Or. Trucking Associations, Inc. v. Dep't of Transp.

• Decision Date: 15 November 2017
• Docket Number: A157244
• Parties: OREGON TRUCKING ASSOCIATIONS, INC., an Oregon nonprofit corporation; AAA Oregon/Idaho, an Oregon nonprofit corporation; Oregon-Columbia Chapter of the Association ; Redmond Heavy Hauling; Gordon Wood Insurance & Finance; Property Casualty Insurers Association of America; National Association of Mutual Insurance Companies; and Oregon Mutual Insurance Company, Plaintiffs-Respondents, v. DEPARTMENT OF TRANSPORTATION and Department of Administrative Services, Defendants-Appellants.
• Court: Oregon Court of Appeals

288 Or.App. 822
407 P.3d 849

OREGON TRUCKING ASSOCIATIONS, INC., an Oregon nonprofit corporation; AAA Oregon/Idaho, an Oregon nonprofit corporation; Oregon-Columbia Chapter of the Association ; Redmond Heavy Hauling; Gordon Wood Insurance & Finance; Property Casualty Insurers Association of America; National Association of Mutual Insurance Companies; and Oregon Mutual Insurance Company, Plaintiffs-Respondents,
v.
DEPARTMENT OF TRANSPORTATION and Department of Administrative Services, Defendants-Appellants.

A157244

Court of Appeals of Oregon.

Argued and submitted September 3, 2015.
November 15, 2017

Rolf C. Moan, Assistant Attorney General, Salem, argued the cause for appellants. With him on the briefs were Ellen F. Rosenblum, Attorney General, and Anna M. Joyce, Solicitor General.

Gregory A. Chaimov, Portland, argued the cause for respondents. With him on the brief was Davis Wright Tremaine LLP.

Louis A. Santiago, Roy Pulvers, Garrett S. Garfield, Nellie Q. Barnard, and Holland & Knight LLP filed the brief amicus curiae for NICUSA, Inc.

Before DeVore, Presiding Judge, and James, Judge, and Duncan, Judge pro tempore.^*

DUNCAN, J. pro tempore.

407 P.3d 851

288 Or.App. 824

This declaratory judgment action concerns agreements between the two defendants—Oregon Department of Transportation (ODOT) and Oregon Department of Administrative Services (DAS)—and between DAS and a private company, NICUSA, that allow NICUSA to make Oregon driver records available electronically, for a fee, to companies authorized to receive and resell them (disseminators). Plaintiffs¹ sought declarations that ODOT lacked authority to sell DAS an exclusive license to provide electronic access to driver records, and that it was violating its trust fund obligations to the State Highway Fund (highway fund). Defendants appeal from a declaratory judgment in favor of plaintiffs, following the grant of plaintiffs' motion for partial summary judgment. Defendants assign error to the trial court's grant of plaintiffs' motion for partial summary judgment and its denial of defendants' cross-motion for summary judgment. Because we agree with defendants that the trial court erred in both respects, we reverse and remand.

In an appeal from a judgment resulting from cross-motions for summary judgment, in which appellants have assigned error to the trial court's rulings on both motions, both rulings are subject to review. Adair Homes, Inc. v. Dunn Carney , 262 Or.App 273, 276, 325 P.3d 49, rev den , 355 Or. 879, 333 P.3d 333 (2014). We review each motion to determine "whether there are any disputed issues of material fact and whether either party was entitled to judgment as a matter of law." Vision Realty, Inc. v. Kohler , 214 Or.App 220, 222, 164 P.3d 330 (2007).

288 Or.App. 825

We begin by setting out the relevant statutory and constitutional provisions. Article IX, section 3a, of the Oregon Constitution, requires revenues collected from certain motor-vehicle-related taxes and fees to "be used exclusively for the construction, reconstruction, improvement, repair, maintenance, operation and use of public highways, roads, streets and roadside rest areas" within the state. ORS 366.505(1) establishes that the "State Highway Fund shall consist of" listed funds and revenues, which include the funds and revenues referred to in Article IX, section 3a. Another provision of ORS 366.505 provides that the highway fund "shall be deemed and held as a trust fund, separate and distinct from the General Fund, and may be used only for the purposes authorized by law and is continually appropriated for such purposes." ORS 366.505(2).

