The rule establishes eligibility criteria to apply to deliver an internet pre-licensing course.

The rule sets forth the details of the application process. An application must be accompanied by a $7,500 fee. A sponsor must post a $100,000 bond or letter of credit.

The rule sets forth the minimum requirements for all internet pre-licensing courses. The Department of Motor Vehicles (DMV) must be given access to all course materials and must be able to audit all internet pre-licensing courses. Sponsors must allow and cooperate with DMV or its designee’s monitoring of internet pre-licensing courses. In addition to any third-party monitor working on behalf of the Department, the sponsors are required to procure an independent third-party monitor.

The rule requires course sponsors to evaluate the effectiveness of their internet pre-licensing course.

The rule sets forth the length of the course and customer support requirements. It also requires that the course sponsors utilize identity validation techniques and content questions that insure student participation.

The rule establishes information security guidelines for course sponsors and requirements for course administration.

The rule sets forth the basis for DMV to suspend or revoke approval of sponsors.

The rule establishes guidelines for acceptable advertising produced by the sponsors.

1. Statutory authority: Article 12-D of the Vehicle and Traffic Law (VTL), as added by Chapter 368 of the Laws of 2019, provides in section 399-p that the Commissioner of Motor Vehicles “…shall establish and implement a comprehensive pilot program to review and study the use of the internet for the administration and completion of an approved pre-licensing course…” Section 399-q of Article 12-D provides that the Commissioner may impose a fee of up to $7,500 for each applicant for the program. Qualified applicants are permitted to participate in the pilot program from June 30, 2020 to June 30, 2025.

Section 399-r of such law provides that the Commissioner of Motor Vehicles is authorized to promulgate regulations in relation to the pre-licensing course internet pilot program. Such section provides that the regulations should insure that internet delivered courses can validate: student identity at registration and throughout the course; student participation throughout the course; course time requirements; and successful course completion. Such section also provides that the Commissioner may charge the sponsoring agency a fee of up to $8 for each student who completes the Pilot Program course.

2. Legislative objectives: Section 399-p of new Article 12-D of the VTL expands upon the pre-licensing classroom course set forth in VTL Section 502(4)(a)(i) by authorizing the Commissioner of Motor Vehicles to establish a pilot program to review and study internet as an alternative means of delivering the classroom pre-licensing course. The Legislature specifically directed that the regulations address issues regarding validating student identity, student participation throughout the course, student successful completion of the course and time requirements. The proposed regulations are in accord with the public policy objectives that the Legislature sought to advance in creating Article 12-D, since it creates comprehensive and detailed rules for establishing and administering an internet pre-licensing pilot program.

3. Needs and benefits: The proposed regulations are necessary to effectuate the provisions of Article 12-D of the VTL, the Pre-Licensing Course Internet Pilot Program. Chapter 368 of the Laws of 2019, Section 399-r, directs the Commissioner to promulgate any rules and regulations necessary to implement Article 12-D of the VTL.

These proposed regulations are necessary and beneficial to prospective sponsors, approved sponsors and the general public because it sets forth the specific rules and guidelines governing the internet delivery of the pre-licensing pilot program. In particular, these regulations set forth requirements relative to: eligibility criteria to apply to deliver the internet course; the course application procedures; third party monitoring; Department audits; information security; minimum course requirements; customer support requirements, student identity validation techniques; course validation techniques; evaluation of student participation and course effectiveness; suspension and revocation of a sponsor’s authority to give such course; and advertising restrictions.

4. Costs: This is a voluntary program. No business is obligated to participate.

VTL Article 12-D, Section 399-q provides that all businesses applying to sponsor the internet pre-licensing course must pay an application fee of $7,500.00. This application fee, minus administrative expenses of the Department, must be deposited into the dedicated highway and bridge trust fund established pursuant to section 89-b of the State Finance Law.

VTL Article 12-D, Section 399-r (2) authorizes the Commissioner to impose a fee upon each approved sponsoring agency, which shall not exceed $8.00 for each student who completes the internet course. Such $8.00 fee, minus administrative expenses of the Department, must be deposited into the dedicated highway and bridge trust fund established pursuant to section 89-b of the State Finance Law.

