City of Sacramento
City Council - 5PM Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2023-00960 8/15/2023 Consent Item 6.
Supplemental Agreement: Active Net Registration Management Software File ID: 2023-00960
Location: Citywide
Recommendation: Pass a Motion authorizing the City Manager or the City Manager’s designee to execute Supplemental Agreement No. 3 to City Agreement No. 2017-0772-03 with Global Payments, Inc. dba Active Network, LLC for Active Net Registration Software Management services and monthly transaction fees for a new not-to-exceed amount of $623,683 through the remaining five-years of the contract.
Contact: Anthony Munoz, Recreation Manager, (916) 808-6251, [email protected], Department of Youth, Parks, & Community Enrichment
Presenter: None.
Attachments:
1-Description/Analysis
2-Supplemental Agreement No. 3
Additional Description/Analysis
Issue Detail: In June 2017, the Department of Youth, Parks, and Community Enrichment (YPCE) entered into an agreement with Global Payments, Inc. dba Active Network, LLC (Active Net), for registration and reservation management software.
YPCE heavily relies on this custom-designed registration software to effectively manage facility reservations throughout an extensive network, which includes 235 parks, community centers, picnic sites, and permitted athletic fields. Additionally, it efficiently handles registrations for numerous recreation classes and special events, amounting to over 31,000 registrations each year.
Initially, because there was no user history, the anticipated accumulated amount of the monthly transaction fees was unclear, and there were conflicting provisions within the contract regarding its expiration date. This contract supplement aims to provide clarity on the transaction fees and present an updated estimated amount in order to pay the monthly fees. Additionally, it serves to clarify the length of the remaining term of the contract.
File ID: 2023-00960 8/15/2023 Consent Item 6.
Due to the recent expansion of department facilities and programming, along with the addition of extra pay points, there has been an increase in transaction fees. Active Net will continue to retain a portion of the customer transaction fees instead of charging set licensing and maintenance fees. The transaction fees for each payment method are as follows:
In person transaction fees for Cash and Check on site payments - 1.5% Online and in person Credit Card payments- 2.5%
These transaction fees are estimated to total approximately $100,000 annually, which is reflected in the contract supplement as the per fiscal year not-to-exceed amount.
In addition to the details regarding fees, another significant benefit of this proposed supplement is the removal of ambiguity surrounding the previous auto-renewal details stated in the original agreement.
With the additional term length now clearly defined, YPCE can strategically plan its budget and operations, having better financial planning and operational efficiency for the department.
Furthermore, the inclusion of estimated rates on a fiscal year basis for transaction fees provides YPCE with a better understanding of its financial obligations over the course of the agreement. This clarity helps prevent unexpected costs.
Policy Considerations: Providing parks and recreation facilities is consistent with the City’s strategic plan to enhance livability in Sacramento’s neighborhoods. This supplemental agreement exceeds the City Managers authority and requires City Council approval in conformance with City Code 3.60.210:
City council approval is required for a change order that increases the contract amount to $250,000 or more. The RFP process, as described in the City Administrative Policy AP-4102, was used to solicit the consultant for the software and professional services.
Economic Impacts: None.
Environmental Considerations:
California Environmental Quality Action (“CEQA”): The recommended action is not a “project” that is subject to CEQA because it is an administrative activity that will not result in direct or indirect physical changes in the environment and involve continuing administrative or maintenance activities. (CEQA Guidelines section 15378(a), (b)(2), and (b)(5).) Sustainability: Not applicable.
Commission/Committee Action: Not applicable.
File ID: 2023-00960 8/15/2023 Consent Item 6.
Rationale for Recommendation: RFP number P17191311002 was utilized to select Active Net Management Registration software, and City agreement 2017-0772 was approved on June 30, 2017, with a not-to-exceed amount of $43,100 plus transaction fees. Supplement Agreement No. 1 was executed on September 2, 2021, to increase the original contract amount to $93,833 for additional equipment. Supplement Agreement No. 2 was executed on April 4th, 2022, to further raise the original contract amount to $123,683, enabling the purchase of ACTIVE Hub database services.
Supplement Agreement No. 3 will clarify the remaining term of the agreement and will clearly define the annual amount for transaction fees, bringing the total contract not-to-exceed amount to $623,683.
