(b) Definitions. As used in this section -

Driving-related offense means any offense under State or local law relating to the use or operation of a motor vehicle, including but not limited to driving while intoxicated, misrepresentation of the individual's age, reckless driving, driving without wearing a seat belt, child restraint violation, speeding, prohibited use of a personal wireless communications device, violation of the driving-related restrictions applicable to the stages of the graduated driver's licensing process set forth in paragraphs (d) and (e) of this section, and moving violations. The term does not include offenses related to motor vehicle registration, insurance, parking, or the presence or functionality of motor vehicle equipment.

Licensed driver means an individual who possesses a valid unrestricted driver's license.

Unrestricted driver's license means full, non-provisional driver's licensure to operate a motor vehicle on public roadways.

(d) Learner's permit stage. A State's graduated driver's licensing statute shall include a learner's permit stage that -

1. (1) Applies to any driver, prior to being issued by the State any permit, license, or endorsement to operate a motor vehicle on public roadways other than a learner's permit, who -

   1. (i) Is younger than 18 years of age; and
   2. (ii) Has not been issued an intermediate license or unrestricted driver's license by any State;
2. (2) Commences only after an applicant for a learner's permit passes a vision test and a knowledge assessment (e.g., written or computerized) covering the rules of the road, signs, and signals;

3. (3) Is in effect for a period of at least 6 months, and remains in effect until the learner's permit holder -

   1. (i) Reaches at least 16 years of age and enters the intermediate stage; or
   2. (ii) Reaches 18 years of age;
4. (4) Requires the learner's permit holder to be accompanied and supervised, at all times while operating a motor vehicle, by a licensed driver who is at least 21 years of age or is a State-certified driving instructor;

5. (5) Requires the learner's permit holder to either -

   1. (i) Complete a State-certified driver education or training course; or
   2. (ii) Receive at least 50 hours of behind-the-wheel training, with at least 10 of those hours at night, with a licensed driver who is at least 21 years of age or is a State-certified driving instructor;
6. (6) Prohibits the learner's permit holder from using a personal wireless communications device while driving (as defined in § 1300.24(b)), except as permitted under § 1300.24(c)(2)(iii), provided that the State's statute does not include an exemption that specifically allows a driver to text through a personal wireless communication device while stopped in traffic; and
7. (7) Requires that, in addition to any other penalties imposed by State statute, the duration of the learner's permit stage be extended if the learner's permit holder is convicted of a driving-related offense during the first 6 months of that stage.

(e) Intermediate stage. A State's graduated driver's licensing statute shall include an intermediate stage that -

1. (1) Commences -

   1. (i) After an applicant younger than 18 years of age successfully completes the learner's permit stage;
   2. (ii) Prior to the applicant being issued by the State another permit, license, or endorsement to operate a motor vehicle on public roadways other than an intermediate license; and
   3. (iii) Only after the applicant passes a behind-the-wheel driving skills assessment;
2. (2) Is in effect for a period of at least 6 months, and remains in effect until the intermediate license holder reaches at least 17 years of age;
3. (3) Requires the intermediate license holder to be accompanied and supervised, while operating a motor vehicle between the hours of 10:00 p.m. and 5:00 a.m. during the first 6 months of the intermediate stage, by a licensed driver who is at least 21 years of age or is a State-certified driving instructor, except when operating a motor vehicle for the purposes of work, school, religious activities, or emergencies;
4. (4) Prohibits the intermediate license holder from operating a motor vehicle with more than 1 nonfamilial passenger younger than 21 years of age unless a licensed driver who is at least 21 years of age or is a State-certified driving instructor is in the motor vehicle;
5. (5) Prohibits the intermediate license holder from using a personal wireless communications device while driving (as defined in § 1300.24(b)), except as permitted under § 1300.24(c)(2)(iii), provided that the State's statute does not include an exemption that specifically allows a driver to text through a personal wireless communication device while stopped in traffic; and
6. (6) Requires that, in addition to any other penalties imposed by State statute, the duration of the intermediate stage be extended if the intermediate license holder is convicted of a driving-related offense during the first 6 months of that stage.

(g) Exceptions. A State that otherwise meets the minimum requirements set forth in paragraphs (d), (e), and (f) of this section will not be deemed ineligible for a grant under this section if -

1. (1) The State enacted a statute prior to January 1, 2011, establishing a class of permit or license that allows drivers younger than 18 years of age to operate a motor vehicle -

   1. (i) In connection with work performed on, or for the operation of, a farm owned by family members who are directly related to the applicant or licensee; or
   2. (ii) If demonstrable hardship would result from the denial of a license to the licensee or applicant, provided that the State requires the applicant or licensee to affirmatively and adequately demonstrate unique undue hardship to the individual; and
2. (2) A driver younger than 18 years of age who possesses only the permit or license described in paragraph (g)(1) of this section and applies for any other permit, license, or endorsement to operate a motor vehicle is subject to the graduated driver's licensing requirements of paragraphs (d), (e), and (f) of this section.

(i) Use of grant funds - (1) Eligible uses. Except as provided in paragraphs (i)(2) and (3) of this section, a State may use grant funds awarded under 23 U.S.C. 405(g) only as follows:

1. (i) To enforce the State's graduated driver's licensing process;
2. (ii) To provide training for law enforcement personnel and other relevant State agency personnel relating to the enforcement of the State's graduated driver's licensing process;
3. (iii) To publish relevant educational materials that pertain directly or indirectly to the State's graduated driver's licensing law;
4. (iv) To carry out administrative activities to implement the State's graduated driver's licensing process; or
5. (v) To carry out a teen traffic safety program described in 23 U.S.C. 402(m).
6. (2) Special rule. Notwithstanding paragraph (i)(1) of this section, a State may elect to use up to 75 percent of the grant funds awarded under 23 U.S.C. 405(g) for any eligible project or activity under Section 402.
7. (3) Special rule - low fatality States. Notwithstanding paragraphs (i)(1) and (2) of this section, a State may elect to use up to 100 percent of the grant funds awarded under 23 U.S.C. 405(g) for any eligible project or activity under Section 402 if the State is in the lowest 25 percent of all States for the number of drivers under age 18 involved in fatal crashes in the State as a percentage of the total number of drivers under age 18 in the State, as determined by NHTSA.