Title
MOTION TO APPROVE THE CHANGE ORDER FOR THE PURCHASE OF ADDITIONAL AGENT LICENSING FOR FRESHSERVICE IT SERVICE MANAGEMENT (ITSM) IN THE AMOUNT NOT TO EXCEED $26,185.64 FROM FRESHWORKS, INC, PURSUANT TO SECTIONS 35.18(C)(7)(H), 35.18(C)(7)(I), AND 35.28(B) OF THE CITY'S CODE OF ORDINANCES.
Summary Explanation and Background
PROCUREMENT PROCESS TAKEN:
- Chapter 35 of the City’s Code of Ordinance is titled “PROCUREMENT PROCEDURES, PUBLIC FUNDS.”
- Section 35.18 of the City's Code of Ordinances is titled "COMPETITIVE BIDDING OR COMPETITIVE PROPOSALS REQUIRED; EXCEPTIONS."
- Section 35.18(C) states that "Only the following situations are exempt from the competitive bid and competitive proposal requirements of this section:"
- Section 35.18(C)(7)(h) states, “Copyrighted materials, including computer software;”
- Section 35.18(C)(7)(i) states, “Software licensing and maintenance with the company from which the software was purchased, or its authorized representative;”
- Section 35.21 of the City's Code of Ordinances is titled "AWARD OF CONTRACT."
- Section 35.21(A) of the City's Code of Ordinances is titled "City Commission approval.
- Section 35.21(A)(1) states, "An initial purchase of, or contract for, commodities or services, in excess of $25,000, shall require the approval of the City Commission, regardless of whether the competitive bidding or competitive proposal procedures were followed."
- Section 35.15 defines CHANGE ORDER. "Changes, due to unanticipated conditions or developments, made to an executory contract, which do not substantially alter the character of the work contracted for, and which do not vary so substantially from the original specifications as to constitute a new undertaking. The changes must reasonably and conscientiously be viewed as being in fulfillment of the original scope of the contract rather than as departing therefrom. Further, the changes, when viewed against the background of the work described in the contract and the language used in the specifications, must clearly be directed either to the achievement of a more satisfactory result or the elimination of work not necessary to the satisfactory completion of the contract."
- Section 35.28 of the City's Code of Ordinances is titled "CHANGE ORDERS."
- Section 35.28(B) states that "Notwithstanding the provisions of (A) above, the City Manager is not authorized to approve a change order without authorization of the City Commission where the initial purchase required the City Commission's approval and where the sum of all change orders issued under the contract exceeds 5% of the original contract amount or $25,000."
SUMMARY EXPLANATION AND BACKGROUND:
1. On April 19, 2023, City Commission approved the purchase of FreshService IT Service Management (ITSM) Helpdesk Software in the amount not to exceed $155,550 for a three-year period from Freshworks, Inc., as outlined below:
|
Description |
Unit Price |
Months |
Qty. |
Total Cost |
|
Implementation Cost |
$18,750.00 |
N/A |
1 |
$ 18,750.00 |
|
Annual Cost - 4/20/23 to 4/19/24 |
$ 76.00 |
12 |
50 |
$ 45,600.00 |
|
Annual Cost - 4/20/24 to 4/19/25 |
$ 76.00 |
12 |
50 |
$ 45,600.00 |
|
Annual Cost - 4/20/25 to 4/19/26 |
$ 76.00 |
12 |
50 |
$ 45,600.00 |
|
|
|
|
|
$155,550.00 |
2. Freshservice is a cloud-based IT service management (ITSM) software offered by Freshworks. It is designed to streamline IT operations and provide a centralized platform for managing IT tickets, assets, and services.
