2024-20616. Minimum Standards for Driver's Licenses and Identification Cards Acceptable by Federal Agencies for Official Purposes; Phased Approach for Card-Based Enforcement

Table 1—OMB Circular A-4 Accounting Statement

[$ millions]

Category	Estimates			Units			Notes
	Primary	Low	High	Year dollar	Discount rate (%)	Time horizon (years)
Benefits
Annualized Monetized	N/A	N/A	N/A	N/A	2	N/A	Not Quantified.
Annualized Quantified, But Non-Monetized	N/A	N/A	N/A	N/A	2	N/A	Not Quantified.
Unquantified	The proposed rule would provide Federal agencies flexibility to decide whether to enforce the REAL ID card-based regulations in a phased manner that may reduce security vulnerabilities, operational disruption and public impact related to official Federal purposes. A phased approach would not unnecessarily delay REAL ID enforcement for those Federal agencies ready to fully implement on the card-based enforcement deadline. A phased approach would also allow individuals more time to obtain a REAL ID and may help mitigate potential application backlogs at State licensing agencies. Furthermore, a phased approach may reduce potential queuing and associated delays at access points.
( print page 74148)
Costs
Annualized Monetized	$0.87	N/A	N/A	2023	2	2
Annualized Quantified, But Non-Monetized	N/A	N/A	N/A	N/A	2	N/A	Not Quantified.
Unquantified	Full security benefits associated with REAL ID rule would not be realized, as a result of agencies implementing a phased approach, until full enforcement occurs. Federal agencies would also incur costs related to plan implementation, including, but not limited to training personnel on the policies of the plan, and efforts to inform individuals of the new identity verification policies related to plans. Individuals may also incur costs to become aware of phased enforcement plans and respond accordingly.
Transfers
Annualized Monetized Federal Budgetary Transfers	N/A	N/A	N/A	N/A	2	N/A	Not Quantified.
From/To	From:			To:
Other Annualized Monetized Transfers	N/A	N/A	N/A	N/A	2	N/A	Not Quantified.
From/To	From:			To:
Net Benefits
Annualized Monetized Net Benefits	N/A	N/A	N/A	N/A	2	N/A	Not Quantified.
Effects
State, Local, and/or Tribal Government	None
Small Business	None.
Wages	None.
Growth	Not measured.

b. Need for Regulation

In January 2008, DHS published the Minimum Standards for Driver's Licenses and Identification Cards Acceptable by Federal Agencies for Official Purposes Final Rule to implement the requirements of the Act. Since the publication of the original Final Rule, DHS extended the original compliance date multiple times in response to challenges in REAL ID adoption, including but not limited to, the COVID-19 pandemic. In accordance with the Final Rule published in March 2023, Federal agencies are required to commence card-based enforcement on May 7, 2025, at which point Federal agencies may not accept for official purposes a license or identification card issued by a State unless that license or card was issued in accordance with the REAL ID standards by a REAL ID- compliant jurisdiction.^[50]

DHS does not intend to extend the card-based enforcement deadline further and intends to commence enforcement of the REAL ID card-based requirements on May 7, 2025. However, based on current adoption rates of REAL ID-compliant DL/IDs and the projected number of compliant DL/IDs in circulation by the card-based enforcement date (discussed in the succeeding section), DHS believes this proposed rulemaking is necessary to provide flexibility to mitigate potential risks related to security, operational feasibility, and public impact.

Without the flexibility the proposed rule permits, agencies may be faced with serious concerns that immediate implementation of full enforcement may create including security vulnerabilities, operational challenges, and disruption of government services. For instance, there could be cases where an agency needs to conduct work with a subject-matter expert or specialist that does not have REAL ID-compliant identification and is therefore unable to access the Federal facility. Barring a phased enforcement plan, the agency may need to come up with alternate accommodations, which could include holding meetings or presentations offsite or standing up a virtual option. These options may result in additional costs that would otherwise not be incurred if the agency was operating under a phased enforcement plan. Additionally, absent a phased enforcement plan, individuals without a REAL ID-compliant DL/ID or acceptable alternative would be unable to board federally regulated aircraft upon card-based enforcement. This represents a large use case for REAL ID. These individuals would not be able to use their noncompliant DL/ID to access the security checkpoint which could result in backlogs and other negative outcomes on travel ( e.g., delayed or missed flights). This may also have a potential impact on the customer experience and air travel. Long lines, confusion, and frustrated travelers at the checkpoint may also increase security risks.^[51] Given the current level of REAL ID adoption across various States, the start of card-based enforcement may also create an increased demand on States to issue ( print page 74149) REAL IDs, which could result in strained resources and a potential delay of application processing time or backlog. Additional disruptive impacts to those who currently rely upon non-REAL ID-compliant DL/IDs for official Federal purposes may also occur.

Federal agencies that determine an immediate transition to full enforcement would raise concerns related to security, operational feasibility, or negatively impact the public, would benefit from phased enforcement, and would be able to implement a phased enforcement plan, coordinated with DHS, to provide a smoother transition to full card-based enforcement.^[52] This proposed rule would also enable these agencies to minimize negative impact to individuals who do not have REAL ID-compliant DL/IDs and provide States time to issue and individuals time to obtain REAL ID-compliant DL/IDs during initial phases of enforcement.

