HomeMy WebLinkAboutStaff Report 3.B 5/19/2014Agenda Item #3.9
DATE: May 19, 2014
TO: Honorable MayorandMembers of the City Council through City Manager
FROM: Tim Williamseh. IT Manager
SUBJECT: Resolution Authorizing City Manager to Sign Lease Documents for Replacement
Computer Workstations
RECOMMENDATION
It is recommended that the City Council approve the attached Resolution authorizing the City
Manager to execute the lease, maintenance, and other documents necessary for computer
workstation replacements from Sterling Computers and Dell Leasing in a 5 -year lease amount
not to exceed $69,000.
BACKGROUND
The Fiscal Year 2013-2014 Budget includes a CIP item for workstation replacement. Council
approved an order of 90 workstations for this CIP item in Fall 2013. Prior to that the last
meaningful replacement of computer workstations occurred in 2007 and there are some units that
remain in service that date back to 2005 and 2006. Prior to 2008 the City had leased computers
manufactured by Dell. The old systems lack features found in more modem systems, such as the
ability to support Windows 7 and future operating system versions. Further, the old workstations
lack the ability to be controlled for energy efficiency and the ability to support recent software.
As well, vendor maintenance contracts are no longer available and replacement parts are not
readily available. Thus workstation maintenance is problematic, failures have increased and
workstation slowness has become evident and at times a barrier to staff in meeting deadlines.
The workstations installed throughout City offices have reached end of manufacturer support,
thus repair response and normal updates are no longer available for many models currently in
service at the City.
DISCUSSION
Most of the existing workstations were acquired under a Dell Master Lease Agreement initiated
in 2005. The master lease allows the City to acquire workstations and other products from Dell.
Agenda Review:
City Attorney Finance Director City Manager
Among the 2013-2014 Information Technology goals included in the 2013-2014 budget include
replacement of 1/3 of the workstations in service. While the first 1/3 for fiscal year 2013-2014
has been placed, IT needs to place an additional, partial order prior to fiscal year 2014-2015.
The reason is to have replacement computers in place to support a large software upgrade for the
Police Dept., in conjunction with a County -wide system upgrade. This County -wide upgrade is
scheduled to take place the week of July 14, 2014. The purpose is to update the Police
Department's main applications for dispatching, mobile, and records. That upgrade requires
Windows 7; the current version requires Windows XP. The 65 computers being replaced
represent all of the remaining non -Windows 7 workstations in the Police Department. A critical
role of the IT Division is to ensure continued operations of desktop and enterprise computing
functions. Replacement of workstations allows achievement of that goal.
Staff has obtained a quote from Sterling Computers for delivery of 65 Dell Optiplex desktops
and operating system installation, via Dell Finance. The equipment was formally bid and pricing
obtained through the National Cooperative Purchasing Alliance (NCPA). In accordance with
City Municipal Code 4.04.100, the City may purchase goods and services that have been already
bid and awarded by other public agencies. The alternative is purchasing via the Dell Premier
program, or through either of two other vehicles. All the alternatives offer less favorable pricing
than the NCPA price. The obtained pricing benefits the City in that the cost per desktop unit is
6% less than the Dell Premier program; the obtained pricing includes basic software installation
not available in the Premier program, saving the City over 100 hours in staff labor; and, the
proposed acquisition includes 5 -year maintenance, shipping, sales tax and recycling of shipping
materials.
The technical standard computer workstations for the City was established in 2005. That
standard was and continues to be the Dell Optiplex desktops. At the time, it was determined
these provided the greatest functionality, flexibility, ease of maintenance and compatibility with
existing systems. That standard has continued since 2005 and staff believes savings in employee
training and technician labor will continue.
Utilizing the existing Dell Master Lease Agreement, which was entered into as approved by
Council with Resolution 2005-096 on June 20, 2005, the City can add the proposed acquisition
as a schedule by submitting a purchase order and completing related information forms. The
leasing quote is included as Attachment 2. As previously mentioned, the purchase price of
hardware, software and services is covered by the National Cooperative Purchasing Alliance
(NCPA) contract, numberNCPA01-01.
To distribute the costs over the life of the equipment, five years, staff recommends a lease. The
full cost of the project has been anticipated and can be supported in the IT fund budget. The
yearly lease expense is less than $14,000.
Implementation of this proposed project will result in reduced risk of computer workstation
functionality losses, as the new hardware will be supported by the manufacturer for the duration
of the lease. Additionally, implementation of this proposed project will enable the City to
support the County -wide software upgrade for the Police Dept. Implementing this replacement
2
project in the current fiscal year escalates a portion of the IT equipment replacement program,
leaving fewer replacements in fiscal 14-15 and 15-16.
FINANCIAL IMPACTS
Total project costs, including hardware, software, installation, training and five years
maintenance and sales tax is not to exceed $69,000. With a lease interest rate of 4.36%, lease
payments will be not more than $14,000/year. The total, 5 -year leased cost is therefore less than
$69,000. Funding is in place within the IT budget, fund 7300. The effort is also identified and
budgeted in CII' budget as project E73501401. While this project represents a portion of the
fiscal year 14-15 replacement effort, there are sufficient funds in the fiscal year 14 IT operating
budget to cover earlier replacement.
