Topic:
DRIVER LICENSES; JUVENILES;
Location:
MOTOR VEHICLES - LICENSES;

OLR Research Report


July 2, 2004

 

2004-R-0545

THE CONNECTICUT DRIVER RETRAINING PROGRAM

 

By: James J. Fazzalaro, Principal Analyst

You asked a number of questions regarding the Connecticut Driver Retraining Program authorized by CGS 14-111g. These cover a wide range of topics including the history of the program, the process that was followed in approving the vendors who provide the retraining classes, the number of people who participate in the program, and several other areas.

This report constitutes a compilation of information developed in response to your questions over a period of several months.

SUMMARY

The Connecticut driver retraining program was established by the legislature in 1993, initially to apply only to 16- and 17-year old drivers with moving violations on two or more occasions. It was expanded to apply to drivers of all ages in 1995 and modified in 1998 to apply to drivers through age 24 with two or more violations and drivers over age 24 with three or more violations. Drivers ordered to attend the retraining class must complete it to avoid license suspension.

In late 1995 and early 1996, the motor vehicle commissioner selected two entities to provide the retraining classes. The two program providers were the National Safety Council, which was approved in the Fall of 1995, and the Driving School Association of the Americas, Inc., which

was approved in April 1996. The selections appear to have been made through an informal process that did not involve issuance of a Request for Proposals. Former commissioner Michael Kozlowski issued approvals in the form of letters of certification to the two vendors rather than through explicit contracts for services.

Although the law authorizing the retraining program requires the commissioner to adopt implementing regulations, the process begun in 1996 prior to initiation of the program was not completed. Regulations were reintroduced in 2001, approved by the legislature's Regulations Review Committee in 2002 and became effective on October 25, 2002. Thus the program operated from mid-1996 through early October 2002, a period of about six years, without regulations. Although there are now regulations, it is not clear if all of their requirements are being applied to the two current vendors selected in 1996.

The National Safety Council operates its portion of the retraining program from its northeast region office in Syracuse, New York. It does not appear to have a physical presence in Connecticut, apart from the fact that its certified instructors teach the classes here, even though required to do so by the regulations. The Driving School Association of the Americas, Inc. appears to be headquartered in Milwaukee, Wisconsin. Its portion of the retraining program is operated through an affiliate—the Driving School Association of Connecticut. The agent for the Driving School Association of Connecticut is listed in the records maintained by the secretary of the state as Jack Sousa. He owns and operates Driving Schools, Inc., a state-licensed commercial driving school that appears to conduct driver training activities in as many as 34 Connecticut municipalities. Sousa is also listed as a past president of the Driving School Association of the Americas. Sousa appears to be the primary administrator of retraining activities.

The Department of Motor Vehicles (DMV) could provide us with only limited information on the activities of the retraining program as it appears not to conduct extensive oversight of the program. No one in DMV has historically been assigned explicit oversight responsibility. Drivers whose histories of violations require attendance at a retraining class pursuant to the law are provided with two toll-free telephone numbers on the DMV website—one for each of the two vendors. These drivers must call one of the vendors to find out the location and schedule of classes that they might attend. The vendors provide DMV with a list of those who complete the course and tender $10 of the $60 program fee they collect for each person who completes the course.

DMV estimates that during the three years from 2001 through 2003 approximately 85,000 drivers were required to attend retraining classes of which around 77,200 actually completed the classes. The program has a significant recidivism rate of more than 41%. Approximately 32,000 of the people who took the retraining classes during the three-year period were taking it for at least the second time. Almost one-quarter of the 32,000 repeaters were taking it for the third time and 5,500 of them were taking it for at least the fourth time. DMV could not provide a breakdown of each vendor's proportionate share of program participants.

DMV received over $270,000 from its $10 portion of the program fee in 2001, $316,000 in 2002, and $305,000 in 2003. Based on these amounts, it appears the two vendors retained approximately $1.5 million in program fees annually. We do not have an analysis of DMV's administrative costs for the program, but since it does not appear historically to have conducted direct program oversight or operation, its involvement would appear to be limited to providing notice to drivers subject to the law's requirements and maintenance of the section of its website providing the vendors' toll-free numbers. Thus it appears highly probable that the revenue it derives from the program fees exceeds its costs to administer the program.

