DATE: June 16, 2025
TO: Mayor and Members of the City Council
VIA: Stefan Chatwin, City Manager
FROM: Diane Pitman, Administrative Services Director
Rob Lasky, IT Manager
DEPARTMENT: Administrative Services
SUBJECT: SMALL GOVERNMENT ENTERPRISE LICENSE AGREEMENT
WITH ESRI INC. FOR A 3-YEAR TERM IN AN AMOUNT NOT TO
EXCEED $126,600
RECOMMENDATION
It is recommended that the City Council adopt the attached resolution authorizing the Mayor to execute a Small Government Enterprise License Agreement (ELA) with ESRI Inc. for a 3-year term in an amount not to exceed $126,600, reflecting annual payments of $42,200.
EXECUTIVE SUMMARY
Foster City has used ESRI ArcGIS Software for the City's GIS (Geographic Information Systems) since 2016. ESRI ArcGIS Software is the de facto standard for municipal GIS software, and it provides the City with a fully-featured and well-supported GIS system.
ESRI software is licensed as a 3-year term, and the current agreement is ending on July 29, 2025.
BACKGROUND
ESRI ArcGIS Software is the current industry leader for GIS software. Due to this large market share, other vendors will often develop their software to easily integrate with ESRI. For example, the City uses an Enterprise Asset Management System (OpenGov EAM/Cartegraph) to track the City‘s assets and the work that is performed
on those assets. OpenGov EAM is tightly integrated with ESRI and uses the asset metadata in ESRI to populate information for work orders.
The City has also taken advantage of a wide range of pre-written applications offered by ESRI (similar to an App Store concept). These applications address many required functions of a municipal GIS system, and this has allowed the City to avoid extensive custom development. ESRI releases updates and patches to ArcGIS regularly, and when vulnerabilities are discovered.
ANALYSIS
In 2016, the IT Division worked with the consulting firm Farallon Geographics to develop a GIS Strategic Plan and a GIS Roadmap document based on discussions with departmental GIS users. These documents helped to define the City’s needs and laid out options for how to achieve a successful transition to an ESRI-based GIS system.
One of the topics covered in the Roadmap document was the consultant’s recommendations for licensing of the GIS software. Their recommendation was to license ESRI ArcGIS software in the form of a Small Government ELA. In an excerpt from the Roadmap document:
“The ELA will provide a basis for the City to gain unencumbered access to ESRI software licenses in a manner that is relatively easy to pre-plan and budget for.” Other options for licensing were also analyzed, but the other options had limited access to the software, and a high upfront cost to purchase. The ELA is treated as a site license, allowing the City to use ESRI software as needed without requiring the addition of licenses as usage grows. Also, the annual subscription model makes the cost consistent year-to-year without a large initial investment.
The ELA also offers online training benefits as well as credits for usage of ArcGIS Online, which is a cloud service that we use for public viewing on the City’s website.
California Environmental Quality Act
Not Applicable
FISCAL IMPACT
The ELA specifies a cost not to exceed $42,200 annually for a 3-year term. This is an increase from the current agreement’s annual cost of $38,000. Funding for the first year of the agreement (FY 2025-2026) is included in the IT Operating Budget – Account No. 504-0160-419-4246 (Maintenance).
Costs for the second and third years of the contract term will be included in the proposed IT annual budget in those subsequent years.
The ELA is only available for purchase directly from ESRI. A sole source letter is attached.
CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Innovation
ATTACHMENTS:
Attachment 1 - Resolution
Attachment 2 - Agreement
Attachment 3 - ESRI Quotation
Attachment 4 - ESRI Sole Source Letter