STATEMENT OF ISSUE

The City currently leases two Xerox high capacity printers to produce approximately 1.3 million utility statements each year. The current sixty-month lease for these printers is scheduled to end on June 30, 2009. The Utility Business and Customer Services (UBCS) and Information System Services (ISS) departments worked in a cooperative manner to identify a suitable replacement for this equipment that would reduce cost, and be highly reliable. Xerox’s newer line of high capacity printers uses a newer technology that enables them to produce a high quality product with a much smaller unit. Additionally, these printers are more reliable and are easier to maintain.

UBCS is requesting the Commission’s approval to enter into a sixty-month lease agreement with Xerox for two Xerox 4127 printers to replace the existing printers using Marion County (FL) contract # 3029JD, with for a monthly expense of $6,289.28 (equipment $5,403.44/month, plus maintenance and supplies $885.84/month). This results in a net savings to the City of $52,304 annually in comparison to the current lease.

RECOMMENDED ACTION

Option 1 - Authorize UBCS to enter into a new lease with Xerox Corp. for two Xerox 4127 printers including hardware, software, training and other support services from Marion County Contract # 3029JD, for a sixty-month lease rate of $75,471 per year ($377,356.80 5-year term).

FISCAL IMPACT

The recommended action is projected to result in an annual savings of $52,304 each year ($261,522.00/5-year term), in comparison to the current lease.

Reese Goad, Director, Utility Business & Customer Services

Anita Favors Thompson, City Manager

For information, please contact: Matt Matherne 891-6184

SUPPLEMENTAL MATERIAL/ISSUE ANALYSIS
HISTORY/FACTS & ISSUES

The City currently leases two Xerox high capacity printers to produce approximately 1.3 million utility statements each year. In June of 2004, ISS replaced two Xerox 92C printers with a Xerox DP100 and a Xerox DP90 for this function. The end of that lease is now at hand and technology has continued to advance. To improve operational efficiency, commensurate with the expiration of the current printer lease and the acquisition of new printers, the printing of the utility statements and related reports will be moved to the Utility Business & Customer Services facility located in the Gemini building. It will now be performed in the same facility as the statement folding, stuffing and mailing operations. This has long been desirable, but was delayed due to the physical size of the printers. Xerox’s new printers the 4127’s, have a smaller footprint than our current units and will fit nicely in the UBCS billing preparation area.

The Xerox 4127 printers being proposed are more technologically advanced thus providing greater reliability and ease of maintenance while producing the high quality print image required for utility billing. The Xerox 4127 printers also cost less and this change will result in a savings to the City of $52,304 each year ($261,522.00/5-year term).

The Office of Budget and Policy and the Procurement Division have reviewed this item and concur with the recommended action.

CHARITABLE CONTRIBUTIONS

N/A

OPTIONS

Option 1 - Authorize UBCS to enter into a new lease with Xerox Corp. for two Xerox 4127 printers including hardware, software, training and other support services from Marion County Contract # 3029JD, for a sixty-month lease rate of $75,471 per year ($377,356.80 5-year term).

PROS:
• Save the City $52,304 each year ($261,522.00/5-year term).
• Consolidate utility bill printing, folding, and stuffing in a single location.
• Utilize newer, more reliable and more efficient technology.

CONS:
• Even newer and more advanced technology may be available in the future.

Option 2 – Extend the current lease on a month-to-month basis.

PROS:
• Save staff time and effort required to migrate to a new printer.
• Current printers have performed well.

CONS:
• Will not save the City $4,358.70 per month.
• Bill production consolidation in a single location cannot happen.

Option 3 – Direct UBCS to continue to investigate other alternatives.

PROS:
• Xerox may introduce an even better printer in the future.
• Other printer manufacturers may introduce a competitive high capacity unit.

CONS:
• The City would not save $4,358.70 per month.
• Bill production consolidation in a single location cannot happen.

ATTACHMENTS/REFERENCES

None