Agenda Report
Fullerton City Council
MEETING DATE: NOVEMber 15, 2022
TO: CITY COUNCIL / SUCCESSOR AGENCY
SUBMITTED BY: Ellis chang, director of administrative services
ROBERT DUNN, CHIEF OF POLICE
PREPARED BY: STEVEN AVALOS, BUDGET AND PURCHASING MANAGER SUBJECT: MASTER services agreement WITH KONICA MINOLTA BUSINESS SOLUTIONS FOR CITY COPIER FLEET
SUMMARY
Consideration of Master Services Agreement with Konica Minolta Business Solutions U.S.A., Inc. (Konica Minolta) for business solution provider services for the City of Fullerton (City) Multi-Function Devices (MFD)-Copier Fleet of approximately 30 to 35 copier devices, provide supplies, technical and printer support services and provide equipment as needed, such as desktop printers and various other services.
RECOMMENDATION
Approve Master Services Agreement with Konica Minolta Business Solutions U.S.A., Inc. for a five-year term with two optional five-year extensions and authorize City Manager, or designee, to execute and administer the agreement and related documents, in a form approved by the City Attorney.
Authorize City Manager, or designee, to administer and execute all documents related to the City’s MFD-Copier Fleet transition to the Master Services Agreement with Konica Minolta Business Solutions U.S.A, Inc. including, but not limited, to termination of existing lease agreements with other vendors and/or authorize transition related costs within the Information Technology budget (Fund 68).
Authorize City Manager, or designee, to make any future changes (e.g., swap copier models), additions and/or deletions to the City’s MFD-Copier Fleet master inventory list, depending on need and specifications of MFD, desktop printer, scanners and other related devices needed, provided any changes remain within the Information Technology budget (Fund 68).
CITY MANAGER REMARKS
None.
PRIORITY POLICY STATEMENT
This item matches the following Priority Policy Statement:
Fiscal and Organizational Stability.
FISCAL IMPACT
The City currently has many individual leases with different copier lease providers for MFD-Copier Fleet devices throughout the City. All copier leases have varying lease rates and costs, as well different service plans and lease terms. The City has a $120,000 annual budget in its internal service fund, Information Technology Fund (Fund 68), to support all Citywide copier lease costs.
Entering into a Master Services Agreement with Konica Minolta would result in an estimated $70,000 annual base lease cost for 30 to 35 MFD-Copier Fleet devices, in addition to $0.0045-$0.0055 per black and white impression and $0.0300-$0.0350 per color impression costs. Staff estimates the total copier lease costs, including per impression costs, would total $90,000-$100,000 annually. Entering into one master lease agreement would potentially yield an estimated $20,000 in annual savings. Staff projects the five-year lease agreement with Konica Minolta to total $450,000-$500,000 over the agreement term.
Konica Minolta will “buy-out” existing City leases with other copier lease providers and include the buyout costs in the base monthly lease rate. Konica Minolta will either pay a lump-sum payout to providers to “buy-out” current leases or provide rebate payments to the City to continue to pay leases that it cannot terminate. The FY 2022-23 Adopted Budget includes all proposed agreement and lease costs.
If the City chooses to exercise any of its five-year optional renewal terms, the City will seek to replace its entire MFD-Copier Fleet to new, current MFD models based on functionality and usage needs. Staff will negotiate pricing and terms with Konica Minolta and seek to utilize the most competitive cooperative agreement or “piggy-back” off the most competitive governmental contract award. Staff will present renewal of agreement with updated pricing and terms to City Council for approval.
DISCUSSION
The City has many individual leases with different copier lease service providers for its existing MFD-Copier Fleet devices located throughout the City. The City has approximately 30 to 35 MFD-Copier Fleet devices located in all departments and City facilities. This structure has created different lease terms and costs across all leases that increase Citywide annual lease costs, administrative inefficiencies in managing several different lease agreements, differing levels of customer service and technical support which increase support and supply costs and creates administrative burden to staff to access such services and varying copier equipment and technology levels across the organization. Much of the existing, aging copier fleet needs replacement with newer equipment and better technology for a more streamlined business solution.
