The Florida Senate BILL ANALYSIS AND FISCAL IMPACT STATEMENT (This document is based on the provisions contained in the legislation as of the latest date listed below.) Prepared By: The Professional Staff of the Committee on Transportation BILL: SB 1178 INTRODUCER: Senator Broxson SUBJECT: License Plates DATE: February 1, 2022 ANALYST STAFF DIRECTOR REFERENCE ACTION 1. Proctor Vickers TR Pre-meeting 2. ATD 3. AP I. Summary: SB 1178 repeals the Department of Highway Safety and Motor Vehicles (DHSMV) authority to conduct a pilot program to evaluate designs, concepts, technologies for alternative license plates, and the long-term cost impact to the consumer. Further, the bill provides for the use of a digital license plate upon a determination that the information on the digital license plate display is readable by current automated license plate recognition hardware and software, subject to the laws of Florida applicable to a physical license plate, in place of the current physical license plate. However, the purchaser of a digital license plate must first obtain a physical license plate from the DHSMV before obtaining a digital license plate directly from a digital license plate provider. The bill provides that a digital license plate owner is not subject to the penalties for failure to display a validation sticker if the vehicle is operated in compliance with law and any rules adopted by the DHSMV governing the placement of digital license plates and registration renewal. The bill provides that the Department of Corrections via Prison Rehabilitation Industries and Diversified Enterprises (PRIDE) shall manufacture license plates. The bill may have an indeterminate, likely insignificant, negative fiscal impact to the DHSMV. See Section V. Fiscal Impact Statement. The bill has an effective date of upon becoming law. REVISED: BILL: SB 1178 Page 2 II. Present Situation: All vehicles required to be licensed in Florida generally must display an assigned license plate on the rear of the vehicle. No license plates other than those furnished by the state may be used. 1 The DHSMV administers the issuance of motor vehicle license plates as a part of the tag and registration requirements specified in ch. 320, F.S. License plates are issued for a 10-year period and are replaced upon renewal at the end of the 10-year period. The license plate fee for both an original issuance and replacement is $28.00, which is deposited in the Highway Safety Operating Trust Fund. 2 An advance replacement fee of $2.80 is applied to the annual vehicle registration and is credited towards the next replacement; the fee is deposited in the Highway Safety Operating Trust Fund. 3 Current state law provides for several types of license plates. In addition to plates issued for governmental or business purposes, the DHSMV offers four basic types of plates to the general public: Standard plates: The standard license plate currently comes in three configurations: the county name designation, the state motto designation, or the state slogan designation. Specialty license plates: 4 Specialty license plates generate revenue for various colleges, universities, charities, causes, and civic organizations. Personalized prestige license plates: 5 Personalized license plates allow motorists to define the alpha numeric design (up to seven characters) on a standard plate that must be approved by the DHSMV. Special use license plates: Certain members of the general public may be eligible to apply for special use license plates if they are able to document their eligibility pursuant to various sections of ch. 320, F.S. This category of plates primarily includes special military license plates as well as plates for the handicapped. Examples include the Purple Heart, National Guard, United States Armed Forces, Pearl Harbor, and Iraqi Freedom plates. Current state law provides that license plates must be made of metal specially treated with a retro reflection material, as specified by the DHSMV. The license plate must be designed to increase nighttime visibility and legibility and must be at least 6 inches wide and not less than 12 inches in length, unless a plate with reduced dimensions is deemed necessary by the DHSMV to accommodate motorcycles, mopeds, or similar smaller vehicles. The license plate must be imprinted with a combination of bold letters and numerals or numerals, not to exceed seven digits, to identify the license plate number. 6 The license plate must be imprinted with the word “Florida” at the top and at the bottom: The name of the county in which it is sold, the state motto, or the words “Sunshine State”; o Any county may, upon majority vote of the county commission, elect to have the county name removed from the license plates sold in that county. The state motto or the words “Sunshine State” must be printed in lieu thereof. 1 Section 316.605(1), F.S. 2 Sections 320.06 and 320.0607, F.S. 3 Section 320.06(1)(b)1., F.S. 4 Section 320.08058, F.S. 5 Section 320.0805, F.S. 6 Section 320.06(3)(a), F.S. BILL: SB 1178 Page 3 Apportioned license plates must have the word “Apportioned”; Specially taxed vehicles must have the word “Restricted”; Dealer vehicles must have the word “Dealer” unless the license plate is a specialty license plate; Manufacturer vehicles must have the word “Manufacturer”; and Wrecker vehicles must have the word “Wrecker”. 7 A license plate issued for a for-hire vehicle may not be assigned a registration license number, or be issued with any other distinctive character or designation, that distinguishes the motor vehicle as a for-hire motor vehicle. 