As set forth in the regulations, a business approved to sponsor an internet course must post a $100,000 bond or letter of credit.

5. Local government mandates: These regulations do not impose any mandates upon local governments.

6. Paperwork: The primary paperwork requirement is the initial application that all providers must complete to become an approved provider. In addition, the course providers are required to evaluate their course during the five-year period. This will require the retention of data and submission of results to DMV within 90 days of the pilot program termination. Providers must also provide participating students with an online receipt, available for printing. A provider that wishes to substantively change the course must provide DMV with a proposed notice of change. The providers must also maintain records subject to Department audit, submit copies of policies and procedures to the Department, maintain student completion records for five years, issue course completion certificates to the students, report successful completions to the Department, notify students of the requirements necessary to complete the course, and abide by the Department’s advertising policies as established in Part 10.15 of these regulations.

7. Duplication: These regulations do not duplicate, overlap or conflict with any relevant rule or legal requirement of the State or federal governments.

8. Alternatives: A no action alternative was not considered. Regulations are mandated by statute.

9. Federal standards: These regulations do not exceed any minimum standards of the federal government for the same or similar subject areas.

10. Compliance schedule: Compliance shall commence upon adoption of these regulations.

1. Effect of rule: There are no local governments affected by this rule.

It is anticipated that new Article 12-D of the Vehicle and Traffic Law and these statutorily required regulations relating thereto may have a detrimental effect on classroom-based driving schools. This is because the internet pre-licensing course represents a shift in how the course is delivered to students who apply for other than class DJ or MJ licenses. However, all classroom-based driving schools will be eligible to apply to provide their courses via the internet. It is anticipated that the availability and convenience of internet delivery of the pre-licensing course will reduce the number of participants in the classroom course, thus negatively impacting the business and revenues of those schools that are ineligible for this pilot program. The extent of this impact is unknown.

2. Compliance requirements: Participation in the online pre-licensing pilot program is voluntary. Those choosing to apply will be required to implement strategies for validating student identity, student participation throughout the course, student successful completion of the course and time requirements, as well as securing all personal information.

The primary paperwork requirement is the initial application that all providers must complete to become an approved provider. In addition, the course providers are required to evaluate their course during the five-year period. This will require the retention of data and submission of results to the Department within 90 days of the pilot program termination. Providers must also provide participating students with an online receipt, available for printing. A provider that wishes to substantively change the course must provide the Department with a proposed notice of change. The providers must also maintain records subject to Department audit, submit copies of policies and procedures to the Department, maintain student completion records for five years, issue course completion certificates to the students, report successful completions to the Department, notify students of the requirements necessary to complete the course, and abide by the Department’s advertising policies as established in Part 10.15 of this proposal.

3. Professional services: Sponsors may choose to contract with firms that provide Internet services and various technological solutions for verifying student identity participation as part of the overall development of their course. The sponsors may have to contract with an independent third party monitor.

4. Compliance costs: This is a voluntary program. No business is obligated to participate.

VTL Article 12-D, Section 399-q provides that all businesses applying to sponsor the internet pre-licensing course must pay an application fee of $7,500.00. This application fee, minus administrative expenses of the Department, must be deposited into the dedicated highway and bridge trust fund established pursuant to section 89-b of the State Finance Law.

VTL Article 12-D, Section 399-r (2) authorizes the Commissioner to impose a fee upon each approved sponsoring agency, which shall not exceed $8.00 for each student who completes the internet course. Such $8.00 fee, minus administrative expenses of the Department, must be deposited into the dedicated highway and bridge trust fund established pursuant to section 89-b of the State Finance Law.

As set forth in the regulations, a business approved to sponsor an internet course must post a $100,000 bond or letter of credit.

5. Economic and technological feasibility: Economic and technological feasibility have been demonstrated because 12 sponsors approved and currently delivering IPRIP are eligible to apply for this online pre-licensing pilot program.

