HomeMy WebLinkAboutAgenda Statement 1981/10/13 Item 7~~ COUNCIL AGENDA STATEMENT
Item I
Meeting Date 10~13/f3l
ITEM TI LE: Resolution Dlv-1~A rovin a reement with Inter-Continental Computing,
/ IPporporated for Mutual Computer Backup Services
SUBMITT D BY: Director of Policy Analysis & Program Evalu i~On (4/5ths Vote: Yes No X )
At its July 14, 1981 meeting, the City Council (1) authorized Inter-Continental Computing,
Incorpo ated (ICCI) to use the City's computer on a one-time basis, pending further Council
discussion and resolution of the policy issue involved; (2) authorized staff to negotiate a
tentati e agreement with ICCI for mutual computer backup services; and (3) directed staff to
provide Council with a report for further consideration of the Council policy limiting the
City's ata processing contractual services to public and quasi-public organizations. A
tentati e contract has been negotiated with ICCI and it is my
RECOMMENDATION: That Council:
Adopt as Council policy the Data Processing Contracting Policy shown in Exhibit A.
Adopt the resolution approving the agreement.
BOARDS/ OMMISSIONS RECOMMENDATION: N.A.
DISCUSS ON
A. Contracting Poli
In pproving an agreement for the City to provide data processing services to Coronado,
the Council, on March 11, 1980, requested a report on other possible external uses for
the City's computer. In discussing the request fora report, Council decided to restrict
the other potential users of our computer to government or quasi-government agencies,
pub is service organizations, or franchises that deal with cities. In a report accepted
by he Council on May 10, 1980, I indicated that the City's natural market for its data
pro essing services would primarily be small to medium-sized governmental and quasi-
gov rnmental agencies and thus the limitation established by the Council in March of 1980
wou d not seriously hinder the Data Processing Division's marketing effort.
Sin e that time, the Division has expanded its customers from four (Sani-Tainer and the
Cit es of E1 Cdjon, Imperial Beach and Coronado) to eight by establishing new accounts
wit the San Diego Housing Commission, Sweetwater Authority, SCOOT, and the Union of
Pan Asian Communities. In addition, we have significantly increased the amount of work.
per ormed for Coronado, and we are currently investigating the possibility of agreements
wit National City, Poway, Santee and Rancho Santa Fe. As indicated, we have been able
to ind a significant amount of new business and potential new business within the market
res ricti,ons established by Council.
At
do
wo r
:he January 29, 1981 Preliminary Budget Workshop, I discussed with Council the need to
one of the following if the City wanted to continue increasing the amount of contractual
and corresponding revenue:
- Add in-house staff
- More facilities management (contractual) staff
- Create a separate organizational entity (_commercial or non-profit)
continued
Form A-~13 (Rev. 11/79)
Item ~
Meeting Date 10/13/81
Page 2
At t e meeting, there appeared to be a consensus that the Data Processing Division should
cont nue its efforts to increase the amount of work performed for other agencies and the
Coun it indicated its willingness to consider various means of doing so. The Council
poli y of not providing data processing services to the private sector was not changed,
but ouncil indicated a willingness to reconsider that policy if staff so requested. In
orde to allow the Division to increase the contractual work performed, the Division's
1981 82 budgeted positions were increased by 1 Programmer position and .25 Data Entry
Oper for position. The projected data processing revenue for the current fiscal year is
$120 000.
I am currently not convinced of the need or the desirability of establishing a separate
enti y (either commercial or non-profit) for Data Processing or increasing the facilities
mana ement (.contractual) staff. In my judgment, the City should continue its current
orga izational arrangement as well as continuing to market its services primarily to
publ c and quasi-public organizations. As outlined previously, the Data Processing staff
has rought in enough outside business to keep the staff extremely busy in implementing
new. ystems for outside public and quasi-public agencies in addition to the work it
prov'des for internal City departments. Furthermore, discussions are underway or
resp nses to data processing RFP's are being prepared for four other public or quasi-
publ'c agencies. Thus, I-think the Division should not actively solicit business in the
priv to sector in the immediate future. Nonetheless, I believe the City should consider
taki. g advantage of limited opportunities that may arise with private sector firms, after
nevi: w on a case-by-case basis. This recommended position is formalized into a policy
stat ment in Exhibit A.
B. Proposed Agreement with ICCI
The proposed agreement with Inter-Continental Computing, Incorporated (ICCI), is an
exa ple of a data processing contract with a private sector firm that, in my opinion, is
ver appropriate as well as beneficial to the City.
ICC is a data processing service bureau for credit unions. The proposed contract with
ICC would establish a mutual computer backup arrangement i.n the event of either party
exp riencing a computer breakdown or wark overflow. ICCI has two medium-sized Burroughs
com uters similar to the City's Burroughs 2805. The major provisions of the contract
are as follows:
- Computer time would be made available to the requesting party on a time
available basis, with the requesting party furnishing the necessary supplies
and computer operator.
- Each party would be entitled to use the other party's computer, up to the
following amounts per quarter (3 months), at no charge:
(a) 5 hours of printing from tapes
(b) 1 hour of processing time
- Computer time used in excess of the above free time would be charged at
the following rates:
(a) $20 per hour for printing from tapes
(b) $100 per hour for computer processing
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Item 7
Meeting Date 1~3/~1
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contract would thus provide a formal backup arrangement for the City to utilize
's computers for time-sensitive applications such as payroll and automated accounting
our computer is inoperable. It is unlikely that the City will need more computer
than the amount allowed at no charge under the contract. ICCI, however, will probably
the City an estimated $1,000 - $5,000 per year for use of our computer during work
flow periods. ICCI experiences such overflow periods at the end of each quarter when
rints its quarterly statements of accounts for the credit unions, The revenue from
would thus depend on the amount of overflow work it wished to run on our computer
ell as on its computer breakdown rate.
FISCAL IMPACT
The prop sed contract would provide an estimated $1,000 - $5,000 in revenue per year, with
minimal osts to the City.
JRT:mab
~.; , _.
~~ ~~_~~
DATA PROCESSING CONTRACTING POLICY
In order to decrease the net City cost for data processing, the Data
Processing Division should seek to perform contractual work for other
agencies, subject to the following provisions:
- The primary focus of such contractual work should be to seek
the maximum utilization of the Division's fixed-cost resources
of equipment, .facilities, programs, and staff.
- Any work performed for other agencies should be incidental to
the Division's primary purpose of providing data processing
services for the City of Chula Vista.
- The Division's primary marketing effort should be directed toward
public and quasi-public agencies.
- The Division should not actively market its resources to private
sector agencies, but opportunities that may arise related to
private sector firms will be considered on a case by case basis.
- In any cases where the City does enter into agreements with
private sector agencies, the rates charged to the private sector
firms should be established at the "going market rate" for such
services, if such a market rate can be readily determined.
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EXHIBIT A