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HomeMy WebLinkAboutAgenda Report - June 16, 2010 D-13AGENDA ITEM 1>44� CITY OF LODI COUNCIL COMMUNICATION AGENDA TITLE: Adopt Resolution Authorizing Renewal of Support Agreement for Electronic Customer Information Billing System with Vertex Business Services, of Bend, OR, and Grant City Manager Authority to Approve Subsequent Annual Renewals ($62,456.62). MEETING DATE: June 16,2010 PREPARED BY: Information Systems Manager RECOMMENDED ACTION: Adopt resolution authorizing renewal of support agreement for electronic customer information billing system with Vertex Business Services, of Bend, OR, and grant City Manager authority to approve subsequent annual renewals ($62,456.62). BACKGROUND INFORMATION: On April 15, 1998, the City Council adopted Resolution No. 98-61, appropriating $996,525.00 for the purchase and implementation of the Electronic Customer Information Billing System (ECIS) from Orcom Systems, of Bend, Oregon. The purchase was made following an exhaustive research and evaluation process in which many software products were examined. The ECIS system has since been acquired by Vertex Business Services, the system's current owner and vendor. The ECIS system is one of two mission -critical computer applications operated by the City, the other being J.D. Edwards Enterprise Resource Planning software. ECIS is the centerpiece for the City's utility billing activities. In addition to other critical functions, ECIS processes all electric and water meter readings and applies flat -rate charges where appropriate. The system also stores important customer information and billing history. The ECIS system has a direct relationship to the City's cash flow. Any significant interruption in the ECIS system would have an immediate negative impact on the City's finances, including its ability to render customer bills, making this support agreement an essential service. While the City has one full-time programmer -analyst assigned to handle day-to-day billing system management activities, the City relies heavily upon the manufacturer to provide ongoing maintenance and support services for the installed software for a fee. The annual support charge for the ECIS system is $62,456.62 for fiscal year 2010/1 1 payable in two semi-annual payments of $31,228.31, the same as fiscal year 2009/10. Included in the support agreement are periodic software updates and security patches, plus telephone support for City programmers and technicians, should the need arise. APPROVED: e Konradt Bartlam, Interim City Manager There are no suitable alternatives to not renewing this support contract. Unlike with many other software packages, there appear to be no third -party vendors offering support contracts for this system, nor would that likely be a recommended alternative if there were. Given the criticality of this software, staff recommends renewing the support agreement with Vertex Business Systems in the amount of $62,456.62, payable in two semi-annual payments of $31,228.31. Staff further recommends granting the City Manager authority to approve subsequent annual renewals of this contract, as it has with the JD Edwards support contract. FISCAL IMPACT: Approval of the support agreement will ensure timely access to knowledgeable maintenance and support staff for a critical City system. FUNDING AVAILABLE: ISD sublet service contracts —100411.7335 QA&b� "�_" - Jordan Avers Deputy City Manager/Internal Services Director Prepared by: Steve Mann, Information Systems Manager May 25, 2010 Steve Mann City of Lodi 212 West Pine Street Lodi, CA 95241 Dear Steve: Your support agreement is up for renewal on July 1, 2010. Your support fee will stay the same as last year at the rate of $62,456.63 for the period July 1, 2010 through June 30, 2011. Additionally your annual support hour time bank will re -start at 240 hours for the time period, July 1, 2010 to June 30, 2011. As your support fees are invoiced semi-annually, the first invoice for $31,228.32 will be sent to you in June 2010 for the period July 2010 to December 2010 and the second invoice for $31,228.32 will be sent in December 2010 for the period January — June 2011. Vertex Business Services continues to provide services to ensure your satisfaction with the support we provide to you and your staff. Those services include: • A National Account Manager that supports a small group of both licensed and outsourced clients. Supporting both types of clients promotes the sharing of process and product information across clients. • A Technical Account Manager that is responsible for ensuring your Support Incidents are addressed in a timely manner. • CIS Operations, with analysts and programmers, to serve your support needs. • A Client Professional Services department devoted to custom development and services. • Quality Assurance department