The software, along with the related services, plays a crucial role in YPCE's day-to-day operations, actively generating revenue for the various services the City provides. Its seamless functionality and user-friendly interface enable the department to streamline operations, enhance customer experiences, and efficiently manage facilities and programs. Without this software, our ability to deliver high-quality services and optimize revenue generation would be significantly impacted.
Therefore, ensuring the continuity of this vital registration software is of utmost importance to the success of our department and, ultimately, the satisfaction of the City customers we serve.
Financial Considerations: The proposed agreement is for a not-to-exceed amount of $623,683. Considering the type of transaction, Active Net's fees, which range from 1.5% to 2.5%, will be deducted from the City's collected fees. Based on current revenue trends, Active Net is projected to retain a maximum of $100,000 annually in estimated fees, totaling up to $500,000.00 over the five- year term. Active Net’s fees are lower than what they charge other agencies. YPCE will evaluate if the current recreation programming fee structure can absorb this additional charge or if it will be necessary to return to Council to adjust fees to ensure that the revenues cover the program costs.
Local Business Enterprise (LBE): Global Payments, Inc. dba Active Network, LLC is not an LBE.
The minimum LBE participation requirement was waived by the Director of YPCE as staff has determined the waiver is in the City’s best interest as a result of lack of qualified vendor availability in the Sacramento region. The majority of qualified firms are located in the Bay Area and Southern California.
SUPPLEMENTAL CONTRACT
(Rev. 11-1-19)
Project Title and Job Number: YPCE Registration Software Date: _________________ Purchase Order #: 67662 Supplemental Contract No.:03
The City of Sacramento ("City") and GLOBAL PAYMENTS, INC dba Active Network, LLC ("Contractor"), as parties to that certain Professional Services Agreement designated as Contract Number _2017-0772_, including any and all prior supplemental contracts modifying the Agreement (the Agreement and all supplemental contracts are hereafter collectively referred to as the "Agreement"), hereby supplement and modify the Contract as follows:
1. The Scope of Services specified in Attachment 1 to Exhibit A of the Agreement is amended to add the following fee schedule:
Transaction Fees & Other Expenses
Description FY
2022/2023
FY
2023/2024
FY
2024/2025
FY
2025/2026
FY
2026/2027
The monthly transaction fees
commenced on September 17, 2018,
which marked the system's go -live
date. This software has been custom -
designed to meet the specific
requirements of the department’s
programming and operation al need s.
The agreed-upon amount set forth
herein will not be exceeded.
NTE
$100,000.00
NTE
$100,000.00
NTE
$100,000.00
NTE
$100,000.00
NTE
$100,000.00
TOTAL (not to exceed) $100,000.00 $100,000.00 $100,000.00 $100,000.00 $100,000.00
2. In consideration of the additional and/or revised services described in section 1, above, the maximum not -to-exceed amount that is specified in Exhibit B of the Agreement for payment of Contractor's fees and expenses, is increased/decreased by __$500,000.00__, and the Agreement’s maximum not-to-exceed amount is amended as follows:
Agreement's original not-to-exceed amount: _$43,100.00_ Net change by previous supplemental contracts: _$80,583.00_ Not-to-exceed amount prior to this supplemental contract: _$123,683.00 Increase/decrease by this supplemental contract: _$500,000.00 New not-to exceed amount including all supplemental contracts: _$623,683.00
3. Contractor agrees that the amount of increase or decrease in the not -to-exceed amount specified in section 2, above, shall constitute full compensation for the additional and/or revised services specified in section 1, above, and shall fully compensate Contractor for any and all direct and indirect costs that may be incurred by Contractor in connection with such additional and/or revised services, including costs associated with any changes and/or delays in schedules or in the delivery of other services by Contractor.
4. Section 5 of Exhibit A and Section 9 of Exhibit D are revised to reflect that the contract shall be e ffective through June 30, 2027, unless either party gives written notice to ter minate the hosted software no less than six (6) months prio r to the end of a Renewal Term, as applicable.
5. Contractor warrants and represents that the person or persons executing this supplemental contrac t on behalf of Contractor has or have been duly authorized by Contractor to sign this supplemental contract and bind Contractor to the terms hereof.
6. Except as specifically revised herein, all terms and conditions of the Agreement shall remain in full force and effect, and Contractor shall perform all of the services, duties, obligations, and conditions required under the Agreement , as supplemented and modified by this supplemental contract.
[SIGNATURES ON FOLLOWING PAGE]