Funding Alone May Not Save Minnesota’s Troubled Licensing System

A recent influx of funding was meant to fix the state’s struggling Licensing and Registration System. Now, lawmakers are grappling with whether to pull the plug and start from scratch.

by / March 22, 2019
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Minnesota's costly and controversial Licensing and Registration System (MNLARS) was recently approved for an additional $13 million in funding — the bulk of which will go to IT contractors that continue to tackle the various bugs troubling the system.     

However, more money, while appreciated, hasn’t necessarily inspired confidence in MNLARS long term. Two lawmakers confirmed this week that state officials are currently exploring the possibility of abandoning the beleaguered system and once again hiring an outside company to build a new one.

State Rep. Dave Baker, R-District 17B, chair of the House committee on technology, said in an interview with Government Technology that abandoning MNLARS was an avenue that could be pursued.

“We are not convinced yet that we shouldn’t scrap it and walk away and do another version of something different,” he said. “I think that’s the big question right now: Is it worth saving?"

Rep. Paul Torkelson, R-District 16B, similarly said that the state's Department of Public Safety was currently in "conversation" with several different companies about potentially taking on the task of creating a new system. One of those companies, Torkelson said, is the contractor the state used to create its driver's license IT system, FAST Enterprises.

"It's challenging to be optimistic — it really is," Torkelson said of the current system.

The reasons for that skepticism are legion, according to the lawmakers. A project that has cost the state over $100 million, the system — which was supposed to streamline and modernize services for state residents — suffered continual setbacks throughout the decade it was in development. After the initial vendor didn't work out, the state’s IT Services agency decided to build the system in-house. An imperfect design, however, led to a dysfunctional rollout in 2017, and the system has been plagued by longstanding issues ever since.

While many of the initial problems associated with the rollout have now been mended, issues still persist. The appeal of building a new system lies in the fact that MNLARS, according to some, seems to function less efficiently than the system it was built to replace.

“It is largely not functioning as well as the old e-support system was,” Baker said. "It is still clunky. It is still slower than it should be. The deputy registrars are still frustrated.”

Julie Hanson, the deputy registrar for Scott County, said things have improved since 2017 but agreed that the transition to MNLARS has been quite difficult.

“Our world has just completely changed,” she said. “The hope was that by going to MNLARS, the back end to the customer would be much quicker.”

Instead, she said, the opposite happened. MNLARS shifted substantial responsibilities for new IT work onto the registrars' shoulders, creating a shortage of manpower for basic services, she said. Substantial new staffing and additional funding will be necessary to fix the customer experience, now plagued by increased wait times.  

“The system design isn’t such that it’s ever going to flow real well for its end users,” she said. “I don’t know that it has the potential to ever become something that is that user friendly.”

Hanson also said the new $13 million allocation was helpful but would not go far for her county. “I think Scott County would get somewhere in the neighborhood of $85,000,” she said. That one-time payment "doesn’t enable us with salary and benefits [to] hire somebody on and keep them on,” she said.

“With the different types of coding that were used to build MNLARs that don’t speak to each other well, I don’t know if it honestly can be fixed,” she said.

In addition to the governor's recent $13 million allocation, several different funding strategies are being considered to support the system into the future. In particular, state officials are currently mulling the allocation of an additional $80 million in funding to MNLARS to help with operations, Baker and Torkelson said. 

Similarly, a bill recently introduced by Rep. Rick Hansen would allocate a one-time payment of $10 million to reimburse the deputy registrars that have suffered financial losses as a result of the debacle.

Both Baker and Torkelson said that a decision as to whether the state would try to salvage or replace MNLARS would likely be made by the end of the legislative session in May. 

It will be a difficult decision, Torkelson said. 

"It's a very difficult choice to make between investing more money in this system that we've already spent over $100 million on, and putting it on life support and going out and hiring someone to come in and more or less start over, which would also be very expensive," he said.

Lucas Ropek Staff Writer

Lucas Ropek is a staff writer for Government Technology. He has worked as a newspaper reporter and writer in Massachusetts and New York. He received his Bachelor's degree in English from Kenyon College in Ohio. He lives in Northern California.

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