focused on improving processes throughout the organization. • Client Web Portal, which provides Custom Project and Support Incident tracking, updated technical information, user documents and training information. Vertex Business Services continues to value you as a business partner. We look forward to continuing to serve City of Lodi's information technology needs. Our personnel are available to work with you to support your current and future business needs. Please contact me directly at 541-389-0120 ex. 1334, if you wish to discuss any aspects of your current or future support needs. Sincerely, Tom Morgan National Account Manager Vertex Business Services SOFTWARE SUPPORT AGREEMENT between ORCOM SOLUTIONS, INC. ("Orcorn") and CITY OF LODI ("Client") Dated: July 1,2003 1. DEFINITIONS 1.1 "Software" nwaiis the standard Orcom software programs for which Client has acquired a license to use pursuant to the terms of the Software License Agreement between OTC0111 and Client. 1.2 "Documentation" means the user manuals provided by Orcom to its customers with the Software. 1.3 "Updates" ;Beans corrections and modifications to the Software and minor improvements to existing features of the Software that Orcom provides to all of its Software Support customers for no additional license fee. Updates do not include significant modifications to the functions or features of the Software, any modification to the Software for which Orcom charges a separate or additional fee, or any new version of the Software. 1.4 "Software Support" means the software support services offered by Orcoin to Client as described in Section 2. 1.5 "Software License Agreement" means the End -User Software License Agreement between Orcom and Client, incorporated herein by this reference. 1.6 "Person" means any individual, partnership, association, limited liability company, corporation, ti-ust, governmental authority or other entity. 1.7 Capitalized terms not defined in this Section I shall have the meaning set forth in the Software License Agreement. 2. SUPPORTSERVICES 2.1 Description of Software Support Upon receipt and acceptance by Orcoin of Client's order for Software Support, and performance by Client of Cliei}t's obligations under this Agreement and the Software License Agreement, Orcoin shall provide to Client the Software Support. Software Support shall consist of (a) Updates; telephone support pertaining to the operation and use of the then -current release of the Software and the prior release for six months after release of the current release described in Section 2.3, below. Software Support Agreement — Confrdewial Page 1 City ceGadr 2.2 License to Use Updates 2.2.1 All Updates delivered to Client shall be subject to the terms and conditions of the Software License Agreement. Each Update shall be included in the definition of "Software" for purposes of the Software License Agreement. 2.2.2 Client shall install earl) Update oat its IBM AS/400 computer. 2.2.3 Orcom may deliver Updates electronically by telecommunication lines or on magnetic or optical media. Updates may require on-site installation and training by Orcom. 2.2.4 Installation of Updates is not included in the fees for Software Supporl. Subject to the mutual written agreement of Orcom and Client, Orcoin may offer installation services for separate fees under a separate service agreement. 2.3 Telephone Support 2.3.1 Orcom offers telephone support under its "Standard Support Program" eight hours a day, five days a week. Telephone support outside the hours of 8:00 a.m. to 5:00 p.m. U.S. Pacific Time, Monday through Friday, excluding holidays observed by Orcom, are provided by Orcom staff who are "on call" during such hours. The Standard Support Program is limited to 20 hours oftelephone support each month. Orcom shall charge Client at the rate of $150.00 per hour for any telephone support provided to Client by Orcom, which exceeds 20 hours each month. 2.3.2 Telephone support is available in the United States and Canada by a toll-free number. 2.3.3 All telephone support will be provided by Orcom only to Client's personnel who have been trained by Orcom in the operation and use of the Software. 2.3.4 Orcom has no duty to provide telephone support, for any version or release of the Software other than (a) the then -current release and (b) for a period of six months after release of the then -current release, the then most recent prior release. 2.3.5 Orcom has no duty to provide telephone support for any subject other than the operation and use of the Software by Client. 