6. Minimizing adverse impact: This is a voluntary 5-year pilot program. The proposed regulation and associated specifications require commonly accepted, readily available technologies. The proposed regulations allow flexibility for the sponsor in choosing their course delivery method, as well as their validation and security techniques, rather than requiring a specific model.

7. Small business and local government participation: There are no local governments affected by this rule and therefore, participation was unnecessary. There was no participation by the current 12 eligible IPIRP sponsors or other potential applicants or industry groups. Regulations are mandated by statute.

A revised Rural Area Flexibility Analysis is not submitted with this proposal because it will not have an adverse or disproportionate impact on rural areas of the State and no substantive changes were made.

It is anticipated that new Article 12-D of the Vehicle and Traffic Law and these statutorily required regulations relating thereto will have a detrimental effect on classroom-based driving schools. This is because there are currently 513 businesses registered with DMV that are approved to deliver the classroom pre-licensing course, in addition to educational institutions approved by the New York State Education Department to deliver this course, but none are currently providing the course via the internet. This is because the internet pre-licensing course represents a shift in how the course is delivered to students who apply for other than class DJ or MJ licenses. However, all classroom-based driving schools will be eligible to apply to provide their courses via the internet. It is anticipated that the availability and convenience of internet delivery of the pre-licensing course will reduce the number of participants in the classroom course, thus negatively impacting the business and revenues of those schools that do not make the shift to using the internet to provide the pre-licensing course. The extent of this impact is unknown.

As a rule that requires a RFA, RAFA or JIS, this rule will be initially reviewed in the calendar year 2023, which is no later than the 3rd year after the year in which this rule is being adopted.

The Department of Motor Vehicles received public comments from four organizations regarding amendments to 15 NYCRR 10.

Comment: Kevin Bronner of Park Strategies on behalf of the New York State Association of Professional Driving Schools, wrote:

My question is whether a newly proposed regulation is going to be issued due to the law change that was included in the Executive Budget this year. Or will a final regulation issued incorporate these changes? As you can see [in Sections 2 & 3 of Part ZZ of Chapter 58 of the Laws of 2020], there are two changes to the law this regulation was originally proposed to govern that were made after its release on March 25, 2020. The first being the authorization of the Commissioner to allow more participants in the program and the second prohibiting class DJ and class MJ licensees from being able to take the course online.

Response: The DMV appreciates the comments submitted by the New York State Association of Professional Driving Schools. We respond to its concerns as follows:

The Department has further amended Part 10 of the regulations in order to conform such regulations to the Vehicle and Traffic Law by removing the requirement that a sponsor of an internet pre-licensing course must be a sponsor of an internet accident prevention course.

With respect to the eligibility of applicants for MJ and DJ licenses to participate in the internet pre-licensing course pilot, the Department has further amended Part 10 of the regulations in order to conform such regulations to the Vehicle and Traffic Law by prohibiting sponsors from enrolling such license applicants in an internet pre-licensing course. By way of Department policy, no sponsor’s application will be approved unless there is a method by which to prohibit applicants for a class DJ or class MJ license from enrolling in the sponsor’s course.

Comment: Thuy Nguyen, Director of Legal and Regulatory for I Drive Safely, wrote:

1. Proposed 10.4(e) requires that the sponsor validate student identity at registration and throughout the course and proposed 10.5(b) establishes that the Commissioner will set forth such identity validation methods. I Drive Safely suggests the following validation method, which will achieve the highest levels of confirming student identity while also offering the most favorable student experience: sending the student a two-factor authentication code via text message or email. This method provides a more seamless and less error-prone user experience, rather than the caller-ID or temporary password method which is currently being employed for the Internet/Alternate Delivery Method Point & Insurance Reduction Program (I-PIRP);

