THE DRIVER and Vehicle Standards Agency (DVSA) has identified a suitable site to move motorcycle and LGV testing to.
Northern Isles MP Alistair Carmichael said the organisation "knows the work that needs to be done" at the site, adding that the move could be concluded fairly soon.
The DVSA had failed to find a new location for testing after it was told by Shetland Islands Council (SIC) it would have to move from the old Anderson High School parking area by 31 March as plans are made to redevelop the site.
Carmichael met with officials from the DVSA and the SIC as well as local driving instructors in Lerwick on Friday and he said progress is being made.
While the identity of the site in question has not yet been revealed, the DVSA had been looking at a location off the old North Road near the holiday houses at the Decca.
"Of course the situation should never have been allowed to reach this point, but at last the agency is taking its obligations seriously," Carmichael said.
"Given the history of the issue, however, I am staying in close contact to ensure that the good intentions are followed though. DVSA have agreed to give me an update by the end of June.
"I hope they will have made proper progress by then. I will not leave them in peace until they finish the job."
DVSA director of operations Peter Hearn said: "DVSA's priority is to help you through a lifetime of safe driving.
"We are negotiating with the Shetland Islands Council to further extend the lease at Anderson High School in Lerwick, whilst we are in discussions regarding a suitable permanent site for LGV and motorcycle module 1 tests in Lerwick."
The agency added that the situation does not affect motorcycle module 2 tests, as they take place on the road.