While improvements are expected, MNLARS costs expected to grow in 2019

The new year is expected to bring several long-awaited improvements to how the state processes licenses and vehicle registrations, as well as more requests for taxpayer dollars to reimburse those who have been stung by the problematic system.

State agency leaders said they plan to roll out some changes to the Minnesota Licensing and Registration System (MNLARS) in early February, including allowing Minnesotans to transfer specialty license plates and flag staff when a potentially incorrect vehicle base value is entered in the system.

But by the end of February they will have run out of money. After that, state employees said they will be able to maintain only the system in place, not add new functions.

State agencies will be asking legislators for more money to develop the system in 2019, but that's not all, Sen. Scott Newman, R-Hutchinson, said at a recent MNLARS Steering Committee meeting. He expects there will be a renewed push to reimburse struggling deputy registrars who manage the licensing centers across the state. He said auto auction companies, car dealers and towing companies, all of which have taken a hit because of the system's issues, will likely also be requesting state aid.

"It's almost like an endless request for money that I see coming over the MNLARS project," Newman said. "And I do understand that you need additional staff to get this done. But where is all this money going to come from?"

Last legislative session, lawmakers decided to devote $9 million to deputy registrars who have experienced major losses in income due to various glitches with the new system. Gov. Mark Dayton vetoed the proposal, saying he wanted the bill to include broader funding for MNLARS fixes.

Earlier in the session, lawmakers did agree to spend $9.6 million in emergency funding to continue work on MNLARS. That came on top of about $93 million the state had previously spent overhauling the aging system.

Minnesota Information Technology Services Commissioner Johanna Clyborne said she would tell the Walz administration about the various paths forward, including the possibility of shifting to a private company, and will offer the pros and cons she sees with different approaches.

"It does have problems, but at the same time it is producing revenue for our state," she said of the system.

It is not clear yet whether Clyborne, who has been on the job less than 10 months, will remain.

Walz is in the midst of selecting new state agency leaders. He has not yet announced the next commissioners of Minnesota Information Technology Services and the Department of Public Safety, the agencies that have been working on MNLARS and on issuing Real IDs that comply with federal security requirements.

The state began issuing the Real IDs on Oct. 1. Driver and Vehicle Services hired 26 temporary staff to help with customer service in anticipation of the REAL ID debut, Director Dawn Olson told steering committee members as part of a quarterly update at the December meeting.

More than 32,000 people have applied for the enhanced identification, she said, and the department has processed and mailed about 11,500 of those IDs. Olson said DVS aims to clear the pileup of applications by the first week in January.

Meanwhile, it is taking about 35 to 40 days for people to get their vehicle titles, Olson said. DVS is not yet meeting its goal of sending titles in less than 30 days, she said, but it is down from a high of 92 to 100 days at the start of the year.