DMV estimates that it would cost approximately $2.1 million annually for it to operate the retraining program entirely “in-house.” The largest cost items it identified were $928,281 for 15 staff positions it stated it would have to add, $819,000 for course materials, and $160,000 to rent 12 classroom facilities to augment four locations it already has at its branch offices.

Since we began gathering information on the retraining program, DMV has taken several actions in this area. In April, it published a Request for Information in newspapers to assess whether there are other entities that might be interested in providing the retraining services. Responses were due June 25, 2004. In May, the commissioner agreed to conduct an evaluation of the retraining program that, among other things, must consider replacing the program with a license points based system, using the motorcycle rider education program as an administrative model for providing driver retraining, methods to reduce recidivism in the program and assure that the program is fiscally self-sustaining, improvements to the current program, and graduated sanctions for those who commit additional violations after attending the retraining classes.

CONNECTICUT OPERATOR RETRAINING PROGRAM

The Connecticut operator retraining program was created in 1993 to apply to 16- and 17-year old drivers who had multiple moving violations but was expanded in 1995 to apply to Connecticut drivers of all ages (CGS 14-111g). Initially, the DMV commissioner was authorized to require any driver under age 18 to attend a driver retraining program who committed a moving violation on two or more occasions. The maximum fee for the program was set at $50 and the commissioner was given authority to suspend the license of anyone who failed to attend or successfully complete the program.

In 1995, the law was broadened to include any Connecticut driver with two or more moving violations regardless of age. In 1998, it was modified again, this time to apply the retraining requirement in its current form to anyone age 24 or under after two moving or suspension violations and anyone over age 24 after three moving or suspension violations. (The 1998 law reclassified several of the violations that previously were called moving violations but actually were criminal offenses and reclassified them as “suspension violations.”)

The 1998 law also raised the program fee from $50 to $60 and authorized DMV to receive the extra $10 for the cost of implementing the retraining program.

Moving violations that trigger the retraining requirement range from infractions, such as failure to signal, improper passing and violating stop signs or traffic lights, to more serious offenses such as speeding, reckless driving, tailgating for the purpose of intimidation, and passing a stopped school bus. Suspension violations that trigger the retraining requirement are generally serious criminal offenses such as driving while intoxicated, negligent homicide with a motor vehicle, evading responsibility after an accident, and the penal code offenses of manslaughter in the second degree with a motor vehicle, misconduct with a motor vehicle, and assault in the second degree with a motor vehicle.

PROGRAM INITIATION

In implementing the requirements of the law, DMV does not appear to have followed a formal Request for Proposal process. Instead, it appears to have selected the vendors informally. The only documents DMV was able to provide to us as evidence of vendor selection and approval are letters of confirmation of approval signed by then-commissioner Michael W. Kozlowski. Commissioner Kozlowski selected and approved two vendors to operate the retraining program—the National Safety Council (NSC) and the “Driving School Association of America/AAA.” (While the DMV refers to the latter provider as the “Driving School Association of America,” certain documents submitted by the agent for the provider refer to it as the “Driving School Association of the Americas, Inc.”)

The NSC was the first of the two vendors approved for the retraining program although it is unclear from the documents DMV provided to us when the official notification of approval occurred. We received three versions of the National Safety Council approval letter from DMV. Two unsigned versions are dated October 4, 1995. A signed version is dated November 17, 1995. The November 17 letter contains Commissioner Kozlowski's signature, but subsequent correspondence to DMV from an attorney representing the NSC refers to a signed “October 1995 letter agreement.” Thus it is unclear if the “official” notification of approval occurred in October or November of 1995.

The Driving School Association of America/AAA (DSAA/AAA) approval letter is dated April 4, 1996. The letter most closely resembles the November 17 NSC letter in terms of form and content.

The approval letters are similar but not identical. DSAA/AAA was required to offer retraining classes in approximately 20 classroom locations with geographical distribution planned for maximum accessibility for drivers required to attend. The NSC was required to offer classes at a minimum of nine locations under a similar geographic distribution requirement. The DSAA/AAA approval letter requires classes to be held on Saturdays during morning and evening hours. The NSC letter requires classes to be held “Saturdays and evening hours.”

