PISMO BEACH COUNCIL AGENDA REPORT
Agenda Item #9.F
SUBJECT/TITLE:
CONTRACT EXTENSION WITH CHANNEL ISLANDS TECHNOLOGY
INTEGRATORS’ GROUP, INC. (CITIG) FOR INFORMATION TECHNOLOGY
SERVICES
RECOMMENDATION:
Adopt a Resolution authorizing the City Manager to execute Amendment 2 to the Channel Island Technology Integrators’ Group, Inc. agreement for Information Technology Services from December 1, 2022 to November 30, 2025, and making related budget adjustments.
BACKGROUND:
On November 15, 2019, the City Council authorized the City Manager to enter into an agreement with Channel Islands Technology Integrators’ Group, Inc. (CITIG). The agreement included a three-year period from December 1, 2019 through November 30, 2022, with two options for a three-year extension as mutually agreed to. The services covered were Information Technology (IT) help desk services and shared management of IT infrastructure. The cost of the contract was up to $144,540 per year or $433,620 over the 3 years of the contract. In addition to these core services, CITIG also provides the City with special pricing on antivirus, backup, spam filtering, monitoring, and other services at a discounted rate. These other services are separate from the total contract and are provided as needed.
Each year, staff has conducted a customer satisfaction survey on CITIG’s services. CITIG has consistently received high satisfaction scores. In the 2022 survey, CITIG received a 90% overall satisfaction rating of satisfied or very satisfied, as shown in Chart 1 below.
CITIG has committed to addressing the areas where the survey indicated dissatisfaction ratings.
Chart 1: CITIG Help Desk Survey Responses
75%
80%
85%
90%
95%
100%
2020 2021 2022
Overall Satisfaction with IT Services
9.F-1Council Agenda 12-20-2022
CITIG Contract Services and Costs
The CITIG contract includes help desk services, shared infrastructure management services, and options for onsite services.
Help Desk Tickets: Since 2019, the number of tickets has increased due to additional workload caused by construction at various facilities, which included moving and setting up various IT equipment and resources with staff changing locations, implementation of any new software and servers, and increased reliance on technology. With the additional amount of tickets averaging about 65 tickets per month over the estimated 60 tickets per month, the City is paying an additional $47,580/year on average to support the Help Desk.
Onsite Help Desk Support: Since 2021, staff requested additional onsite services to support the help desk. In response, IT increased the CITIG onsite days from one day per month to one day per week, which was an additional cost of $25,000 per year. Managed Servers: Since 2019, the number of servers needed to run City services has increased, and staff recommends increasing the base estimate to 61 managed servers (up from 39 servers), reflecting a 22-server, or 56%, increase. These 22 new servers include 14 new Police Department servers and 8 new City Hall servers. These additional managed servers resulted in an increase of $42,240 per year.
Based on the increased ticket volume, additional on-site help desk support, and increased managed servers, the Table 1 illustrates the original contract services and costs and the current contract services and costs. The original contract amount of $144,540 per year has grown to $265,360 per year over the 3-year period.
Table 1: CITIG Services and Costs – Original vs. Current Services Original
Contract
Services
Original
Contract Cost
Current Contract
Services
Current
Contract
Services
24 / 7 Help Desk
services
Assumes 60
tickets/month at
$61 per ticket
$43,920/year
Assumes 60
tickets/month at
$61 per ticket
$43,920/year
Help Desk Ticket
Overage $61/ticket N/A
$61/ticket
average overage
per year of 65
tickets
$47,580/year
Onsite Help Desk 1 day per month
at $965/month $11,580/year 1 day per week $36,580/year
Shared Infrastructure
Management (Server
Maintenance and
Support)
$160/server per
month for 39
servers
$74,880/year
$160/server per
month for 61
servers
$117,120/year
Onsite Infrastructure
Day
1 day per month
at $1,180/month $14,160/year 1 day per month
at $1,180/month $14,160/year
Grover Beach Dispatch
Support N/A N/A $500/month $6,000/year
Total $144,540/year $265,360/year
9.F-2Council Agenda 12-20-2022
Projected Cost Savings with New IT Technician
In October 2022, the City filled the new IT Technician position created and funded by the City Council on June 21, 2022. This position is supporting the City’s operations to become the primary on-site point person for the IT Help Desk to respond to and manage Help Desk tickets and also implement operational portions of the Technology Master Plan.
