Walz backs scrapping MNLARS, starting over with new software

Gov. Tim Walz Wednesday embraced a new report that recommends pulling the plug on the troubled Minnesota Licensing and Registration System. A blue-ribbon panel formed by the governor said that the system known as MNLARS should be switched over to a private vendor and off-the-shelf software at a cost of at least $20 million.

When lawmakers passed a stop-gap funding measure earlier this year to keep MNLARS repairs on track, they also required that independent experts review the system and report by May 1.

"Our recommendation is to move to a packaged software solution," said Thomson Reuters vice president Rick King, who chaired the panel that looked at whether the state has resources needed to correct remaining problems and whether the system should be outsourced to the private sector.

State IT experts and lawmakers have been wrestling with MNLARS since its failed launch in September 2017. The total costs have already topped $100 million.

"The path moving forward for an internal build of the remaining software is risky," King said about the added cost of the new approach. "We believe it will be much less risky to select a packaged software solution, particularly one that is currently in use in 12 other states."

Lawmakers received preliminary information last summer from three private vendors on the possibility of replacing MNLARS. Their estimated costs and timetables varied significantly. King said the review team looked closely at one of the companies, but he did not reveal which one.

Walz said he believes the report is the first independent review of MNLARS since its development began more than a decade ago. Walz said he accepts the recommendations and will work to carry them out.

"If we're going to fail, fail fast and fix it, save money for the taxpayers and get this thing on the right path. We have been dying a slow death for 12 years here, certainly over the last two years, and it doesn't make sense," he said.

Frustrated lawmakers have been pushing for a MNLARS fix. Senate Transportation Committee Chair Scott Newman, R-Hutchinson, has been a leading advocate of outsourcing. Newman, who butted heads frequently with the administration of former Gov. Mark Dayton over MNLARS, credited Walz looking at the problem with fresh eyes.

"As of tomorrow morning, the first thing I'm going to do is pick this up and start working on it. So, I would look at this as being really a good day," Newman said. "And for the first time in a very long time, I honestly feel that we see the end of the tunnel."

Lawmakers have 19 days left in the session to come up with the needed MNLARS funding. Then, the administration would need to hire a vendor.

The review team recommendations call for the state agencies in charge of MNLARS to shift the system toward a maintenance mode this summer to prepare for the changeover. King said the switch would take at least 16 months and take more staff.

"During the bubble time, MNLARS will be functional," he said. "It will be what they're going to use to do the transactions. Backlogs will get cleaned up. We'll just freeze it at version 1.16, which comes out in June."