Consolidating and streamlining all City MFD-Copier Fleet into one single Master Services Agreement with one business solution provider will:
Provide administrative ease with one uniform agreement and service provider for all the Copier Fleet with one dedicated account manager and support services provider Significantly upgrade the City’s aging copier fleet to industry standard, Enterprise-Grade MFD-Copier Fleet with enhanced technology and new “Print-Release” printing capability, which allows for improved printing security to any copier device on network Achieve greater cost savings with one master lease agreement, with uniform lease terms and costs across all its copier fleet in its lease pricing structure Reduce reliance on IT staff to service and maintain existing copier fleets and printer products.
To save City administrative time and resources, staff opted to procure leasing of its copier fleet and equipment through “piggy-backing” off a competitively bid governmental award or cooperative purchasing process. Fullerton Municipal Code (FMC) Section 2.64 and Fullerton Policy and Procedures Manual – Policy 4.1.2 Procurement of Goods and Services –allows an exemption to the Open Market process when participating in an established governmental “Cooperative Purchasing Agreement” or “piggy-backing” off another governmental agency’s competitively bid contract award.
Staff issued an informal Request for Information (RFI) for its MFD-Copier Fleet Master Lease Project to solicit copier lease and business solutions service providers on July 27, 2022. Staff sent the RFI to six copier fleet lease and business solution providers. The RFI consisted of two phases: Phase 1 - a qualifying round to submit prerequisite specifications and information to the City and Phase 2 - advancing firms submitted a formal cost proposal and most competitive bid and lease pricing. The City’s Project Team, consisting of Police Department, IT Division and Administrative Services Department staff, evaluated the top proposals from the informal RFI Phase 2. Based on several different criteria, including technology and equipment, technical support and service delivery, competitive pricing and lease terms, the Team selected Konica Minolta as the top business solution provider to lease its MFD-Copier Fleet and enter into a Master Services Agreement with the City.
Konica Minolta is a multinational corporation and an industry leader in providing business solutions and leasing MFD-Copier Fleet and printing equipment and products. Konica Minolta is a renowned business partner with over 5,000 federal and local / state contracts nationwide, including local contracts with the City of Anaheim, City of Lake Forest and City of Pomona. The City has a number of existing copier leases with Konica Minolta and staff has found all of the Konica copiers, products and services very satisfactory.
If approved, the City will procure leasing Konica Minolta’s MFD copier devices and related services and “piggy-back” off the Foundation for California Community Colleges (FCCC), FCCC Cooperative Agreement No. 00003237 (Attachment 3), pursuant to pricing and terms in Los Angeles Community College District (LACCD) Master Agreement No. 4500274899. The FCCC Agreement allows the City to utilize its terms and pricing in the competitively bid LACCD Agreement for all its leased Konica Minolta’s MFD-Copier Fleet, desktop printers and other products and services. Staff found the pricing stated in the FCCC agreement acceptable, competitive and the most “value-driven” in terms of costs, quality of technology and enterprise-grade copier fleet devices proposed.
Staff estimates the annual lease costs to enter a Master Services Agreement with Konica Minolta for its approximate 30 to 35 MFD-Copier Fleet devices at $90,000-$100,000 annually and $450,000-$500,000 over the duration of the five-year term, with two five-year renewal options. Should the City exercise any of its five-year renewal terms, staff will seek to replace its existing MFD-Copier Fleet with new, current models under a new, most competitive cooperative agreement or “piggy-back” governmental agreement available at that time. Staff would present the updated renewal terms and pricing for City Council for approval.
The Master Services Agreement - Exhibit B (Attachment 1) lists all estimated Proposed Costs’ Detail and Konica Minolta’s pricing for its catalog of copier fleet and products and services. Please note that device models and specifications listed in Exhibit B represent initial models proposed to meet each department’s business need and not the final model selection If City Council approves the Master Services Agreement with Konica Minolta, staff will initiate the implementation phase with Konica Minolta and finalize all MFD-Copier Fleet device specifications for all departments and service areas and begin the schedule for replacement.
Attachments:
Attachment 1 – Master Services Agreement
Attachment 2 – RFI for Multi-Function Device (MFD)-Copier Fleet Lease Project Attachment 3 – FCCC Cooperative Agreement No. 00003237
cc: City Manager Eric J. Levitt
Master Services Agreement with Konica Minolta Business Solutions, USA Inc.
November 15, 2022 - Page 2