2. Proposed 10.5(b) establishes that the Commissioner will set forth student participation validation methods. I Drive Safely proposes the following validation methods, which will achieve the highest levels of confirming student participation while also offering the most favorable student experience: Participation will be validated by the time spent in the course, which will be computed by crediting the student minutes of course activity based on the completion for each aspect of online content. For example, (a) for each page of written content completed, the student is credited time equal to the number of words in the page divided by the a “words per minute” count of 200 words/minute; (b) for each video viewed, the student is credited time equal to the running time of the video; and (c) for interactive learning elements (such as pop-up questions), the student is credited the number of minutes that the average student takes to complete the interactivity;

3. Aside from the above suggested approaches, we agree that the proposed regulations in 10.5 sufficiently address instructional design requirements. For example, it should be the discretion of each sponsor to include video/animation content, and interactive motion graphics or gamification; and it should be left up to the student on whether they would prefer to interact with a course that offers such features, or does not;

4. Similarly, we agree that the proposed regulations sufficiently address information security guidelines in 10.11. Any requirements to provide third party network certifications or cyberattack testing results are not necessary;

5. With respect to making sure students have access to resources and live support, we would recommend that students are given access to help center articles free of charge 24/7 and that live support through email, phone, and/or chat be provided during regular business hours;

6. Proposed 10.4(h)(10) and 10.10 require the Department’s review and approval of all changes to course material or internal controls. We would propose that only material changes to the course material or internal controls must be submitted for review and approval. For example, despite our best quality assurance measures, a typographical error in an image or text may need to be fixed. By way of further example, we may change the voice-over for a video segment, but the content of the audio and video segment is not materially changed;

7. Proposed 10.15(a)(16) prohibits the use of comparative statistics or claims that state or imply that one sponsor is more effective than another. We seek clarification on the rationale for the Department’s prohibition against comparative advertising that is in compliance with applicable laws and the Federal Trade Commission; and

8. 10.15(a)(1) and (7) seem to prohibit the sponsor from advertising supplemental or additional features or services. For example, if a provider desired to offer additional duplicate certificates to the student (if for example, the student lost their original copy), advertising as to the service would be prohibited by these regulations. Similarly, if the provider desired to offer expedited fulfillment services (eg, within the hour instead of 24-hours), advertising as to the service would be prohibited by these regulations, even if it is clearly communicated to the student that the additional service is completely optional. By way of further example, if the provider desired to offer optional practice exams or a printed version of the course materials to better assist the student and to provide more educational resources, advertising as to the service would be prohibited by these regulations. We seek clarification on the rationale for the Department’s prohibition against such advertising.

Response: The DMV appreciates the comments submitted by I Drive Safely. We respond to its concerns as follows:

1. The two-factor identity validation confirmation method sent via text or email is among the validation methods that the Department, by policy, has identified to be considered for use by sponsors. The caller ID and temporary password methods have not been specifically identified in Department policy, but the Department is willing to consider techniques suggested by sponsors other than those specifically identified.

2. Sponsors will be required, by Department policy, to make specific allocations for time spent using multimedia, simulations & exercises, charts & graphs, and written text.

3. In addition to the sections of the rules and regulations that apply to course content and presentation, sponsors will be required to adhere to Department policy as it relates to course content and presentation.

4. Sponsors will be required to adhere to the Department’s Risk Management policies and the policies of New York State’s Information Technology Services as they relate to cybersecurity.

5. Sponsors will be required, by Department policy, to provide live customer service telephone support, that is at a minimum, Monday through Saturday from 8 am to 4 pm EST. The Department will consider sponsor applications that utilize an interactive voice message system to supplement live contact or in conjunction with live contact. Sponsors will also be required, by Department policy, to maintain documentation regarding frequently asked questions (FAQs) made available to the public 24/7.

6. As stated in 15 NYCRR 10.10, sponsors are prohibited from making any changes to the internet pre-licensing course curriculum or internal controls without prior approval of the Department. Sponsors must request any course change in writing. Sponsors shall describe the impact of the change in the request. Changes that will have little impact on the course are anticipated to be approved by the Department more quickly than those changes that would have a greater impact on the course.

