services special fund;

(23) Rental motor vehicle customer facility charge special fund established under section 261-5.6;

(24) Shared services technology special fund under section 27-43;

(25) Nursing facility sustainability program special fund, under Act 156, Session Laws of Hawaii 2012;

(26) Automated victim information and notification system special fund established under section 353-136; [~~and~~]

(27) Hospital sustainability program special fund under Act 217, Session Laws of Hawaii 2012[,]; and

(28) Uninsured motorist identification special fund established under section 431:10C-C;

shall be responsible for its pro rata share of the administrative expenses incurred by the department responsible for the operations supported by the special fund concerned."

SECTION 4. Section 249-31, Hawaii Revised Statutes, is amended to read as follows:

"§249-31 State registration fee. (a) All vehicles and motor vehicles in the State as defined in section 249-1, including antique motor vehicles, except as otherwise provided in sections 249-4 and 249-6, shall be subject to a $45 annual vehicle registration fee. The fee shall be paid each year together with all other taxes and fees levied by this chapter on a staggered basis as established by each county as authorized by section 286-51, and the state registration for that county shall likewise be staggered so that the state registration fee is due and payable at the same time and shall be collected together with the county fee. The state registration fee shall be deemed delinquent if not paid with the county registration fee. The respective counties shall collect this fee together with the vehicle registration tax collected for the county and shall transfer the moneys collected under this section to the State.

(b) From each annual motor vehicle registration fee, the director shall deposit $40 into the state highway fund and $5 into the emergency medical services special fund.

(c) If a motor vehicle registration is revoked pursuant to section 431:10C-E, the registration shall not be reinstated until an administrative reinstatement fee of $ is paid. All reinstatement fees shall be deposited into the uninsured motorist identification special fund."

SECTION 5. Section 431:2-215, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) All assessments, fees, fines, penalties, and reimbursements collected by or on behalf of the insurance division under title 24, except for the uninsured motorist identification special fund (section 431:10C-C), the commissioner's education and training fund (section 431:2-214), the patients' compensation fund (Act 232, Session Laws of Hawaii 1984), the drivers education fund underwriters fee (sections 431:10C-115 and 431:10G-107), and the captive insurance administrative fund (section 431:19-101.8) to the extent provided by section 431:19-101.8(b), shall be deposited into the compliance resolution fund under section 26-9(o). All sums transferred from the insurance division into the compliance resolution fund may be expended by the commissioner to carry out the commissioner's duties and obligations under title 24."

SECTION 6. In codifying the new sections added by section 1 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 7. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 8. This Act shall take effect on July 1, 2014; provided that the amendments to sections 36-27(a) and 36-30(a), Hawaii Revised Statutes, in sections 2 and 3 of this Act shall not be repealed when sections 36-27 and 36-30, Hawaii Revised Statutes, are reenacted on June 30, 2015, pursuant to section 34 of Act 79, Session Laws of Hawaii 2009.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	1887
TWENTY-SEVENTH LEGISLATURE, 2014
STATE OF HAWAII