Approval of Public Contract for a Term Exceeding Two Years- Multifunction Business Machine Lease
|Meeting Date:||February 6, 2007||Primary Staff Contact:||Jim Olson|
|Contributing Departments:||Com Dev/Legal||Secondary Staff Contact:||Nancy Slocum|
|Estimate Time:||Consent Agenda|
This action is to request approval from the City Council, as the Local Contract Review Board, to enter into a four year lease for two Xerox multifunction machines at a total four year cost of $35,207.52 (assuming current average monthly usage stays the same).The Public Works Administration, Engineering and Community Development divisions share costs and the use of the copier/fax/printer/scanning machines. The lease agreement exceeds the twenty four month period requiring approval by the LCRB.
The current four year Ikon Office Solutions lease has expired on two Canon multifunction machines at 51 Winburn Way. The cost of the lease was shared by the Public Works Administration, Engineering and Community Development divisions. The current Canon machines were leased just as Community Development, Engineering and Public Works Administration moved into the shared facilities at 51 Winburn Way. At that time it was difficult to determine what the combined usage and needs of the equipment would be. The four year lease offered a testing period to gauge the needs of the building in terms of volume and performance.
In November, 2006, a call for solicitation was sent out to interested companies to replace the smaller front counter machine and the large production machine. With four years of experience as a combined building, the solicitation more fully reflected the current demands. In addition, new technology has made the reproduction and archiving of documents more efficient. Of particular importance was the increased reliance on scanned documents and the need to scan documents quickly and efficiently.
A four year lease term was selected because of significant cost savings from the two or three year lease. There was another cost savings at five years, however, our experience with the current machines indicate there are more maintenance problems with time and an increased likelihood of the technology becoming outdated.
The call for solicitation was offered to Advanced Business Systems, Ikon Office Solutions, Inc., Imagistics and Superior Office Systems. All four potential suppliers responded by submitting quotes.
The qualifications for the smaller multifunction machine included a slightly faster machine to increase the efficiency for front counter customer service with additional paper capacity, envelope printing, the latest technology in scanning (scanning to email and scan to network file) and fax capabilities. The table below compares the current machine with the least expensive comparable model from each bidder. The cost per image varies from month to month depending on usage and is added onto the monthly rental cost.
The new qualifications for the large production machine included a slightly faster machine to increase the efficiency for copying commission packets and other large documents, three-hole punching and the latest technology in scanning (scanning to email and scan to network file). The new machines could not exceed the existing footprint due to space limitations. The table below compares the current machine with the least expensive comparable model from each bidder.
Demonstrations were set up with the ABS, Imagistics and Superior Office Systems machines and since staff is familiar with Canon it was felt a field visit was adequate. Input was received from staff on the use of the machines and also from the IT department on the compatibility of the machines with the current network system. Xerox through Superior Office Systems was not the least expensive, but was less than the recently expired lease, and was the best responsive bidder. The advantages of Xerox over the over bidders are:
Draft leases were circulated to the Legal Department for review and comment. The Legal Department did not have any changes to the lease.
Under the Ashland Municipal Code, the procedures for Intermediate Procurement for Goods and Services for under $75,000 were applicable. As this was an intermediate procurement, it was sent directly to suppliers as a call for solicitation.
The proposed lease agreement was signed by Administrative Services and Finance Director Lee Tuneberg on January 25, 2007 with the condition that the contract could be negated any time within sixty (60) days pending Council approval. This action was necessary to lock in the quoted lease payment which included a trade in value from a machine donated to Xerox. The sales representative offered this trade as part of the lease agreement on the condition that the lease is signed prior to January 31st. Signing the lease before this date saved the City $76 per month ($3,648) in lease payments for the two machines over the next four years. The cancellation clause is stated in attached lease Section 24(B) and in the letter dated January 24, 2007 from Ted Darnall, President, Superior Office Systems (Xerox sales agent).
|Related City Policies:|
AMC Chapter 2.50.015 The Purchasing Contracting Officer is authorized to recommend that the Local Contract Review Board approve or disapprove a contract when the term exceeds twenty-four months.
Under AMC 2.50.020 (A) (ii), the Purchasing Agent shall have the authority to execute a contract without prior Council approval if the contract does not exceed a twenty-four month contract period.
Local Contract Review Board can approve the lease agreement with Superior Office Systems for the four year lease term for two copier/fax/scanner/printer machines for the Community Development, Public Works Administration and Engineering Services Building.
|Staff Recommendation: |
Staff recommends that the public contract be awarded to Superior Office Systems for four year multifunction business machine services.
Council, acting as the Local Contract Review Board, moves to approve the lease agreement with Superior Office Systems for the two copier/fax/printer/scanner machines.
Click on the PDF file below to view the following attachments:
• Draft Lease
• Letter dated January 24, 2007 from Ted Darnall
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