TSA requests comments on the assumptions and estimates presented within this economic impact analysis. Comments that will provide the most assistance to TSA will reference a specific portion of this proposed rule, explain the reason for any suggestion or recommended change, and include data, information, or authority that supports such suggestion or recommended change.

c. Baseline Summary

The baseline represents DHS' best assessment of what the world would be like absent this regulatory action.^[53]

In January 2008, DHS published the Minimum Standards for Driver's Licenses and Identification Cards Acceptable by Federal Agencies for Official Purposes Final Rule to implement the requirements of the REAL ID Act of 2005.^[54] Since the publication of the Final Rule in 2008, DHS has delayed the card-based enforcement date for REAL ID multiple times due to various challenges that have prevented full enforcement including, most recently, the COVID-19 pandemic. The last extension was issued in March 2023, when DHS extended the card-based enforcement date from May 3, 2023, to May 7, 2025.

Absent this regulatory action, beginning on that date, all Federal agencies would be prohibited from accepting non-REAL ID-compliant State-issued DL/IDs for REAL ID official purposes.^[55] If an individual does not have a REAL ID-compliant DL/ID, the individual may use another acceptable form of identification as determined by individual agencies' identity verification and access policies.^[56] In accordance with the 2008 Final Rule, enforcement on the card-based enforcement date would be applied unilaterally, across all respective agency locations in the United States and its territories including, accessing Federal facilities, boarding federally regulated commercial aircrafts ( i.e., TSA airport security checkpoints), and entering nuclear power plants.

DHS estimates that by the card-based enforcement date, approximately between 61 and 66 percent of all State-issued DL/IDs would be REAL ID-compliant based on adoption data provided by States, to DHS, through January 2024.^[57] The lower-end values represent a monthly adoption rate similar to current rates through card-based enforcement. However, DHS expects that the adoption rate may also increase ahead of the card-based enforcement date as a result of both natural adoption prior to enforcement and efforts by DHS to drive awareness and action. Ahead of the card-based enforcement deadline, DHS plans to launch additional phases of its public service campaign “Be Your REAL ID Self”, which in part, provides toolkits for government and industry partners. To account for this increased rate of adoption, DHS uses a Compounded Monthly Growth Rate of 1.03 percent (compared to a current 0.56 percent CMGR) for its higher-end value of 66 percent of REAL ID compliant DL/IDs by the card-based enforcement date.

As a result, approximately between 34 percent and 39 percent of DL/IDs in circulation would be non-compliant (either legacy or non-compliant marked DL/IDs). Individuals with non-REAL ID-compliant DL/IDs would not be permitted to use those DL/IDs to access Federal facilities nationwide, including the security checkpoint at airports, unless they are able to present an approved alternate form of identification such as a passport.^[58]

d. Adoption of REAL ID-Compliant DL/IDs

Prior to the onset of the COVID-19 pandemic in the United States in October 2019, DHS estimated that approximately 33 percent, or 90.9 million of the 274.8 million DL/IDs in circulation, were REAL ID-compliant.^[59] In April 2020, DHS issued an amended final rule to further delay the card-based enforcement date from October 1, 2020, to October 1, 2021. DHS noted that the COVID-19 pandemic had caused significant disruption citing that State and local government offices, including the DMV, have restricted all but the most essential services, and that in some cases, had been temporarily closed to the public. In October 2020, national REAL ID compliance was approximately ( print page 74150) 41 percent.^[60] Three years later, in October 2023, the national REAL ID compliance rate increased to approximately 56 percent.^[61] Although there has been a modest increase in the number of compliant REAL IDs, the overall percentage as of January 2024 remains unchanged at 56 percent, with the remaining 44 percent of State-issued DL/IDs being noncompliant.^[62]

However, individual State compliance includes a wider range of rates. Table 2 presents REAL ID compliance over time based on the 56 licensing jurisdictions percentage of REAL IDs issued relative to the total number of IDs in circulation for each jurisdiction. As shown in the table, State compliance rates have generally increased over time. For instance, the number of licensing jurisdictions where the percentage of REAL IDs, relative to all DL/IDs in circulation, is greater than 75 percent has increased from eight jurisdictions in October 2019 to 17 in January 2024. Similarly, the number of licensing jurisdictions where the percentage of REAL IDs, relative to all DL/IDs in circulation, is less than 25 percent has decreased from 31 in October 2019 to 9 in January 2024.

Table 2—REAL ID Compliance Over Time

Range (REAL IDs as a percentage of total IDs in circulation by jurisdiction)	Number of licensing jurisdictions
	October 2019	October 2020	October 2023	January 2024
0%-24%	31	22	12	9
25%-49%	11	15	16	18
50%-74%	6	9	12	12
75%-100%	8	10	16	17

1. Compounded Monthly Growth Rates (CMGR)

DHS began receiving monthly data on the number of REAL IDs for each of the 56 licensing jurisdictions in October 2019 (and has monthly data through early 2024). Using this data, DHS calculates the growth, or increase, in number of REAL IDs month over month, relative to the total number of DL/IDs in circulation. Using the historic adoption data, DHS calculates CMGRs which represents growth over various intervals of time. In subsequent sections, DHS uses CMGRs to forecast REAL ID compliance.

