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HomeMy WebLinkAboutOrdinance 16315-03-2005Ordinance No. ~~~ ~ ~ ~~`~~~~~~ AN ORDINANCE INCREASING ESTIMATED RECEIPTS AND APPROPRIATIONS IN THE INFORMATION SYSTEMS CAPITAL PROJI=CT FUND IN T'HE AMOUNT OF $4,700,000 TO BE OBTAINED TWROUGH THE CITY'S EQUIPMENT NOTE PROGRAM APPROVED ON SEPTI=MBER 28, 1999 {M&C G-12681} ORDINANCE 13954 AND AMENDED ON MARCH 30, 2004 (M&C C-20b13}, FOR THE PURPOSE OF FUNDING PURCHASE AGREEMENTS USING STATE OF TEXAS DEPARTMENT OF INFORMATION RESOURCES CONTRACTS WITH DELL MARKETING, L.P., HEWLETT PACKARD, AND SOFTWAREHOUSE INTERNATIONALIGOVERNMENT SOLUTIONS, 1NC. FOR THI= PROCUREMI=NT OF COMPUTERS, SERVERS, PERIPHERAL EQUIPMENT, AND SOFTWARE FOR THE INFORMATION TECWNOLOGY SOLUTIONS DEPARTMENT; MAKING THIS ORDINANCE CUMULATIVE OF PRIOR ORDINANCES IN CONFLICT HEREWITH; AND PROVIDING AN EFFECTIVE DATE. BE ET ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS: SECTION 1. That in addition to those amounts allocated fa the various City departments far Fiscal Year 2004-2005 in the Budget of the City Manager, there shall also be increased estimated receipts and appropriations in the Information Systems Capital Project Fund in the amount of $4,700,000 to be obtained through the City's Equipment Note Program approved on September 28, 1999 {M&C G-12681 } Ordinance 13954 and amended on March 30, 2004 (M&C C-20013), for the purpose of funding purchase agreements using State of Texas Department of Information Resources contracts with Dell Marketing, L.P., Hewlett Packard, and 5oftwarehouse InternationallGovernment Solutions, Inc for procurement of computers, servers, peripheral equipment, and software for the Information Technology Solutions Department. SECTION 2. That should any portion, section or part of a section of this ordinance be declared invalid, inoperative or void for any reason by a court of competent jurisdiction, such decision, opinion or judgment shall in na way impair the remaining portions, sections, or parts of sections of this ordinance, which said remaining provisions shall be and remain in full force and effect. SECTION 3. That this ordinance shall be cumulative of Ordinance No. 16061 and all other ordinances and appropriations amending the same except in those instances where the provisions of this ordinance are in direct conflict with such other ordinances and appropriations, in which instance said conflicting provisions of said prior ordinances and appropriations are hereby expressly repealed. SECTION 4. This ordinance shat! take effect upon adoption. PPROVED AS TO FORM AND LEGALITY: Assistant City Attorney ADOPTED AND EFFECTIVE~`~~~~-.- r r~ i ~rnnnur~~at® CGUNCIL ACTION: Approved on 31112QQ5 -Ordinance No. 16315-43-24D5 DATE: Tuesday, March 01, 2Q05 LOC= NAME: 13P05-0032 REFERENCE NO.: **P-1 ~1 t~0 SUBJECT: Adopt Appropriation Ordinance and Authorize Purchase Agreements with Dell Marketing, L. P.; Hewlett Packard; Hewlett Packard Designated Resellers; and Softwarehouse Internatianail Government Solutions Inc., for the Information Technology Solutions Department RECOMMENDATION: It is recommended that the City Council: 1. Adopt the attached appropriation ordinance increasing the estimated receipts and appropriations in the lnformation Systems Capital Project Fund by $4.7 million, to be obtained through the City's Equipment Nate Program; 2. Authorize purchase agreements for the procurement of computers, servers and peripheral equipment and software with Dell Marketing, LP, Hewlett Packard, Hewlett Packard designated resellers and Softwarehouse InternationaVGovernment Solutions Inc., for the lnformation Technology Solutions Department using State of Texas Department of Information Resources contracts; and 3. Authorize the purchase agreements to be effective for the term and renewal terms as defined by the individual contracts entered into between Dell Marketing, LP and State of Texas Department of Information Resources, between Hewlett Packard and State of Texas Department of lnformation Resources and between Softwarehouse InternationallGovernment Solutions Inc. and State of Texas ©epartment of lnformation Resources through December 31, 2008. ®ISGUSSIQN: On February 22, 2x05, Informal Report (IR} 8664 was submi#ted to the City Council regarding the use of an internal financing method for technology equipment purchases. The IR described the potential financial benefits to the City, if the City's E~gai~prnent Note Program was used rather than lea~in~~e~quipment through external vendors' Fair Market Value processes. The City began leasing computers in 1998, as a way to replace a large inventory of aging technology equipment. As a result, the City entered