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APPROVE MOTION TO ENTER INTO COOPERATIVE AGREEMENT TO ESTABLISH A VENDOR POOL FOR THE PURCHASE OF CISCO PRODUCTS AND SERVICES
recommended action
RECOMMENDATION
It is recommended that the City Council approve a motion to:
1. Approve entering into a cooperative agreement (Attachment A) to utilize the, “STATE OF UTAH - STATE COOPERATIVE CONTRACT, CONTRACT NUMBER AR233,” and utilize this vendor pool to make purchases of Cisco products and services in an amount not to exceed $1,780,000 over the next eighteen (18) months for Cisco equipment, Cisco maintenance services, Cisco subscriptions and licenses, and professional services;
2. Authorize the City Manager or designee to execute vendor agreements;
3. Approve findings which support and justify an exception to the competitive bid process; and
4. Authorize the City Manager to take necessary and appropriate actions to carry out the purpose and intent of this motion.
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Summary
The IT Department supports all data communications throughout the City utilizing a Cisco networking environment as its standard. There are more than two thousand (2,000) computers, printers, servers, mobile devices, and other technology connected on this network. The City uses approximately six hundred (600) Cisco devices and software to support this equipment. Staff requests that Council authorize the use of the State of Utah cooperative agreement for the purchase of Cisco equipment, Cisco maintenance services, Cisco subscriptions and licenses, and professional services, in an amount not to exceed $1,780,000.
DISCUSSION
Background
All City departments rely on the computer network infrastructure for data communications. This infrastructure is what allows users access to email, software applications (Word, Excel, Computer Aided Dispatch, Records Management Systems, etc.), network drives, the Internet, Voiceover Internet Protocol (VoIP) telecommunication services, and all hosted services. There are more than 2,000 computers, printers, servers, mobile devices, and other technology supported on the City’s network infrastructure. The City uses approximately 600 Cisco devices and software to support this equipment.
Present Situation
Cisco is the sole manufacturer of the network equipment used as a standard for the City. Only Cisco-approved resellers are authorized to sell Cisco goods and services. The ability to purchase goods and services through an established Vendor Pool of approved resellers will allow the IT Department to maintain service and replace network components as needed, thereby minimizing risk of component failures that could result in network outages. Using an approved vendor pool makes the procurement of Cisco equipment a competitive procurement process.
An agreement with CDW-G to purchase Cisco equipment was first approved under Motion 2015-06-23-1207 for a total amount not to exceed $1,822,513 over a four (4) year period, $322,513 in the first year and $500,000 in subsequent years. These procurements were solely for hardware, comparable to the annual hardware cost estimates in the table below. Cisco maintenance was approved separately under Motion 2018-06-19-1108 in an amount not to exceed $243,609, also from CDW-G, comparable to the maintenance cost estimates in the table below.
Cisco services and subscriptions are new requests with estimated costs summarized below in the amount of $160,000 in FY 2018-19 and $140,000 in FY 2019-20. These include professional services for configuration and installation of equipment, software licenses, and additional Cisco network security subscription services.
This request to utilize $1,780,000 consolidates our anticipated expenditures on replacing end-of-life Cisco equipment, maintenance and support for active Cisco equipment, third-party professional services, and the implementation of Cisco subscriptions for management and security tools. As compared to Motion 2015-06-23-1207 previously approved by council which only included hardware purchases, this request provides an overall management strategy regarding the Cisco infrastructure.
This request to establish a vendor pool for Cisco products and services merges previous and new requests into a multi-year bundle, with the added benefit of including the participation of multiple vendors and providing the City with an opportunity for increased cost savings. By establishing a multi-year process to obtain approvals for purchasing routine operational expenses, this consolidates the decision making and approval process which is effective in reducing staff overhead and delays in acquisitions of products and services. In the coming years, it is necessary to continue maintenance, servicing, licensing, and replacement of existing equipment based on the lifecycle replacement schedule. City staff have projected that the purchases related for Cisco products, maintenance, and services over the next eighteen months will be approximately $1,780,000.
Table 1: Anticipated and budgeted lifecycle replacement schedule
|
Fiscal Year |
Hardware |
Maintenance |
Services/ Subscriptions |
Total |
|
2018-19 |
$ 480,000 |
$ 275,000 |
$ 160,000 |
$ 915,000 |
|
2019-20 |
$ 450,000 |
$ 275,000 |
$ 140,000 |
$ 865,000 |
|
Total |
$ 930,000 |
$ 550,000 |
$ 300,000 |
$ 1,780,000 |
If a network device should have issues or fail, the ability to utilize a vendor pool would allow the IT Department to quickly remedy the situation. Equipment failure could lead to an extended period of downtime which would impact critical computing services provided to all city departments and its constituents. With the use of a vendor pool, any failed equipment could be replaced in a timely and cost competitive manner.
FINDINGS
Stockton Municipal Code Section 3.68.070(A)(5) authorizes the City Council to award contracts without competitive bidding in cases where the City Council has approved findings which support and justify exceptions to the competitive bidding process. The following proposed findings are recommended to support such an exception to the competitive bidding process and approval of an established vendor pool for the acquisition of Cisco equipment, Cisco maintenance services, Cisco subscriptions and licenses, and professional services:
1. The City’s Procurement Office recommends and approves the use of this participating agreement and cooperative purchase agreement as it meets the criteria as an exception to the competitive bidding process.
2. Procurement determines that the process that was used to establish this cooperative agreement was awarded through a competitive process and meets the City’s procurement requirements.
3. This cooperative agreement allows for other agencies such as the City of Stockton the ability to utilize and participate in this agreement.
4. The City of Stockton adopted a data communications network equipment standard and made significant Cisco equipment investments.
5. Ensuring that the City of Stockton data communications network functions properly is critical to business operations of the City.
FINANCIAL SUMMARY
All acquisitions made from these vendors through this participating agreement will be funded through the Computer Internal Service Fund, project accounts, or department accounts and will not exceed $1,780,000 over the eighteen-month period. Budget is appropriated for this purpose in the FY 2018-19 Annual Budget for the Computer Equipment Internal Service Fund, account number 502-5101-670 and 502-5101-571. Future annual costs will be included in the annual budget appropriation process. There is no impact to the General Fund.
Attachment A - Participating Agreement with Cisco