8 Most license plates are equipped with validation stickers that reflect the period of valid registration, which expire on midnight on the last day of the registration period and are issued upon payment of the proper license tax amount and fees. 9 Validation stickers must also be treated with a retro reflection material, must be of such size as specified by the DHSMV, and must adhere to the license plate. 10 Digital License Plates “Aside from the expected changes from a metal plate to a digital screen (including the digital screen, circuitry, a power source, and a housing), the Digital License Plate includes mobile phone technology for over the-air updates, Global Positioning System (GPS), and accelerometers to read when the vehicle is in motion.” 11 The mounting bracket typically uses specially shaped “security screws” to prevent unauthorized removal of the plate. If the plate is removed from the bracket, the plate is programmed to display a blank screen. 12 ReviverMX, Inc. (Reviver) and Airplate appear to currently be the only manufacturers of a digital license plate product in the United States. Currently, two states allow digital license plates for use by the public, California and Arizona. 13 The digital license plates are purchased through participating resellers or the plate manufacturer and are not available through the states’ agencies. 14 The manufacturer determines the plate’s cost and the states do not receive any proceeds from sales. 15 It is expected that Texas, Maryland, North Carolina, Pennsylvania, Ohio, Michigan and Georgia are also looking into the feasibility of allowing digital license plates. 16 7 Ibid. 8 Ibid. 9 Sections 320.06(1)(b) and (c), F.S. 10 Supra FN 6. 11 California Department of Motor Vehicles, Report on Alternative Registration Products Pilot Program, at 9-10, August 2019, https://www.dmv.ca.gov/portal/uploads/2020/04/AlternativeRegistrationProducts.pdf (last visited January 27, 2022). 12 Ibid. 13 Sebastian Blanco, Digital License Plates Coming to Michigan in 2021 after Debut in California, Car and Driver, November 28, 2020, https://www.caranddriver.com/news/a34748524/digital-license-plates-coming-2021/(last visited January 27, 2022). 14 Arizona Department of Transportation, Digital License Plate Program, https://azdot.gov/motor-vehicles/vehicle- services/plates-and-placards/digital-license-plate-program (last visited January 27, 2022). 15 Ibid. 16 Department of Highway Safety and Motor Vehicles, 2022 Legislative Bill Analysis for SB 1178, (January 13, 2022), p. 3 (on file in the Senate Committee on Transportation). BILL: SB 1178 Page 4 ReviverMX, Inc. Reviver is the developer of a platform that integrates a digital license plate and a smart phone app. The company sells two types of digital license plates: the Rplate and the Rplate Pro. 17 Approximatively 4,000 vehicles are equipped with Rplates in California and Arizona. 18 According to Reviver, the Rplates have the functionality to be used by some businesses as mini- billboards to advertise their products or services and to provide public service messages, such as street closure notifications or to show an ad for a city service. However, the Rplate will be able to do so only when the vehicle comes to a stop for four seconds or longer. The license plate number will still appear on the screen when messages appear, but it will be smaller and in the upper right corner of the screen. 19 Purchasers of the Reviver Rplates incur two costs; the price of the screen itself (plus installation for the Reviver Rplate Pro) and the annual service plan. The basic Reviver Rplate is powered by a five year battery and is $899 or $19.95 per month with a 48 month agreement, both purchase options require an additional $55 annual service plan; and the Reviver Rplate Pro is $1049 ($999 plus $150 installation fee) or $24.95 per month with a 48 month agreement, both purchase options require an additional $75 annual service plan. The Reviver Rplate Pro is wired to a vehicle’s power source and provides additional options such as telematics through a built in GPS system. 20 Airplate Airplate is the developer of a platform that integrates a digital license plate, smart phone app and a color code HD LED display ring around the digital license plate which indicates the status of the vehicle and the driver, allowing a law enforcement officer to avoid danger from a distance. 21 The color codes provided on their website are: green which indicates a driver is legal to operate a motor vehicle; yellow which indicate the vehicle registration has expired; red which indicates the driver does not have a legal right to operate a motor vehicle, a violation of law has occurred, or has a warrant for arrest; amber which indicates a National Amber Alert for a person of interest and missing persons; Blue which indicates a restricted license; purple which indicates an emergency signal for those with Alzheimer’s or dementia; silver which indicates a missing elderly person; and pink which indicates an autonomous self-driving vehicle or artificial intelligence operated vehicle. 22 Airplate’s digital license plate is designed to initially be used by government fleet-issued vehicles, school buses, day care transportation vehicles, transportation vehicles for senior 17 Reviver, Reviver Announces Florida Has Filed Legislation Authorizing its Digital License Plates, PR News Wire, February 9, 2021, https://www.prnewswire.com/news-releases/reviverannounces-florida-has-filed-legislation-authorizing-its- digital-license-plates-301224838.html (last visited January 27, 2022). 