HomeMy WebLinkAboutAgenda Statement 1982/06/22 Item 7COUNCIL AGENDA STATEMENT
ITEM TItLE:
SUBMITTED BY:
7
6-22-82
Resolution ~a 9Q 7 - Approving Computer Facilities Management Contract
with EDP Manage/meant, Inc.
/ I
Director of Management Services (~ (4/5ths Vote: Yes Nom)
The Cit has contracted with EDP Management, Inc. since 1975 for the supervision and
opera ti of the City's computer center. This arrangement has involved EDP Management's
stationing of a full-time, on-site Data Processing Manager who directs five City employees
in the ata Processing Division, provides systems analysis and programming services
for the City, and coordinates the City's marketing and provision of data processing
service to outside agencies. In addition, other EDP Management personnel may be called
upon to assist with particularly complex problems or special projects.
The cur ent one-year contract with EDP Management expires June 30, 1982. Since the
firm's erformance under the contract has been highly satisfactory, I have negotiated
a new o e-year agreement with EDP Management to become effective July 1, 1982, and
it ism
RECOMMENDATION: That Council:
1.) Adopt the resolution approving the agreement.
BOARD/COMMISSION RECOMMENDATION: Not Applicable.
DISCUSSION
The onl significant change in the proposed new contract compared to the existing contract
involve the payment amount (Section 4.A. of the contract). The monthly payment to
EDP Man Bement for basic services will be increased from $3,378 to $3,603, a 6.7% increase.
The pro osed new contract includes the provisions established last year for an incentive
payment system (Section 4.C.). This system provides for potential incentive payments
based o the gross revenues from outside agencies earned by the City's Data Processing
Divisio For the one-year period beginning July 1, 1982, the City will pay EDP Manage-
ment l00 of all such revenues earned in excess of $100,000, with the incentive payments
limited to $6,000 for the year. These provisions are exactly the same as those in
the cur ent year's contract.
The Dat Processing Division's revenue and potential incentive payments for FY 1980-81
through 1982-83 are shown below:
FY
1980-81 Actual
1981-82 Estimated
1982-83 Projected
Total DP Revenue
$ 76,690
110,000
99,800
Item
Meeting Date
Incentive Payment
$ -0-*
1,000
-0-
Continued
The incentive payment system was not in effect during FY 1980-81, but no payments
would have been earned if it had been in effect then.
Form A}~113 (Rev. 11/79)
Page 2, Item 7 ;
Meeting Date ~6-22-82
As indi
be $1,0
over $3
jected
Divisio
receive
I consi~
con trac
ofasm
anticip
otherwi
like th
in a si
current
For EDP
annual
earned
~ted above, the incentive payment for the current fiscal year is estimated to
), based on the estimated revenue for the current year of $110,000, which is
,000 higher than the revenue for any previous fiscal year. The currently pro-
~venue for the Division for FY 1982-83 is slightly below $100,000, so the
's revenue will have to exceed the projected amount for EDP Management to
any incentive payments for next year.
'r this incentive system to be an innovative and beneficial aspect of the
By potentially providing part of EDP Management's compensation in the form
11 percentage of the revenue earned above a threshold of $100,000, I would
to a net increase in the Division's revenue above the amount that would
e be realized. Such an incentive system is particularly useful in situations
s where an aspect of good performance (increased customer business) results
nificant and on-going increase in workload. The Data Processing Division is
y providing service to nine outside agencies in addition to City departments.
Management to receive the maximum $6,000 in incentive payments, the Division's
evenue would have to reach $160,000, which is more than twice the revenue amount
rior to the establishment of the incentive system.
The pro osed contract also includes provisions that allow the City the option of obtaining
additio al full-time programmers (Section 3.E.) or additional temporary personnel (3.F.)
at addi Tonal cost to the City. I do not anticipate that the City will exercise these
options during FY 1982-83, and no funds are budgeted to exercise these options.
FISCAL IMPACT
The FY
budget
incenti
fiscal ,
the FY
$100,00
JT:Im
~~_
982-83 cost of the contract for basic services will be $43,236. The FY 1982-83
ncludes funds to pay for this contract, as well as for the estimated $1,000
e payment to be made in July of 1982 based on revenue earned in the current
ear. Approval of this contract could have an impact (maximum of $6,000) on
983-84 budget, if the Data Processing revenue earned during FY 1982-83 exceeds
and thus results in an incentive payment to be made in July of 1983.
Cf~~
~*-~_
x n /~ s
Ct;uEa Vista, Caiitornia
Dated ~ ~ ~'i `_