HomeMy WebLinkAbout1984-05-15; City Council; 7752; UPGRADE OF CITY COMPUTER SYSTEMc: u-l g tX a 2
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. I b9 .-,< ",; CIT-~F CARLSBAD - AGEND~ILL
AB# 77 $3 TITLE: DEPT. HI
CITY ATl MTG. 5/15/84
DEPTF CITY MG
RECOMMENDED ACTION:
UPGRADE OF CITY COMPUTER SYSTEM
Adopt Resolution No. zryg , approving the upgrade of the City's computer
appropriating $92,000 from the general fund unappropriated fund balance; and
that $70,000 be included in the Water Department budget to fund completion of
Series 30 lease/purchase agreement for their proport ionate share of computer
costs.
ITEM EXPLANATION: -
City staff is experiencing problems with the City's Hewlett-Packard 3000, Sex We need additional memory and additional disc space. Long waits are often
experienced by users because of insufficient memory. Also, lack of disc spac
operating problems. There is not enough capacity in the existing system to F current applications.
The largest user of the system, to date, is the Finance Department. Current applications include the financial accounting system, payroll, personnel, bu:
licenses, and water billing. Water billing is by far the largest applicatior
system, and there is insufficient capacity to meet existing needs.
The solution to existing problems is to upgrade our current system. It is PC
to expand the capacity of our current system. However, expansion of the cur1
system to its maximum capacity would cost approximately $22,900. That would
the total cost of our current system from $166,000 to $188,900, and would on.
the life of the system by one year.
To meet the needs beyond one year's time, it is desirable to upgrade the sys
Hewlett-Packard 3000, Series 48. Based on current information, the desired
configuration should provide ample memory and disc space for at least the ne:
years.
The total cost (including tax) of the desired system configuration is $104,01
however, Hewlett-Packard is now offering a discount for orders placed before
1984. With the extra discount, the total price (including tax) is $92,000,
of $12,000.
The existing $166,000 system is being purchased on a five year lease purchasl
The City has been paying on this system for about 3 years and still owes ab0
$70,000 before the existing system is paid off. This $70,000 must be paid o the system can be modified. Water billing operations use about 50% of the c of the existing computer system which represents $83,000 of the original tot
of the existing system. Therefore, it is recommended that water funds be us1
off the balance of the purchase agreement.
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PAGE 2 OF ANI yzy&
Payoff of the existing system lease purchase contract should be kept in total
perspective. When the existing computer was originally purchased, it includc
several pieces of hardware such as terminals, disc drive, tape drive, printe. other miscellaneous pieces of hardware. Most of those will remain with the (
be used with the new computer system. Only the Processor and Console would I replaced.
The price from Hewlett-Packard on the new system includes a credit of $8,470
trade-in of the existing Processor and Console.
Another fiscal impact is the maintenance costs for the hardware. Current mor
cost is $878. The monthly cost for the new system is $1,142 - an increase of
per month. The increase, however, is covering additional memory and an addit
tape drive and disc drive. Taking into account the additional memory and ad(
hardware, the maintenance on the new system is reasonable.
FISCAL IMPACT:
The final factor to consider is whether it is better to lease/purchase or bu]
equipment. Generally, if the lease/purchase interest rate is below the exist market rates, it is to the City's advantage to use the lease/purchase option.
The lease/purchase option was analyzed with the assistance of the Finance Dir
and it appears that the leasejpurchase would provide no savings to the City.
Cost of purchasing the new computer system is $92,000, including tax. Cost c
completing the lease/purchase agreement with Bank of America is $70,000, to t
by the Water Department for its proportionate share of usage. The annual inc
cost of maintenance will be $3,168.
ALTERNATIVES:
1.
2. Order the new system this year and include funds in next year's budget fo
Purchase the new system with a 3-year leaselpurchase agreement.
outright purchase.
3. Purchase the new system this year from the general fund unappropriated fu
balance.
EXHIBITS:
1. Resolution No. 799 , approving the upgrade of the City's computer sys
appropriating funds.
