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TO: Mayor Richard Irvin
FROM: Michael Pegues, CIO
Jeff Anderson, Deputy CIO
DATE: March 14, 2024
SUBJECT:
Resolution to enter into a three-year Enterprise Agreement for the purchase of Microsoft software from the State of Illinois Department of Innovation and Technology Joint Purchasing Contract CMT #1176800 with Dell Marketing L.P. in an amount of $1,889,555.20.
PURPOSE:
The Information Technology Department requests authority to purchase a three-year renewal of Microsoft Enterprise and Select licenses from Dell Marketing L.P. (Dell). This Microsoft Enterprise Agreement (EA) purchase will include licenses and software assurance for previously covered applications and Office 365.
This purchase will renew Microsoft desktop operating system licenses for computing devices (desktop computers, laptops, tablets and smart phones) currently utilized by staff city-wide, for email and the suite of Microsoft Office 365 products. Also included in this purchase is Microsoft enterprise licensing SQL Database licenses SharePoint Server, Data Center and System Configuration Manager licensing.
BACKGROUND:
The City has used an EA to license and manage Microsoft software since at least 2014. The EA is offered through Microsoft and administered by approved partners to sell and support Microsoft products as Microsoft does not sell directly to the public. An EA streamlines license management within the City, simplifies purchasing and provides for predictable payments throughout the agreement. Under an EA, the costs for both maintenance and new purchases are spread out over the three years of the contract term. Prices are also locked for the term of the contract and updates to software are included in the EA at no additional cost through the Microsoft Software Assurance program, which provides for technical support, training and planning services.
The State of Illinois holds a Microsoft Licensing Solutions Provider (LSP) Statewide Master Contract which provides government pricing levels on all Microsoft products that has been awarded to Dell, a Microsoft Licensing Solutions Partner. Through the State contract, the City is provided a level of pricing and service which is comparable to the pricing provided to commercial customers who license 15,000 or more users.
DISCUSSION:
The City's current EA was renewed by City Council via R21-075 for $1,237,190.52. Subsequently, R22-028 was approved by City Council to add security licenses for all employees which increased by $118,536.00 over the last 2 years of the previous EA for a total of $1,474,262.52 for the previous EA.
Annual increases in license usage are reconciled at the end of each year of the EA in a "true-up" transaction. The third-year true-up for the previous EA include costs for increased Microsoft Office licenses as it was determined that all city staff should be licensed for improved communications for to staff members. Also included in this true-up are Azure costs for monthly usage of Microsoft cloud services that support public-facing services like the City's Open Data portal.
These costs are listed separately from the new EA and are as follows:
|
Increased Microsoft Office licenses |
$72,080.53 |
|
Azure cloud usage |
$44,173.41 |
|
Total Year 3 True-Up |
$116,253.94 |
As part of the new EA renewal process, city IT staff worked with city Departments to identify those employees who utilize a shared computer or access city services only through city-assigned smart phones. This effort identified 383 employees. With the new EA, city IT staff worked with Dell to utilize the new less expensive "frontline worker" license which decreased the city's user license costs by 29% for each of the next three years which equates to an annual cost avoidance of $109,000 or $327,000 for the three-year EA.
Therefore, yearly request for this new EA are below
|
Year |
Annual Fee |
Previous EA True-Up |
Total |
|
Year 1 |
$591,100.42 |
$116,253.94 |
$707,354.36 |
|
Year 2 |
$591,100.42 |
|
$591,100.42 |
|
Year 3 |
$591,100.42 |
|
$591,100.42 |
|
Total |
|
|
$1,889,555.20 |
This represents a 9% increase over the last two years of the previous EA
A budget amendment has been requested to provide the additional $543,737.20 for this item in account no. 101-1280-419.38.11 (General Fund).
IMPACT STATEMENT:
As part of the City of Aurora Technology Strategic Plan or “IT Roadmap” for 2019, the Information Technology Division is seeking to evaluate and improve efficiency throughout the organization. This purchase is aligned with the Strategic Plan.
RECOMMENDATIONS:
That the proposed resolution be adopted.
cc: Finance Committee
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
title
A Resolution to enter into a three-year Enterprise Agreement for the purchase of Microsoft software from the State of Illinois Department of Innovation and Technology Joint Purchasing Contract CMT #1176800 with Dell Marketing L.P. in an amount of $1,889,555.20.
body
WHEREAS, the City of Aurora has a population of more than 25,000 persons and is, therefore, a home rule unit under subsection (a) of Section 6 of Article VII of the Illinois Constitution of 1970; and
WHEREAS, subject to said Section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs for the protection of the public health, safety, morals, and welfare; and
WHEREAS, Microsoft software products are used by all city staff for services including email, anti-virus and office productivity software; and
WHEREAS, the State of Illinois holds a Microsoft Licensing Solutions Provider (LSP) Statewide Master Contract which provides government pricing levels on all Microsoft products that has been awarded to Dell, a Microsoft Licensing Solutions Partner; and
WHEREAS, an amendment to the 2024 City Budget has been requested to provide the additional $543,737.20 for this item in account no. 101-1280-419.38.11 (General Fund).
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows: the Director of Purchasing is hereby authorized to purchase a three-year Enterprise Agreement for the purchase of Microsoft software from the State of Illinois Department of Innovation and Technology Joint Purchasing Contract CMT #1176800 with Dell Marketing L.P. in an amount of $1,889,555.20.