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HomeMy WebLinkAbout39- Finance a OF SAN BERNARDINO = REQUEST FOR COUNCIL. ACTION a 017161 FROM: BARBARA PACHON, Subject: PRINT SHOP: INCREASE DIRECTOR OF FINANCE ANNUAL MAINTENANCE PURCHASE ORDER ON XEROX 5090 COPIER DEPT: FINANCE/PURCHASING DIVISION DATE: DECEMBER 9, 1997 Synopsis of.Previous Council action: None Recommended motion: 1 Adopt Resolution. Signature Contact person: Todn P. NUERhy, Purchasing Manager Phone: x5086 Supporting data attached: Ward: Funding Requirements: Amount: Source: Finance: Council Notes: Res 97- ;; f �' Agenda Item No. Z):L � aiislq� STAFF REPORT SUBJECT FY 1997-1998 maintenance contract for Print Shop's Xerox 5090 copier. BACKGROUND At the Council meeting of December 1, 1997, staff was directed to look at replacing the Xerox 5090 in the print shop rather than continue maintenance on the old machine. Three manufacturers who make high speed copiers were asked to provide non-binding planning proposals as if we were going to replace our Xerox 5090. Summarized below are the results of the non-binding proposals projected over two and one half years(see attachment for details): Keep Current Copier Xerox Docutech Xerox 5690 Oce 600&3165NC TOTAL Maint. $56,130 $98,053 $57,196 $23,925 Total Lease 62,400 $77,519 $77,579 $130,500 Total 2 %2 yr cost $ 118,530 175,572 $134,775 $154,425 All high speed copiers need regular maintenance, and it starts from the day a machine is delivered. It is important to note that we will NOT avoid paying maintenance costs by purchasing a new machine. Manufacturers will frequently offer incentives that reduce operating(maintenance)costs in the short term to get you to purchase a new machine. The life of a high speed copier is about seven years. One of the things considered when replacing a machine is how long the manufacturer will guarantee parts/service support. This is usually seven years also. Our machine will be seven years old at the end of the fiscal year. We could not buy a new machine exactly like our current one because it has been replaced with newer technology models. Due to this, the City's long term monthly costs are going to rise by replacing the current machine. In the last two budget cycles,the Print Shop has been considered for privatization. It did NOT make sense to ask Council to approve a major capital expenditure at a time when the activity was being considered for out-sourcing. It also did NOT make good business sense to replace the machine knowing it still had economic life in it. This remaining life can be seen by examining the age of the machine which is approaching seven years and the number of copies. Without a manufacturer's rebuild, these 5090 machines are designed to produce 55 million copies(impressions). We have a total of 35 million copies as of today. We do an annual volume of 5 million based on the past seven years experience. If the current machine was not as old as it is,we still have copier volume remaining which would make you want to keep it even longer. RECOMMENDATION That the Mayor and Common Council authorize the Purchasing Manager to increase Purchase Order 991389 by$20,000 for a fiscal year total of$40,000 to provide copier maintenance for the Print Shop's Xerox 5090 copier. Also, direct the Purchasing Manager to prepare Bids to lease/purchase a new copier for the new fiscal year beginning July 1, 1998. o �� m A# _Lo Lo d( \( co co £ §k kd wQ § N Lo 2 d( §( °Q � cq § § oo � o S ° # coQ cq Lo k od 2 §§ Aa °a Go co w _ 2 ° oln Lo o Lo co m lo co a *.4 ~ §§ § � °# g \ ° � \\ k �� \ as 0 o L6 j w co - ' ~ §§ ] 0 2 F ODQ C-4 04 CV co co C6 OD CD clj co lo Lo 0 U o °m _ i < @ ] 2 U c6 °\ °\ �� o$ c k k °J $ w Lo to c6 co co Lco § § § A | © « §o e \\\ s \ /\ e \ /\ S \ \ e Q :5E � � {\ ° °{\ ` � {\ � �®� cc a2 ) S�� k � a� ) �k) �)) Sk)) ) ƒ)) _ § . / §/§2 _ _ )§§ 9aw� &/« ■■a k co 0 A% 8 Gg i - N IT 04 w LO LO 0 La§ �§ cl # d( \( k 8 ■ - � vi cm em �m 0 U - - � @ E �)ui @ j Q m �m ° r§ qq ) @ S £ Go OD ° � � ) # 00 Cl) o � C)C-4 LO @@ S o ) - - �g c C)k 4§ I k A me kk § k �) k [§ � �M U a cm \ }k C, (7 �§ 4m 2 co j k Go [§ �g vC n� CL j am § j § / § � L� � R � � � �) e W . cE . . . . 7! o2 |p / t ,2 C0 ® �\\ {ff � k�)k k �)\ wB k02M CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION FROM: BARBARA PACHON, Subject: PRINT SHOP: INCREASE DIRECTOR OF FINANCE ANNUAL MAINTENANCE PURCHASE ORDER ON XEROX 5090 COPIER DEPT: FINANCE/PURCHASING DIVISION DATE: OCTOBER 30, 1997 Synopsis of Previous Council action: None NOV 17 1991 Recommended motion: Adopt Resolution. 1 ,Signature Contact person: John P. Murphy, Purchasing Manager Phone: x5086 Supporting data attached: Ward: Funding Requirements: Amount: $20,000.00 Source: 621-123-5172 Finance: Council Notes: Previously - # 1-7/0/h-7 Agenda Item i=� k; // 7 STAFF REPORT SUBJECT FY 1997-1998 maintenance contract for Print Shop's Xerox 5090 copier. BACKGROUND The lease purchase on the Print Shop's Xerox 5090 Copier was completed in FY 1997. Throughout the duration of the lease purchase, the City was required to have Xerox provide maintenance for the copier per the specifications of the lease purchase agreement. However, the lease purchase is now paid in full and the City is contractually free to work with another maintenance vendor. The only other known vendor is Kodak. However, they have no local experience with this type of machine. Due to Kodak's lack of local experience, and the fact that this machine is seven years old and at the end of its economic life, staff does not recommend experimenting with new sources. Staff has also discussed options with Xerox and as a result, Xerox has proposed a less expensive run length maintenance plan based on the actual number of copies generated in a year. The cost of this maintenance agreement, based on current usage levels, is $40,000 annually. Prior to this maintenance agreement, the cost of a flat maintenance agreement with Xerox was approximately $50,000. While staff explored options with Kodak and Xerox, a purchase order for six months of maintenance was issued to Xerox at the beginning of the fiscal year in the amount of$20,000. Council approval is required to extend the contract to twelve months. This copier is more than seven years old and at the end of its economic life. The maintenance call frequency of newer equipment is 1.5 calls per month; this machine averages three calls per month. Additionally, this is the last machine of its type that Xerox maintains in this area. Next year's Print Shop budget request will include the replacement of this machine. RECOMMENDATION That the Mayor and Council authorize the Purchasing Manager to increase Purchase order 991389 by $20,000, from $20,000 to $40,000 to provide copier maintenance for Print Shop's Xerox 5090 copier.