ATTACHMENTS
Resolution Authorizing the City Manager to Sign Equipment Lease and Maintenance
Agreement Documents for Computer Workstation Replacement
2. Dell Financing Services lease quote.
3
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PETALUMA
AUTHORIZING THE CITY MANAGER TO EXECUTE THE LEASE, MAINTENANCE
AND OTHER DOCUMENTS NECESSARY FOR COMPUTER WORKSTATION
REPLACEMENTS FROM STERLING AND DELL FINANCIAL
WHEREAS, the City of Petaluma utilizes a functioning, well integrated computer
network system for the performance of all business and administrative functions; and
WHEREAS, the existing system is comprised of and depends upon well-functioning
computer workstations; and
WHEREAS, the existing systems are not any longer supported by the manufacturer for
these purposes; and
WHEREAS, the continued use of computer workstations is viewed by staff to
accomplish the necessary administrative and business functions; and
WHEREAS, the acquisition of replacement computer workstations is funded in the
Information Technology budget; and
WHEREAS, the existing City standard for computer workstations is Dell; and
WHEREAS, cooperative purchasing requirements of the Petaluma Municipal Code,
section 4.04.100 allow for the acquisition under cooperative purchasing agreements; and
WHEREAS, the acquisition of replacement computer workstations from STERLING
and Dell Finance is by a cooperative purchasing agreement through National Cooperative
Purchasing Alliance, contract #NCPA01-01.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Petaluma
as follows:
1. The City Council authorizes the City Manager to execute the lease, maintenance and
other documents necessary for Dell computer desktop replacements in an amount not
to exceed $69,000.
0
Prepared For: City of Petaluma, California
Tim Wllliamsen
Information Technology Manager
(707)778-4573
fimw ci. efaluma.Pa.us
APrit 16, 2014
Thank you for giving Dell Financial Services LL.C. PDFS"l the opportunity to provide a technology financing solution. o ... ' '-3
Enclosed is a financing disposal for your new technology need_. We look forward to discussing this opportunity in Paymahl Annual
further detail with you. If you have any questions, please contact me at the phone number or email address below I Consolidation: I Mc nthi}
STERLING Q
G.PE TAW MA.0415"2014.1
Reopoa.1 Expleatlp0_Q_atel.
.July iS, 2014
Dell OptiPlex 7010 1 SSR5.00 1 65 1 558.175,00
Tax I $4.70044 I 1 i 54.759,44
Leasing and financing provided by Dell Financial Services L.L.C. or i c affiliate or designee PDF51 to qualined cenomers. Offer may not be available or may vary
In certain counties_. Where available, offers maybe changed without notice and are subject to product availability, credit approval, execution of documentation
provided by and acceptable to DFS, and maybe subject to minimum transaction size. Offers not available for personal, family or household use. Dell and the
Dell logo are trademarks of Dell Inc. Proposal Is property of DFS, contains confidential information and shall not be duplicated or dlsdoeed in whole or part.
Proposal is not a arm offer of financing. Pricing and rates based upon the final amount, configuration and specification of the suppiied equipment. software,
services or fees, Pmrata payment may he due in the first payment cycle. Proposal excludes additional costs to customer such e, shipping, maintenance, filing
es, applicable taxes, insurance and similar items. Proposal valid through the expiration date shown above, or if none is specified, for 30 calendar days from
data of presentation.
End of Term Options:
TexJ><emaiJ..nas=Jruahaxs_¢ELPJ:
. L -C, a the option to aheha:e the pmducc far SLO0.
• IL -Nm sit products to Isar et tha:e5fu 5 mP•nm.
Tiffany Collins
Fleandat acluticns Represenbtive
Eat I nnancial Servio.
office. 1512 7237225
Lame.29292=
Prepared For: City of Petaluma, California
Tim Willlamsen
Information Technology tdanoge,
(707) 77E 4513
times LIRMalwmili
APrR 16, 2014
SE QUOTE: The Lease I is exclusive of shipping costs, maintenance tees fill fees. licensing fees property or use taxes, insurance premiums and
itar items which shall be for Lessee's account Lessee will pay payments and all ether amounts withoutset-oft shmament or reduction for any reason
nsoever. Additionally, Lessee shall declare and pay all sales, use and personal property t=axes to the appropriate taxing authorities. If view are sales tax
mp3.PLgsepi YLde.3 RY.oLXs4LE%SmR11pbC4ryU,,;,3. .li6.ihs�sas_CeRtGactIf Lessee provoe-the appropriate tax exemption conifc=tes to DFS,
s and use taxes will not be collected by DFS. However, if your taxing authority assesses a personal property tax on leased equipment. and if DFS pays that
under your lease structure. L.&SSg.�413L@ m� r"e ]FS br thptj-,.v_=rp;nygi_4onpgr�jlgry[lyp„j�a5g,
1CHASE ORDER: The PrIo ese Order must be made out to Dell Fin=ancial Sernces LLC., One Dell Way, RR8-23, Round Rock,TX 78662. The Purchase
er will need to include the audio number.gunnery and description of the equipment, Please be sure to indicate that the PO is for a lease order and shove
type of lease, the term length, and payment frequency. The data of the lease quote referenced should he included. Please be sure to include any applicable
iI Posts as a line item and include your address as the SHIP TO dessbi-a tion.
M The risk of loss on the equipment is borne solely by the Lessee Lessee shall be required to purchase and maintain during the Term
thensive public liability, insurance naming Lessor as additional insured: and bit'gtHhsk' physical damage insurance in a minimum amount of the
Prire, naming DFS as first loss payee.
iPRIATION COVENANT, The Lease will contain an appmpriadon of funds clause. Tne Lessee will covenant that It shall do all things legally wind its
to obtain and maintain funds from which the payments may be paid,
NT aLTIOA, In addition to a duty executed Agreement, other documents as reasonably requested by DFS may be required, such as but not limited to,
of counsel. IRS tax exemption forms (If applicable), and erupted financials.
This is a proposal based upon market conditions and is valid for 30 days, is -subject to final credit approval, review of the