City of Culver City, California
City Council Agenda Item Report
RECOMMENDATION:
That the City Council approve entering into a five-year telecommunications
maintenance and repair contract with Standard Tel, Inc. not to exceed $219,800.
Funding for the contract will be appropriated in account 310-16100-512410.
BACKGROUND:
In 1994, the City contracted with Phoneby, a telephone vendor, to install a new
telecommunications system at all City facilities. The telecommunications system
included telephone equipment manufactured by Mitel, and an Octel VMX voice
mail system. Phoneby, however, never completed the system installation.
Following a number of installation problems and attempts at problem resolution,
the City terminated its contract with Phoneby. Subsequently, staff issued a
Request for Proposal (RFP) for the completion of the telecommunications
installation and a multi-year contract for the system’s maintenance. The vendor
selected was Standard Tel, Inc. In 1996 the City entered into a five-year
maintenance and repair contract with Standard Tel. After a competitive RFP
process, a second five year contract was awarded to Standard Tel in 2001.
Over the past ten years, Standard Tel has been award the maintenance and repair
contract twice. They have performed in a satisfactory manner in the repair and
replacement of failed telecommunications equipment. Standard Tel has also acted
as the supplier for new components such as telephone sets and the line cards that
support them. The city’s telecommunications system has grown from an initial
1,120 ports to approximately 1,800, primarily as a result of the Transportation,
Public Services and Police Department construction projects. As the
Meeting Date: 05/22/06 Item Number: A-10
AGENDA ITEM:
Authorization to enter into a five-year contract with Standard Tel, Inc. for maintenance
and repair of the City’s telecommunications equipment.
Contact Person/Dept.: Ruben Arellano Phone Number: (310) 253-5956
Fiscal Impact: Yes [x] No [] General Fund: Yes [x] No []
Public Hearing: [] Action Item: [x] Attachments: [x]
Public Notification: Master Notification List (05/18/06) and Standard Tel, Inc. (Nina
Harper 05/11/06)
Department Approval:
John Richo (05/11/06)
CAO Approval: Martin R. Cole for Jerry
B. Fulwood (05/18/06)
City Controller Approval: Marlee Chang
(05/18/06)City of Culver City, California
City Council Agenda Item Report
telecommunications system has grown, Standard Tel has worked well with staff in
planning the voice and data needs for building construction projects.
The existing five-year maintenance and repair contract expires on June 30, 2006.
DISCUSSION:
Under the maintenance and repair contract, all repairs of failed hardware and
software components within the telecommunications system, including telephone
sets, are repaired or replaced at no charge to the City. Any labor involved to
perform such repairs is also included with the contract, unless it falls outside of
normal business hours. On rare occasions, the vendor is asked to perform
programming changes to the system, and/or Moves, Adds and Changes (MACs) of
equipment. These activities are outside the scope of repairs, and are billable to
the City. The City also purchases new telecommunications equipment, such as
telephone sets and line cards that support them on an as needed basis from the
maintaining vendor. These new equipment purchases are billable to the City and
come with a one-year warranty. Upon their annual anniversary, new equipment is
incorporated into the existing repair and maintenance contract.
This repair and maintenance agreement for the City’s telecommunications network
does not include public safety (9-1-1 Dispatch) telecommunications equipment,
which is covered under a 24/7 repair contract managed by the Police Department.
On March 30, 2006 a Request for Proposal was sent to local authorized Mitel Elite
and Platinum dealers as well as advertised in the local newspaper and posted on
the City’s website for download. The Request for Proposal asked for three and five
year contracts with Business Day and 24/7 repair coverage options. The vendors
were given approximately one month to prepare and submit their proposals.
Eighteen prospective vendors downloaded the Request for Proposal from the
City’s website.
A meeting was held on April 12, 2006 to answer any questions the Request for
Proposal may have generated and to inspect the City’s telecommunications
equipment. Six prospective vendors attended the inspection meeting.
On April 27, 2006 two vendors, Blue Violet and Standard Tel submitted formal
proposals by the RFP deadline. City of Culver City, California
City Council Agenda Item Report
The following is a comparative summary of Blue Violet and Standard Tel’s
proposals:
A. Repair and Maintenance Cost:
When a telephone set, fax or modem extension is installed anywhere within the
telecommunications network, it is connected to its own port on the system.
Line cards (each typically has 16 ports) are installed within the phone switch
cabinetry, providing support for a combination of 16 telephones, fax or
modems.