Since this new position will be onsite five days a week, the City no longer needs to pay for CITIG to come onsite one day per week to support the IT Help Desk tickets. In addition, the City no longer needs to prepay for 60 tickets per month or pay for any ticket overages, and will instead pay CITIG an hourly rate on an as-needed basis. As such, the CITIG contract will be reduced to reflect a decrease in the prepaid tickets and the onsite help desk support.
Cost and Service Changes
CITIG is proposing cost increases based to reflect a cumulative annual Consumer Price Index (CPI) comparing September 2022 to the previous September 2019, reflecting a total 14.12% increase in its rates. Going forward, annually, CITIG is proposing adjusting its fee each year based on CPI to keep up with inflation.
In April 2022, the City began to provide IT support services for the City of Grover Beach as part of the City’s agreement to provide joint dispatching services for both agencies.
The cost for CITIG to provide support for the City of Grover Beach’s dispatching services is $500 a month until December 1, 2024. This cost is included on the replacement pricing sheets included in Attachment 1.A. This will increase the total not to exceed amount in a year by $6,000.
Proposed Services and Cost for CITIG
Based on the above projected cost savings with the new IT Technician, the proposed cost increases to reflect CPI adjustments, and an estimated 5 additional servers in the agreement, the total proposed not-to-exceed contract amount is $167,100 for the first year and $501,300 over the three-year term extension, as shown in Table 2.
9.F-3Council Agenda 12-20-2022
Table 2: CITIG Services and Costs – Current vs Proposed Services
Current Contract
Services
Current Contract
Services
Proposed
Contract
Services
Proposed
Contract
Services
24 / 7 Help Desk
services
Assumes 60
tickets/month at
$61 per ticket
$43,920/year N/A N/A
Help Desk Ticket
Overage
$61/ticket average
overage per year
of 40 tickets
$29,280/year N/A N/A
Onsite Help Desk 1 day per week $36,580/year N/A N/A
Shared Infrastructure
Management (Server
Maintenance and
Support)
$160/server per
month for 61
servers
$117,120/year
$183/server
per month for
66 servers
$144,936/year
Onsite Infrastructure
Day
1 day per month at
$1,180/month $14,160/year
1 day per
month at
$1,347/month
$16,164/year
Grover Beach
Dispatch Support $500/month $6,000/year $500/month $6,000/year Total $265,360/year $167,100/year
Conclusion and Recommendation
Staff recommends that Council adopt a Resolution (Attachment 1) authorizing the City Manager to approve Amendment 2 (Attachment 1.A) to the Channel Island Technology Integrators’ Group, Inc. agreement for the City’s Information Technology Services for December 1, 2022 to November 30, 2025.
FISCAL IMPACT:
Contractual Year Financial Impact
The fiscal impact of adopting the attached Resolution and Amendment 2 is a total cost of $167,100 per contract year, or $501,300 over the three-year extension from December 1, 2022 to November 30, 2025. This Amendment helps support the City’s staff with shared infrastructure management services, Grover Beach dispatch support, and options for additional help desk and onsite services. With the addition of the City’s new IT Technician able to handle the majority of IT help desk tickets, compared to the current agreement, staff estimates an annual cost savings of $98,260 per year.