2.4 Limits on Orcom's Software Support Service 2.4.1 Orcom shall have no duty to provide Software Support for any (a) Software that has been modified; (b) Software installed or used on any hardware or software operating system that is not supported by Orcom; (c) any version of the Software other than the then -current release or (for six months after release of the current release) the prior release; (d) Software incorporated into or used with software prograins not described in Orcom user documentation for the Software; or (e) Software that has been relocated to a different geographic location or reinstalled o❑ different hardware or a different software operating system. 2.4.2 Software Support does not include (a) maintenance or support of operating system software; or (b) upgrades of operating system software that may be needed to operate new releases of the Software; or (C) maintenance or support of any hardwarc; or (d) upgrades of hardware that may be needed to operate new releases of the Software; or (e) training; or (f) installation of any Software; or (g) installation ofany Update or new version; or (h) support for any Software that has been modified; or (i) any assistance with any custom library; or 0) time and expenses incurred to visit Client's site. Client is responsible, at Client's expense, for maintaining and acquiring the hardware, operating system software, and other third -party software that Client may need or desire for operation for the Software. Software Supporl Agreement —Colrfidendal Page 2 Cily of Lodi 2.4.3 Software Support does not include any support for any Software that has been modified by Client, by Orcoin, or any other Person. Subject to the mutual agreement of Orcom and Client, Orcoin may offer support foy modified Software or custom libraries on a time and nnaterials basis under a separate service agreement. 3. OBLIGATIONS OF LICENSEE 3.1 Notice of Defects Client shall, in accoi•dancewith Orcom's then -current problem reporting procedures, proinptly notify Orcoin of all defects or nonconformance of the Software and provide Orcom with sufficient information to enable Orcom to reproduce each defector nonconformance. 3.2 Software Manager Client shall provide Orcoin with the name, address, telephone number, fax number and E-mail address of a Software Manager' and an alternate for each designated site. The Software Manager shall be trained regarding the operation and use of the Software. All technical 0011117iunications and materials between Client and Orcoin pursuant to this Agreement shall be made through Client's Software Manager or the designated alternate. 4. SUPPORT FEES 4.1 The annual fee for Support for the Software is set forth in Exhibit A to this Agreement, subject to adjustment pursuant to Section 4.4 of this Agreement. 4.2 The fee for each year of support shall be due and payable in two equal installments. The first installment shall be due and payable on July 1, and the second installment shall be due and payable on December 1. 4.3 Client shall pay all Software Suppoit fees on or before the date on which such payment is due. Any late payment shall be subject to a late charge at the rate of one and one-half percent (1.5%) per rrronth or the highest rate allowed by law, whichever is less, determined and calculated daily from the date due until the date paid. 4.4 After the initial term of this Agreement, Orcoin inay increase the fees for Software Support for the Orcoin Software Modules initially licensed by Client. If Client licenses additional Orcoin Software Modules or new versions of Orcoin Software Modules at any time during the term of this Agreement, or if, during the term of the Agreement, Client's use of the Software exceeds any applicable limitations or restrictions, as set forth in Section 2.1, 2.5, Exhibit B, or elsewhere in the Software License Agreement, and pursuant to Section 2.10, Client shall pay to Orcoin the additional fees applicable to Software Support for such inodules, new versions, or additional use. 5. LIMITATION OF LIABILITY 5.1 Direct Damages ORCOM'S TOTAL LIABILITY FOR DIRECT DAMAGES UNDER THIS AGREEMENT SHALL NOT EXCEED THE AMOUNT RECEIVED BY ORCOM FROM LICENSEE FOR SUPPORT SERVICES UNDER THIS AGREEMENT DURING THE PERIOD OF TWELVE MONTHS' PRIOR TO THE MONTH IN WHICH ORCOM IS NOTIFIED OF THE CLAIM FOR SUCH DAMAGES. 5.2 Consequential Damages ORCOM SHALL NOT BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES ARISING IN ANY WAY OUT OF THIS AGREEMENT, ANY SOFTWARE SUPPORT PROVIDED BY ORCOM, OR THE USE OF THE SOFTWARE OR DOCUMENTATION, HOWEVER CAUSED AND WHETHER ARISING UNDER A THEORY OF CONTRACT, TORT OR ANY OTHER LEGAL THEORY, EVEN IF Software Support Agreement — Confidential Page 3 City of Lodi ORCOM WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THE DAMAGES EXCLUDED BY THIS SECTION SHALL INCLUDE, WITHOUT LIMITATION, DAMAGES FOR LOST PROFITS, LOSS OF DATA, AND COSTS OF PROCUREMENT OF SUBSTITUTE SOFTWARE, GOODS, OR SERVICES. THE LIMITATIONS ON LIABILITY SET FORTH IN THIS SECTION SHALL APPLY NOTWITHSTANDING ANY HOLDING BY ANY COURT THAT ANY OF THE LIMITED REMEDIES SET FORTH IN THIS AGREEMENT MAY HAVE FAILED OF THEIR ESSENTIAL PURPOSE. 