Staff recommends a 5-year Business Day repair contract, which is discussed in
the Vendor Comparisons section of this report:
Business Day 24/7 Coverage
3 year 5 year 3 year 5 year
Blue Violet No Bid No Bid $52,800 $52,800
Standard Tel $42,960 $36,960 $54,960 $48,960
B. Cost of Equipment Components:
As the City’s telecommunications needs grow, it becomes necessary to
purchase additional equipment. The following is a list of those equipment
components most commonly used. These prices are based on a five-year
maintenance contract:
Most Common Items Purchased Blue Violet Standard Tel
ONS Analog Line Card (16 Port) $2,000.00 $1,238.33
OPS Off-Premise Analog Card (8 port) $2,251.00 $1,780.17
DNI Digital Line Card (16 port) $1,350.00 $936.64
Superset 4001 Telephone Set $110.00 $80.53
Superset 4015 Telephone Set $165.00 $136.29
Superset 4025 Backlit Telephone $265.00 $201.32
Superset 4150 Backlit Telephone $395.00 $303.10City of Culver City, California
City Council Agenda Item Report
C. Labor Rates for Billable Activities:
Parts and labor costs are covered for repairs. The City occasionally asks the
maintaining vendor to aid in Moves, Adds and Changes (MACs), which are
billable. It should be noted that since 1997, City staff (IT Telecommunications
Analyst) has performed approximately 95% of all the software programming
and physical modifications necessary on the telecommunications network. As
a result, billable activities are kept at a minimum and have not exceeded
$10,000 per year. In the event that the vendor is asked to perform the services,
the following (based on a five year maintenance contract) rates would apply:
Business Day *
5 year Labor Rates
Blue Violet Standard Tel
Technician on-site 1
st
hour $185.00 $144.00
Each additional hour $135.00 $96.00
Remote Technician ^ $95.00 $96.00
* Denotes work performed during business hours, which is historically 90% of
all billable requests made by the city.
^ Remote is defined as programming performed via modem.
D. Vendor Comparisons:
1. Vendor Staffing:
Blue Violet and Standard Tel maintain nearly identical numbers of support
staff (approximately 30) and Mitel factory trained technicians (approximately
10) on duty in the greater Los Angeles/Orange County area. Standard Tel
does have offices in the San Diego and Sacramento area that would allow
them to reallocate resources if required. This ensures that the City will
maintain its required two-hour emergency repair response time.
Blue Violet does have factory certified staff that supports the Octel-VMX
voice mail system. Standard Tel support staff are not factory certified on the
voice mail system but are very knowledgeable and in the past have
demonstrated the skills required to maintain the Octel-VMX. The Octel-
VMX voice mail system is no longer a factory support item and should be City of Culver City, California
City Council Agenda Item Report
considered for replacement in the near future due to possible problems
acquiring replacement parts.
As the repair and maintenance incumbent, Standard Tel has intimate
knowledge of the City’s complex telecommunications network.
The City has been satisfied with Standard Tel’s performance and has built a
good relationship with them over the past ten years.
2. Business Day versus 24/7 repair coverage options:
Repairs conducted outside of normal business hours are rare and the
additional expense far exceeds the benefit of electing a 24/7 coverage
option.
3. Three years versus five years:
Standard Tel’s five-year option saves the City $6,000.00 per year or
$30,000.00 over the term of the agreement compared to the three-year
option.
4. Comparison of Standard Tel’s old five-year contract to the new five-year
contract:
The proposed Standard Tel contract reduces equipment purchase prices by
approximately 2%. Per-port fees are reduced by 13%. Labor rates will
remain the same for services mostly commonly requested, and the
maximum allowable labor rate increase will be tied to the CPI. Staff
estimates an $80,525 saving over the prior contract (See Attachment A)
As a result of these comparisons and considerations, staff recommends
entering into a five-year Business-Day maintenance and repair contract with
Standard Tel not to exceed $219,800, calculated as follows:
Per Year Extended 5 Years
Repair/Maintenance $36,960 $184,800
New Equipment Maintenance $2,000 $10,000
Equipment Purchases $5,000 $25,000
Total $43,960 $219,800City of Culver City, California
City Council Agenda Item Report
FISCAL ANALYSIS:
Funds for the maintenance and repair contract are budgeted and available from
the telecommunications account number 310-16100-512410 of the general fund.
One fifth of the contract amount is budgeted annually.
