HomeMy WebLinkAbout1999-10-04 City CouncilTO:
FROM:
City of Palo Alto
City Manager’s Report
HONORABLE CITY COUNCIL
CITY MANAGER DEPARTMENT:
10
UTILITIES
ADMINISTRATIVE
SERVICES
DATE:OCTOBER 4, 1999 CMR: 363:99
SUBJECT:APPROVAL OF AMENDMENT NO. 1 IN THE AMOUNT OF
$500,000 TO EXISTING CONTRACT NO. C8100757 WITH SCT
CO~ORATION FOR CONSULTING SERVICES FOR UTILITIES
CUSTOMER INFORMATION SYSTEM AND APPROVAL OF A
BUDGET AMENDMENT ORDINANCE TO INCREASE CAPITAL
IMPROVEMENT PROGRAM PROJECT NO. 9357, UTILITIES
CUSTOMER INFORMATION SYSTEM, BY $425,000
RECOMMENDATION
Staff recommends that Council:
Approve and authorize the Mayor to execute the attached Amendment No. 1 in the
amount of $500,000 to the existing contract, No. C8100757, with Systems and
Computer Technology (SCT) Corporation for consulting services to supplement City
staff resources and ensure that a Y2K compliant Utilities Customer Information
System is operational before December 31, 1999.
Authorize the City Manager or her designee to negotiate and execute one or more
change orders to Amendment No. 1 with SCT for related additional but unforeseen
work. The total value of change orders shall not exceed $45,000.
Approve a Budget Amendment Ordinance in the amount of $425,000, and increase
Capital Improvement Program (CIP) Project No. 9357, Utilities Customer
Information System, by $425,000.
BACKGROUND
The Utilities Department initiated the Customer Information System (CIS) project in
1991. It was prompted by the recognition that the City needed to provide high quality
customer service while remaining efficient and effective in an increasingly competitive,
CMR: 363:99 Page 1 of 5
deregulated environment. The existing Utility Billing System (CUBIS) was created in
the mid-1970’s. It limits the ability of the City to offer unbundled rate options, to provide
convenient customer payment options, to track workflow processes, and to provide
management with information. In addition, CUBIS is a COBOL-based application that is
complex, lacks documentation, and is difficult to change.
Staff undertook a needs assessment process to identify system requirements and issued a
Request for Proposals (RFP) to acquire a new system. The RFP process resulted in two
alternatives: development of an in-house application or purchase of software from an
outside vendor. Outside vendor applications were more costly and did not possess all of
the CIS system functions required by Palo Alto. In 1993, staff opted for in-house
development of CIS.
The project proceeded in-house, with staff acquiring the necessary computer hardware,
operating system, data management tools, and consulting services at an approximate cost
of $900,000. However, the project experienced a variety of delays owing to staff
vacancies, difficulty in retaining contract staff, and a lack of training in key programming
tools. At the same time, due to significant advances in computer technology and
improved vendor solutions at more competitive prices, staff decided to again research the
purchased software option. In 1997, an RFP was issued for a CIS software package.
After the responses were reviewed, and further negotiations were conducted, in August
1997 the City Council approved a $1.2 million fixed-price contract with SCT Corporation
for acquisition and implementation of a CIS (CMR 347:97). Additional Capital
Improvement Project funding of $355,000 was approved for Fiscal Year 1998-99 for
database consulting and software licenses.In the current fiscal year, $260,000 was
approved for CIS enhancements.
DISCUSSION
In addition to needing a CIS that will serve as a strategic tool for the Utilities
Department, staff also recognized that CUBIS is not Y2K compliant. In order to ensure
that the new CIS is operational by January 1, 2000, staff requires assistance in five
critical areas: data conversion, job process testing, system testing, key account testing,
and end-user training. SCT Corporation will provide critical assistance in each of these
areas, as described below.
Data Conversion
It is necessary to convert the 30,000 accounts in the current CUBIS to the new
system. While City staff has begun the process of converting the accounts, SCT will
complete the conversion task, including validating that data was converted properly,
resolution of issues raised in the conversion process, and general conversion
assistance.
CMR: 363:99 Page 2 of 5
Job Process Testing
In both the current CUBIS and new CIS, the running of"batch jobs" is a daily part of
the system operation. Once the new system is in place, batch jobs will be run in the
new system. SCT will test that the batch job processes are working properly, identify
any problems, and propose solutions.