53 Construction Orcoin is willing to enter into this Agreement only in consideration of and in reliance upon the provisions of this Agreement that liinit Orcoin's exposure to loss or liability. Such provisions are an essential part of the bargain underlying this Agreement and have been reflected in the support fees and other consideration specified in this Agreement. Both parties understand and agree that the exclusion of wan-andes, limitation of liability and the limitation of remedies allocate risks between the parties as authorized under applicable law. 6. TERM AND TERMINATION 6.1 Term The initial term of this Agreement shall commence on July 1, 2003 and (unless earlier terminated in accordance with the terms of this Agreement) shall end on June 30, 2005. This Agreement shall be automatically renewed for additional terms of two year unless either party notifies the other party, at least 30 days prior to the end of the initial term or any renewal tem), of its intention not to renew this Agreement. Orcom shall have the right not to renew this Agreement for discontinued Software Modules by notifying Client at least GO days prior to the discontinuation of support. 6.2 Termination This Agreement may be terminated by either party upon written notice if the other party breaches any material provision of this Agreement and fails to remedy the breach within thirty (30) days after being given written notice of such breach. Orcom may suspend performance of Software Support in the event that Client fails to pay support fees when due. A default by Client under the Software License Agreeinent shall he deemed to constitute a default by Client under this Agreement. All services to be provided by Orcoin under this Agreement shall automatically terminate in-nue.diately and without further notice upon termination of the Software License Agreement. 63 Effect of Termination Termination of this Agreement will not relieve either party from any liability arising from any breach of this Agreement. Neither party will be liable to the other party or any other person as a result of terminating this Agreement in accordance with its terms. Termination of this Agreement shall not limit the availability of any other right or remedy of either party. In the event that Client fails to renew this Agreement or otheiwise tenninates this Agreement, Orcoin shall discontinue Software Support at the end of the applicable temp. In the event that Software Support are terminated for any reason, Orconi may, at Orcom's sole option, reinstate Software Support if Client pays to Orcoin all applicable support fees, together with a reinstatement charge. 7. MISCELLANEOUS 7.1 Notices Any notice or other communication under this Agreement shall be deemed given if delivered in writing to the intended recipient either in person or mailed by first-class, registered or certified, mail, postage prepaid, to the intended recipient at the address specified below its signature at the end of this Agreement. Either party may change its specified address by giving the other party notice of the change in accordance with this Section. Software SupportAgreeinent — Confidential Page 4 City cf .Lodi 7.2 Relationship of the Parties Neither party hereto shall be deemed an agent, partner, joint venturer, or related entity of the other by reason of this Agreement. Orcoin shall act at all times as an independent contractor, and shall be responsible for any and all social security, unemployment, Worlcers' Compensation and other withholding taxes for any and all of its employees. 7.3 Government Contracts If the Software Support to be provided under this Agreement is supplied in the performance of a goveminent contract or subcontract, those clauses of the applicable government procurement regulation which are mandatorily required by federal statute to be included in government subcontracts shall be incorporated herein by reference. 7A Nonwaiver The failure of either party to insist upon or enforce strict performance of any of the provisions of this Agreement or to exercise any rights or remedies under this Agreement shall not be construed as a waiver or relinquishment to any extent of such party's right to assert or rely upon any such provisions, rights or remedies in that or any other instance; rather, the same shall be and remain in full force and effect. 7.5 Entire Agreement This Agreement (including the Exhibits referenced herein) sets forth the entire agreement, and supersedes any and all prior agreements between the parties regarding the subject matter hereof. No amendment of any provision of this Agreement shall be effective unless set forth in a written instrument signed by the party to be bound thereby. Nothing contained in any purchase order or other document submitted by Client shall in any way modify the terms of this Agreement or add any terms or conditions. 