2. Memorandum dated April 27, 1984, to City Manager.
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RESOLUTION NO. 7599
A RESOLUTION OF THE CITY COUNCIL W THE CITY OF
CARLSBAD, CALIFORNIA, APPROVING THE UPGRADE OF
THE CITY'S COMPUTER SYSTEM AND APPROPRIATING FUNDS.
WHEREAS, the City's computer system lacks sufficient capacity to hand
current data processing applications; and
WHEREAS, it has been determined that it is necessary .to upgrade the e
computer system in order to meet the on-going data processing needs of th
and
WHEREAS, the water billing operation uses about fifty percent (50%) o
capacity of the existing system; and
WHEREAS, the City has sufficient funds available in the general fund
unappropriated fund balance.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Car
as follows:
1 . That the above recitations are true and correct.
2. Staff is directed to upgrade the Hewlett-Packard, Series 30 to a
48 as configured in the promotion package.
3. Staff is directed to include funds in the Water Department budge
1 fiscal year 1984-85 in the amount of $70,000 to complete the contract wit1 I of America.
4. Council does hereby appropriate $92,000 from the City general fur
unappropriated fund balance for the purchase of the new system.
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meet ing of the - PASSED, APPROVED AND ADOPTED at a reqular
Council of the City of Carlsbad on the 15th day of blc3ty , 1984, t -
following vote, to wit:
AYES:
NOES : None
ABSENT: Council mnber Kulchin
Council bkmkrs Casler, Lewis, Chick and Prescott
9 d/ &k -- Mayor
ATTEST:
&l?Q/zLnLa ALETHA L. RAUTENKRANZ, City Cler6
(SEAL)
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April 27, 1984
TO: FRANK ALESHIRE, City Manager
FROM: Lee Rautenkranz, Central Services Director &
UPGRADE OF HP 3000 COMPUTER SYSTEM
A matter that needs the immediate attention is the status of our Hewlett-Packard
3000, Series 30 computer system. We frequently run out of memory and disc
space.
Shortage of memory causes slow processing time, meaining long waits for users.
We have documented users waiting as long as a minute and a half for a response
to the terminal. Also, I have observed on several occasions as many as four
users being put in a hold for as long as 15 minutes because there is not enough
memory available to run the programs.
be only four of the eight terminals being used.
use, the impact is greater. The waits are longer, thus unproductive time is
significantly increased.
Shortage of disc space causes operational problems.
keep purging files to tape to provide more disc space. To use those files,
then, requires reloading and purging other files.
Another problem occurs due to the lack of disc space. The system will abort a program in the middle of operation when it runs out of disc space,
Even iff no more information was entered into the computer, the system, as is, needs additional memory and additional disc space. However, there is no
feasible way to keep from adding information to the data bases currently
maintained on the computer. Example:
customers on computer in the water billing data base, and that base is growing at approximately 150 customers a month.
I believe there is no question that we need to upgrade our computer system. It
is a necessity. The issue, then, is how we upgrade. There are alternatives.
Alternative 111
First, we could keep the Series 30, and add another 512 kbytes of memory at a
cost of $10,000, which would not increase the trade in value. In addition, the
extra memory would only be sufficient for a maximum of one year's growth on the
system. At that time, we would still need to upgrade. The Series 30 cannot be expanded any further.
We can also add another disc drive to our Series 30. That would give us another 120MB of disc space. The cost is approximately $12,900. too, would be adequate for one or two year's growth, at the most.
These waits occur even though there may
When all eight terminals are in
One problem is that we must
There are now approximately 11,000 water
That extra disc space,
a a
UPGRADE OF HP 3000 COMPUTER SYSTEM
Page 2
Therefore, the total cost of Alternative #I is approximately $22,900, which
would give us one more year on the Series 30.
would increase from $166,000 to $185,900.
Alternative 12
The next system in the HP 3000 line is the Series 42. Based on the maximum
capacity of the Series 42 and the growth of the City, I believe the Series 42
would be a short-term solution. The cost: $60,597.