System Testing
As a last step, there will be a "dress rehearsal" of the entire system to ensure that it is
running properly. This testing will include not only the computer systems, but also
meter reading, bill printing, and the City’s financial, cash remittance, and cash
receipting interfaces. SCT will monitor this system testing, identify and resolve any
problems.
Key Account Testing
Key utility accounts encompass significant users of the City utilities. There are 13
such high volume users, which represent significant revenue sources and high profile
customers. It is critical that special attention be paid to these accounts to ensure that
the information has been transferred accurately and properly. SCT will assist with
this process, which will occur concurrently with the above tasks.
End-User Training
There are a number of staff groups within the Utilities Department, Public Works
Department, and the Administrative Services Department who will require training in
the new system. SCT will assist in this process. Training will occur concurrently
with the data conversion and testing activities.
These consultant services are required at this time because of the Y2K issues with the
current system (CUBIS) and recognition that additional outside resources are needed to
complete the CIS. Because other Y2K remediation projects (modifying programs to
operate in the year 2000) have taken priority (including fire services, building inspection,
legislative history, and payroll), CUBIS remediation was delayed. Having begun to
remediate CUBIS, staff cannot be absolutely certain that it will be successful, due to the
age and proprietary nature of the software. If it were not for the knowledge that the
current system is not Y2K compliant, staff could undertake the above-identified tasks,
and implement CIS more gradually.
City staff originally intended to complete these tasks in-house, but due to a variety of
factors, progress is behind schedule. These factors include the necessity to temporarily
assign technical staff to other high priority projects, key staff turnover, an unexpected
staff vacancy at a critical juncture, and to purchase a new server for the CIS.
The contract will provide up to 3,000 hours of assistance, at $150 an hour. In addition, it
provides up to $50,000 for travel, hotel, and other incidental expenses. Staff is confident
CMR: 363:99 Page 3 of 5
that this will allow the City to have an operational CIS by January 1, 2000. The plan has
extra time built in to it, with a goal to be up and running on November 1, 1999. This
gives staff and the consultant two months to respond to any unforeseen problems or
difficulties. To reduce Y2K risk exposure, the primary backup plan is for staff to
continue efforts with an outside consultant to remediate CUBIS, which is estimated to
cost approximately $40,000. These funds have been previously budgeted.
RESOURCE IMPACT
The funding appropriated for development by SCT and other outside consultants for the
Utilities Customer Information Services CIP Project No. 9357 currently totals $1.9
million. There is currently $120,000 available in the CIP to support this contract
amendment.
This proposed BAO would increase the CIP project by $425,000, to a new total of $2.4
million. The costs for the CIS are supported by all of the Utilities funds. The CIP cost
increase is allocated to each fund as detailed below.
ELECTRIC GAS REFUSE STORM WASTEWATER WATER TOTAL
DRAINAGE COLLECTION
$255,000 $63,750 $42,500 $0 $21,250 $42,500 $425,000
Since the Storm Drainage Fund has no reserves at the present time, its share of the costs
for this contract amendment ($8,500) have been allocated to the other Utility funds. At
mid-year, staff will evaluate the financial position of the StormDrainage Fund and adjust
these allocations if possible.
POLICY IMPLICATIONS
This recommendation does not represent any change to existingCity policies.
ENVIRONMENTAL REVIEW
These services do not constitute a project under the California Environmental Quality Act
(CEQA).
ATTACHMENTS:
Attachment A:
Attachment B:
Attachment C:
Amendment No. 1 to Consulting Contract
Budget Amendment Ordinance
Budget Amendment Ordinances Impacting Reserves Approved to
Date in 1999-00
PREPARED BY: Shannon Gaffney, Senior Financial Analyst
CMR: 363:99 Page 4 of 5
DEPARTMENT HEAD APPROVAL:
DEPARTMENT HEAD APPROVAL:
CITY MANAGER APPROVAL:
CARI/YEATS
Director,
city
ULRICH
Services
CMR: 363:99 Page 5 of 5
SCT UTILITY SYSTEMS, INC.
Carolina Research Park
9 Science Court
Columbia, SC 29203-9344
FAX Number (803) 935-8032
("SET")
ATTACHMENT A
AMENDMENT TO
SOFTWARE LICENSE &
SERVICES AGREEMENT
and
CITY OF PALO ALTO
250 Hamilton Avenue
Palo Alto, CA 94301
FAX Number (415) 321-0651
("Licensee")
Origins[ Software License and Services Agre~raent dated September 30, 1997 (the "Agreement").
