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EXTENSION OF HYLAND ONBASE HOSTED SOLUTION AGREEMENT WITH NEKO INDUSTRIES, INC.
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RECOMMENDATION
Staff recommends that City Council approve a motion accepting findings which support an exception to the competitive bidding process, and authorize the City Manager to approve an extension of the Hyland OnBase Online Hosted Solution Agreement with NEKO Industries, Inc. in an amount not to exceed $222,684 using the County of Sonoma cooperative purchasing agreement with NEKO Industries, Inc. (Attachments A, B and C).
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Summary
Currently six departments (City Clerk, Administrative Services, Public Works, Economic Development, Municipal Utilities, and Community Development) use OnBase to image and retrieve documents. This software solution is purchased through NEKO Industries, Inc. (NEKO), a value added reseller. Consideration has been given to investing in a more comprehensive citywide document imaging and management system. This concept has been under review in this past year, with an assessment of the ability of the current system to be expanded citywide. The result of the assessment is that staff does not recommend expanding the current system; therefore additional time is necessary to fully evaluate and develop an alternate recommendation. Implementation of a citywide document management system is a major project and represents a significant investment. As such, the Information Technology Department (IT) is recommending a one-year extension of the current agreement with NEKO, with an option for an additional one-year term.
This will allow sufficient time to examine, develop and forward recommendations for implementing a well-thought out citywide strategy for document management that will provide greater internal efficiencies as well as increased transparency.
DISCUSSION
Background
An agreement with NEKO Industries, Inc. to provide imaging and hosting solutions was first approved under Resolution 06-0409 and extended by Resolutions 07-0420, 08-0240, 09-0179, 09-0369, 10-0365, and 13-1002 which extended the term to March 31, 2015.
In July 2011, an IT Assessment for the City of Stockton was prepared and presented to the City Council by NexLevel Information Technology, Inc. Issues with the current online hosted document management system were identified in this report, principally that the City should consider a more comprehensive and strategic approach to document management.
In April 2014, the hosting contract with NEKO was extended in order to maintain critical business functions, and to allow time for completing an assessment of the hosted OnBase system. The assessment was to be part of a larger project that may have included expansion of OnBase to all City departments and conversion of GroupWise documents to OnBase.
At this time, IT has concluded that OnBase does not meet the City’s document management, workflow, and collaboration needs. IT recommends that the City examine other document management systems and collaborative software as a long-term solution. Because IT recommends developing an alternative solution, additional time is necessary to fully evaluate and develop this alternative within the context of an update to the Citywide Technology Strategic Plan under review by the new Director of Information Technology.
Present Situation
The current extension agreement with NEKO will expire on March 31, 2015. Staff is recommending that Council adopt findings to support an exception to the competitive bidding requirements for renewal of the agreement using Sonoma County’s cooperative purchase agreement with NEKO Industries Inc. for a period of one year, effective April 1, 2015 to March 31, 2016, with an option to renew for an additional one-year term.
Extending the term of the contract during this year will ensure the City’s current hosted/online document management system is licensed and maintained while an implementation of other document management solution can be done. During this time, an extension of the existing contract with NEKO is needed to meet the City’s document management needs while other options for an enterprise document management are developed.
IT’s analysis of document management and collaboration solutions will include a review of other options for enhancing the City’s document management needs. Emerging infrastructure offerings such as the State’s CalCloud Service and other technology hosting options will be explored.
Findings:
Stockton Municipal Code section 3.68.070 provides an exception to the competitive bidding process in cases where the City Council has approved findings that support and justify the exception. The findings are as follows:
1. Sonoma County has established a cooperative purchase agreement with NEKO Industries, Inc. and offers all entities within the State of California the same Terms and Conditions, the same price and for the same effective period.
2. Sonoma County established these cooperative purchase agreements pursuant to a competitive bidding process.
3. The bid specifications used by Sonoma County have been assessed by Purchasing as compatible to the City of Stockton standards with regards to the formal process, lowest pricing, awarded contract, and cooperative purchasing language allowing public agencies to avail of such process and pricing.
4. While the City is in the process of exploring its options for a comprehensive document management solution, it is not in the best interests of the City to seek a new vendor until that process is complete. This contract extension will allow the City to continue using the existing vendor NEKO during this period.
FINANCIAL SUMMARY
The annual amount is $222,684 for the Hyland OnBase Online renewal through NEKO Industries Inc., and the contract term is April 1, 2015 through March 31, 2016. There is sufficient appropriation in the Computer Internal Service Fund, account number 502-7450-670, to cover the FY14-15 portion of the expense of $55,671. The remaining balance of $167,013 will be budgeted in FY15-16.
Attachment A - County of Sonoma Cooperative Purchasing Agreement with NEKO Industries, Inc.
Attachment B - Letter from County of Sonoma extending Cooperative Purchasing Agreement
Attachment C - NEKO Industries, Inc. Agreement with the City of Stockton