COUNCIL AGENDA REPORT
TO: Mayor and City Council
FROM: Rebecca Campbell, Director of Finance
DATE: August 12, 2025
SUBJECT: Approve Change Order for Agreement with Workday-Cognizant
Description:
The City Council will consider authorizing the City Manager to approve project change order #1 to the Master Services Agreement with Cognizant Worldwide Limited – Cognizant Technology Solutions US and to approve future change orders related to the Enterprise Resource Planning System.
Environmental Notice: The activity is not a “Project” as defined under Section 15378 of the California Environmental Quality Act State Guidelines; therefore, pursuant to State Guidelines Section 15060(c)(3) no environmental review is required.
RECOMMENDATION:
1. Authorize the City Manager to approve project change order No. 1 to the Master Services Agreement with Cognizant Worldwide Limited - Cognizant Technology Solutions US.
Corporation for implementation of the Enterprise Resource Planning System; and
2. Authorize the City Manager to approve future change orders related to the Enterprise Resource Planning System that are within the total authorized budget for the project.
BACKGROUND:
On March 19, 2024 the City Council approved entering into an agreement with Cognizant Worldwide Limited - Cognizant Technology Solutions US Corporation (Cognizant) for implementation of the City’s Enterprise Resource Planning (ERP) System. Project change order No. 1 to the agreement is being requested for changes related to major system configuration elements, integration specifications changes, and deliverable changes from the originally planned Workday deployment or applicable service offering.
DISCUSSION:
The City of Santa Maria has used Tyler Eden as its core financial system since 1998. This system is outdated and offers limited integration with other City functions, resulting in manual processes using paper, email, and spreadsheets. While NeoGov is used for Human Resources, it does not provide comprehensive Human Capital Management capabilities.
Following a Request for Proposal (RFP) issued in October 2022, the City selected Cognizant/Collaborative to implement Workday for Core Financials, Human Capital Management, 2 and Payroll, along with SpryPoint for Utility Billing and CanAm/Teller for cashiering. The integrated ERP platform will improve operational efficiency, reduce data entry errors, and streamline workflows across departments.
The ERP project began in June 2024 and is scheduled to conclude in Spring 2026. Th e system is expected to serve the City’s needs for at least 10 years before a major upgrade is required. On July 2, 2025 Phase 1 of the implementation went live for financial operations. Phase 2 is anticipated to go live in January 2026.
Significant prog ress has been made on project planning, system design, and integration preparation. However, the complexity of the ERP implementation, combined with evolving operational requirements, has increased the scope of work. Additional time is needed to complete advanced configurations, conduct extensive data migration, and perform comprehensive testing to ensure accuracy and reliability. Extending the agreement with Cognizant will provide continued access to expert implementation teams and technical support necessary for these critical project phases. Additional funding will cover extended professional services, updated integration needs, and enhanced training for City staff.
Alternative(s)
Should the City Council choose not to approve the amendments and additional funding:
The ERP project schedule will likely be delayed, potentially extending beyond the planned Spring 2026 completion date.
The City may experience reduced system functionality at go -live due to incomplete configuration, testing, and training.
Existing staff workloads may become unmanageable, increasing the risk of errors, reduced service quality, and post-launch operational issues.
The City would remain dependent on outdated financial and HR systems for a longer period, limiting process improvements and efficiency gains.
Fiscal Considerations
The original cost for implementation services from Cognizant for the ERP project was $3,948,442.
This project change order #1 will increase that cost by $280,028. A breakdown by line item is listed in Attachment 1 – Project Change Order No. 1. There is sufficient savings within the project to cover this change order, and there will be no additional funding needed from the City’s General Fund or other funds.
Impact to the Community
The Enterprise Resour ce Planning System will bring forth modern technologies to the City’s financial and human resources operations. The City organization and the community will benefit from the efficiency of operations, enhanced security of City assets, and transparency of information.
ATTACHMENT(S)
A. Project Change Order Amendment #1
B. Original Agreement