In the first 6 months that DHS began to receive monthly data, between October 2019 and March 2020, the CMGR of REAL IDs was approximately 2.5 percent. Between April and May of 2020, the CMGR of REAL IDs had decreased to 0.5 percent. The CMGR later increased to approximately 2.0 percent between June 2020 and October 2020. Over the next 3 years, the CMGR of REAL IDs was 1.3 percent between October 2020 and September 2021, 0.9 percent between October 2021 and September 2022, and 0.8 percent between October 2022 and September 2023. Over the 12-month period, between January 2023 and January 2024, the national CMGR for the adoption of REAL IDs was 0.56 percent.^[63]

2. Projection of Total Number of DL/IDs

DHS leverages monthly data received from the 56 licensing jurisdictions to estimate the total number of DL/IDs in future months. The report provides DHS with the total number of DL/IDs in circulation, including the proportions of REAL-ID compliant, “legacy” cards, and non-compliant cards. Based on the January 2024 data from the licensing jurisdictions, there were 287,321,596 DL/IDs in circulation.

DHS uses this value as a starting overall DL/ID population. Next, DHS leverages the U.S. Census Bureau's Monthly Population Estimates for the United States to estimate the total U.S. population and proportion with a DL/ID. DHS first estimates the total population using Census Bureau annual population data to calculate a compound annual growth rate (CAGR) of 0.60 percent in the U.S. population from 2012 to 2022.^[64] DHS divides the CAGR of 0.60 percent by 12 to calculate a simple compound monthly growth rate (CMGR) of 0.05 percent. DHS then uses Census Bureau monthly population estimates through December 2023, and applies the simple CMGR of 0.05 percent to forecast the population for each month through October 2027.^[65] DHS estimates a total population of 355,966,451 in January 2024.

Last, DHS divides the total number of DL/IDs by the total population. As of January 2024, 85.5 percent of the population held a driver's license or identification card.^[66] DHS assumes this proportion of the population holds true through October 2027 (some portion of the adult population may not need a DL/ID, along with most of the population under the legal driving age). DHS multiplies the 85.5 percent proportion by the projected population each month to estimate the total number of DL/IDs in circulation.

3. Forecast of REAL ID Compliance Under Status Quo

If full card-based enforcement, absent phased enforcement, were to take place on May 7, 2025, DHS assumes that the adoption of REAL ID-compliant DL/IDs would spike leading up to, and continuing for a period of time past, the card-based enforcement date as individuals, who may otherwise have held off on acquiring a REAL ID-compliant DL/IDs, would take steps to ensure they would not be turned away from Federal facilities where a REAL ID would be required for official purposes.

DHS assumes such a spike would be similar to a 23 percent increase that the Department of State experienced after ( print page 74151) implementation of the first phase of the Western Hemisphere Travel Initiative (WHTI).^[67] Specifically, in fiscal year 2007, the Department of State experienced an influx of passport applications prior to, and after, the implementation of its first phase of the WHTI, which established new document requirements for travelers entering the United States from within the Western Hemisphere at airports of entry. At the time, the Department of State forecasted it would receive approximately 15 million passport applications in the 2007 fiscal year, however, it ended up receiving approximately 18.6 million passport applications, an approximate 23 percent increase over the original estimate.^[68]

As aforementioned, in January 2024, 56.42 percent or 162.1 million of the 287.3 total IDs in circulation are REAL ID-compliant. Based on the data range of January 2023 through January 2024, DHS expects that through April 2024, the 0.56 percent CMGR for the adoption of REAL IDs to remain unchanged,^[69] bringing the percentage of REAL IDs relative to all IDs in circulation to 57.3 percent. In the year leading up to the card-based enforcement deadline, DHS considers a similar situation as the influx of passports leading up to, and through, the implementation of WHTI, and applies a 23 percent increase in the adoption of REAL IDs (equivalent to a CMGR of 1.61 percent).^[70] Using this methodology, by May 2025, approximately 70 percent or 202.7 million of the total 289.6 million IDs in circulation would be REAL-ID compliant.^[71 72] DHS requests public comment on the assumptions related to the forecast of REAL ID compliance under the status quo, including the estimate and duration of the spike in REAL ID compliance.

Following the card-based enforcement date, DHS expects the spike to remain in place for approximately 4 to 5 months as individuals work to secure appointments with their local DMV.^[73] DHS applies the 1.61 percent CMGR to estimate the percentage of REAL IDs in October 2025. DHS estimates approximately 75 percent of DL/IDs in circulation would be REAL ID-compliant.^[74]

To forecast beyond October 2025, under the status quo of full enforcement beginning May 2025, DHS assumes a 50-percent decrease of the initial spike in the adoption of REAL IDs between October 2025 and October 2026 but requests public comment on the duration and level of decrease in the months following card-based enforcement.^[75] DHS estimates that by October 2026, one and a half years after the card-based enforcement deadline, approximately 83 percent of DL/IDs in circulation would be REAL ID-compliant.^[76] Subsequently, to estimate the percentage of REAL IDs relative to all DL/IDs in circulation, 2 years after the card-based enforcement date, DHS assumes an additional 50-percent decrease in the adoption of REAL IDs between October 2026 and October 2027.^[77] Under this assumption, DHS estimates that approximately 87 percent of DL/IDs would be REAL ID-compliant by October 2027.^[78]

