Users of Minnesota’s troublesome vehicle licensing and registration system are coming up with a list of improvements they believe the state should make to the system, before a funding shortfall interrupts progress on the project.

In a progress report sent to state lawmakers Monday night, officials with the Department of Public Safety and Minnesota Information Technology Services (MNIT) warned they soon will be forced to “ramp down” efforts to fix the system.

The Legislature dedicated $9.6 million this session to continue repairing the system, far short of the $43 million that state agencies said was needed. MNIT Commissioner Johanna Clyborne said Tuesday she is still figuring out how far she can stretch the money they have for repairs. She said they might be able to continue to work on problems until this fall before they are cut down to a “skeleton crew.”

There were still 163 system defects, gaps and requests for new features as of June 1, according to the latest update to legislators. That number is down from 284 listed in the May 1 report.

This week, groups affected by problems with the Minnesota Licensing and Registration System (MNLARS) plan to come up with a list of priorities that Clyborne’s staff should focus on with the money still left.

The glitchy system has resulted in costly delays since the state rolled it out last summer. The system’s failures affected deputy registrars who operate the state’s licensing offices, as well as auto dealers, insurers and people who were stuck waiting for specialty license plate transfers.

Lawmakers spent much of the legislative session airing their frustrations over how the system went live before it was ready. Nevertheless, the House and Senate included $13.7 million for MNLARS in the massive budget bill they passed at the end of the session. Gov. Mark Dayton vetoed the bill, which included dozens of items he opposed.

The lack of state funding has made it difficult to attract and keep quality contractors, Clyborne said. It created a “buyer’s market” for contractors trying to “extort” more money, she said, because they know they may not be able to stay on the project long-term.

House Speaker Kurt Daudt and other Republican legislators have said they doubt MNIT can fix the system and want to look for a private vendor to take over the project.

“For my team, it makes them question why are we doing this? It’s a morale issue,” Clyborne said. She said it would be more expensive to bring in an outside company at this point and added that “the deputy registrars are going to continue to feel the pain.”