City Fiscal Year Financial Impact
The FY 2023 Revised Budget includes $164,580 for these services. This amount was developed in FY 2021 based on the original contract of $144,540 per year and was revised to include the $6,000 per year Grover Beach Dispatch support and carry over from the previous year of $10,200 for services. FY 2023 year-to-date actuals are $102,940, reflecting the current level of tickets and servers, additional onsite days, and the Grover Beach dispatch support. The remaining budget is $61,640. Based on the proposed agreement, 7 months of the proposed agreement in FY 2023 is $93,975. As such, there is a $32,335 budget shortfall. The following table illustrates the FY 2023 Revised Budget and Actuals and projected CITIG costs and budget shortfall.
9.F-4Council Agenda 12-20-2022
FY 2023 Current Budget and Actual Expenditures
FY 2023 Revised Budget $164,580
Year-to-date Actuals (102,940)
Remaining Budget $61,640
CITIG Proposed December 2022 to June 2023 costs $93,975 Budget Shortfall $(32,335)
Staff recommends that Council appropriate $32,335 in the FY 2023 Technology Services Fund contract services account to support the proposed agreement; appropriate $32,335 of IT Service Charges revenues in the Technology Services Fund; and appropriate related allocations to the Technology Services Fund based on the City’s allocation of servers reflecting an appropriated technology cost account expenditures of $28,539 from the General Fund, $1,038 from the Water Enterprise Fund, $2,508 from the Wastewater Enterprise Fund, and $250 from the Parking Enterprise Fund.
Appropriate Funds $32,335
Remaining Budget $0
ALTERNATIVES:
1. Do not authorize the City Manager to enter into an agreement with CITIG; provide staff with alternative direction.
2. Modify the agreement and provide staff with alternative direction.
ATTACHMENTS:
1. Resolution
1.A. Exhibit A to Resolution: Amendment 2
Prepared by: Meeting Date: December 20, 2022
Jason Takagi, Information Technology Manager
Submitted by: Nadia Feeser, Administrative Services Director City Manager Approval:
9.F-5Council Agenda 12-20-2022
RESOLUTION NO. R-2022-XXX
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PISMO BEACH, CALIFORNIA AUTHORIZING THE CITY MANAGER TO EXECUTE AMENDMENT 2 TO THE CHANNEL ISLANDS TECHNOLOGY INTEGRATORS’ GROUP, INC.
AGREEMENT FOR INFORMATION TECHNOLOGY SERVICES FROM DECEMBER 1, 2022 THROUGH NOVEMBER 30, 2025, AND MAKING RELATED BUDGET
ADJUSTMENTS
WHEREAS, the City’s Information Technology (IT) services are provided by an IT Manager and a contract IT service provider that offers 24/7 helpdesk services for computers and servers for all of the City’s approximately 130 users, backup support for the IT Manager, and additional project hours and services as needed; and WHEREAS, on November 15, 2019, the City Council authorized the City Manager to enter into an agreement with Channel Islands Technology Integrators’ Group, Inc. (CITIG) for the period of December 1, 2019 through November 30, 2022, with two options for a three-year extension; and
WHEREAS, each year, staff conducts a customer satisfaction survey on CITIG’s services and CITIG consistently receives high satisfaction scores; and WHEREAS, the CITIG agreement extension for the 3-year period between December 1, 2022 and November 30, 2025 includes shared infrastructure management, onsite infrastructure days, Grover Beach dispatch support, and the option to support the help desk and with a fiscal impact of $167,100 per year for a total of $501,300 over the three- year extension, depending on the number of servers and support.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pismo Beach hereby authorizes the City Manager to execute Amendment 2 (Exhibit A) to the Channel Island Technology Integrators’ Group, Inc. agreement for Information Technology Services from December 1, 2022 to November 30, 2025.
BE IT FURTHER RESOLVED that the City Council of the City of Pismo Beach hereby appropriates $32,335 in the Fiscal Year (FY) 2023 Technology Services Fund contract services account and to support the proposed agreement; appropriates $32,335 of IT Service Charges revenues in the Technology Services Fund; and appropriates related allocations to the Technology Services Fund based on the City’s allocation of servers reflecting appropriated technology cost account expenditures of $28,539 from the General Fund, $1,038 from the Water Enterprise Fund, $2,508 from the Wastewater Enterprise Fund, and $250 from the Parking Enterprise Fund.
