ACTION REQUESTED:
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Communication from the City Manager and Finance Director/Comptroller with a Request to Authorize the City Manager to Negotiate and Execute CONTRACT EXTENSIONS with Current City VENDORS in Exchange for Discounted Pricing, for Any Contract with an Annual Cost of $250,000 or Less.
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BACKGROUND:
For fiscal years 2012 and 2013, the City Council granted the City Manager the authority to execute contract extensions for City vendors in exchange for discounted pricing. This effort has been successful.
As staff enters into the FY2014 budget, which kept contractual services budgets at minimal growth over 2013, this tool can once again be helpful in containing cost. The Administration is seeking authorization to approach City service providers with a request to reduce current and future contact amounts in exchange for an additional year of guaranteed contract length.
The approved FY2014 budget includes $19 million in the "Contractual Services" portion of the operating budget. The list of services is very broad, ranging from the City's multi-million dollar contract for residential refuse collection to a $1,600 contract for document shredding. Most of these services are provided for a fixed fee and on an annual basis. Some, such as the garbage contract, are multi-year contracts. A small number of contracts are unit based, such as "per hour" for legal services or "per square foot" or "per lot" for environmental clean-up (Code Enforcement).
If authorization is granted, the City Manager and the Finance Director will work with each Department Head to determine which contracts might be potential targets for an extension in exchange for a discount. Consideration will be given in the following areas:
1. Is the City happy with the service offered by the vendor?
2. Is there an option other than this particular vendor? Many software agreements held by the City (i.e. Microsoft) have no realistic alternative.
3. Might the City save more...
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