Both approval letters state that the relationship between the DMV and the approved provider “will continue indefinitely” unless the legislature repeals the statutory authorization for the program. The DSAA/AAA and the November 17 NSC letter contain additional specifications regarding legislation that might have the effect of precluding application of the authorizing statute by DMV or eliminating its authority to administer the law. The October 4 NSC letter does not have this additional language.

The two approval letters also state that DMV's certification may be withdrawn and its relationship with the provider terminated for any or all of the following circumstances:

1. The provider receiving money from students referred by DMV while teaching no class in return, but certifying these drivers as having completed the class.

2. The provider's failure to monitor its instructors to assure that the approved courses are taught as prescribed with any problems regarding an instructor addressed within 60 days.

3. The provider's failure to provide an adequate number of classes so that referred students may complete their obligation within 60 days.

4. The provider's failure to comply with any material provision of the certification to conduct retraining classes. (This criterion appears in the November 17 NSC letter but not the October 4 letter, so it is unclear whether it applies to the NSC agreement.)

These are the only grounds specified for termination.

Both letters contain a provision stating that DMV may withdraw certification and terminate the relationship only if the provider fails to correct any of the above deficiencies within 45 days of receiving written notice of the deficiency.

The approval letters give both providers the right to terminate their participation in the program if they determine that revenue generated by the program is insufficient. They must give DMV 45 days written notice of their intent to terminate.

The documents also indicate that there may have been some conflict between DMV and the National Safety Council in March of 1996. In a letter dated March 11, 1996, Attorney Scott Mendel representing the NSC wrote to DMV Division Chief Barbara Tanuis expressing concern over the possibility that DMV was considering suspension of the program “due to baseless threats by another driver improvement organization.” Attorney Mendel indicated that the organization had made a substantial investment in preparing to offer the program in Connecticut, that suspension would impose a significant hardship on the NSC in that continuing the program was the only way this investment could be recouped, and that the letter agreement signed by Commissioner

Kozlowski specified limited circumstances under which the program could be terminated and that none of these had occurred. A letter from DMV Chief of Legal Services John Yacavone to Attorney Mendel dated March 12, 1996 stated that the DMV was not suspending the program but that certain “administrative details and changes” had to be completed before the program is operational.

VENDOR BACKGROUND

National Safety Council (NSC)

The NSC appears to have no actual representative physically present in Connecticut apart from the instructors conducting its retraining classes. We found no listing for it in the Secretary of State's on-line database (Connecticut Online Commercial Recording Database). Correspondence between the DMV and the NSC has been addressed to Patrick J. Healy, Senior District Manager for the Northeastern Region Office located in Syracuse, New York. In some correspondence Mr. Healy has also identified himself as the Manager for State DDC Program Development. A September 18, 1995 letter from Healy to DMV states that “All administration, training and scheduling of instructor/advisors would be done by the Council's Northeastern Region Office. All data would be transmitted electronically between Syracuse, N.Y. and DMV headquarters.”

The NSC lists 28 locations in Connecticut where retraining classes are conducted. These include commercial driving schools in Norwalk, Newington, Middletown, Wallingford, and Hartford; community technical college and other college facilities in Enfield, Waterbury, Willimantic, Bridgeport, Danbury, New Haven, North Haven, Storrs, West Haven, and Farmington; public school facilities in Manchester, Colchester, and Uncasville; public libraries in Danielson and Windsor Locks; motels and other public lodging facilities in Meriden, Old Saybrook, Southington, Vernon, and Torrington; the multi-cultural center in East Hartford; and locations in Stamford and Milford that were not specifically identified.

Driving School Association of the Americas (DSAA)

The DSAA describes itself as an international association of driving school owners and educators from Austria, Canada, Germany, Japan, the United Kingdom, and the United States. Its internet website indicates its operates a communications office in Milwaukee, Wisconsin. Its membership fees range from $115 to $215 annually, depending on the number of vehicles the driving school operates.