ATTACHMENTS:
Exhibit A – Standard Tel New and Old Contract Comparison
MOTION:
That the City Council:
1. Award a five-year contract to Standard Tel for the maintenance and repair of
the City’s telecommunications systems not to exceed $219,800 from the
“Stores Non-departmental Telephone” fund (31016100.512410), and
2. Authorize the City Attorney to prepare the appropriate contract, and
3. Authorize the Chief Administrative Officer to execute the contract on behalf of
the City; and
4. Authorize the Information Technology Director to add or remove parts covered
under the contract as needed to expand or decrease services, and
5. Authorize the Information Technology Director to increase the Standard Tel
maintenance and repair contract by an amount not to exceed 10% of the
contract, if deemed advisable by the Information Technology Director.
MEETING DATE 5/22/06
AGENDA ITEM
Authorization to enter into a five-year contract with
Standard Tel, Inc for maintenance and repair of the City's
telecommunications equipment
ATTACHMENTS
Pages
1 Standard Tel Old and New Contract Comparison 1-3Attachment A
Standard Tel Old and New Contract Comparison
The following are highlights of the new five-year Standard Tel contract in
comparison to the old five-year contract
A Repair and Maintenance Costs
First year maintenance, compared to prior year The new contract
reflects a minimum $62 925 savings over the term of the agreement
Old Contract per year $49 545
New Contract Year $36 960
Yearly Savings $12,585
Additiona Equipment Maintenance
Old Contract $1 73 per port, per month
New Contract $1 50 per port, per month
The new contract includes structured voice and data cabling and
Uninterruptible Power Supply (UPS) batteries The City anticipates
seven such battery units will require replacement over the coming 5-
year term, an anticipated $12,600 in savings
B Equipment Cost Comparisons
Historically, the city purchases approximately $5,000 per year in new
equipment The Standard Tel pricing structure reflects Mitel s GSA
pricing structure (Government Service Account) This has not changed
dramatically since the previous contract was also GSA price structure
and cost savings due to purchases will be minimal under the new
contract Listed are the most commonly purchased hardware
components
Component Old Prices New Prices % Change
ONS Line Card (16) 1 248 05 1238 33 -1%
OPS Line Card (8) 1,405 37 1780 17 +26%
DNI Line Card (16) 943 90 936 64 -1%
Superset 4001 79 44 80 53 -1%
Superset 4015 155 50 136 29 -12%
Superset 4025 Backlit 202 50 201 32 -1%
Superset 4150 Backlit 365 77 303 10 -17%
Wel RFP 1326 Attachment A doc 05/11/06
Page 1 of 3C Labor Rate Comparisons
Labor rates are unchanged from the old contract
Standard Tel old rates Standard Tel new rates
Technician on-site, 1 st hour $ 144
Each additional hour $ 96
Technician on-site, 1 st hour $ 144
Each additional hour $ 96
Remote Technician, hourly $ 96 Remote Technician hourly $ 96
Summary
Staff estimates that the new contract will save approximately $80,525 over
the term of the agreement versus the old contract, calculated as follows
Maintenance and Repair Reduction $12,585/yr X 5 years = $62,925
New Equipment Purchase Reduction $1,000/yr X 5 years = $5,000
UPS Battery Replacements $2,520/yr X 5 years = $12,600
TOTAL 5 YEAR SAVINGS. $80,525
Recommendations
The Mitel SX-2000 PBX is a legacy TDM PBX product that although has not
been sunsetted Wel and other PBX vendors are shifting to development of
Voice over Internet Protocol (VolP) based systems VolP technology
integrates voice communications with the data network, voice mail, faxes, and
video conferencing/collaboration in other words, voice and data
convergence A possible application for the City is Customer/Client/Citizen
Relations Management (CRM) The City has Wel SX-2000 s at City Hall,
Police Department Transportation and the Veterans Memorial Complex
The Mitel SX-200 PBX s located at Fire Stations 2 and 3 are no longer
supported by the manufacturer The SX-200 is supported by our current PBX
vendor though parts will become harder to acquire as time passes
The Octel VMX-200 voice mail system is no longer supported by the
manufacturer, Avaya Software updates/upgrades and expansion hardware
are non-existent This voice mail system is antiquated by today s standards
and may put the City in a precarious position in case of catastrophic failure
Mite! RFP 1326 Attachment A doc 05/11/06
Page 2 of 3Staff recommends allocating funds for replacement/upgrading of systems no
longer supported by manufacturers and to position the City for emerging
communications standards involving VolP
Mite! RFP 1326 Attachment A doc 05/11/06
Page 3 of 3