HomeMy WebLinkAboutAGENDA REPORT 1999 0120 CC REG ITEM 10KTO:
FROM:
DATE:
MOORPARK CITY COUNCIL
AGENDA REPORT
Honorable City Council
ITEM 10 ALS
CITY OF VOORP ARK, CALTFORTNTA
Ci±y Conned Meeting
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BY: U
John E. Nowak, Assistant City ManagerGl��
06 January 1999 (Council Meeting of 01- 20 -99)
SUBJECT: Consider Approval of a Contract With Pentamation
Enterprises, Inc. for the Purchase, Installation,
Training and Maintenance of a Financial
Accounting Software Package, and Adoption of
Resolution No. 99- Amending the City Budget
to Provide Additional Funds for the Accounting
Software and Related Hardware Equipment.
BACKGROUND: The City Council included funds in the FY
1998/99 budget for the purchase of new accounting software
to replace the current system. The new software is to
provide more flexibility to maintain the City's accounting
structure, provide for a reduction in manual operations
required, provide means to better adhere to accounting
principals and regulations, be more "user friendly"
allowing decentralization of some operations, and enhance
public presentation of budget and financial information.
Staff has completed a solicitation and review of proposals,
and is submitting a recommendation for the City Council's
consideration.
DISCUSSION: The City of Moorpark has been using a Business
Records Corporation (BRC) accounting software program since
1990, with various modifications and upgrades over the
years. The software is limited in its ability to provide
information on accounts, to prepare required accounting and
financial reports, to track projects and programs through
various funding sources, and is not "user friendly" in its
izn[II !;-w't
Accounting Software Purchase
Meeting of 20 January 1999
Page 02
ability to be accessed by departments. The budget document
prepared through the BRC program is complicated and
difficult to read. The current year's budget document was
prepared by manually duplicating efforts, which required
substantial staff time. Further, the BRC program is not Y2K
compatible and would require an expenditure of over $13,000
for hardware and software modifications. The City has also
contracted with Automatic Data Processing (ADP) for payroll
services for the past ten years. In reviewing the options
available to the City, staff recommended a new accounting
software package be purchased to not only address the Y2K
issue, but to also provide a program that would overcome
the BRC's shortcomings. $112,000 was included in the FY
1998/99 budget for the purchase of the software and
training.
A Request for Proposal was prepared and transmitted to
eight (8) firms that deal with municipal accounting
software. Four (4) proposals were received from Eden
Systems, Inc., JPH International, Inc., Pentamation
Enterprises, Inc., and Scientific Consultants, Inc. (SCI).
Staff's initial review of the proposals eliminated JPH from
further consideration due to its limited use by municipal
governments and its emphasis on utility billing. The three
other firms were invited to give a presentation before the
finance division staff. At that point, SCI declined
further involvement in the City's selection process. Both
Eden and Pentamation made presentations at the City on
their software programs and capabilities. Staff also
visited four cities with the software programs to review
actual implementation and use. The cities were San Gabriel
and Manhattan Beach for the Eden system, and Duarte and
West Hollywood for the Pentamation system.
Based on the proposals, demonstrations and site visits,
staff is recommending that the Pentamation Enterprises,
Inc.'s software package be acquired. The principal factors
for the recommendation are outlined in detail in the
descriptions that follow. In summary they are: (1) having
a fully integrated accounting system; (2) is Windows
oriented with simple access /entry procedures; (3) is
flexible to address the City's multi- funding approach; (4)
Accounting Software Purchase
Meeting of 20 January 1999
Page 03
can be adapted to handle the Community Development Trust
Funds (about 1,000) with direct transfer to City accounts;
(5) can prepare all accounting report requirements direct
from stored information; (6) has strong in -house support
for technical assistance; (7) has over 25 years of local
government accounting software experience; and (8) can be
expanded by modules to meet future City needs. The City's
auditors have provided an indication that they have other
municipal clients using the Pentamation software, and that
the software, when properly used, meets all accounting
requirements. Also, over 275 local governments in the
country now use this software. Recently the cities of
Temple City, Walnut and Brea have purchased the Pentamation
program.
A description of the principal elements of the Pentamation
software and transition costs follows. The components for
both Eden and Pentamation and the related costs are shown
in the attached Exhibit "A ".
