Report: Some overcharged due to troubled licensing system

Published 8:24 pm Tuesday, September 25, 2018

ST. PAUL — Some drivers in Minnesota were overcharged for vehicle licensing transactions because of the troubled licensing and registration system, according to a new report Tuesday.

The review by the state Legislative Auditor says its investigators found “significant inaccuracies” in some transactions through the Minnesota Licensing and Registration System known as MNLARS, including those for newly registered passenger vehicles and heavy non-passenger vehicles.

The report indicates some owners of similar vehicles were charged different tax amounts, the Star Tribune reported.

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Frustration by the public and state lawmakers over the troubled rollout of the new MNLARS system prompted the review. But the audit found that more than a technological fix is needed to correct and prevent errors in the transactions. Instead, policy changes and extensive work by the Minnesota Department of Public Safety will be needed, according to the audit’s recommendations.

Auditors reviewed transactions between July 24, 2017, and Feb. 28, and found that many of the issues were a result of the same vehicles being assigned different base values.

People who own a vehicle of the same make, model and year should have the same registration tax, according to audit. But because there was not one source to determine a vehicle’s base value, that did not happen.

As an example, more than 2,000 2018 Ford F-150s were entered in the system, and the pickup trucks had 130 different base values. Over the course of 10 years, that could result in some owners paying thousands of dollars more in taxes than others.

In a statement, Minnesota IT Services and the Department of Public Safety said the agencies are committed to enhancing MNLARS. But the agencies noted “the vast majority of inaccuracies” were not the result of a malfunctioning IT system.

“Rather, they largely reflect differences in interpretation of statute, human error in data entry, and the misalignment between unique Minnesota laws and automotive industry practices,” the agencies said.

Republican state Rep. Paul Torkelson of Hanska, who chairs the House Transportation Finance Committee, said the system must be fixed.

“Too many Minnesotans have been getting fleeced for months by a system that has been broken for far too long,” Torkelson said in a statement. “This audit finally gives us an idea of the dollars and cents literally taken from the pockets of thousands of Minnesotans who were overcharged for their vehicle taxes and fees.”

Members of the House and Senate MNLARS steering committee meet Wednesday to review the audit’s findings.