18 Supra FN 9. 19 California Senate, Senate Rules Committee, SB 806 Senate Floor Analysis, p. 4, September 3, 2013, https://leginfo.legislature.ca.gov/faces/billAnalysisClient.xhtml?bill_id=201320140SB806 (last visited January 27, 2022). 20 Reviver, Shop, https://www.reviver.com/shop/ (last visited January 27, 2022). 21 Theairplate, https://www.theairplate.com/ (last visited January 28, 2022). 22 Ibid. BILL: SB 1178 Page 5 citizens, trucking, and rental car fleets. 23 At this time there is no pricing information available for the digital license plate. Other States In 2013, the California Department of Motor Vehicles (DMV) was authorized to establish a pilot program to assess and review the use of alternative products for vehicle registration currently issued by the DMV (license plates, stickers, tabs, and registration cards). The purpose of the pilot was to allow the DMV to examine the functionality of alternatives to standard registration products and to evaluate the cost-effectiveness and feasibility of implementation. In 2015, the DMV awarded and executed a non-competitive bid contract with Reviver for a digital license plate pilot program. 24 The California pilot program became operational in December 2015, with five vehicles. In 2017, the pilot program grew to approximately 85 vehicles. In 2018, participation increased to approximately 1,400 vehicles. The pilot program was projected by California to conclude in July 2020 with participation of approximately 1,500 vehicles. 25 In 2017, Arizona conducted a pilot program to assess and review the use of alternative products for vehicle registration, and as of January 2019 drivers in Arizona were able to purchase a digital license plate for their vehicles. The Arizona Department of Transportation (ADOT) worked with Reviver to administer the pilot to test the functionality, durability, and viability of digital license plates in Arizona’s areas with extreme high and low temperatures and to test the ability to operate in areas with low/no cellular connectivity. Arizona’s pilot was limited to 10 ADOT- owned vehicles throughout the state. The ADOT selected vehicles with higher monthly mileage to ensure that plate display devices were adequately exposed to the elements. 26 During this pilot project, the ADOT collaborated with the Arizona Department of Public Safety, which performed readability and functionality testing. The pilot found digital license plates: Readable from a distance of 100 feet during daylight; Readable at night; Do not have glare that cause the plates to be difficult to read; Continue to operate when disconnected from the power source; and Maintain functionality and readability in extreme temperatures. 27 Florida In 2012, the DHSMV was authorized to implement a pilot program to evaluate designs, concepts, technologies for alternative license plates, and the long-term cost impact to the consumer. The pilot would be limited to license plates used on government-owned motor vehicles. The DHSMV has implemented a pilot program for alternative license plate technologies. Presently, several government vehicles in the DHSMV’s Division of Motorist Services fleet are equipped with digital license plates from Reviver and are being evaluated for 23 Barney Bishop, Representative of Airplate (on file in the Senate Committee on Transportation). 24 Supra FN 11. 25 Ibid. at p. 1. 26 Ibid at p. 14. 27 Ibid at p. 15. BILL: SB 1178 Page 6 feasibility. The plates are not integrated with the DHSMV’s motor vehicle titling and registration systems. 28 III. Effect of Proposed Changes: The bill amends s. 320.06(4), F.S., to provide that the Department of Corrections via PRIDE shall manufacture license plates. Currently the DHSMV pursues competitive bids for the manufacture of decals and has utilized different vendors, including PRIDE. 29 The bill repeals s. 320.06(5), F.S., providing the DHSMV authority to conduct a pilot program to evaluate designs, concepts, technologies for alternative license plates, and the long-term cost impact to the consumer. The bill amends s. 320.07, F.S., to provide that a digital license plate owner is not subject to the penalties of s. 320.07, F.S., for failure to display a validation sticker if the vehicle is operated in compliance with law and any rules adopted by the DHSMV governing the placement of digital license plates and registration renewal. Digital License Plates The bill creates s. 320.08069, F.S., which allows for the use of a digital license plate. It provides that a digital license plate is subject to the laws of Florida applicable to a physical license plate. However, digital license plates will be exempt from s. 320.06(3)(a), F.S., which relates to specific physical characteristics of an aluminum license plate. The bill creates the following definitions: Digital license plate to means an electronic display designed to: o Display the information required in this chapter to be included on a physical license plate. o Be placed on a motor vehicle registered under this chapter in lieu of a physical license plate. Digital license plate provider to mean a person or an entity engaged in the business of providing digital license plate hardware and services to motor vehicle owners. Digital License Plate Issuance The bill provides that by August 1, 2022, the DHSMV must allow a motor vehicle registered in this state to be equipped with a digital license plate in lieu of a physical license plate issued under s. 320.06, F.S., upon a determination that the information on the digital license plate display is readable by current automated license plate recognition hardware and software. However, the purchaser of a digital license plate must first obtain a physical license plate from the DHSMV before obtaining a digital license plate from a digital license plate provider. Physical license plates must be renewed in accordance with the requirements of s. 320.06, F.S., relating to all fees due on an annual or semiannual basis. 