DSAA does not operate the retraining classes in Connecticut directly. Its summary of operations states that an affiliate, the Driving School Association of Connecticut (DSAC), provides business services for DSAA that include responding to calls from a published toll-free number, collecting fees, and directing and assigning customers to the scheduled classes. DSAC provides the toll-free number to DMV for those who are required to take the retraining course to use to find classes and class times. The DMV website lists the toll-free numbers for both DSAA and NSC for this purpose (DMV: Operator Retraining).

The DSAA is not registered with the Office of the Secretary of the State, but the DSAC is registered. The secretary of state's database lists no business address for the DSAC, but lists a mailing address as 73 Post Road in Cos Cob (Greenwich). The mailing address recently changed from a Norwich address. The principals listed for the DSAC are Franz J. Redantz as President and Linda Muccio as Treasurer. (These principals did not change when the mailing address changed from Norwich to Cos Cob.) DMV records show the 73 Post Road address in Cos Cob as the business address of Tom's Auto Driving School, Inc. operated by Thomas Ferraro. DMV records list a “Frank Redanz” as the co-owner (with Maureen Redanz) of Briarwod Driving Academy LLC in Bozrah (with additional offices in Jewett City, Ledyard, Norwich, Pawcatuck and Uncasville).

Jack P. Sousa is listed as the agent for the DSAC. His business address is shown as 23 Woodtick Road in Waterbury. Sousa appears to be the person who actually administers driver retraining operations for the DSAA and is the person who corresponds with DMV regarding matters concerning the DSAA/AAA agreement. The DSAA website lists Sousa as a past president of the organization. Sousa also owns and operates Driving Schools, Inc with its main office located at 23 Woodtick Road in Waterbury. Besides Waterbury, DMV records show Driving Schools, Inc. operating branches or school-based operations in at least 33 other municipalities. Driving Schools, Inc. apparently also does business under the name “Academy of Driving.”

As you are aware, Sousa provided you with a list of the 20 driving schools participating in the driver retraining program through the DSAC. These include: AAA (Avon); Top Driver Acquisition, LLC (Avon); Glastonbury Driving School, LLC (Bolton); Briarwood Driving Academy, LLC (Bozrah, Jewett City, Norwich, and Pawcatuck), Driving Schools, Inc. (Branford, Cheshire, Danbury, East Lyme, Hamden, and Old Saybrook); Airway Auto Driving School (Bridgeport); AAA Driving School (Bristol, Farmington, and West Hartford); Tom's Driving School (Cos Cob); Big A Driving School, LLC (Cromwell and Middletown); M & N Driving School (Enfield); Robert's Driving School (Greenwich and New Canaan); Danny's Driving School (Hartford); International Academy of Driving (Hartford); Central Driving School (Kensington); Big A Driving School, LLC (Middletown); AA Milford Driving School, Inc. (Milford); Howe Driving School (Monroe and Stratford); Patz Driving School (Newington); Santo Driving School (Norwalk); and Modern Lern-Rite Driving School (Wallingford).

The DSAA website lists 18 driving schools as Connecticut members of its organization. Of these, eight are on the DSAC list of schools providing retraining (AAA Driving School, Airway Auto Driving School, Briarwood Driving School, Driving School, Inc., Howe Driving School, M & N Driving School, Tom's Auto Driving School, and Roberts Driving School).

DMV IMPLEMENTING REGULATIONS

The driver retraining program was fully operational in 1996. The law requires DMV to adopt implementing regulations, but no such regulations were in place until 2002. It appears that DMV made an attempt to adopt regulations in 1996 but that the process was never completed. DMV held a public hearing on a set of proposed regulations on May 15, 1996. Although DMV apparently submitted the regulations to the attorney general's office for approval sometime prior to the end of August 1996, they appear to have gotten no further in the implementation process.

DMV did not address the issue of driver retraining program regulations again until 2001 when it published a notice of intent to adopt regulations in the Connecticut Law Journal. The notice appeared on February 13, 2001. The public hearing on the proposed regulations was held on February 26, 2001. The attorney general approved them for legal sufficiency on October 2, 2002, and the legislature's Regulations Review Committee approved them on October 22, 2002. The regulations became effective on October 25, 2002 (Conn. Agencies Regs., 14-111g-1 et seq.). Thus the program appears to have operated without the implementing regulations for approximately six years.

