Audit Reveals More Troubling Details Of MNLARS Failure

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ST. PAUL, Minn. – An audit of the Minnesota Licensing and Registration System (MNLARS) reveals more troubling details of the failed rollout, including “significant inaccuracies” in transactions.

The special review, completed by the Office of the Legislative Auditor (OLA), analyzed transactions from July 2017 to February 2018 of this year, and found that MNLARS overcharged some people and undercharged others in vehicle taxes and fees.

“While MNLARS generally calculated certain types of transactions correctly, inaccurate vehicle registration data within MNLARS and user errors resulted in some owners of similar vehicles being charged different tax amounts,” the report said.

Part of the discrepancy comes from faulty base values on vehicles, a key data point in calculating the taxes and fees. For example, the review found that MNLARS had 130 different base values for a 2018 Ford F-150 pick-up truck ranging from $2 to $70,000.

Among the sample of 300 transactions the OLA reviewed, the report estimates there was more than $144,000 in overcharges and $2.7 million lost in undercharges.

State Rep. Jim Nash (R-Waconia) said the report is “just another item on the list of what’s gone wrong with MNLARS” at the expense of Minnesota families and small businesses.

“Overcharging for vehicle taxes and fees takes valuable dollars out of family budgets, all because the state can’t get this system to function correctly,” Nash said in a statement. “Moreover, it’s disheartening to see that the problems haven’t been fixed, leaving our Deputy Registrars looking for ways to save their small business. In all, I’m disappointed in the findings, and will continue to be an advocate for Minnesotans who simply want MNLARS to work.”

While the inaccuracies were discovered during an audit of MNLARS, the OLA notes the blame does not solely fall on MNLARS. Complex laws for calculating tab fees played a sizable role in the inaccuracies, and the report recommends the Legislature considers simplifying the laws that govern vehicle licensing and registration.

MNLARS has faced problem after problem since its launch in July 2017. The glitch-filled system has cost over $90 million to date, and costs are still on the rise. Minnesota IT Services (MNIT), the agency involved in developing MNLARS, has faced backlash from the problems plaguing the system. In August, MNIT was audited by the OLA. According to the audit, MNIT “did not provide adequate oversight” for Information and Telecommunications Account (ITA) projects and failed to comply with state laws, resulting in the mismanagement of taxpayer dollars.

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