UPON MOTION OF Council Member , seconded by Council Member , the foregoing resolution was adopted by the City Council of the City of Pismo Beach this 20th day of December 2022, by the following vote:
9.F-6Council Agenda 12-20-2022
Attachment 1
AYES:
NOES:
ABSENT:
ABSTAIN:
RECUSED:
Approved: Attest:
________________________ ________________________
Ed Waage, Mayor Erica Inderlied, City Clerk
9.F-7Council Agenda 12-20-2022
Attachment 1
AMENDMENT # 2
to the
NOVEMBER 15, 2019 AGREEMENT BETWEEN THE CITY OF PISMO BEACH AND CHANNEL ISLANDS TECHNOLOGY INTEGRATORS’ GROUP, INC. (CITIG) FOR
INFORMATION TECHNOLOGY SERVICES
Pursuant to the November 15, 2019 Agreement for Professional Services between the City of Pismo Beach, hereinafter referred to as “City,” and Channel Islands Technology Integrators’ Group, Inc., hereinafter referred to as “Vendor,” City and Vendor hereby agree as follows:
1. The term of the agreement, originally expiring on November 30, 2022, shall be extended to November 30, 2025.
2. Additional services shall be performed as set forth in the proposal dated December 6, 2022 which is attached hereto and by this reference made a part hereof.
3. Compensation for and timing of the additional services shall be as set forth in the referenced proposal. Compensation for the additional services shall not exceed the amount of one hundred sixty-seven thousand one hundred dollars ($167,100) per year or five hundred one thousand three hundred dollars ($501,300) over three years, without prior written approval of the City.
4. The revised fee under the December 1, 2022 contract, plus this addendum, is $940,420 for all six years, or one hundred sixty-seven thousand one hundred dollars ($167,100) for the first year contract amount dollars.
5. All other provisions of the Information Technology Services Professional Services agreement between City and Vendor shall remain in full force and effect.
CITY:
City of Pismo Beach, a Municipal Corporation
Signed:
Name: Nadia Feeser
Title: Administrative Services Director
Dated: ________________________________
Signed:
Name: James R. Lewis
Title: City Manager
Dated: ________________________________
ATTEST:
Signed:
Name: Erica Inderlied
Title: City Clerk
VENDOR:
Channel Islands Technology Integrators’
Group, Inc.
Signed:
Name: ________________________________
Title: _________________________________
Dated: ________________________________
Address for giving notice:
(if changed from prior agreement)
______________________________________
______________________________________
Email address for official communications:
(if changed from prior agreement)
______________________________________
Vendor Representative:
(if changed from prior agreement)
Name/Title: ____________________________
9.F-8Council Agenda 12-20-2022
Attachment 1.A
APPROVED AS TO FORM:
Signed:
Name: David M. Fleishman
Title: City Attorney
Attachment:
Replacement Pages to December 1, 2019 agreement pages 12 and 13 or Summary section 7.
9.F-9Council Agenda 12-20-2022
Attachment 1.A
Proposed Solutions:
Effective December 1, 2022 and each year thereafter on December 1, all fees (unless otherwise noted) on the Contract, (excluding percentage‐based fees) shall be increased by the percent increase in the Consumer Price Index ‐‐ U (Los Angeles‐Long Beach‐Anaheim, CA All Urban Consumers) as reported for the most recent September compared to the September of the previous year. For labor rates, the adjustment will be made to the base labor rate prior to applying the 7.5% discount. The formula for the fees (excluding percentage‐based fees) shall be as follows:
New amount for December 1, 2023 = November 1, 2023 amount * (September 2023 CPI / September 2022 CPI – 1)
New amount for December 1, 2024 = November 1, 2024 amount * (September 2024 CPI / September 2023 CPI – 1)
New amounts shall be rounded to the nearest dollar per month, and in NO event shall any new amount be less than the amount that was in effect on the prior December 1.