3. Some of the key features of Freshservice include:
a. Service catalog: Create a centralized catalog of IT services offered to employees and customers, including details such as pricing, availability, and service level agreements (SLAs).
b. Self-service portal: Empower end-users to resolve common IT issues themselves through an intuitive self-service portal, reducing the volume of support requests and freeing up IT staff time.
c. IT asset management: Track all hardware and software assets across your organization in one place, including details such as purchase date, warranty, and depreciation.
d. Incident management: Handle all IT-related incidents, service requests, and changes using a standardized process, ensuring that all requests are logged, prioritized, and resolved quickly.
e. Knowledge management: Build a comprehensive knowledge base of IT articles to help employees resolve issues quickly and improve overall IT service delivery.
f. Change management: Manage and track all changes to your IT infrastructure, including software and hardware updates, using an established process to minimize the risk of downtime and ensure compliance.
g. Reporting and analytics: Monitor key IT service metrics and generate reports to help you make data-driven decisions and optimize IT service delivery.
4. The Technology Services Department has obtained a quote for 20 additional agent licensing from Freshworks in the amount of $26,185.64, for the period commencing on November 20, 2024, through the end of the original term of the agreement on April 19, 2026, as shown below:
|
DescriptionUnit PriceMonthsQty.Total Cost |
|
|
|
|
|
Annual Cost - 11/21/24 to 4/19/25 |
$ 76.00 |
5.227 |
20 |
$ 7,945.64 |
|
Annual Cost - 4/20/25 to 4/19/26 |
$ 76.00 |
12 |
20 |
$ 18,240.00 |
|
|
|
|
|
$26,185.64 |
5. As a result, the total contract amount would be increased from $155,550 to $181,735.64 for the three-year period, as shown below:
|
Contract Year |
Original |
Change |
Revised Total |
|
4/20/23 to 4/19/24 |
$ 64,350.00 |
|
$ 64,350.00 |
|
4/20/24 to 4/19/25 |
$ 45,600.00 |
$ 7,945.64 |
$ 53,545.64 |
|
4/20/25 to 4/19/26 |
$ 45,600.00 |
$ 18,240.00 |
$ 63,840.00 |
|
Total |
$ 155,550.00 |
$ 26,185.64 |
$ 181,735.64 |
6. Request Commission to approve the change order for the purchase of additional agent licensing for Freshservice IT Service Management (ITSM) in the amount not to exceed $26,185.64 from Freshworks, Inc, pursuant to sections 35.18(C)(7)(h), 35.18(C)(7)(i), and 35.28(B) of The City's Code Of Ordinances.
Financial Impact
FINANCIAL IMPACT DETAIL:
a) Initial Cost: Increase is for an additional $26,185.64 in licensing fees.
b) Amount budgeted for this item in Account No: 001-513-2002-546801-0000-000-0000- (IT Maintenance Contracts)
c) Source of funding for difference, if not fully budgeted: Not Applicable.
d) 5 year projection of the operational cost of the project: The agreement is for an initial three year period from April 20, 2023 through April 19, 2026. The Change Order only affects year 2 and 3 of the contract, and the original contract amounts for year 1 & 2 have already been paid to the vendor, therefore the table below represents the pro-rated increase for contract year 2 ($7,945.64)) and the adjusted amount of contract year 3 ($63,840), which would all be paid in the current fiscal year.
|
|
Current FY |
Year 2 |
Year 3 |
Year 4 |
Year 5 |
|
Revenues |
$0.00 |
$0.00 |
$0.00 |
$0.00 |
$0.00 |
|
Expenditures |
$71,785.64 |
$0.00 |
$0.00 |
$0.00 |
$0.00 |
|
Net Cost |
$71,785.64 |
$0.00 |
$0.00 |
$0.00 |
$0.00 |
e) Detail of additional staff requirements: Not Applicable.
FEASIBILITY REVIEW:
A feasibility review is required for the award, renewal and/or expiration of all function sourcing contracts. This analysis is to determine the financial effectiveness of function sourcing services.
a) Was a Feasibility Review/Cost Analysis of Out-Sourcing vs. In-House Labor Conducted for this service? Not Applicable.
b) If Yes, what is the total cost or total savings of utilizing Out-Sourcing vs. In-House Labor for this service? Not Applicable.