Report Summary
Department of Natural Resources: Electronic Licensing System
Special Examination
| Financial Audit Division |
April 2026 |
We have significant concerns regarding the Department of Natural
Resources’ and Minnesota IT Services’ upcoming spring 2026 launch of its
new electronic licensing system. We identified concerns related to
project success criteria, launch preparation activities, service level
agreements, statutory changes, ongoing project work, and legacy systems,
all of which may jeopardize the success of the overall project and
continue to cause system launch delays.
Concern 1
The Department of Natural Resources’ Electronic Licensing System
project has not met its critical success criteria necessary for
launch. (p. 12)
Recommendation
Prior to beginning launch preparation activities for the
Electronic Licensing System, the Department of Natural Resources
and Minnesota IT Services should ensure that all project critical
success criteria are met.
Concern 2
The Department of Natural Resources and Minnesota IT Services may
not meet a spring 2026 launch date without significantly
compressing or cutting necessary launch preparation activities,
increasing overall project risk. (p. 13)
Recommendations
-
The Department of Natural Resources and Minnesota IT Services
should ensure that necessary testing activities occur after the
project meets the critical success criteria for launch.
-
The Department of Natural Resources and Minnesota IT Services
should set its launch date for the first phase of the Electronic
Licensing System to allow adequate time for launch preparation
activities.
Concern 3
The Department of Natural Resources and Minnesota IT Services have
not finalized a service level agreement with the Electronic
Licensing System vendor. (p. 15)
Recommendation
The Department of Natural Resources and Minnesota IT Services
should finalize a detailed service level agreement with the
Electronic Licensing System vendor prior to launching the system.
Concern 4
Phased implementation of the Electronic Licensing System makes it
unclear how to implement statutory changes. (p. 16)
Recommendations
-
The Department of Natural Resources should determine which
statutory changes are necessary for each Electronic Licensing
System project phase.
-
The Department of Natural Resources should work with the
Legislature to ensure that statutory changes are effective based
on the phased rollout of the Electronic Licensing System.
Concern 5
Ongoing project work is required to address functional gaps and
complete the full Electronic Licensing System, following initial
system launch. (p. 17)
Recommendations
-
The Department of Natural Resources and Minnesota IT Services
should establish critical success criteria for each subsequent
planned launch phase of the Electronic Licensing System and
establish launch schedules based on satisfaction of the criteria.
-
The Department of Natural Resources and Minnesota IT Services
should amend their contract with the vendor to define development
obligations and any anticipated additional costs.
-
The Department of Natural Resources and Minnesota IT Services
should ensure that adequate funding remains available to complete
the Electronic Licensing System project.
Concern 6
Deviations from project management best practices present ongoing
project risks for additional delays. (p. 19)
Recommendations
-
The Department of Natural Resources and Minnesota IT Services
should ensure that related work items are linked in the project
management tool.
-
The Department of Natural Resources and Minnesota IT Services
should require the vendor to provide deliverable timelines for
each future phase and functional area of the Electronic Licensing
System and incorporate these timelines into the state’s contract
with the vendor.
Concern 7
The initial Electronic Licensing System launch will not eliminate
the Department of Natural Resources’ legacy systems and their
associated risks. (p. 20)
Recommendations
-
The Department of Natural Resources and Minnesota IT Services
should consider ways in which known risks with legacy systems can
be mitigated prior to their replacement.
-
The Department of Natural Resources and Minnesota IT Services
should identify opportunities to reduce known operation
complexities and prioritize project tasks that contribute to
simplifying ongoing operations and reducing legacy systems risk.