SOFTWARE: ($43,706)
Staff recommends the General Financial program, which
includes general ledger, accounts payable, accounts
receivable, purchase orders, budget preparation, and the
payroll module be purchased. The software is Windows
compatible, which makes it easier for staff to access
information. All elements are fully integrated which means
that data entered into one program is automatically
recorded in all other appropriate accounts and programs,
eliminating duplicate entries. The software permits the
allocations to the various funds to be calculated by
predetermined criteria and charged to the assigned funds as
part of regular accounting processes, eliminating manual
calculations and separate entries into the various
accounts. This becomes especially valuable in charging
costs to the various trust funds in the Community
Development Department that not only must charge different
activities at different rates to the trust, but also
calculate the amount of administrative fee to be paid to
the City's general fund. Some payments must also be
distributed to various trusts with the same variety of
charges. Currently there has been a once -a -year adjustment
0 00125
Accounting Software Purchase
Meeting of 20 January 1999
Page 04
for payment to the General Fund because of the time
required to do the calculations manually. It is
anticipated this could be done monthly with the new
software.
The query system will allow department heads to more easily
identify current revenue and expense details and summaries
in order to better manage their department's operations.
It is anticipated that some functions will be decentralized
to the departments (i.e., preparation of purchase orders) .
The budget module will allow various scenarios to be viewed
without affecting the base data, develop informational
charts and graphs directly from the budget data, and
approved budget amounts can be directly transferred to the
accounting ledgers at the start of the fiscal year. Due to
implementation schedules, this function will not be
utilized until next year (FY 00 /01).
The payroll module will handle all personnel costs related
operations currently contracted for, with the additional
ability to directly assign salary and benefit costs to
various funds used from the time sheets. This addresses an
issue raised in the recent Gas Tax audit. It will also
permit the City to charge salary costs to construction
projects and their funding sources. Due to the additional
training and preparation time required for the payroll
program, implementation is not scheduled until later in the
year (estimated to be November) . The current ADP contract
will be dropped in January 2000 after the W -2 forms are
processed for the year 1999.
The accounting software will be operational on July 1, 1999
and the FY 99/00 budget will be incorporated on the
Pentamation program. The City will continue to use the BRC
programs to close out the current fiscal year. There will
also be a period of parallel use n the payroll system to
test the new program for inclusion of all elements. Both
are standard procedures for a change in software.
000120
Accounting Software Purchase
Meeting of 20 January 1999
Page 05
SCO SOFTWARE: ($2,584)
This is an operating software that will allow the programs
to operate on the City's LAN network and in a Windows
environment.
FORMS EXPRESS: ($4,600)
This software and operating program permits the program to
print multi -copy forms on a laser printer and to print
secure checks on a laser printer. Currently the City
spends about $2,000 per year on preprinted forms and
checks. Storage of pre - printed checks is always a security
concern. The proposed software allows checks to be printed
on plain paper stock with numerous security elements built -
in. It will also allow other forms to be printed on
regular paper stock, which reduces costs.
HARDWARE and MISC.: ($24,785)
This includes items such as a print spooler, compilers,
database syntax, and the cost of installation and testing
of the hardware and software, and maintenance training.
TRAINING: ($48,438 est.)
This is an estimated figure provided by Pentamation. It is
proposed that seven (7) staff members receive full training
on the accounting software. Twenty -five (25) other
employees would receive varying degrees of training on the
system, from making simple queries to entering purchase
order and budget information. Full training for employees
will take approximately 200 hours each, while query
training takes about 2 hours.
With other cities in southern California now installing the
Pentamation software, there will be some cost savings by
splitting the travel costs for the trainers among a number
of cities. Also, with our staff's existing knowledge of
accounting operations and the limited number of program
modules being installed, it is anticipated that the actual
cost for training will be less than the estimated amount.
Staff is requesting that the full amount of the training
funds be budgeted at this time to avoid delays in
000127
Accounting Software Purchase
Meeting of 20 January 1999
Page 06
implementation of the accounting software planned within a
very tight time schedule.
CONVERSION: ($15,000 est.)
This is the cost for Pentamation to convert existing
Moorpark files to the new software configuration
electronically (e.g., ADP payroll records, vendor files) .
Other options are available to the City including using
city staff or hiring part -time data entry personnel, both
of which would cost less. Part of the initial meeting with
Pentamation would be to identify the files that require
conversion and which approach would be most cost effective
for the city. The extent of the historical data to be
converted will also impact the cost.
Staff is requesting that the full amount of the training
funds be budgeted at this time to avoid delays in
implementation of the accounting software planned within a
very tight time schedule.
COMPUTER HARDWARE - MAIN: ($11,675)
For security, warranty protection and maintenance the
accounting software needs to be housed in a separate
central server that is then linked to the City's Local Area
Network server. The City currently has an IBM AS400 server
that houses the BRC software. Staff priced the cost of
upgrading the AS400 to meet the requirements of the new
software, have sufficient storage capacity, and to make the
computer Y2K compliant, coming up with an estimate of
$11,000. For the same amount of money, staff is proposing
to purchase new Hewlett Packer server hardware that meets
all requirements of the software package, is Y2K compliant
and has more future growth capacity than the AS400. It is
also easier and less costly to maintain than the IBM
server. When use of the BRC is completed, it is proposed
to sell the AS400 and recover some of the funds expended.