7. Pursuant to Article 12-D of the Vehicle and Traffic Law, the purpose of this pilot program is to evaluate utilizing the internet for delivering an approved pre-licensing course and to make recommendations as to the future use of the internet as an effective way to deliver such course. Prior to the completion of this pilot program and such an evaluation, sponsors are prohibited from making any claims related to effectiveness of the program, or their various courses, in their advertising.

8. Pursuant to 15 NYCRR 10.5(g), proof of completion of the course provided to the student will be in the form of a course completion notification delivered electronically, not as a course completion certificate. Pursuant to 15 NYCRR 10.5(g), there will be no additional fee for duplicates of notification of course completions provided to students. Sponsors may notify students of the opportunity to request a duplicate notification of course completion in the course terms and conditions. 15 NYCRR 10.15(a)(7) prohibits combining internet pre-licensing course advertising with other advertising. If a sponsor combines advertising for the internet pre-licensing course with other advertising, the sponsor is required to have approval from the Department. Examples of other advertising given in the regulations include driving schools and insurance agency advertising. There is no prohibition against sponsors advertising services that are permitted to be provided as part of the internet pre-licensing course. Pursuant to 15 NYCRR 10.12(a)(14), sponsors must provide an enrollment contract to students prior to starting instruction. Among other things, the enrollment contract must explain all fees associated with the course. It should also be noted that 15 NYCRR 10.4(h)(9) states, “[S]ponsors must not display advertising during any part of the internet pre-licensing course, including the registration, instruction, testing, validation, or completion periods, nor shall sponsors display any distracting material that is not related to the topic being presented.”

Comment: John Comly, President & CEO of the American Safety Council, wrote:

1. 10.4(e) & 10.5(b): ASC strongly encourages the Department to implement a two-factor, text- or email-based authentication process. Such processes have been widely and successfully implemented across various industries where confirming identify is critical, namely healthcare and financial services;

2. 10.5(b): Based on similar experience in other, comparable regulated remote learning environments, ASC proposes the following method for calculating and validating participation:

Use of End-of-Module quizzes to validate participation.

Implement module-based timers based on:

word count (using a standard words-per-minute standard) or,

in the case of video, run time.

3. 10.5: Other than items specifically highlighted herein, the proposed regulations in 10.5 sufficiently reflect instructional design and remote learning best practices. More specifically, it should be the discretion of each school to include video/animation content, and interactive motion graphics or gamification; and it should be left up to the student on whether they would prefer to interact with a course that offers such features, or does not.

4. 10.9: With respect to customer support guidelines, we would recommend that students are given access to help center articles free of charge 24/7 and that live support through email, phone, and/or chat be provided during regular business hours.

5. 10.11: As a national provider of regulated remote learning, we feel strongly that the proposed regulations in 10.11 sufficiently all address applicable information security standards necessary to protect the consumer while not placing an undue and commercially unreasonable burden on businesses.

6. 10.4(h)(10) & 10.10: Department review and appoval [sic] should be limited to material changes, accomidating [sic] the Providers ability to address items such as a typographical error in an image or text or re-recording of a voice-over for a video segment where content is not materially changed.

Response: The DMV appreciates the comments submitted by the American Safety Council. We respond to its concerns as follows:

1. The two-factor identity validation confirmation method sent via text or email is among the validation methods that the Department, by policy, has identified to be considered for use by sponsors. The caller ID and temporary password methods have not been specifically identified in Department policy, but the Department is willing to consider techniques suggested by sponsors other than those specifically identified.

2. Sponsors will be required, by Department policy, to make specific allocations for time spent using multimedia, simulations & exercises, charts & graphs, and written text.

3. In addition to the sections of the rules and regulations that apply to course content and presentation, sponsors will be required to adhere to Department policy as it relates to course content and presentation.

4. Sponsors will be required, by Department policy, to provide live customer service telephone support, that is at a minimum, Monday through Saturday from 8 am to 4 pm EST. The Department will consider sponsor applications that utilize an interactive voice message system to supplement live contact or in conjunction with live contact. Sponsors will also be required, by Department policy, to maintain documentation regarding frequently asked questions (FAQs) made available to the public 24/7.