The Renewal for December 1st, 2022 will reflect 14.12% (September 2022CPI / September 2019 CPI ‐1).
City may choose Help Desk Option A or Help Desk Option B to use and can change with 30 days’ notice.
Help Desk Option A:
CITIG will triage and assign all tickets.
Help Desk Cost (RFP Section B.3.a) $7,000/month, $84,000/year Basis for Cost $70/ticket per month based on annual average of 100 tickets/month
Help Desk Hours Monday through Friday, 7am to 5:30pm
Emergency Ticket Response Time Phone: Immediate, Email/Web: 1 hour Urgent Ticket Response Time 1‐2 hours
Standard Ticket Response Time 2‐4 hours
Setup Fee $0
Schedule and timeline to get up to speed Immediate
Help Desk Add‐On Options
Onsite Help Desk Day (one per month)
Onsite Help Desk Day (two per month)
Onsite Help Desk Day (one per week)
Expedited Response Time Ask
Help Desk Option B:
City will triage, assign, and complete as many tickets as staff are able.
Help Desk Cost (RFP Section B.3.a) No pre‐payment
Basis for Cost Hourly based on Rates listed in Separate line Item Pricing section
Help Desk Hours Monday through Friday, 8:30am to 5:30pm Emergency Ticket Response Time Phone: Immediate, Email/Web: 1 hour Urgent Ticket Response Time 1‐2 hours
Standard Ticket Response Time 2‐4 hours
Setup Fee $0
9.F-10Council Agenda 12-20-2022
Attachment 1.A
Schedule and timeline to get up to speed Immediate
Help Desk Add‐On Options
Onsite Help Desk Day (one per month) $1,101/month, $13,212/year (add‐on) Onsite Help Desk Day (two per month) $2,083/month, $24,996/year (add‐on) Onsite Help Desk Day (one per week) $4,291/month, $51,492/year (add‐on) Expedited Response Time Ask
Shared Infrastructure
Shared Infrastructure Management (B.3.b) $11,163/month, $133,956/year Basis for Cost $183/server per month based on 61 servers Support Hours Monday through Friday, 7am to 5:30pm
After Hours Scheduled Maintenance Monday through Friday 5:30pm‐12pm or Saturday 10am‐10pm
Response Time Same As Above for Help Desk
Onsite Infrastructure Day (one per month) $1,347/month, $16,164/year (add‐on) Setup Fee $0
Schedule and timeline to get up to speed Immediate
Discounts
Full Contract Labor Discount 7.5% (applied to non‐contract labor) Annual CITIG Exclusivity Credit 5% (CITIG is given first right of refusal for all IT expenditures)
Separate Line Item Pricing (Section B.3.c/d)
AntiVirus (SOPHOS Intercept X Advanced
Protection)
$4.39/system per month
Backup (Storagecraft ShadowProtect) $8/desktop, $30/virtual server, $52/physical server per month
Spam Filtering (SpamTitan) $2.50/user per month
Monitoring (LogicMonitor) Included.
Dispatch Support Expansion $500/network CPI will apply starting Dec. 1, 2024
CPI will apply to the below labor rates:
Hourly Standard Service $200/hour (not including 7.5% discount) Hourly Advanced Service* $234/hour (not including 7.5% discount) Hourly Enterprise Service** $269/hour (not including 7.5% discount) EOC Emergency Onsite Staffing (M‐F 8‐5) $400/hour (not including 7.5% discount) EOC Emergency Onsite Staffing (After Hours) $600/hour (not including 7.5% discount) EOC Scheduled Onsite Staffing (M‐F 8‐5) $200/hour (not including 7.5% discount) EOC Scheduled Onsite Staffing (After Hours) $300/hour (not including 7.5% discount) IT Project Management Based on highest associated rate for project *VMware, VLAN, and Similar See CITIG Rate Sheet
**Enterprise Storage, Wireless Design See CITIG Rate Sheet
9.F-11Council Agenda 12-20-2022
Attachment 1.A