The value of the computer is unknown at this time.
Also included is a modem for connection to the accounting
software server which will allow Pentamation to tie into
the program to assist in any questions or issues that arise
from staff. It will also allow them to download upgrades
c;,oas28
Accounting Software Purchase
Meeting of 20 January 1999
Page 07
directly into our program here, saving the time and cost of
having it done manually on site.
LASER PRINTER: ($6,500)
A new high speed laser color printer is also proposed for
the Finance Division to allow for the printing of checks,
purchase orders, invoices and other reports provided by the
software. Since warrants will be printed on this computer,
some security printing is required which is the reason for
the color capability. It will be available for use by
other staff in Administrative Services, which does not have
a high speed laser printer in its department, for printing
business registration forms, purchase orders and other
financial and regular reports. Since it will have color
printing capacity, this feature can be shared with other
departments.
COMPUTER UPGRADES: ($10,000)
Two of the computers used by the Account Clerks are old 486
models that do not have the minimum operating capacity
required of the Pentamation software. Staff is
recommending that these be replaced with new computers and
that the existing computers be allocated for the Public
Works maintenance staff and to the Police Service Center
for use by the volunteers.
Also, the four other computers in the finance division need
upgrades in RAM to more effectively use the operations of
the new software and larger monitors for better viewing of
the work screens (they are currently 13" monitors).
MAINTENANCE AGREEMENTS: ($17,062 /year)
The annual cost for hardware and software maintenance for
all aspects of the accounting system covers program
upgrades, telephone service and assistance for both the
hardware and software. Currently the City spends $19,000
per year for various maintenance and service agreements for
the BRC software, ADP payroll service and AS400
maintenance. No additional funds are required for this
fiscal year to cover the new maintenance agreements since
they will be spread over a period of time and the software
maintenance is billed at 50% the first year.
UO 142y
Accounting Software Purchase
Meeting of 20 January 1999
Page 08
The total cost of the software and equipment, training,
conversion, and computer equipment is $167,288. This is
$55,300 more than appropriated in the adopted budget.
Staff is proposing that the additional $55,300 be
appropriated from a number of funding sources. (Exhibit "B"
shows the current and proposed additional funding.)
Additional Funding Squr..cgg
1. $8,000 from the Redevelopment Agency. This would
bring the total MRA funding to $55,400 or 33% of the
total cost. This is about the same percentage as the
Agency currently pays for the total general financial
operations.
2. $4,000 from AB939. This brings the total solid waste
funds to $5,200, or about the same percentage of the
software costs as AB939 funds are to the general fund
expenditures in the City's operating budget.
3. $12,200 from Gas Tax Funds. One of the principal
advantages to having the new accounting software is to
address the documentation concerns raised in the
recent Gas Tax audit. This increase brings the total
share of expenses from Gas Tax to $15,800, or 9.44 %,
which is less than the State's accepted indirect cost
share of 12.9 %.
4. $7,000 from CDBG. The Community Development Block
Grant program requires detail accounting information
that is made easier under the new software. Computer
software and equipment for assistance with CDBG
eligible projects is an allowable expense under
federal regulations. The funds will come from the
program's current administration allocation that would
not otherwise be expended this year.
5. $22,000 from the Los Angeles and Tierra Rejada Areas
of Contribution. As indicated in the Gas Tax audit
staff report, it is appropriate that staff time be
charged directly to capital projects that are funded
through the ADCs and other restricted funding sources.
0001,30
Accounting Software Purchase
Meeting of 20 January 1999
Page 09
This was difficult in the past with existing software.
The new programs will allow for a full tracking and
direct charge to the special funds. It is proposed
that $11,000 come from each of the AOCs.
6. 52.100 from the General Fund. This money would come
from salary savings resulting from the current vacancy
in Administrative Services and would be handled with a
line item transfer. No additional appropriation is
required.
