This study develops an alternative model for issuing driver licenses and personal identifications in Kentucky. Under the current model, most licenses are distributed by circuit court clerks at 142 offices across the state while the Kentucky Transportation Cabinet (KYTC) provides central and regional support for specific license types. Given the cumbersome administrative structure and impending REAL ID requirements, both circuit clerks and KYTC administrators would like to explore an alternative distribution model. Researchers at the Kentucky Transportation Center (KTC) projected the costs of transitioning from the current issuance model to a centralized DMV model where licenses are distributed at 18 to 24 regional field offices. In FY 2020, the cost for having circuit clerks distribute licenses was roughly $18.5 million. A regional model will have initial costs between $10.4 and $16.4 million depending on the number of offices and employee compensation levels. If switching from a 4-year to 8-year license renewal cycle, the ensuing revenues would more than cover costs, although the License Fund allocation from each license sale should be adjusted so that all costs are covered and do not require additional Road Fund supplements. Optimizing the centralized issuance model will depend on transitioning from 4-year to 8-year license renewal intervals, completely transitioning issuance to KYTC and avoiding a hybrid distribution system and duplication of infrastructure, increasing allocations to the License Fund, implementing an online driver license renewal system in the near future, and transitioning away from the dated mainframe driver licensing database to a newer, more dynamic system.

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© 2020 University of Kentucky, Kentucky Transportation Center

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The contents of this report reflect the views of the authors, who are responsible for the facts and accuracy of the data presented herein. The contents do not necessarily reflect the official views or policies of the University of Kentucky, the Kentucky Transportation Center, the Kentucky Transportation Cabinet, the United States Department of Transportation, or the Federal Highway Administration. This report does not constitute a standard, specification, or regulation. The inclusion of manufacturer names or trade names is for identification purposes and should not be considered an endorsement.