Administrative
Report
H.13., File # 24-0868 Meeting Date: 5/21/2024
To: MAYOR AND CITY COUNCIL
From: MIKE COOK, INFORMATION TECHNOLOGY DIRECTOR
TITLE
APPROVE AN AGREEMENT WITH TYLER TECHNOLOGIES, INC FOR ENTERPRISE RESOURCE
PLANNING SOFTWARE AS A SERVICE (SAAS) LICENSING AND MIGRATION SERVICES NOT TO EXCEED $1,437,761.07 AND THE TERM MAY 22, 2024 TO MAY 21, 2029
EXECUTIVE SUMMARY
The City’s Tyler Munis Enterprise Resource Planning (ERP) application is one of the City’s most critical applications serving as the primary system of record and mechanism for doing business in most administrative departments including Human Resources and Financial Services. The software allows the City to complete the budget and perform necessary accounting, cashiering, and purchasing functions, while also playing a critical role in licensing and permitting operations. The tool is used by both the public and City staff on a daily basis to complete nearly all administrative tasks.
The City is currently utilizing Tyler’s oldest supported application version which is running on server infrastructure in the City Hall data center that has exceeded its usable life span. The environment is operated by the City’s Information Technology Department and necessitates extensive coordination and testing with Tyler in order to maintain such necessities as annual tax code updates. Industry trends in the ERP sector show a dramatic shift from legacy on-premise solutions to cloud-based applications that eliminate the need for cumbersome manual system upgrades and on-site servers.
This Agreement will enable the City to update to Tyler’s latest Cloud Software as a Service ERP application, including all implementation and project management services, and secures a 3-year term with options to renew for two additional years.
BACKGROUND
In 2004, the City entered into a ten-year licensing agreement with Tyler for MUNIS financial software and support services to replace a number of legacy applications and the final remnants of the City’s mainframe computer. To date, there have been five amendments to the original contract including adjusting payments, adding and removing modules, and procuring professional services for enhancements and implementation services. Today, the Tyler MUNIS system provides the City with core financials, accounting/general ledger, budget, payroll, cashiering, human resources, business license, animal license and permitting capabilities, as well as other modules that provide support and disaster recovery for the aforementioned systems. Tyler has demonstrated a commitment to advancing the product by keeping pace with changing technologies. As such, the product has continued to meet the needs of the City.
Council approved funding for the Tyler ERP system upgrade as part of the FY 2023-24 Budget process through Decision Package #57. Since October, staff have been negotiating with Tyler to
H.13., File # 24-0868 Meeting Date: 5/21/2024
process through Decision Package #57. Since October, staff have been negotiating with Tyler to develop a scope of work and implementation timeline.
COORDINATION
IT Department staff coordinated with Tyler Technologies and various City departments to structure the Agreement, scope, and timeline. The Agreement has been approved as to form by the City Attorney’s Office.
FISCAL IMPACT
The costs associated with this Agreement are funded from the Information Technology Internal Service Fund. Funding is planned to be allocated in each fiscal years’ upcoming budget to accommodate annual service costs. While the annual cost of software licensing increases by approximately $69,000 per year from current, the overall cost is reduced due to elimination of onpremise servers and reduction in staff effort.
This Agreement solidifies a 3% maximum increase per year for the first 3 years of the Agreement, and will revert to Tyler’s standard 5% annual increase in the following years. The total not to exceed cost of the Agreement is $1,437,761.07 inclusive of optional years 4 and 5.
Funding Expenditures
IT Internal Service Fund
(23-24)
$322,818 Year 1 SAAS License $254,874
Implementation $67,994
IT Internal Service Fund
(24-25)
$262,520.22 Year 2 SAAS License $262,520.22
IT Internal Service Fund
(25-26)
$270,395.83 Year 3 SAAS License $270,395.83
IT Internal Service Fund
(26-27)
$283,915.62 Year 4 SAAS License
(Optional)
$283,915.62
IT Internal Service Fund
(27-28)
$298,111.40 Year 5 SAAS License
(Optional)
$298,111.40
Total $1,437,761.07 $1,437,761.07
APPROVED BY:
Mike Witzansky, City Manager
ATTACHMENTS
· Agreement - Tyler Software as a Service (SAAS)
· Certificate of Insurance
· FY 2023-24 Decision Package #57