Title
The Board of Water Commissioners for the City of Detroit, Water and Sewerage Department authorizes the Director to approve DWSD’s portion of the City-wide Contract No. 6003725 with Oracle America, Inc., for Oracle Cloud SaaS Licensing for a total contract not-to-exceed amount of $425,000 and a term of three and a half years. This also authorizes the Director to take such other action as may be necessary to accomplish the intent of this vote.
Body
Agenda of August 18, 2021
Item No. 21-0567
Contract No.: 6003725
Contractor: Oracle America, Inc.
Proposed Contract Amount: $425,000.00
Proposed Current Contract Term: 7/31/21 - 1/16/25
TO: The Honorable
Board of Water Commissioners
City of Detroit, Michigan
FROM: Gary Brown, Director
Detroit Water and Sewerage Department
RE: DWSD’s portion of the City-wide Contract 6003725
New contract with Oracle America, Inc., for Oracle Cloud SaaS Licensing
MOTION
Upon recommendation of Mamata Burgi, Operations Resource Manager, the Board of Water Commissioners for the City of Detroit, Water and Sewerage Department, authorizes the Director to approve DWSD’s portion of the City-wide Contract No. 6003725 with Oracle America, Inc., for Oracle Cloud SaaS Licensing for a total contract not-to-exceed amount of $425,000 and a term of three and a half years. This also authorizes the Director to take such other action as may be necessary to accomplish the intent of this vote.
BACKGROUND & JUSTIFICATION
DWSD currently uses the City of Detroit’s instance of Oracle FUSION ERP for financial management and GLWA’s instance of Oracle WAM for Inventory and Supply Chain Management. As part of DWSD’s effort to separate from GLWA, the GLWA provided services are being migrated to DWSD supported services or replaced with COD supported services. DWSD is planning to replace Oracle WAM with Oracle Supply Chain, a module of Oracle FUSION.
In 2019, DWSD IT and Procurement recommended that DWSD implement Oracle Supply Chain for several reasons. First, because Oracle Supply Chain is a module of FUSION, it is natively compatible and integrates without the need for custom integrations thereby reducing support costs. Second, support for Oracle Supply Chain will be provided by the same City of Detroit contractor that supports FUSION. This ensures compatibility and upgrades will continue to be reviewed, tested and implemented in a timely fashion by individuals who know the system. Third, because Oracle Supply Chain is a module of FUSION, it will streamline business processes and seamlessly integrate with the City’s General Ledger and existing procurement processes.
Oracle Supply Chain is made up of 2 licenses. Supply Chain Planning handles the forecasting and planning aspects while Supply Chain Execution handles the warehousing functions. The expected cost of licenses during the term of this contract is $411,321.05 and is broken out below by fiscal year. A contingency of ~3.3% or $13,678.95 has been added in order to account for possible additional licenses due to changes in staffing or processes. This reflects a total spend of $425,000.00 over the life of the contract. The reduced cost in FY 25 is due to the contract expiring on January 16th 2025, midway through the year.
|
|
FY 22 |
FY 23 |
FY 24 |
FY 25 |
|
Supply Chain Execution |
$ 57,330.00 |
$ 57,330.00 |
$ 57,330.00 |
$ 31,593.15 |
|
Supply Chain Planning |
$ 58,500.00 |
$ 58,500.00 |
$ 58,500.00 |
$ 32,237.90 |
|
Contingency |
$ 4,170.00 |
$ 4,170.00 |
$ 4,170.00 |
$ 1,168.95 |
|
Totals |
$ 120,000.00 |
$ 120,000.00 |
$ 120,000.00 |
$ 65,000.00 |
Then annual license charge is $115,830.00 with a contingency of $4,170 for the number of users currently identified. The cost is fixed for the term of the contract but will increase if changes to existing DWSD staffing or business process requires additional licenses.
PROCUREMENT METHOD
This city-wide contract is being procured via a Single Source Exception to Competitive Solicitation (ECS). The City Council has approved the contract on 7/27/2021.
Requisition #489719 for DWSD’s portion of this contract was approved on 07/26/21.
Oracle’s clearances are currently valid and will expire on 01/05/2022
SUMMARY
A. Contract No.: 6003725
B. Contractor: Oracle America, Inc.
C. Contract Amount: $425,000
D. Contract Term: 7/31/21 - 1/16/25
E. Funding Source: O&M Funds
F. GL String(s):
5720-20168-483301-622302-000205-10790-0000-000000- 30% Water
5820-20179-493301-622302-000226-15805-0000-000000- 70 % Sewer
G. Fiscal Year Breakdown: FY 21-22: $120,000
FY 22-23: $120,000
FY 23-24: $120,000
FY 24-25: $65,000
This proposed contract was presented to the DWSD Finance Committee on August 4th, 2021. Per DWSD Procurement Policy, there are no other approvals required.