Thursday, Feb. 11, 2010 | 2:01 a.m.
- Gibbons: Time to reinvent state government (2-8-2010)
- Governor plans emergency address on Nevada budget (2-7-2010)
- Governor’s speech will lay out state’s budget problems (2-7-2010)
- State budget comes up $800 million short (1-22-2010)
- Forecast: Economy will begin to rebound in mid-2011 (1-22-2010)
- Gibbons’ no-talk order further divides branches (1-22-2010)
- Special session may require help of state Supreme Court (1-10-2010)
The state’s deficit has grown so dire that Gov. Jim Gibbons is seriously considering hiring a company to search Nevada roadways for uninsured motorists.
The proposal to hire Chicago-based InsureNet to use cameras to verify whether vehicles are insured and registered with the state could raise $100 million in revenue, according to Lynn Hettrick, Gibbons’ deputy chief of staff.
The plan might be included in a package of proposals — likely to include $418 million in budget cuts and other suggestions to close Nevada’s $881 million deficit — which the Legislature will debate during a special session beginning Feb. 23.
The 2009 Legislature considered signing a contract with InsureNet.
A bill that would have required the Department of Motor Vehicles to sign a contract with the company died after the state agency complained it would duplicate an in-house insurance verification system. DMV officials also criticized the bill because it was written so that only InsureNet would qualify, giving it significant leverage in negotiating financial terms.
But InsureNet’s overtures might be more appealing now, as the governor and legislative leaders are working to close the budget hole without raising taxes.
Hettrick said InsureNet would be asked to put up a bond for as much as $100 million. The company said the state could earn $160 million the first year from penalties assessed against drivers, he added.
Some legislators, though, raised privacy concerns.
“The idea of using cameras is anathema for many Nevadans,” Assemblywoman Sheila Leslie, D-Reno, said. “It screams Big Brother ... It hasn’t been done successfully in any other state that I know of.”
Jonathan Miller, president of InsureNet, said if there is no evidence that a driver is uninsured or is driving an unregistered vehicle, the group “dumps” the information it has collected after 60 seconds.
InsureNet cameras — the company calls them scanners — could be set up in law enforcement vehicles or along streets to check license plates of passing cars, Miller said.
The company has been operating overseas, verifying insurance in Antigua and Venezuela for years, he said.
Although it isn’t operating in the United States yet, it is implementing systems in two states, Miller said.
He refused to identify the states because he was under obligation not to, and a few large auto insurance companies oppose the idea because they don’t want to disclose insurance information, he said.
“There is zero risk to anyone in Nevada,” Miller said. “If it doesn’t work, there’s no harm to Nevada. If it does work, there’s a great benefit.”
He won’t ask for a green light to start operating in the state until another jurisdiction is using the technology, he said. “Nevada will know it works, working perfectly.”
According to InsureNet and information cited by Gibbons’ office, up to 20 percent of all vehicles nationwide are uninsured.
DMV officials have acknowledged that the system they use to verify whether drivers have up-to-date insurance is antiquated and inefficient, taking up to 45 days to flag lack of insurance.
To speed up the process, the department has been working on a new system, Nevada LIVE (Liability Insurance Verified Electronically), according to Tom Jacobs, DMV spokesman.
The system was supposed to launch Feb. 1, but is now scheduled to launch March 15.
Although the DMV fought the bill and criticized the proposal just over six months ago, Jacobs on Wednesday referred questions to the governor’s office.
“InsureNet is something different from what Nevada LIVE is,” Jacobs said.