The current regulations require someone seeking certification to provide driver retraining to submit a written application to the commissioner. A certified provider must meet certain minimum criteria including, among other things: (1) have a permanent place of business in Connecticut where all operator retraining program records must be maintained and accessible for inspection; (2) file and continuously maintain a $100,000 surety bond conditioned upon compliance with the laws and regulations relating to the retraining program; (3) be registered to do business in Connecticut and be in good standing with the Office of the Secretary of the State, and continuously maintain this status; and (4) biennially demonstrate to the commissioner its compliance with all federal, state, and local tax obligations.

Prior to certifying a program provider, the motor vehicle commissioner must investigate the provider's character, driving history, and criminal history. The regulations state that a provider certification is valid for a two-year period and that recertification is at the commissioner's discretion. The regulations prohibit a provider from moving classes to a new location without the commissioner's prior approval and the provider must notify the commissioner if use of a business office or classroom location is discontinued within five business days. Records on program attendees must be maintained by the program provider for three years following program completion. Before approving a classroom instructor, the commissioner must review his character, driving history, and criminal record. In order to maintain his approved status, an instructor must successfully complete an additional program of at least three hours of operator retraining instruction every two years.

The regulations specify that the $10 portion of the $60 program fee the law allows the DMV to retain for administrative expenses must be submitted by the provider “concurrent with notification of completion of the operator retraining program by each operator.” (Conn. Agencies Regs., 14-111g-8)) The regulation appears to make no provision for the $10 remittance should a driver pay the program fee and either not show for the class or not complete it successfully.

It is unclear how these regulatory requirements are currently being applied to the two program providers or if they are being held in abeyance until new provider certifications are done. We found no evidence from the Secretary of State's website, that the National Safety Council has a permanent Connecticut business location where program records are kept or that it is registered to do business in Connecticut. Also, the documents DMV provided to us with respect to the retraining program providers contained no information with respect to whether either has posted the $100,000 surety bond the regulations require. We also do not know if classroom instructors have received the additional training the regulations require biennially or if DMV was notified as required when DSAC's business address changed from Norwich to Cos Cob.

Finally, if the provision of the regulations establishing a two-year period of validity for provider certification is assumed to have been in effect with the current providers as of October 25, 2002 (based on the effective date of the current regulations), it would appear that they should have to be recertified as meeting the requirements of the regulations no later than November 2004.

PROGRAM STATISTICS

Program Participants

DMV indicated that it did not have the ability to track the operations of the driver retraining program on a continuing basis. Instead, it provided us with a “one-shot” profile of the program. Over the last three calendar years (2001-03), DMV reported that a total of approximately 85,000 people were required to go though the retraining program. Of these 7,800 had their licenses suspended for failing to attend a retraining class, leaving approximately 77,200 who actually attended retraining classes. Of the 77,200 attendees, approximately 32,000 (41.5%) attended the classes more than once. The 32,000 people who took the retraining program more than once broke down approximately as follows: 19,000 (59%) attended the program twice, 7,500 (23%) attended the program three times, and 5,500 (17%) attended the program four or more times. Two-time recidivists represented almost a quarter (24.6%) of the people who actually attended retraining sessions during the three-year period. Three time recidivists represented 9.7% of the total program attendees during the three-year period. Approximately 7.1% of the total program attendees were taking it for at least the fourth time in the three-year period.

The recidivism rate in the driver retraining program is significant. Younger drivers appear to be the primary recidivists. Of the 32,000 people who took the retraining program more than once during the three-year period from 2001 through 2003, approximately 22,000 (68.8%) were drivers 24 years of age or younger.

DMV appears to have relatively little information on how the retraining program functions on an ongoing basis. No one in DMV is assigned direct oversight responsibility for it and there has not been any significant amount of analysis with respect to the program's effectiveness or the high rate of recidivism. While DMV provided overall numbers with respect to the number of drivers who went through the program during the 2001-2003 period, it could not identify how many each of the two vendors was responsible for retraining.