DHS assumes that once the percentage of REAL IDs, relative to all DL/IDs in circulation reach a natural adoption threshold or equilibrium ^[79] (with all those who want/need a REAL ID largely have them or an alternate form of identification), which DHS currently assumes as 75 percent, the increase in the proportional value over subsequent months and years would be minimal.^[80] In 2008, DHS issued the Minimum Standards for Driver's Licenses and Identification Cards Acceptable by Federal Agencies for Official Purposes Final Rule. The NPRM included DHS's previous assumption that 100 percent of the population that hold DL/IDs would seek to obtain a REAL ID. However, in the 2008 Final Rule, the assumption was revised to 75 percent.^[81] DHS noted that ( print page 74152) the 100 percent assumption was unrealistic if States do not require all applicants to obtain REAL IDs. DHS further cited, that if States offer a choice of either compliant or non-compliant licenses to applicants, that some portion of the population would choose to receive non-compliant licenses because they may not need a REAL ID for [Federal] official purposes or they may already possess a compliant alternate form of identification.^[82] While DHS maintains the 75 percent assumption from the 2008 Final Rule, DHS acknowledges the uncertainty and that the natural threshold for REAL ID compliance may be above or below 75 percent.

In subsequent sections, DHS refers to the 75 percent assumption as the 75 percent threshold. The threshold represents an assumed natural point where REAL ID adoption would slow and essentially not grow in proportion as all those willing to get a REAL ID have done so. While DHS assumed this value to be approximately 75 percent, the actual rate could be higher or lower.^[83]

4. Forecast of REAL ID Compliance Under Phased Enforcement

To estimate the percentage of REAL ID-compliant DL/IDs by the card-based enforcement date, May 7, 2025, DHS uses the 0.56 percent CMGR estimated from January 2023 to January 2024.^[84] Next, DHS applies the 0.56 CMGR over the next 16 months to forecast the percentage of REAL IDs in circulation by May 2025, relative to all IDs in circulation.^[85] Using this methodology, DHS estimates that approximately 61 percent of all IDs in circulation would be REAL ID-compliant by the card-based enforcement date.

The aforementioned methodology assumes that the next 16 months would be similar to the trends seen over the last year.^[86] Accordingly, DHS provides an alternate forecast on the percentage of REAL ID-compliant DL/IDs in May 2025 using the 1.03 percent CMGR for the adoption of REAL ID over last 4-years.^[87] DHS applies the 1.03 percent CMGR over the 16 months between January 2024 and May 2025 to forecast that approximately 66 percent of IDs in circulation by May 2025 would be REAL ID-compliant by the card-based enforcement date.

Using the aforementioned CMGRs, 0.56 percent and 1.03 percent, DHS estimates that approximately 61 percent (lower-end of forecast) and 66 (upper-end of forecast) of all DL/IDs in circulation by May 2025 would be REAL ID-compliant, respectively. Table 3 reflects the forecasted number of REAL IDs using the two CMGR described in this section.

Table 3—Forecasted Number, and Percentage of, REAL IDs in May 2025

	Last 12 month trend (0.56 percent CMGR)	Last 4 year trend (1.03 percent CMGR)
Approx. IDs in Circulation	289,641,636
Forecasted Number of REAL IDs	177,187,465	191,027,256
REAL IDs as a Percentage of All IDs	61.2%	66.0%

As shown in table 3, under both the 0.56 percent CMGR and the 1.03 percent CMGR, the forecasted percentage of REAL IDs relative to all DL/IDs in circulation for May 2025, 61.2 percent and 66.0 percent, respectively, falls below the 2008 assumption that 75 percent of all holders would seek to obtain a REAL ID. In table 4, DHS illustrates the breakdown of how many DL/IDs would need to be REAL ID-compliant by the card-based enforcement date to meet the 75 percent threshold. Applying the 75 percent assumption from the 2008 Rule results in approximately 217.2 million of the 289.6 million IDs in circulation, in May 2025, would be REAL ID-compliant. As shown, in addition to the 25 percent of DL/IDs in circulation that DHS assumes would be non-compliant, an additional 40.0 million and 26.2 million DL/IDs that would have been assumed to be REAL ID-compliant, respectively, would not be able to be used for official purposes beginning May 7, 2025.

Next, DHS estimates the CMGR needed to reach the 75 percent of REAL ID-compliant licenses and identification cards by the card-based enforcement date using the January 2024 national compliance rate for REAL ID of 56 percent. In the sixteen months between January 2024 and May 2025, the average monthly CMGR for the adoption of REAL ID would need to increase to 1.85 percent.^[88]

Table 4—Number of REAL IDs in May 2025 To Achieve 75 Percent Threshold

	Last 12 month trend (0.56 percent CMGR)	Last 4 year trend (1.03 percent CMGR)	75% Assumption (1.85 percent CMGR)
Approx. IDs in Circulation	289,641,636
Number of REAL IDs Needed to Achieve 75% Threshold	217,231,227 (75.0%)
DHS Forecasted REAL IDs	177,187,465 (61.2%)	191,027,256 (66.0%)	217,231,227
( print page 74153)
Difference Between Threshold and Forecasted	40,043,762 (13.8%)	26,203,971 (9.0%)	0 (0.0%)

Next, DHS uses two scenarios to forecast the national compliance rate following the card-based enforcement date. First, DHS assumes the 61.2 percent and 66.0 percent REAL ID adoption trends presented in table 3 remain unchanged after the start of card-based enforcement. Under this scenario, two years after card-based enforcement, in May 2027, which is when phased approach plans would need to commence full enforcement by, the national REAL ID rate would be 69.1 percent and 83.4 percent.^[89]

