Staff Report

PURPOSE

Information Technology requests Council approval to enter into a three year Enterprise Licensing Agreement with Microsoft Licensing GP with the option to renew the agreement for an additional three year term. The City of Burbank licenses many products from Microsoft Corporation who is by far the largest manufacturer of software used by City staff. Microsoft Office is the standard word processing suite on almost every personal computer (PC) owned by the City. Information Technology also licenses all Windows servers with Microsoft products to support the City PC infrastructure. The Microsoft Enterprise Agreement, negotiated by the County of Riverside, will provide the City with a managed, all inclusive solution to license Microsoft products.

BACKGROUND

Currently the City of Burbank purchases new Microsoft software licenses from retailers at predetermined �Select Level D� pricing each time we purchase a PC or need to do a product upgrade. Microsoft Select Licensing is a software volume licensing program designed for corporate, government, and academic customers with 250 or more desktops and mixed product and purchasing requirements. Under this methodology, the City gains discounts over standard retail pricing; however, the City must purchase new product versions outright when upgrading with no pricing guarantees from one purchase to the next. Also, Information Technology has no privileged access to Microsoft technical support.

Over the years, as PCs have become more efficient, the PC hardware life cycle has increased to 5 years. The software bundled into the original purchases is not recovering funds appropriately; major software releases occur approximately every three years. The enterprise agreement alleviates the life cycle inconsistencies by providing Information Technology the ability to keep current with our software to meet customer needs.

By piggy backing on the negotiated County of Riverside agreement the City will save 12.5% over the standard Microsoft Government rates for Enterprise Agreements. Not only is this solution the best fit offered by Microsoft for the City of Burbank, it gives the City the following benefits which we do not currently possess with Microsoft or are paid for annually or �by incident�:

The key benefit to the Enterprise Agreement is Software Assurance which allows the City to upgrade to the latest version of all Microsoft products covered by the agreement as soon as they are available and ensures ongoing, legal Microsoft software licensing compliance. Another benefit included in the Enterprise Agreement is the Microsoft Home Advantage which allows all City employees who are specifically issued a work PC the right to install the current version of Microsoft Office Products at home for the cost of shipping the media (approx. $20.00) which will be paid by the employee if they take advantage of this benefit.

The Microsoft Enterprise Agreement is structured in three year terms. The first three year term is considered the initial agreement purchase and each subsequent three year term is a renewal term.

The fiscal impact of this proposal is $295,402.15 per year to be paid annually over the first three year term, totaling $886,206.44. Internal Service Fund 537 will fund the General City portion of the agreement which totals $195,944.39 per year and Burbank Water and Power will fund their equipment licensed under the agreement at a cost of $99,457.76 over the initial term. Each renewal term thereafter can be estimated to cost between 55 and 60% of the initial term costs to maintain the annual Software Assurance.

Staff recommends Council approve the resolution entering into a three year Enterprise Licensing Agreement with Microsoft Licensing GP with the option to renew the agreement for an additional three year term.

Council Agenda - City of Burbank

Tuesday, April 18, 2006