7.6 Severability If any one or more of the provisions or portions of provisions of this Agreement shall be deemed by any court or quasi-judicial authority to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions or portions of provisions contained herein shall not in any way be affected or impaired thereby, so long as the Agreement still expresses the intent of the parties. If the intent of the parties cannot be preserved, this Agreement shall either be renegotiated or rendered null and void. 7.7 Assignment The rights of Client hereunder may not be assigned or transferred, nor the obligations of Client delegated, in whole or in part without the prior written consent of Orcom. Any attempt to so assign, transfer or delegate such rights or obligations shall be voidable at Crcoin's option and shall be cause for Orcom's termination of this Agreement. 7.8 Attorneys' Pees In the event of any action to enforce this Agreement, for interpretation or construction of this Agreement or on account of any breach of or default under this Agreement, the prevailing party in such action shall be entitled to recover, in addition to all other relief, from the other party all reasoiaable costs and attorneys' fees incurred by the prevailing party in connection with such action (including, but not limited to, any appeal thereof). 7.9 Injunctive Relief The panties agree that a material breach of this Agreement adversely affecting Orcom's intellectual property rights in the Software or Documentation would cause irreparable injury to Orcoin for which monetary damages would not be an Software Support Agreement — Confidential Page 5 ON of Lodi adequate remedy. The parties therefore agree that Orcom shall be entitled to equitable relief in addition to any remedies it may have under this Agreement or at law. 7.10 Force Majeure Except for the obligation to make payments under this Agreement, nonperfonuance. of either party shall be excused to Uie extent that perforniance is rendered impossible or convuercially unreasonable by strike, fire, flood, governmental action, failure of suppliers, earthquake, or other season where the failure to perform is beyond the reasonable control of the Donperfonning panty. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized representatives. CITY OF LODI Name: Title: Address: City of Lodi 221 West Pine Street Post Office Box 3006 Lodi, CA 95250 , 1p'empi} ATTEST SUSAN J. BLACKS I UfV City Clerk ORCOM SOL IONS, INC. By: Z ry E. La ince AxecutivOrIce President and CFO Address: Orcom Solutions, Inc. 1001 SW Disk Drive Bend. OR 97102 Softwase Support Agreement —Confidential Page 6 City cf Lodi EXHIBIT A TO SOFTWARE SUPPORT AGREEMENT [Software Support Fee for Each Year] SOFTWARE Orcom's E -CIS Software, Version 5.1.8 STANDARD SOFTWARE SUPPORT FEE FOR EACH YEAR $55,000.00 Client shall pay the standard software support fee for each year in two equal installments, The first installment of $27,500.00 shall be due and payable on or before July 1. The second installinent shall be due and payable on or before December 1. EXHIBIT A to Software Suppoit Agreement—Confidential �.u�of awu• RESOLUTION NO. 2010-94 A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING RENEWAL OF SUPPORT AGREEMENT FOR ELECTRONIC CUSTOMER INFORMATION BILLING SYSTEM WITH VERTEX BUSINESS SERVICES, AND FURTHER GRANTING THE CITY MANAGER AUTHORITY TO APPROVE SUBSEQUENT ANNUAL RENEWALS WHEREAS, the Electronic Customer Information System (ECIS) is one of two mission -critical computer applications operated by the City; and WHEREAS, ECIS is the centerpiece for the City's utility billing activities; and WHEREAS, the ECIS system has a direct relationship to the City's cash flow, and any significant interruption in the ECIS system would have an immediate negative impact on the City's finances, including its ability to render customer bills; and WHEREAS, staff feels it imperative to continue to have a maintenance and support agreement in force for this software; and WHEREAS, staff recommends renewing the support agreement with Vertex Business Systems in the amount of $62,456.62; and WHEREAS staff further recommends granting the City Manager authority to approve subsequent annual renewals. NOW, THEREFORE, BE IT RESOLVED by the Lodi City Council that it does hereby authorize renewal of the Support Agreement for Electronic Customer Information Billing system with Vertex Business Services, and further granting the City Manager authority to approve subsequent annual renewals as required. Date: June 16, 2010 hereby certify that Resolution No. 2010-94 was passed and adopted by the Lodi City Council in a regular meeting held June 16, 2010, by the following vote: AYES: NOES: ABSENT: ABSTAIN: COUNCIL MEMBERS — Hansen, Hitchcock, Johnson, and Mounce COUNCIL MEMBERS — None COUNCIL MEMBERS — Mayor Katzakian COUNCIL MEMBERS— None 2010-94 JOHL City Clerk