Program Revenues

As noted above, in 1998, the legislature increased the program fee from $50 to $60 and authorized DMV to retain the additional $10 from the fee “for the cost of implementing the motor vehicle retraining program… .” The DMV received $270,780 from the fees charged program attendees in 2001, $316,410 from these fees in 2002, and $305,120 from these fees in 2003. These revenues, which appear to represent fiscal year rather than calendar year program participation, suggest an average annual number of participants of approximately 29,700 for FYs 2001-03.

The amount DMV collected from program fees equals approximately one-sixth of the total amount paid by participants ($10 of the $60 fee). Extrapolating from the amount DMV collected, it appears that program participants paid a total of $1,624,680 in fees in FY 2000-01, $1,898,460 in FY 2001-02, and $1,830,720 in FY 2002-03. Therefore, the two program operators appear to have derived approximately $1,353,900 in receipts from participants in FY 2000-01, $1,582,050 in FY 2001-02, and $1,525,600 in FY 2002-03. Thus, the average annual receipts over the FY 2001-03 period were $1,487,183.

DMV ESTIMATE FOR IN-HOUSE OPERATION OF THE PROGRAM

At our request and based on your questions regarding the driver retraining program, DMV provided an estimate of what it felt it would cost to provide this program on a completely “in-house” basis instead of through the use of outside vendors. This estimate was provided directly to you by DMV in May 2004 but is summarized here.

DMV estimates a total cost of providing the program on an in-house basis as approximately $2.1 million annually. Most of these costs ($928,281) were attributed to personnel. DMV indicated it would hire 15 new people consisting of one program coordinator (overall administration, resource coordination, and review of statistics of program effectiveness), three administrative clerical positions (scheduling classes, maintaining class room locations, trainer schedules, and customer correspondence), three driver improvement analysts (responsible for license suspension and restoration and customer inquiries), and eight trainers (classroom instruction).

The other main cost areas DMV identifies include $160,000 for renting 12 classroom facilities in addition to the four locations DMV identified it could use in its own offices, $819,000 for classroom materials ($30 each, plus class certificates at $1.50 each), $30,000 for equipment (eight laptop computers, computer projection screens, and portable printers), $50,000 for toll-free phone lines, $60,000 for rental of eight vehicles, $8,000 for instructor training and $600 (biennial) for the three-hour instructor retraining course, and $7,060 for scheduling language interpreters. (The current regulations require program providers to arrange for interpreters when the applicant notes this is necessary when signing up for the class.)

RECENT DMV ACTIONS REGARDING THE DRIVER RETRAINING PROGRAM

Subsequent to our inquiries regarding the retraining program, DMV has undertaken several activities aimed at reviewing and analyzing the program and possible alternatives to it. A DMV work group was formed to develop a Request for Information (RFI) to assess whether there are other entities who might be interested in and capable of providing driver retraining for DMV. The RFI appeared in newspapers beginning April 14, 2004 with written responses to the RFI due on June 25, 2004.

Richard Cosgrove, DMV chief administrative officer, indicated that the work group is also examining possible actions to address the high recidivism rate, such as license suspensions for repeat offenders or DMV providing more intensive training for repeat offenders.

As you are also aware, in a letter dated May 4, 2004 to you, Representative Cocco, and Senator Ciotto, the commissioner agreed that the DMV would conduct an evaluation of the retraining program over the next few months and report to the Transportation and Appropriations identifying alternative methods for administering and operating it and making recommendations for improvements. The commissioner's evaluation must include, at least, consideration of (1) eliminating the current program and replacing it with a license points based system, (2) using the motorcycle rider education program as a model for the driver retraining program, (3) methods to reduce recidivism, (4) a system of graduated sanctions for those who complete the initial retraining

program and commit additional violations subject to sanction, (5) improvements to the current retraining curriculum, (6) methods to assure that the retraining program be fiscally self-sustaining, and (7) any other matters he deems relevant. DMV agreed to provide a summary briefing of its findings to the two committees by December 1, 2004 and a final report by January 1, 2005.

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