28 Supra FN 16, p. 2. 29 Ibid at p. 4. BILL: SB 1178 Page 7 The bill provides that the DHSMV may: Contract with one or more digital license plate providers for the issuance of digital license plates, including any services related to the issuance of digital license plates. The contract must include provisions governing the protection of personal and motor vehicle registration data obtained by a digital license plate provider in the performance of its services. Authorize the display of the motor vehicle’s validation on each digital license plate in lieu of the validation sticker. The validation must display the owner’s birth month, the license plate number, and the year of expiration or appropriate renewal period if the owner is not a natural person. The validation must be displayed in the upper right corner of the digital license plate. Authorize the use of a digital license plate for electronic toll collection, if such use has been approved by the Department of Transportation or other appropriate tolling authority, or to display a parking permit. Establish procedures for displaying the following information on a digital license plate: o An emergency alert or other public safety alert issued by a governmental entity, including an alert for a missing child or adult. o Static logo displays, including unique displays for fleet license plates, specialty license plates, special license plates for military service, and special license plates for the Governor and federal and state legislators. o Other displays that the DHSMV, in consultation with law enforcement agencies, determines are in the interest of public safety. Digital License Plate Requirements The bill provides that a digital license plate issued must: Meet the specifications and requirements adopted in the bill; Include the same information required to be included on a physical license plate and legibly display that information at all times and in all light conditions; and Have wireless connectivity capability. Digital License Plate Providers The bill provides that a digital license plate provider with whom the DHSMV contracts must: Maintain an inventory of digital license plates issued in this state by the digital license plate provider; Make available a digital version of each specialty license plate authorized by the DHSMV; and If a digital license plate displays a validation, promptly update the display of the validation to reflect the current registration period for the motor vehicle and, upon request of the DHSMV, suspend the display of the validation or indicate on the digital license plate that the registration for the motor vehicle has expired. Digital License Plate Consumers The bill provides that a consumer who chooses to purchase a digital license plate must purchase a digital license plate directly from a digital license plate provider. In addition to any fees associated with the purchase of a digital license plate, the consumer is also responsible for paying to the DHSMV all applicable motor vehicle fees, including any annual use fees BILL: SB 1178 Page 8 associated with any specialty license plate the consumer wishes to display on the digital license plate. The bill provides the DHSMV may adopt and implement rules for the use of digital license plates. The bill provides an effective date of upon becoming law. IV. Constitutional Issues: A. Municipality/County Mandates Restrictions: None. B. Public Records/Open Meetings Issues: None. C. Trust Funds Restrictions: None. D. State Tax or Fee Increases: None. E. Other Constitutional Issues: None identified. V. Fiscal Impact Statement: A. Tax/Fee Issues: None. The bill does not increase or change fees for registration of motor vehicles. Vehicle owners who voluntarily decide to purchase a digital license plate would not purchase the digital license plate from the state. B. Private Sector Impact: Reviver appears to currently be the only manufacturer of a digital license plate product that is currently available for purchase by the general public. Any subsequent expansion of availability to any motor vehicle registered under ch. 320, F.S., would have a positive fiscal impact to the company. C. Government Sector Impact: The bill may have an indeterminate, likely insignificant, negative fiscal impact to the DHSMV with the expectation being that programming and implementation will be BILL: SB 1178 Page 9 conducted between the vendor and the consumer. The DHSMV does not currently plan on programming connectivity between the proposed digital license plates and the DHSMV systems and will continue with current procedures for original and renewal license plate transactions. 30 VI. Technical Deficiencies: None. VII. Related Issues: None. VIII. Statutes Affected: This bill substantially amends sections 320.06 and 320.07 of the Florida Statutes. This bill creates section 320.08069 of the Florida Statutes. IX. Additional Information: A. Committee Substitute – Statement of Changes: (Summarizing differences between the Committee Substitute and the prior version of the bill.) None. B. Amendments: None. This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate. 30 Supra FN 16, p. 7.