Following the card-based enforcement date, DHS expects a change in the rate of adoption. Phased enforcement plans could result in REAL ID compliance being spread over time compared to continued increases in compliance if full card-based enforcement went into effect across all agencies. Phased enforcement may also incentivize some portion of the public to obtain a REAL ID as DHS begins card-based enforcement in May 2025 without further extensions and as non-compliant DL/ID holders attempt to use non-compliant identification for official purposes during the period of phased enforcement. For this second scenario, DHS uses the midpoint of the two CMGRs (0.56 percent and 1.03 percent) used to estimate the national REAL ID rate in May 2025 to estimate the national REAL ID rate after the card-based enforcement date. Using this methodology, DHS calculates a 0.79 percent CMGR which would likely capture a balance between potential high and low adoption rates for REAL IDs.^[90] Next, DHS applies the 0.79 percent CMGR to the 61.2 percent and 66.0 percent estimates for May 2025. Two years after the commencement of card-based enforcement, by May 2027, DHS estimates approximately 73.1 percent and 78.8 percent of DL/IDs issued would be REAL ID-compliant, respectively.^[91] Depending on the scenario, the 75 percent threshold may be reached as early as July 2026. However, under a lower CMGR, in which the CMGR stays at 0.56 percent, the 75 percent threshold may not be reached until October 2028.

5. Summary of REAL ID Compliance

Table 5 describes the proportion of all DL/IDs that are REAL ID-compliant under the baseline scenario and phased enforcement at 6-month intervals leading up to, and after, the card-based enforcement date. In the baseline scenario, as discussed in section IV.B.2.d.3, DHS assumes a spike in REAL ID compliance in the year leading up to the card-based enforcement date (1.61 percent CMGR). DHS then assumes a reduction in the CMGR to 0.91 percent from October 2025 to October 2026 and to 0.47 percent after October 2026. This accounts for anticipated increases leading up to and through enforcement including natural adoption prior to a deadline, additional informational campaigns, and increased incentives for those without REAL ID compliant DL/IDs that would be denied when using non-compliant DL/IDs for official purposes.

DHS also presents two phased enforcement scenarios that each include a lower and upper bound range, as discussed in section IV.B.2.d.4. Under the first phased enforcement scenario, DHS assumes trend growth rates remain the same before and after the card-based enforcement date (0.56 percent CMGR for the lower bound estimate, 1.03 percent CMGR for the upper bound estimate). This scenario assumes no change in identified trends leading up or after enforcement where the lower value represents current adoption rates (unchanged) and the higher value accounts for enforcement and phased enforcement impacts on adoption rates. Under the second phased enforcement scenario, DHS assumes the 0.56 percent CMGR for the lower bound estimate and 1.03 percent CMGR for the upper bound estimate up to the card-based enforcement date. After the card-based enforcement date, DHS assumes a change in the CMGR to 0.79 percent, the midpoint of the lower bound and upper bound trend rates to represent possible changes in behavior post enforcement date. Specifically, that in the lower end, more individuals will get REAL DL/IDs and on the higher end, less will seek REAL DL/IDs. However, DHS acknowledges there is a level of uncertainty with such adoption rates and seeks public comment on anticipated adoption and compliance rate impacts.

Table 5—REAL ID Compliance by Scenario

Month	Baseline	Phased enforcement scenario 1 (constant rates)		Phased enforcement scenario 2 (post enforcement change)
		Lower bound (%)	Upper bound (%)	Lower bound (%)	Upper bound (%)
May 24	58.2	57.6	58.7	57.6	58.7
Nov 24	63.8	59.3	62.2	59.3	62.2
May 25	70.0	61.2	66.0	61.2	66.0
Nov 25	75.7	63.1	69.9	64.0	69.0
May 26	79.7	65.0	74.1	66.9	72.1
Nov 26	83.6	67.0	78.6	69.9	75.4
( print page 74154)
May 27	85.7	69.1	83.4	73.1	78.8

The baseline and phased enforcement scenarios present different trade-offs. Under the baseline scenario, the REAL ID compliance rate grows and increases more quickly as a result of more rapid surges in adoption. Such a surge in application for REAL IDs, may lead to potential backlogs at State DMVs and provide individuals reduced options after the enforcement date ( e.g., denied DL/ID use for official purpose). This may serve as a strong motivator but may also have negative consequences ( e.g., not allowed to board a commercial flight for a critical matter).

Under a phased approach, DHS forecasts a slower adoption of REAL ID, as compared to the baseline, with compliance increases being spread over the two-year phased enforcement period. This approach provides individuals more time to obtain a REAL compliant DL/ID and allows individuals who possess non-compliant DL/IDs to use such DL/IDs for official purposes while also creating opportunities for enforcement mechanisms ( e.g., warnings) that may serve to incentivize the public to obtain a REAL ID without, or reduced, negative consequences.

