EAST PALO ALTO
CITY COUNCIL
STAFF REPORT
DATE: July 5, 2022
TO: Honorable Mayor and Members of the City Council
VIA: Patrick Heisinger, Interim City Manager
BY: Greg Henry, Senior Management Analyst
Marie McKenzie, Administrative Services Director
SUBJECT: Agreement for Information Technology Support with the City of Redwood City Recommendation
Adopt a resolution:
1. Ratifying the previous purchase of Information Technology Support with Redwood City services through June 30, 2022, in an amount of $386,557.04;
2. Authorizing the City Manager to execute an amendment to the Agreement for Information Technology Support with the City of Redwood City, in a form to be approved by the City Attorney, for a term of ending June 30, 2024 in an amount not to exceed $430,766.56 for Fiscal Year 2022-23 and $443,689.54 for FY 2023-24;
3. Waiving the formal bid procedures under section 2.84.070(D) of the Municipal Code; and
4. Directing staff to issue a Request for Proposals (RFP) to identify a consultant to conduct an IT Strategic Plan on behalf of the City.
Alignment with City Council Strategic Plan
This recommendation is primarily aligned with:
Priority No. 3: Increase Organizational Effectiveness and Efficiency Background
The City of East Palo Alto has contracted Information Technology Services with Redwood City since September 2007. The last contract the City Council approved was on February 16, 2021 in the amount of $388,000; that contract expired June 30, 2021.
The services provided by Redwood City fulfill critical internal technology functions. During the more than ten years that the City of East Palo Alto has contracted for information technology (IT) services with the City of Redwood City, the City has been very satisfied with quality, accountability, flexibility, and stability of the services.
The $388,000 which was requested on February 16, 2021 was insufficient for the contract in Fiscal Year 2020-21, so staff asks the Council to ratify $6,357.44 in uncovered expenses.
Further, no contract amendment for Fiscal Year 2021-22 was approved by Council, though the City of Redwood City graciously continued to provide services through the year. The base monthly rate charged by the City of Redwood City for Fiscal Year 2021-22 was $31,683.30. As a result, staff asks that the City Council ratify $380,199.60 in further payments.
In total staff requests that $386,557.04 in payments to the City of Redwood City be ratified for past service. In addition, in executing an amendment with Redwood City for an additional two years, staff will be able to pay for services on a monthly basis rather than through an annual ratification due to past staff’s inability to complete the necessary contract.
Analysis
The City Council and staff have been considering developing a technology services strategic plan. However, that analysis has not been done yet due to the attention dedicated to other critical IT projects and priorities. Nevertheless, staff still plans to proceed with the IT strategic plan over the next Fiscal Year.
Following the strategic plan, staff intend to make IT services an internal City function.
Giving the critical need for IT services to maintain City operations, and the quality of services received, staff is recommending the renewal of the contract for two years while staff develop and implement the transition plan.
Under the agreement with the City of Redwood City, East Palo Alto pays a monthly “base fee” which is based upon 2,000 annual hours of support. The following table shows the Base Monthly fee the City has been paying (going back to Fiscal Year 2018-19), as well as the proposed rate for Fiscal Years 2022-23 and 2023-24.
FY Base Monthly Normal Hourly
Rate
Change
18/19 $ 29,583.33 $177.50
19/20 $ 30,833.33 $185.00 4.2%
20/21 $ 32,616.37 $195.70 5.8%
21/22 $ 31,683.30 $190.10 -2.9%
22/23 $ 32,633.83 $195.80 3.0%
23/24 $ 33,612.84 $201.68 3.0%
Staff requests that the City Council approve a not to exceed amount for Fiscal Years 2022-23 and Fiscal Year 2023-24 based on 2,200 hours of support (rather than 2,000). Those “as needed” additional hours would be in potential support of the Enterprise Resource Program implementation as well as support for the planned development of the IT Strategic Plan.
IT Strategic Plan
It is recommended that the City Council direct staff to issue an RFP to identify a consultant to complete a comprehensive IT Strategic Plan on behalf of the City. The plan will provide the Council with options on how the City may be able to deploy IT services in the future. In addition, the plan will look at cyber security and other key issues specific to technology.
If the City Council directs staff to issue an RFP, it is expected that staff will return to the City Council in Fall with a draft agreement for said services.
Fiscal Impact
The proposed amendment to the agreement includes an annual 3.00% percent increase. With the proposed increase in available hours, the amendment not to exceed cost for FY 2022-2023 is $430,766.56 and for FY 2022-2023 is $443,689.54.
Funding was included in the Fiscal Year 2022-23 Budget, but not at the level requested. Of the total amount, $365,000 is budgeted in the Information Technology General Fund sub-fund and the $25,000 is budgeted in F204 Rent Stabilization. The proposed increase of $40,766.56 will be an additional appropriation from the Information Technology General Fund sub-fund reserves, which are sufficient for this increase.
Public Notice
The public was provided notice of this agenda item by posting the City Council agenda on the City’s official bulletin board outside City Hall and making the agenda and report available at the City’s website and at the San Mateo Co. Library located at 2415 University Avenue, East Palo Alto.
Environmental
The action being considered by the City Council is exempt from the California Environmental Quality Act (CEQA) because it is not a “project” pursuant to 15378(b)(4) because it is a fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant impact on the environment.
Attachments
1. Resolution Information Technology Support with City of Redwood City