5. Sponsors will be required to adhere to the Department’s Risk Management policies and the policies of New York State’s Information Technology Services as they relate to cybersecurity.

6. As stated in 15 NYCRR 10.10, sponsors are prohibited from making any changes to the internet pre-licensing course curriculum or internal controls without prior approval of the Department. Sponsors must request any course change in writing. Sponsors shall describe the impact of the change in the request. Changes that will have little impact on the course are anticipated to be approved by the Department more quickly than those changes that would have a greater impact on the course.

Comment: Jonathan Federman of Brown & Weinraub on behalf of National Point & Insurance Reduction Course, Inc., wrote:

1. First, the new section 10.5 on “course content and presentation” should be amended to include the following detailed instructional design requirements:

Each course should include a minimum of 150 minutes of high-quality, customized unique video/animation content;

Each course should include a minimum of 50 minutes of fully interactive motion graphics and gamification requiring the user to interact with the screen to complete exercises and driving simulations – see, for example: (https://rise.articulate.com/share/T7LMJ6I0JFHDxajdAjldk GDG5LxWnu-K#/lessons/FKcoqmTyIpv9ieFurHZkOZqzA39-oGV1);

Each course should be compliant with SCORM, the industry technical standard for effective, efficient online training (https://scorm.com/scorm-explained/one-minute-scorm-overview/);

Each course should be based on an instructional design that has been proven effective in reducing vehicle crashes and moving violations;

Each course should be required to be provided in English and Spanish; and

Each course should provide 24 hour seven day a week student support or alternatively student support should be available continuously when during such times as the course website is open to students to register and take courses.

2. Second, the new section 10.11 on “information security guidelines” should be amended to include the following detailed cybersecurity requirements:

Each course should be required to provide certification by an independent expert that the provider network meets either NIST security standards (https://csrc.nist.gov/projects/risk-management/risk-management-framework-(RMF)-Overview) or ISO 27001 certification (https://www.iso.org/isoiec-27001-information-security.html);

Each course should be required to provide a quarterly report of simulated cyber-attacks with testing results and how exposed threats were fixed (https://www.trustwave.com/en-us/services/consulting/spiderlabs-consulting/).

3. Finally, as the number of authorized course providers is increased, we respectfully request that if one entity owns more than 10% of more than one course provider, only one of those courses may be listed on the DMV website as an approved course (i.e., one listing per owner). In other jurisdictions, our client has seen a single owner utilize multiple LLCs to offer individual courses under each LLC, in order to control the market simply by overwhelming the website with its approved courses.

Response: The DMV appreciates the comments submitted by National Point & Insurance Reduction Course, Inc. We respond to its concerns as follows:

1. Pursuant to Article 12-D of the Vehicle and Traffic Law, the purpose of this pilot program is to evaluate utilizing the internet for delivering an approved pre-licensing course and to make recommendations as to the future use of the internet as an effective way to deliver such course. The Department encourages sponsors to include aspects of the course that they feel would be most effective. The Department also encourages sponsors to provide the internet pre-licensing course in multiple languages as exhibited by the fact that although 15 NYCRR 10.4(h)(8) states that sponsors must submit no more than one internet pre-licensing course at a time, Section 10.5(d) allows for such internet pre-licensing course to be delivered in multiple languages. Sponsors will be required, by Department policy, to provide live customer service telephone support, that is at a minimum, Monday through Saturday from 8 am to 4 pm EST. The Department will consider sponsor applications that utilize an interactive voice message system to supplement live contact or in conjunction with live contact. Sponsors will also be required, by Department policy, to maintain documentation regarding frequently asked questions (FAQs) made available to the public 24/7.

2. Sponsors will be required to adhere to the Department’s Risk Management policies and the policies of New York State’s Information Technology Services as they relate to cybersecurity.

3. An application from a sponsor will not be denied solely on the basis that the sponsor has owners in common with another sponsor; however, sponsors shall only utilize a course that the sponsor has developed, or has exclusively licensed from another entity (i.e. multiple sponsors will not be permitted to deliver the same course).