DHS notes that differences in compliance rates between the baseline and scenarios could have large impacts. For example, TSA screens approximately 2.5 million passengers a day.^[92] If one percent of those passengers were to present a noncompliant DL/ID at a checkpoint, it would result in 25,000 passengers being unable to use the noncompliant DL/ID at the checkpoint in just a single day. If this was extrapolated out a week the number increases to 175,000, then 750,000 in a month and 2,250,000 in three months all of which may result in operational and security concerns. DHS recognizes TSA is a large use case, but impacts on a smaller scale could also apply to other Federal agencies. In any scenario, DHS believes a phased enforcement approach would help reduce challenges that large numbers of non-compliant DL/ID holders could present compared to full and immediate enforcement under the baseline.

a. Phased Enforcement Population

Under the REAL ID Act and regulations, on and after the card-based enforcement date, Federal agencies are prohibited from accepting non-REAL ID-compliant DL/IDs for official purposes. The rulemaking would allow Federal agencies to implement the card-based enforcement requirement of the REAL ID Act and regulations under a phased approach if the agency determines a significant security or operational risk, or if public services offered by the agency would be impacted with full enforcement. Federal agencies that opt to do so must coordinate a plan with DHS. After coordination of a plan with DHS, a Federal agency may continue to accept non-REAL ID-compliant licenses and IDs on and after May 7, 2025, as part of a phased enforcement plan. To ensure that agencies' enforcement plans appropriately advance the objectives of the REAL ID regulations, this proposed rule would require agencies' plans to include measures for full card-based enforcement by May 5, 2027.

Based on agency information in the Federal Register , DHS estimates there are 434 Federal agencies, including cabinet-level departments, who may require REAL IDs for official Federal purposes.^[93] To estimate the number of Federal agencies that would submit a phased enforcement plan under this rulemaking, DHS considers three factors; (1) agencies that are on track to not accept noncompliant marked cards on, or before, the card-based enforcement date; (2) agencies that do not typically require forms of identification for official purposes ( e.g., to be presented for entry); and (3) DHS' monthly engagements with Federal stakeholders.

Agencies on Track To Not Accept Noncompliant Marked Cards on or Before the Card-Based Enforcement Date

First, each Federal agency has the authority to set its own minimum security access requirements and, if desired, can decide not to accept noncompliant marked cards before the card-based enforcement date. For example, the U.S. Department of Defense (DoD) finalized an update to its DoD-wide installation security policy and is in the process of no longer accepting noncompliant marked cards across all of its facilities and installations.^[94] DHS assumes Federal agencies on track to implement enforcement by the effective date, are more likely to not pursue a phased enforcement plan.

Agencies That Do Not, or Do Not Typically, Require Forms of Identification To Be Displayed for Entry

Each facility makes a risk-based decision to determine if a form of identification is needed for entry, and if so, which forms would be accepted. For instance, an agency may require identification as part of their overall security strategy including, but not limited to, checking the individual against a checklist, or to verify that the individual is on an invitation or approved visitors list. If an agency only requires an individual to present a form of identification solely to record the individual's presence as opposed to for screening and access purposes, the requirements under the REAL ID Act of 2005 would not apply.

There are agencies that do not typically require forms of identification for official purposes or only experience of low volume of such interactions. A key factor in an agency's consideration may be the number of individuals that enter, or pass through, the Federal facility in a given day. For some Federal agencies, access to certain areas of the facility is presently granted without the ( print page 74155) need for an individual to present a form of identification for entry. For instance, the public areas of the Smithsonian and the National Park Service (NPS). While the Smithsonian and NPS would still be required to enforce REAL ID requirements on the card-based enforcement date, the enforcement would be limited to the individuals attempting to access the non-public areas. Presumably, as the number of individuals to this restricted entry area are significantly fewer than the daily number of visitors to Smithsonian facilities and National Parks, agencies like the Smithsonian and NPS may not need to submit phased enforcement plans due to limited security or operational risks.

DHS' Monthly Engagements With Federal Stakeholders

In Fall 2023 and the first quarter of 2024, DHS began hosting monthly stakeholder engagement sessions with Federal agencies. During these sessions, DHS briefed agencies regarding the card-based enforcement date and the proposed rulemaking to allow agencies the option for a phased approach if they determine such a plan is appropriate. Through hosting the sessions, DHS was able to establish a greater understanding, across the Government, on which agencies may consider a phased approach based on security, operational, or public impact risks associated with full enforcement. For instance, some agencies noted that they would follow guidance put forth by their cabinet-level department. Of the sample of agencies invited, approximately 63 percent attended one or more stakeholder meetings. Based on feedback from agencies and recurring attendance over months, DHS assumes that 50 percent of agencies that attended one or more meetings would pursue a phased enforcement plan.

Based on these three factors, DHS assumes that of the 434 Federal agencies, 96 percent would not submit a phased enforcement plan. As such, these agencies would join the Department of Defense and begin full card-based enforcement on May 7, 2025. While individuals would need to present a REAL-ID compliant identification or an approved alternate identification for official purposes from that date forth; based on engagements with DHS subject matter experts (SMEs) and Federal agencies, the vast majority of agencies do not handle a significant volume, on a daily basis, of individuals required to present REAL ID for official Federal purposes.^[95]

DHS assumes that the remaining 4 percent of Federal agencies would develop and coordinate phased enforcement plans with DHS. The majority of such plans are anticipated to represent a low-to-medium use case ( e.g., visitor access to a facility) with TSA representing a high-use case given the volume of individuals boarding federally regulated commercial aircraft per day.^[96]

b. Cost of the Proposed Rule

The following summarizes the estimated costs of the proposed rule over a 2-year period of analysis. Specifically, impacts are evaluated between 2024 and 2025 to align with agency efforts to develop a phased enforcement plan prior to the current card-based enforcement date.

