Minnesota selects private vendor to replace troubled MNLARS system

Minnesota officials have selected a replacement for the state's beleaguered vehicle licensing and registration computer system, the source of years of costly headaches for administrators and motorists.

The state is spending nearly $34 million on the new system after deciding to do away with the Minnesota Licensing and Registration System (MNLARS), which was developed in-house at a cost of more than $100 million. The bulk of the new system is slated to be in place in November 2020, with all work completed in late 2021.

Colorado-based Fast Enterprises was the lone company to respond to the state's search for a private software solution. The state previously worked with the company to develop its system to issues Real IDs.

Gaye Smith, who manages the South St. Paul license center, and Suzanne Jensen, who runs another one in Blue Earth County, said they are excited to make the switch to Fast Enterprises.

"They gave us great training, the Fast team, great training. And they were just so available," Jensen said of the Real ID process.

Eleven other states have used the company's car title and registration software. Smith said she called people who work with the systems in a few of those states and they gave the company good reviews.

"I feel a lot more comfortable with where we're heading," she said.

When MNLARS rolled out in 2017 it quickly prompted a backlash from people like Smith and Jensen, who operate the private and public license centers around the state. They are still dealing with inefficiencies and customers being charged twice or the wrong fee, Smith said.

The cost to taxpayers continued to pile up over the past couple years as the state worked to fix system flaws and glitches and hire enough staff to handle a backlog of requests for license plates, titles and driver's licenses.

The error-prone system led Gov. Tim Walz to hire outside experts for an independent review. The study determined the least risky solution would be to employ packaged software already used by other states.

Walz announced in May that he was going to give up on MNLARS and go with a private software option. The decision was applauded by Republican lawmakers, who had been pushing former Gov. Mark Dayton to take that approach.

"This contract is the product of a bipartisan process with a simple goal: Make sure Minnesotans can get their vehicle titles, license plates, and tabs on time and error-free," Walz said in a statement Thursday. "Not only will this solution produce more efficient results, but this process has also laid a foundation for us to move forward on other critical issues facing our state."

Rep. Paul Torkelson, R-Hanska, was one of the leading critics of the MNLARS system. He put out a statement crediting Walz for listening to outside experts and moving on from what he called "the MNLARS disaster."

"Fast Enterprises delivered a Real ID system that is already up and running, and it's my hope we're just a couple short years away from a fully functioning system that works well for deputy registrars and the Minnesotans they serve each day," Torkelson said.

Minnesota will continue to use MNLARS as it phases in Fast Enterprise's software. The state's contract with the company expires at the end of October 2021, but can be extended up to five years. The rollout of the new software will occur in two steps.

Work on the first part will start this month and will take 16 months to complete, according to the company's project plan. It is focused on replacing MNLARS capabilities such as titling. The second rollout 10 months later will add new functions that are not currently available with MNLARS.

It is not the first time Minnesota has looked to the private sector to solve a technology problem.

State officials only decided to do the work in-house after ending a contract with Hewlett-Packard Co. in 2014. The tech company, which had worked with many other states on similar projects, spent two years on the system before the state severed the contract because HP missed deadlines and failed to meet the state's standards, according to audit documents.

Jessie Van Berkel • 651-925-5044