Minnesota Gov. Tim Walz seeks nearly $16 million for MNLARS, driver and vehicle services

Gov. Tim Walz wants to spend another $15.7 million to continue repairs to the state's vehicle licensing and registration system and add employees to handle the backlog of plate, title and license requests.

Walz said Thursday he is submitting a request to legislators to spend millions more on the system called MNLARS, which has already cost the state more than $100 million.

Money for the project is scheduled to ramp down in March. After that, state officials have said they will only have cash to maintain the system — not improve it. And more updates are needed to make the system easier to use and improve customer service for Minnesotans.

The overhaul of the system for handling licensing and registration has been fraught with delays, costly glitches and defects. It was the subject of numerous hearings at the Capitol in recent years, as Republican leadership in the House and Senate pressed former Democratic Gov. Mark Dayton's administration on the system's failures.

Walz is still looking for a new commissioner to lead the Minnesota IT Services department, which has been responsible for much of the project. It is the only commissioner position he has not yet filled.

The governor said in a news release Thursday that a group of public and private IT experts will review applications for the state's top IT job — which can be submitted over the next month — and pass finalist recommendations to Walz and Lt. Gov. Peggy Flanagan. Kathy Tunheim, chief executive of Tunheim Partners, will oversee the committee.

He also announced he is building on the IT advisory group Dayton started.

Walz, a Democrat, plans to expand the council with additional members and state lawmakers who will inform his administration on updating and maintaining IT infrastructure. The experts will also give their opinions on how to balance efficient IT spending with data security and protections against cyberattacks.

"Minnesotans expect reliable, secure and accurate information technology services when they interact with the state," Walz said. "That is why the Blue Ribbon Council on Information Technology was created, to ensure the people of Minnesota have access to high-quality, dependable services."

Walz has been "diving into the nitty-gritty on personnel, and what works and what doesn't work, and where the money's going to go" with the state's IT department, House Majority Leader Ryan Winkler, D-Golden Valley, said. He said he is confident the governor's funding request is needed.

"The House should take action promptly to meet their deadline in order to keep the system operating," Winkler said.

Of the governor's $15.7 million request, $5.5 million would go to a contractor working on the state's Real ID system, said Dana Bailey, who handles external and partner relations for Minnesota IT Services. The state shifted that money last year to help pay for continued upgrades to the MNLARS system, with a plan to ask the next administration to put another $5.5 million toward Fast Enterprises' work developing the Real ID system.

Another chunk of the total ask, $3.4 million, would be used to bolster Driver and Vehicle Services staff, Bailey said.

"Minnesotans should have their titles in a reasonable amount of time and have their driver's license in a reasonable amount of time. And right now the unfortunate piece of that is DVS just simply doesn't have enough staff in order to provide the customer service Minnesotans deserve," she said.

Bailey declined to say when she expects MNLARS will be fully functional. More details on Walz's spending plan for the system and Minnesota IT Services will be unveiled when he debuts his state budget plan Feb. 19.

One more MNLARS upgrade is scheduled for Sunday before the funding dries up. It would include the long-awaited capability of allowing people to transfer specialty license plates. Walz will make the final decision Friday about whether to move forward with the update.

The governor's request for more money for MNLARS and customer service staff is a familiar ask for legislators.

They agreed on nearly $10 million in emergency funding early last session. The money was spent on software development and other technology costs, but legislators determined it should not be spent on additional staff.

Another MNLARS-related funding proposal last session would have given $9 million to deputy registrars who operate licensing centers around the state. Dayton vetoed the bill, saying he supported the money but wanted it to be part of a comprehensive MNLARS funding package.

"I urge Governor Walz to also prioritize relief for the Deputy Registrars whose livelihoods have been devastated by MNLARS through no fault of their own," Rep. Paul Torkelson, the Republican lead in the Transportation Policy and Finance Division, said in a statement. "Any discussion of MNLARS funding must also include these Minnesotans who have been hurt financially by this system."

Winkler said there is widespread support for reimbursing deputy registrars, but he doesn't see that as an emergency budget item that will move forward early in the session.

Jessie Van Berkel • 651-925-5044