Federal agencies would incur costs to familiarize themselves with the proposed rule, assess whether to implement a phased enforcement plan, and if so, develop a plan. DHS, as the agency administering the REAL ID program, would incur costs to coordinate with Federal agencies that voluntarily implement a phased enforcement plan.

Compensation Rates

DHS estimates the labor-related costs for DHS and other Federal agencies. First, DHS uses the GS, step 3 wage scale for the Washington DC metro area to represent the annual wage for each GS level.^[97] For Senior Executive Service (SES) employees, DHS uses the midpoint of the range of basic pay as the estimate for the SES annual wage.^[98]

DHS then multiplies annual wages for each GS level and SES by a compensation factor that represents fully loaded compensation rates. The compensation factor is the sum of all annual compensation which includes wages and internal DHS data on awards, bonuses, personnel benefits, and transit benefits, divided by the annual wage.

DHS calculates a compensation rate per hour by dividing the annual fully loaded compensation rates by 2,087, which represents the number of annual work hours.^[99] Table 6 summarizes the compensation rates per hour for the relevant labor categories DHS uses in the analysis.

Table 6—Compensation Rates per Hour

Labor category	Annual wage	Compensation factor 100	Annual compensation rate	Compensation rate per hour
	a	b	c = a × b	d = c ÷ 2,087
GS-13	$119,482	1.353	$161,673	$77.47
GS-14	141,192	1.349	190,482	91.27
GS-15	166,079	1.346	223,507	107.09
( print page 74156)
SES	176,561	1.345	237,416	113.76
Note: Calculation may not be exact due to rounding.

DHS Costs

DHS would incur costs related to coordinating with Federal agencies on their phased enforcement plans to address any potential concerns ahead of the REAL ID card-based enforcement date. This includes the cost to develop guidance for agencies on phased enforcement and time to review and coordinate with agencies on their plans. Furthermore, DHS must publish the list of agencies that have coordinated phased enforcement plans.

DHS would develop guidance to inform Federal agencies that they may implement REAL ID card-based enforcement using a phased approach, how to do so, and the level of coordination necessary with DHS. DHS consulted with internal SMEs who estimate a range to develop guidance between 60 to 100 hours. DHS uses the midpoint of this range, 80 hours, to calculate the cost to develop guidance. DHS assumes this time would be split between GS-13, GS-14, and GS-15 employees, with a respective burden of 45 percent, 45 percent, and 10 percent. DHS calculates a weighted average guidance development compensation rate of $86.64 per hour by summing the product of the compensation rates and the proportion of burdens for the respective groups of employees contributing to the efforts.^[101] DHS estimates a $6,931 guidance development cost by multiplying the 80-hour burden and the weighted average guidance development compensation rate of $86.64 per hour.

DHS coordination would also include reviewing phased enforcement plans to ensure compliance with the REAL ID Act and regulations (but would not include approval of plans). DHS consulted with internal SMEs who estimate a range to coordinate and review plans between 8 and 24 hours per plan.^[102] DHS uses the midpoint of the range, 16 hours per plan, to calculate DHS coordination costs. DHS assumes this time would be split between GS-13 and GS-14 employees, with a respective burden of 50 percent and 50 percent. DHS estimates a weighted average coordination compensation of $84.37 per hour by summing the product of the compensation rates and the proportion of burdens for the respective groups of employees contributing to the efforts.^[103] DHS estimates the coordination cost by multiplying the 18 agencies that would develop plans, the 16-hour time burden, and weighted average coordination compensation rate of $84.37 per hour for a total coordination cost of $24,298.^[104]

DHS would also incur costs to make publicly available a list of agencies that have coordinated phased enforcement plans with DHS. DHS assumes it would publish the list of agencies on a web page on DHS's REAL ID website in year two of the analysis, just prior to the card-based enforcement date. DHS SMEs estimate it would take 16 hours to create, review, approve, and publish content on its existing REAL ID website. DHS assumes this time would be split between GS-13 and GS-14 employees, with a respective burden of 50 percent and 50 percent. DHS estimates a weighted average publishing compensation of $84.37 per hour by summing the product of the compensation rates and the proportion of burdens for the respective groups of employees contributing to the efforts.^[105] DHS calculates a publishing cost of $1,350 by multiplying the 16-hour burden and weighted average publishing compensation rate of $84.37 per hour. DHS assumes incremental maintenance costs for this one web page would be minimal because DHS would already maintain the DHS REAL ID website. Furthermore, DHS would not need to update the website content frequently because all Federal agencies that voluntarily implement a phased enforcement plan would need to do so by May 7, 2025.

DHS estimates the 2-year total cost for phased enforcement coordination to be $0.033 million undiscounted and $0.031 million discounted at 2 percent. Table 7 describes the total costs of the proposed rule to DHS.

Table 7—Total Cost to DHS

[$ Actual dollars, 2023 dollars]

Year	Cost to develop guidance	Cost to coordinate	Cost to publish list	Total cost
				Undiscounted	Discounted at 2%
	a	b	c	d = a + b + c
2024: 1	$6,931	$0	$0	$6,931	$6,795
( print page 74157)
2025: 2	0	24,298	1,350	25,648	24,652
Total	6,931	24,298	1,350	32,579	31,447
Note: Totals may not add due to rounding.