This Amendment No, I (the "Amendment").
Effective Date of this Amendment: September 1, 1999,(the "’Amendment Date").
LICENSEE AND SCT. intending to be legally bound, agree as Follows:
1.Defined T~ns. Unless specifically defined hrrein, all terms defined in the Agreemem, shall have the same
meaning when used in this Amendment,
2,Amendment to and Modification of Agre~m¢_n_t.
(a) Services To Be Provided. In addition to the fixed price Professional Services identified in the Agreement,
from the Amendment Date through February. 29, 2000, SCT will provide Licensee with up to 3,000 hours of
Supplemental Services at an hourly rate of SiS0 per hour with the value of the Supplemental Services to be
provided by SCT equalling an amount up to
$450,000. SCT will invoice Licensee for the Supplemental Services on a monthly basis, as SCT renders the
Supplemental Services. Notwithstlmding the above: SCT will dedu~ from each monthly invoice for Supplemental
Services an amount equal to twenty percent (20%) of the Supplemental Services f~es for that month (the deduction
of fees will hereafter b¢ referred to as the "Retainage"). SCT will invoice Licensee for all withheld Retainage
amounts at the point in time when Licensee first print~ a customer bill in a production environment. To the extent
that Licensee abandons the implementation project prior to printing a customer bill in a production environment,
then Licensee shall remain liable to pay SCT the Retainage by no later than 30 days aRer the project termination
date. Licensee will also reimburse SCT for actual travel and living expenses that SCT incurs in providing Licensee
with the Supplemental Services. Reimbursement for travel and living expenses incurred in providing the
Supplemental Services under this Amendment will not exceed $50,000 without Licensee’s prior written approval,
3. Integration Provision. Except as expressly modified by this Amendmem, the Agreement shall remain in
full force and effect. As of the Amendment Date. the Agreement, as further amended by this Amendment
constitutes the entire understanding of the parties as regards the subject matter hereof and cannot be modified except
by wriuen agreement of the parties,
IN WITNESS WHEREOF, the parties have by their duly authorized representatives executed this Amendment on
the date first above written.
ATTEST:CITY OF PALO ALTO
City Clerk
APPROVED AS TO FORM:
Senior Asst, City Attorney
APPROVED:
Assistant City Manager
Director Of Administrative Services
Director Of Utilities
Risk Manager
Mayor
CERTIFICATE OF ACKNOWLEDGMENT
(Civil Code § 1189)
STATE
COUNTY OF )
On ~0, ~9~_W~ bef re me, the underslgned, a
Notary Pub$ic in/~nd~fo~said County and State, personally appeared
, personally known to
me or proved Z6 me on ~h~ basis of satisfactory evidence to be the
person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon
behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature of Notary
STATE OF
COUNTY OF
CERTIFICATE OF ACKNOWLEDGMENT
(Civil Code § 1189)
On .~. ~ c~, 19~, before me, the undersigned, a
Notary Publi~ and far ~id County and State, personally appeared
~~/~/, ~/,~ , personally known to
me-o~ proved to me on the basis of satisfactory evidence to be the
person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon
behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official ~eal.
S/ignature of Notar~ Public.
Common E IfS 0 @er a,
ATTACHMENT B
ORDINANCE NO.
ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO
AMENDING THE BUDGET FOR THE FISCAL YEAR 1999-00 TO
PROVIDE AN ADDITIONAL APPROPRIATION OF $425,000 FOR THE
CUSTOMER INFORMATION SYSTEM CAPITAL IMPROVEMENT PROJECT
NUBMER 9357
WHEREAS, pursuant to the provisions of Section 12 of Article
III of the Charter of the City of Palo Alto, the Council on June 28,
1999 did adopt a budget for fiscal year 1999-00; and
WHEREAS, the Utilities Department initiated the Customer
Information System (CIS) project in 1991 to provide high quality
customer service while remaining efficient in a deregulated and
increasingly competitive environment; and
WHEREAS, the project initially proceeded in-house, but due to
significant advances in computer technology and improved vendor
solutions at more competitive prices, Council approved a contract
with SCT Corporation for the acquisition and implementation of a CIS
software package in August 1997; and
WHEREAS, staff has recognized that the current CIS system is
not Y2K compliant and contract assistance is required in critical
areas to ensure that the new CIS is operational by January i, 2000;
and
WHEREAS, the SCT Corporation can provide the necessary
assistance in each of the critical areas; and
WHEREAS, the Utilities Customer Information System CIP, No.
