REPORT TO COUNCIL
SUBJECT
Title
Amend an Existing Purchase Agreement with Dell Marketing L.P. for Computer Equipment in the Amount of $2,500,000 and Extend the Term Through June 30, 2028 (F25-186)
Report
REPORT IN BRIEF
Approval is requested to modify an existing purchase agreement (PA) with Dell Marketing L.P., increasing the PA amount from $800,000 to a new not to exceed amount of $2,500,000 for ongoing, scheduled replacements of computers, monitors, servers, and associated equipment. Approval is also requested to authorize the City Manager to renew the contract for up to three additional one-year periods and to further modify the PA amount, subject to available budget and if pricing and service remain acceptable to the City.
EXISTING POLICY
Pursuant to Section 2.08.040(d) of the Sunnyvale Municipal Code (SMC), Council approval is required for the procurement of goods and/or services greater than $250,000 in any one transaction.
Section 2.08.220(b) of the Sunnyvale Municipal Code authorizes the purchasing officer to direct the city’s participation with one or more governmental, public or quasi-public agencies in a cooperative agreement for the procurement of goods and/or services, provided that at least one of the agencies has solicited bids.
ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines section 15378(a) as it has no potential for resulting in either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment.
BACKGROUND AND DISCUSSION
On December 7, 2021, City Council approved RTC 21-0984, authorizing a contract purchase agreement with Dell Marketing L.P. in an amount up to $800,000 contingent on the continuation of the NASPO ValuePoint Agreement.
Dell has shown the ability to meet the technological needs of the City and provide consistent quality and support service.
This selection also aligns with the strategic direction to standardize hardware platforms to ensure compatibility and integration with existing equipment. Standardization is a key element of efficiency in a public agency, considering the large number of computers in the inventory and relatively small number of Information Technology staff to maintain them. Dell offers some key features and services that meet the City’s requirements:
1. Dell computers are commercial grade, constructed of high-quality components that have been proven to continue functioning over an extended lifespan with a minimum of component failure.
2. Dell has a service organization that responds to the City to repair problems onsite with minimal supervision by City staff.
3. Dell maintains a parts inventory and can replace broken parts with like components well into a device’s projected lifespan to avoid having to replace systems prematurely. Like components are important because many unlike components require software changes to function properly.
4. Dell products provide the features needed to address the City’s business needs, specifically with computer servers and end-user mobility.
Additionally, maintaining an inventory of systems that are as similar as possible provides efficiencies in system support and allows staff to utilize automated methods of managing the systems.
The City frequently uses cooperative agreements to obtain better pricing compared to bidding the goods/services individually. Utilizing a cooperative contract saves time researching product specifications and allows the City to benefit from established pricing. The City entered into its existing agreement with Dell as a cooperative purchase pursuant to National Association of State Procurement Officials (NASPO) ValuePoint Agreement No. MNWNC108. The NASPO agreement was later superseded, assigned, and renumbered as Master Agreement 23026, valid through 06/30/2025, with an option to renew up to an additional 36 months. Continuing use of the appropriate NASPO agreement will allow the City to obtain up to a 17.5% discount from Dell’s retail pricing.
Purchases are expected to increase in the upcoming fiscal years as they include the replacement of existing desktop computers, laptops, tablets and servers coming to end of life. New laptops, desktops and monitors are budgeted for the Lakewood Library, Water Pollution Control Plant, and the Emergency Operations Center.
The recommended amendment to the existing purchase agreement will extend the contract term through June 30, 2028, add funds to bring the total contract amount for that term to $2,500,000, align the cooperative purchase agreement references to the appropriate NASPO agreement, and provide the option for the City Manager to renew the contract for up to three additional one-year periods.
FISCAL IMPACT
Device replacement costs are budgeted in Fund 7027 - Technology and Communications Sub-Fund and in various capital and IT projects for project needs. The full 20-year financial plan includes the replacement costs based on device life cycles; therefore, the costs will vary annually. The Technology and Communication Sub Fund is funded through internal service charge transfers from other department funds, which will be adjusted as needed in future budget cycles.
PUBLIC CONTACT
Public contact was made by posting the Council meeting agenda on the City's official-notice bulletin board at City Hall, at the Sunnyvale Public Library and in the Department of Public Safety Lobby. In addition, the agenda and this report are available at the City Hall reception desk located on the first floor of City Hall at 456 W. Olive Avenue (during normal business hours), and on the City's website.
RECOMMENDATION
Recommendation
Take the following actions:
- Authorize the City Manager to amend an existing Purchase Agreement (PA) with Dell Marketing L.P., to (1) align with NASPO Master Agreement 23026; (2) extend the contract through June 30, 2028; and (3) increase the PA total not-to-exceed amount to $2,500,000, for ongoing, scheduled replacements of computers, monitors, servers, and associated equipment; and
- Authorize the City Manager to renew the contract for up to three additional one-year periods and modify the total compensation by an appropriate amount, subject to available budget and if pricing and service remain acceptable to the City.
Levine Act
LEVINE ACT
The Levine Act (Gov. Code Section 84308) prohibits city officials from participating in certain decisions regarding licenses, permits, and other entitlements for use if the official has received a campaign contribution of more than $500 from a party, participant, or agent of a party or participant in the previous 12 months. The Levine Act is intended to prevent financial influence on decisions that affect specific, identifiable persons or participants. For more information see the Fair Political Practices Commission website: www.fppc.ca.gov/learn/pay-to-play-limits-and-prohibitions.html
An “X” in the checklist below indicates that the action being considered falls under a Levine Act category or exemption:
SUBJECT TO THE LEVINE ACT
___ Land development entitlements
___ Other permit, license, or entitlement for use
_x_ Contract or franchise
EXEMPT FROM THE LEVINE ACT
__ Competitively bid contract*
___ Labor or personal employment contract
___ Contract under $50,000 or non-fiscal
___ Contract between public agencies
___ General policy and legislative actions
* "Competitively bid" means a contract that must be awarded to the lowest responsive and responsible bidder.
Staff
Prepared by: David Battaglia, Purchasing Officer
Reviewed by: Dennis Jaw, Interim Director of Finance
Reviewed by: Kathleen Boutté Foster, Chief Information Officer
Reviewed by: Sarah Johnson-Rios, Assistant City Manager
Approved by: Tim Kirby, City Manager
ATTACHMENTS
1. NASPO ValuePoint Master Agreement No. 23026