Federal Agency Costs

All Federal agencies would need to familiarize themselves with the proposed rule and phased enforcement concept and determine if a phased enforcement plan is necessary. DHS assumes at least one attorney and one manager at the GS-14 and GS-15 levels within each agency would review the proposed rule. DHS estimates that each person reviewing the rulemaking would spend an average of 1.1 hours.^[106] DHS calculates a weighted average familiarization compensation rate of $99.18 per hour by summing the product of the compensation rates and the proportion of burdens for the respective groups of employees contributing to the efforts.^[107] DHS estimates the cost for all Federal agencies to familiarize themselves with phased enforcement by multiplying the 434 Federal agencies, the two employees per agency reviewing the rulemaking, the 1.1 hours familiarization burden and the weighted average familiarization compensation rate of $99.18 per hour for an initial familiarization cost of $94,145.^[108]

In addition to familiarization, all Federal agencies would need to determine if based on their specific environment, developing and coordinating a phased enforcement plan is necessary. DHS SMEs estimate Federal agencies would spend, on average, between 10 to 40 hours to make a determination. DHS uses the midpoint of the range, 25 hours, to calculate the cost to make a determination. DHS assumes this time would be split between a GS-15 and SES, with a respective burden of 50 percent and 50 percent. DHS calculates a weighted average plan determination compensation of $110.43 per hour by summing the product of the compensation rates and the proportion of burdens for the respective groups of employees contributing to the efforts.^[109] DHS estimates the cost for all Federal agencies to determine a need for a phased enforcement plan by multiplying the 434 Federal agencies, the 25-hour burden, and the plan determination compensation rate of $110.43 per hour. This plan determination cost is $1.20 million.^[110]

Federal agencies that develop phased enforcement plans would incur costs to develop and coordinate their respective plans with DHS. DHS assumes plan development and coordination would also include preparing briefing materials for the public and updating the agency's website to inform the public of the phased enforcement plan and policies. DHS SMEs estimate Federal agencies would spend, on average, between 150 and 300 hours to develop plans. DHS uses the midpoint of the range, 225 hours, to calculate the cost to develop plans. DHS assumes this time would be split between GS-14, GS-15, and SES employees, with a respective burden of 45 percent, 45 percent, and 10 percent. DHS estimates a weighted average plan development compensation of $100.64 per hour by summing the product of the compensation rates and the proportion of burdens for the respective groups of employees contributing to the efforts.^[111] DHS multiplies the 18 agencies that develop plans,^[112] the 225-hour development time burden, and the plan development compensation rate of $100.64 per hour to calculate a plan development cost of $407,594.^[113]

Table 8 presents the total Federal cost estimates over the 2-year period of analysis which equates to $1.70 million undiscounted and $1.67 million discounted at 2 percent. ( print page 74158)

Table 8—Total Quantified Cost to Federal Agencies

[$ Actual dollars, 2023 dollars]

Year	Familiarization cost	Plan determination cost	Plan development cost	Total cost to Federal agencies
				Undiscounted	Discounted at 2%
	a	b	c	d = a + b + c
2024: 1	$94,145	$1,198,136	$407,594	$1,699,874	$1,666,543
2025: 2	0	0	0	0	0
Total	94,145	1,198,136	407,594	1,699,874	1,6666,543
Note: Totals may not add due to rounding.

Unquantified Costs

The proposed rule would also include non-quantified impacts and costs to affected entities. Such impacts are difficult to quantify largely due to a high degree of uncertainty. One such impact is the delay of benefits from the original rule by implementing the card-based enforcement requirement of the REAL ID rule in a phased manner. Full security benefits associated with the REAL ID rule would not be realized, as a result of agencies implementing a phased approach, until full enforcement occurs. As the benefits associated with the 2008 rule are difficult to quantify, so too is the quantification of their delay.^[114] Nonetheless, this proposed rule would have less unrealized or delayed security benefits compared to an extension of the full compliance date.

Federal agencies that voluntarily implement card-based enforcement in a phased approach would incur costs related to plan implementation. However, DHS assumes there would be a high degree of variability among such plans, and agencies would have discretion to determine what aspects to include in a phased enforcement plan. Nonetheless, Federal agencies would likely incur costs related to training necessary personnel on the processes and procedures of phased enforcement plans. Federal agencies would also likely incur costs to inform the public or appropriate stakeholders impacted about the new identity verification procedures related to the agencies' phased enforcement plans ( e.g., awareness campaign through media, signage at access points, and/or providing notices for individuals with non-compliant identification). Such costs may extend through agencies' phased enforcement plans, beyond years one and two of this analysis. Individuals may also incur costs to become aware of phased enforcement plans and respond accordingly.

Total Cost of Phased Enforcement Rule

Table 9 presents the two-year total cost of the phased enforcement proposed rule. DHS estimates the total cost of the proposed rule to be $1.73 million undiscounted and $1.70 million discounted at 2 percent.

Table 9—Total Cost of Phased Enforcement Rule

[Actual dollars, 2023 dollars]

Year	Cost to DHS	Cost to Federal agencies	Total cost
			Undiscounted	Discounted at 2%
	a	b	c = a + b
2024: 1	$6,931	$1,699,874	$1,706,805	$1,673,339
2025: 2	25,648	0	25,648	24,652
Total	32,579	1,699,874	1,732,453	1,697,991
Annualized				874,549
Note: Totals may not add due to rounding.