ORS 366.395 provides, in part:

"(1) The Department of Transportation may sell, lease, exchange or otherwise dispose or permit use of real or personal property, * * * which * * * is, in the opinion of the department, no longer needed, required or useful for department purposes, except that real property may be leased when, in the opinion of the department, such real property will not be needed,

407 P.3d 852

required or useful for department purposes during the leasing period."

The relevant facts are undisputed. ODOT, through its Motor Vehicle Services Division (DMV) maintains driver records and other information. It makes certain records available to those who are authorized by law to obtain them. See, e.g ., ORS 802.179 (authorizing or requiring disclosure of personal information contained in motor vehicle records under specified conditions). Before the transactions at issue here, the fee for obtaining a driver record was $2.00, or $1.50 for a query that failed to return a record. ORS 802.183(1) provides that ODOT may set fees at a level that is "reasonably calculated to reimburse" the agency "for its actual cost" of providing "personal information" to those authorized to obtain it under ORS 802.179. The driver records are assets of the highway fund.²

288 Or.App. 826

In 2006, ODOT made driver records available to disseminators electronically via a nonprofit organization, AAMVA, which provided real-time electronic access to driver records through a secure network. Disseminators who accessed driver records electronically through AAMVA paid the per-record fee set by ODOT: $0.50 in 2006, and later, $2.00. Disseminators paid AAMVA a one-time fee to initiate the service, and annual fees to maintain access. ODOT did not collect any other fee for the records, and did not collect a fee for access to the records.

In 2009, DAS was tasked with developing and funding a state government internet portal. It considered the example of a number of other states that had created a "self-funded" internet presence through fees for electronic access to driving records, including a "convenience fee" that helps to pay for the portal. DAS also obtained authority in consultation with the Electronic Government Portal Advisory Board, to collect, or authorize collection of, "convenience fees" for accessing information via the state's internet portal. DAS approached ODOT to determine whether Oregon driver records could be used as part of a plan to self-fund the state's internet portal.

ODOT eventually decided to create a "limited, exclusive license to provide [c]ommercial [e]lectronic [a]ccess to [driver records] through" a state internet portal. In an interagency agreement, ODOT sold that license to DAS. That agreement describes the license as "intangible personal property of" the highway fund.

The license has the following characteristics: It includes restrictions relating to access to, and use of, the data made available through the license. Electronic access to driver data is limited to DMV-approved disseminators. Other means of access to driver data, including multiple means provided by DMV, such as mail, telephone request, and direct access via a DMV terminal, are not licensed—that is, DMV continues to provide access through those means. Ownership of driver data or driver records remains

288 Or.App. 827

with DMV, and it controls who may access them. DAS may sublicense its rights and obligations to another. Neither DAS nor its sublicensee acquires ownership of the data or records. Neither DAS nor its sublicensee may modify, store, or maintain the driver data that is transmitted to DMV-approved disseminators. The license is exclusive, which means that the rights licensed to DAS may not be sublicensed by ODOT or DMV to anyone else.

ODOT sold that license to DAS for an amount that an expert calculated to be the fair market value of the license. Dr. Jenny Liu, Assistant Director of the Northwest Economic Research Center at Portland State University, is an environmental and resource economist with a focus in transportation economics. Liu calculated the fair market value³ of the license to be a per-record fee of $4.63

407 P.3d 853

per record.⁴ In addition, ODOT receives the $2.00 per record reimbursement for its cost of producing the record. The $4.63 per record license payments are credited to the highway fund. Based on payments generated through this arrangement, ODOT estimates that the highway fund will receive $55 million over the course of the 10-year license.

DAS contracted with a company, NICUSA, to create and maintain an internet portal for the state. DAS sublicensed the license it obtained from ODOT to NICUSA. NICUSA developed and hosts the state's internet portal. As part of those services, it provides electronic access to driver records for disseminators. NICUSA's agreement with DAS (master agreement) allows it to collect a $3.00 per record convenience fee for records provided through its electronic access. The convenience fee compensates NICUSA for services provided to all state agencies, not just ODOT and DMV.

Plaintiffs filed this action for declaratory judgment, alleging that they are affected by the sale of the exclusive

288 Or.App. 828

license, the master agreement, and the unauthorized use of proceeds from the...