9357, has insufficient funding available for these additional
consulting services and an additional appropriation of $425,000 is
needed to ensure that the new CIS is operational by January i, 2000;
and
WHEREAS, the additional appropriation of funds will derive
from the Utility Funds; and
WHEREAS, City Council authorization is needed to amend the
1999-00 budget as hereinafter set forth.
NOW, THEREFORE, the Council of the City of Palo Alto does
ORDAIN as follows:
SECTION i. The sum of Four Hundred and Twenty Five Thousand
Dollars ($425,000) is hereby transferred from the reserve funds
hereinafter described, to the appropriation for Capital Improvement
Project Number 9357, Customer Information System. The amounts so
transferred are from the following reserve funds, which will be
reduced by the amount listed:
Electric Distribution Rate Stabilization
Reserve
Gas Rate Distribution Rate Stabilization
Reserve
Refuse Rate Stabilization Reserve
Wastewater Collection Rate Stabilization
Reserve
Water Rate Stabilization Reserve
$255_,000
$63,75o
$42,500
$2Z,250
$4215oo
SECTION 2. The appropriation transfers approved by Section 1
will reduce the following Rate Stabilization Reserves (RSR) :
From:To:
Electric RSR $6,837,000 ~6,582,..000
Gas RSR $4,534,000 $4,470,250
Refuse RSR $4,782,000 $4,739,500
Wastewater collection RSR $7,!54,000 $7,132,750
Water RSR $6,432,000 $6,389,500
SECTION 3. As specified in Section 2.28.080(a) of the Palo
Alto Municipal Code, a two-thirds vote of the City Council is
required to adopt this ordinance.
SECTION 4. The Council of the City of Palo Alto hereby finds
that this is not a project under the California Environmental
Quality Act and, therefore, no environmental impact assessment is
necessary.
SECTION 5. As provided in Section 2.04.350 of the Palo Alto
Municipal Code, this ordinance shall become effective upon adoption.
INTRODUCED AND PASSED:
AYES:
NOES:
ABSTENTIONS:
ABSENT:
ATTEST:
City Clerk
APPROVED AS TO FORM:
Senior Asst. City Attorney
APPROVED:
Mayor
City Manager
Director of
Services
Administrative
Director of Utilities
Attachment C
Budget Amendment Ordinances Impacting Utilities Rate Stabilization Reserves ApprovedTo Date in 1999-00
Electric Fund
Estimated Electric Distribution Rate Stabilization Reserve
(RSR) Balance
Customer Information System (CIP 9357)
Total BAOs
RSR Balance After BA O’s
Gas Fund
Estimated Gas Distribution Rate Stabilization Reserve
(RSR) Balance
Customer Information System (CIP 9357)
Total BAOs
RSR Balance After BAO’s
Refuse Fund
Estimated Refuse Rate Stabilization Reserve (RSR)
Balance
Customer Information System (CIP 9357)
Total BAOs
RSR Balance After BAO’s
Storm Drainage Fund
Estimated Storm Drainage Rate Stabilization Reserve
(RSR) Balance
Total BAOs
RSR Balance After BAO’s
Waste Water Collection Fund
Estimated WWC Rate Stabilization Reserve (RSR) Balance
Customer Information System (CIP 9357)
Total BAOs
RSR Balance After BAO’s
Water Fund
Estimated Water Rate Stabilization Reserve (RSR) Balance
Customer Information System (CIP 9357)
Total BAOs
RSR Balance After BA O’s
($255,000)
($255,000)
($63,750)
($63,750)
($42,500)
($42,500)
($21,250)
($21,250)
($42,500)
($42,500)
$6,837,000
($255,000)
$0 ($255,000)
$6,582,000
$4,534,000
($63,75O)
$0 ($63,750)
$4,470,250
$4,782,000
($42,500)
$0 ($42,500)
$4,739,5oo
$7,154,000
($21,25O)
$0 ($21,250)
$7,132,75o
$6,432,000
($42,500)
$0 ($42,500)
$6,389,500
$0
$0
$0
$0
$0
09/28/99