1 STAFF REPORT
DATE: April 12, 2022
TO: Justin Hess, City Manager
FROM: Betsy McClinton, Management Services Director
BY: Katie Picha, Senior Administrative Analyst
SUBJECT: Approval of a Co- Operative Agreement with Ricoh USA, Inc. and Fairfax County on behalf of the U.S. Communities Government Purchasing Alliance for Reprographics Color Printer Lease Replacement
RECOMMENDATION
Approve a five-year lease and maintenance agr eement with Ricoh USA, Inc. for a color copier and envelope printer for use in the City’s Reprographics section.
BACKGROUND
The Management Services Department’s (MSD) Reprographics section is a full-service print shop for the City of Burbank and has been providing the City with valuable, timely, and high- quality print-related services for over 25 years. The Reprographics section (Reprographics) includes three full-time employees with a total budget of $434,993. In Fiscal Year (FY) 2019 -2020, Reprographics received 1,850 print requests which produced a total 8,143,525 impressions (number of images or physical copies printed) ; 2,958,500 were black & white impressions and 5,185,025 were color impressions. In FY 2020-2021, Reprographics print requests were down 20% due to the impacts of COVID-
19. Over the past year, Reprographics has seen a steady increase in requests and anticipates a complete resurgence by July 1, 2022.
Over the years, Reprographics has been keeping up with the demands and trends of print services. Reprographics has evolved from providing only print services to offering print, copy, large format, binding, business cards, envelopes, and more. Some recent print requests have included City Council agendas, printing of testing materials for Recruitment & Selection, budget related items, various reports, flyers, posters, brochures, City signs,
MANAGEMENT
SERVICES
2 pamphlets, postcards, and banners. By having an in-house print shop, City departments have a fast, cost-effective way to get the materials they need at excellent quality.
As trends move towards the digital era, Reprographics ’ staff have been staying up -to- date of these changes by ensuring they gain the skills, training, and proper equipment to produce quality wor k. In 2020, the entire Reprographics section underwent an assessment of their operations, efficiencies, offerings, and overall resourcefulness to the City. The assessment found that Reprographics is a great value and a true asset to City operations. With staff’s ability to quickly and efficiently produce high quality work in-house, departments are able to save time and money.
As a result of the assessment, many changes are currently being implemented by the Reprographics’ staff, such as an updated, easy to use order form, detailed order and cost tracking, and new and improved processes and operational procedures. In August 2022, Reprographics will be launching a new online ordering system and an updated digital catalogue of services—both of which are expected to increase efficiency, order accuracy, and turnaround times. Reprographic s’ staff is also offering personalized consultation meetings for departments to ensure their order is processed correctly the first time; this has shown to be extremely helpful when processing large requests.
To ensure Reprographics can stay on par with evolving changes and continue to provide these topnotch services, it is important to have quality, reliable printing and copying equipment. In 2005, MSD received approval from the City Council to enter a five-year lease for a color copier and DocWorks software with OCE North America. In 2008, before the five-year lease expired, OCE proposed an extension of the lease with an upgrade of the color copier; the City Council approved a four-year lease extension. In 2012, at the completion of the additional four-year lease, the City was offered an end of lease buyout option to purchase the machine. Staff opted for the buyout option utilizing existing budgeted funds. With this option, the City was able to temporarily decrease its yearly cost by no longer paying the monthly l ease. By 2016, the OCE machine was aging, printing demands had changed, and the machine reached the end of its useful life. Therefore, in 2016, City Council approved a five- year lease agreement with Xerox for a new color copier.
DISCUSSION
Staff is requesting City Council approval of a proposed five- year lease agreement for a new color copier, high -capacity envelope printer, and maintenance service with Ricoh USA, Inc. to replace the expired Xerox lease agreement. The City’s Financial Services Department-Purchasing section worked with MSD staff to develop a lease agreement using a cooperative agreement. A cooperative agreement goes through a competitive bid process by a lead Public Agency and is extended to other Public Agenci es to take 3 advantage of the leveraged pricing and terms. Burbank Municipal Code 2- 2-111 allows the use of cooperative agreements.
Reprographics’ staff reviewed the capabilities of various vendors such as Xerox, Canon, Oki, and Ricoh USA, Inc. (Ricoh) to d etermine who could best meet Reprographics’ needs. Each potential vendor provided a competitive proposal as part of a cooperative agreement. Staff analyzed cost, value, capacity, and reliability of each vendor. The Reprographics’ staff also visited the sit e of a current client of our top prospect, Ricoh.
During the visit, staff was able to receive valuable feedback from the client about Ricoh’s services, machines, responsiveness, and quality. The client allowed our staff to conduct test prints of some of our most requested items such as flyers and letterhead. Staff was extremely satisfied with the test prints and feedback received from the client . Further, Ricoh’s proposal had the lowest cost and provides considerable savings for the City. Staff recommends the City enter into a five-year lease agreement with Ricoh.
FISCAL IMPACT
The annual cost of the current agreement with Xerox is $ 85,239.84, which includes $690.43 per month in maintenance fees (parts and labor), $2,022.38 per month in lease fees (toner included, but not consumables such as staples), and an approximate average of $4,390.51 per month in additional print fees. The current Xerox lease agreement limits prints to 48,395 impressions per month; additional prints beyond this amount are charged at $0.04650 per color impression and $0.01150 per black and white impression.
The new agreement with Ricoh has an estimated cost of $59,302.24 annually. This includes a monthly lease agreement cost of $1,644.84, which includes the new color copier, a high-capacity envelope printer, five-year maintenance agreement for parts and labor, and includes consumable parts such as toner and staples. Impressions for the Ricoh color copier will be billed at $0.035 per color impression and $0.0075 per black and white impression; it is estimated that reprographics produces approximately 80,000 to 100,000 impressions per month. These figures are reflective of pre -COVID-19 service levels. Service demands are increasing monthly and staff anticipates service levels will reach pre-COVID-19 levels by the beginning of the 2022-2023 fiscal year . By moving forward with the Ricoh contract, the City is estimated to save approximately $25,937.60 per year, which equates to a five-year savings of approximately $129,688.
The new agreement is significantly lower in cost and includes two new machines, all parts and service, consumable products such as toner and staples, and is expected to meet the needs and demands of the City. As such, there is no additional fiscal impact to the budget beyond an increase in savings to the City, and no need for a budget amendment.
4 CONCLUSION
The new five-year lease agreement with Ricoh for a new color copier and high-capacity envelope printer will enable the City’s Reprographics section to continue to meet the needs and the demands for color copies and print s and will further enhance the service offerings, all at a substantial savings to the City. Staff recommends the City Counci l approve the proposed five-year lease agreement with Ricoh. Approval of this agreement would support the City’s goals of operating the City in a fiscally and managerially responsible manner through the anticipated savings to the City with increased servic e levels and offering by Reprographics.
ATTACHMENT
Attachment 1 – Agreement with Ricoh USA, Inc.
Attachment 2 – Ricoh USA Inc. Proposal