Alternative 113
The next system in the HP 3000 line after the Series 42 is the Series 48. Base(
on City growth projections, and current information about the data processing
needs of the City, the Series 48 should meet the DP standards of the City for a
minimum of 5 years.
include :
Total investment in the Series 31
The recommended configuration of the Series 48 would
1.
2. 404MB disc drive
3. Magnetic Tape Drive - Model 7974A
Series 48 Processor with 3MB of memory
Actual cost of the desired configuration of the Series 48 is $104,000 including
tax. However, Hewlett-Packard has a special promotion discount in effect for
those upgrading their Series 30 systems. tax, but the order must be placed before 3uly 1, 1984. The savings would
warrant ordering prior to July 1, 1984.
FISCAL INFORMATION:
The cost of the existing Hewlett-Packard Series 30 computer system is $166,003.
It was purchased through the Bank of America on a 60-month lease purchase
agreement. To fulfill the terms on the agreement requires a payment of
$70,000.
The lease/purchase agreement includes several pieces of hardware such as terminals, disc drive, tape drive, printer, and other miscellaneous pieces of
hardware. Those will remain with the City and be used with the Series 48.
the Processor and Console would not stay.
includes $8,470 trade-in credit for those 2 items.
When determining how to fulfill the fiscal obligation of the lease/purchase
agreement with Bank of America for the Series 30, actual computer usage was
examined. The water billing data base comprises slightly more than 50% of the
disc space and processor time.
cost of $166,003 is $83,001.50.
system, it is recommended that the $70,000 to complete the Bank of America
lease/purchase agreement be paid from the Water Department funds.
The promotion price is $86,011.45 pluz
Only
The price from Hewlett-Packard
Therefore, 50% of the total Series 30 system
To pay for their proportionate share of the
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UPGRADE OF HP 3000 COMPUTER SYSTEM
Page 3
The next fiscal consideration is timing of the order. I recommend that the
order be placed prior to 3uly 1, 1984, to take advantage of the discount which
would save $12,895.95 (including tax).
reduced price, and funds could be included in next year's budget to cover the
costs since delivery would not occur until about 4 1/2 months after the order i:
placed.
A third factor is to consider whether it is better to lease/purchase or to buy
equipment.
market rates, it is to the City's advantage to use the lease/purchase option.
Hewlett-Packard offers a lease/purchase agreement priced at 9.5% interest rate.
The City investment pool presently earns 10% to 12%.
Total cost of hardware (including sales tax) is $91,172.
proposal at 10 1/2% is $90,781.
least 10 1/2% per year for the next three years.)
Placing the order will lock in the
Generally, if the leasejpurchase interest rate is below the existin!
Present value of the
(This assumes the City investments will earn a'
Total cash price for system Present value of HP proposal to the City Net savings to City over 3 years
$91,172 -*
The minimal savings of $391 would probably be eliminated when considering the cost of issuing a warrant every month for 3 years. There is, therefore, no real
savings which would be realized with the lease/purchase option.
The final fiscal impact deals with on-going maintenance costs for the hardware.
Current monthly maintenance costs are $878.
the upgrade to the Series 48 is $1,142 - an increase of $264 per month.
increase, however, covers the additional memory, tape drive, and disc drive.
ALTERNATIVES
I.
2.
The monthly maintenance costs for
That
Purchase the new system with a 3-year leaselpurchase agreement.
Order the new system this year and include funds in next year's budget for
outright purchase.
3. Purchase the new system this year from the general fund unappropriated fund
balance.
SUMMARY OF RECOMMENDATION
It is recommended that we upgrade our Hewlett-Packard, Series 30 computer system
to a Series 48. The order should be placed prior to 3uly 1 , 1984, to take
advantage of the promotion savings. The funds for the purchase of the upgrade
in the amount of $92,000 are available in the general fund unappropriated fund
balance.
be included in the budget of the Water Department to pay their proportionate
share of system usage.
The $70,000 required to complete the contract for the Series 30 should