into master lease agreements with Dell Financial Services and IBM Credit Corporation and later with Dell Government Leasing. By 2000, the City inventory included 3100 computers and servers and over 200 printers on lease agreements. Currently, the City has replaced mast individual computers twice. Invoice payments made to the three leasing vendors in 2002 and 2003 were approximately $4.6 and $4.8 million, respectively. In FY 2003-0~, Finance and Information Technology Solutions Department staff began exploring the City's Equipment Nnte Program as a east reduction alternative to leasing technology equipment. As a result of this financial analysis it was determined that utilization of the City's Equipment Note Program would be more cast effective than fair market leasing, For the remainder of this fiscal year it is anticipated that approximately 1500 devices wiii be replaced for an estimated cost of $4.7 million. If the equipmen# is financed using Equipment Notes, the City should realize savings of approximately $370,000 over the three-year financing period. The Information Technology Solutions Department recommends the ongoing scheduled replacement of computer assets at the end of their useful lifie. The success of the Equipment Note financing strategy is contingent upon continuing to refresh technology equipment in a #imely manner. By leasing, most computers have been repiaced on a three-year cycle. Technology wiii continue to evolve, and as a result, each computer should continue to be replaced on this regular established cycle. The purchase of computers, servers, printers and other standard equipment wiii be financed through the Equipment Note Program using the Note Program Ordinance, as amended (Ordinances 13954, 15010, 15933). It has been determined that the Equipment Note Program can be used fnr any lawfiul purpose authorized under Chapter 1431 of the Texas Local Government Code. This appropriations ordinance allows the Information Technology Solutions Department to process the anticipated requests for standard equipment replacement for the remainder of Fiscal Year (FY) 2005. For the last half of FY05 an increase in in the volume of purchases is anticipated because several large projects such as the Municipal Court and Library Information Management Systems are in progress. For FY06 and other future Fiscal Years, the Information Technology Solutions Department will include, as a part of its annual budget submission, the anticipated equipment replacement costs for that year. Although the City wiii transition to aself-financed process, there are approximately 2500 computers, servers and peripheral equipment that are financed through the external vendors. The cost to convert existing lease obligations would be too costly, therefore the existing lease agreements the City has with Dell Government Leasing and IBM Credit Corporation will remain in effect. Qnce a year the Council wiii be presented with an M&C to authorize payments to these vendors. The obliga#ian by the City to the external vendors wilt diminish each year for the current leased computer equipment, and it wiii end in 2008. RENEWAL OPTIONS -The agreements may be renewed with the vendors per the conditions established in the contract between State of Texas Department of Information Resources and the individual vender. If the State of Texas Department of information Resources enters into a new contract with an individual vendor, then the option terms established by the new contract wiii be the term the City #ollows. The authority fo use this M&C as a mechanism for purchasing computers, software and related equipment through the State of Texas Department of information Resources contracts ends an December 31, 2008. This action does not require specific City Council approval provided that the City Council has appropriated sufficient funds to satisfy the City's obligations during the renewal term. FISCAL INFQRMATIUNlCERTIFIC/~TION: The Finance Director certifies that funds for the purchase of computers, servers, peripheral equipment and software will be obtained through the City's Equipment Note Program and be appropriated in the Information Systems Capital Projects Fund. BQN105-00321LGS TO FundlAccaentlCenters C196 485200 004196004003 700 000.00 FROM FundlAccountlCenters 0196 524010 004'196004003 $4.200.000.00 Lo~name: 13(15-003?_ Pang ? nf'~ 0196 524010 004196004003 $4,200.D00.00 0196 541320 004196004003 500 oaaoo 0196 541320 004196004003 $600.000.00 Submitted for City Mana,aer's Office b~ Rici•rard ~a~ala (Acting) (6222) Ori inatin De artment Head. Jim Keyes (8597) Additional Information Contact: Robert Combs (8357} Pete Anderson (8781) 1 .~~~~~~!~ 1 l~l f~..l it l~~ YO RP ~ !\T