In summary the total funds to be used for the accounting
software and related items would be paid from the following
sources:
General Fund $ 27,100
Redevelopment Agency $ 55,400
Community Development Fund $ 34,800
AB 939 Fund $ 5,200
Gas Tax Fund $ 15,800
CDBG Funds $ 7,000
Areas of Contribution $ 22,000
TOTAL: $167,300
Staff believes that the purchase and implementation of the
Pentamation Enterprises, Inc. accounting software programs
and the accompanying hardware would greatly facilitate the
financial and accounting operations of the City of
Moorpark. It: (1) provides a system that more directly
tracts the City's multi -fund expenditures; (2) eliminates
some of the manual calculations and additional journal
entries now required; (3) is more user friendly' for
queries and input of information; (4) provides standard
accounting applications to facilitate year -end closing and
reports; (5) will allow for better tracking of deposits and
expenditures of development trust deposits; (6) addresses
Y2K compliance concerns; (7) allows fast preparation of
reports, charts and presentations; and (8) has the
capability of expansion to cover additional accounting
activity (i.e., fixed asset) as the City's needs expand.
000131
Accounting Software Purchase
Meeting of 20 January 1999
Page 10
In summary, staff is requesting the City Council to approve
the acquisition of the Pentamation financial accounting
software package in the amount of $139,113 to be installed
and operational by July 1, 1999; and related new hardware
and computer upgrades for full utilization of the programs.
STAFF RECOMMENDATION: (ROLL CALL VOTE)
1. That the City Council approve a contract with
Pentamation Enterprises, Inc. for the purchase
installation, training and maintenance of financial
accounting software package in the amount of $139,113,
and authorize the City Manager to sign the Service
Agreement and Contract subject to final language
approval by the City Manager and City Attorney.
2. That the City Council approve the purchase of the
computer hardware indicated in the staff report for
the accounting software utilization in an amount not
to exceed $28,175.
3. That the City Council adopt Resolution No. 99-
amending the City Budget from various funds in the
amount of $53,200.
Attached: Exhibit "A" - Cost Estimates
Exhibit "B" - Purchase Cost Fund Allocations
Contract Agreement with Pentamation Enterprises,
Inc.
Resolution No. 99- Budget Amendment
000132
1 ** Estimates onl
0®01,33
EXHIBIT "A"
COST ESTIMATES
Software
$
PENTAMATION
43,706.00
$
EDEN
99,400.00
Training **
$
48,438.00
$
67,950.00
$
15,000.00
Conversion **
$
20,000.00
Misc., Hardware, etc.
$
24,785.00
$
12,000.00
SCO Software
$
2,584.00
$
3,230.00
Forms Express
$
4,600.00
$
-
Subtotal:
$
139,113.00
$
202,580.00
i
Computer Hardware - Main
$
11,675.00
$
11,675.00
Laser Color Printer
$
6,500.00
$
6,500.00
Computers - Upgrades
$
10,000.00
$
10,000.00
Subtotal:
$
28,175.00
$
28,175.00
TOTAL EXPENDITURES;
$
167,288.00
$
230,755.00
Annual Maintenance
$
17,062.00
$
21,224.50
1 ** Estimates onl
0®01,33
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EXHIBIT "B"
PENTAMATION PURCHASE
Additional Funding Sources
Budget
Budget Total
Addition
New Amount
RevisedTotal
TOTALS:
$112,000
$ 55,300
$ 167,300
General Fund
Redevelopment
$25,000
$47,400
22.32%
$ 2,100
$ 27,100
16.20%
42.32%
$ 8,000
$ 55,400
33.11%
Comm Development
$34,800
31.07%
-
$ 34,800
20.80%
AB 939
1.07%
$ 4,000
$ 5,200
3.11%
$1,200
Gas Tax
$3,600
3.21%
$ 12,200
$ 15,800
9.44%
CDBG
AOCs
$0
$ 7,000
$ 22,000
$ 7,000
$ 22,000
4.18%
13.15%
$0
The additional General Funds ($2,100)
will come from a bugdet transfer
in Admin Services
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RESOLUTION NO. 99-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
MOORPARK, CALIFORNIA AMENDING THE FY 1998/99
BUDGET TO APPROPRIATE FUNDS FROM VARIOUS SOURCES
FOR ACCOUNTING SOFTWARE AND RELATED HARDWARE
PURCHASES.
WHEREAS, on June 17, 1998 the City Council adopted the
Budget for Fiscal Year 1998 -1999; and
WHEREAS, a staff report has been presented to said
Council describing the costs associated with the purchase
of an accounting software package and related hardware,
training and conversion costs; and
WHEREAS, Exhibit "A" hereto describes said budget
amendment and resultant impacts to the current budget.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF
MOORPARK DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. A budget amendment in the amount of
$53,000 be appropriated from the AB939 Fund, the Gas Tax
Fund, the Community Development Block Grant Fund, the
Tierra Rejada/ Spring Road Area of Contribution Fund, and
the Los Angeles Avenue Area of Contribution Fund to various
departments, with $40,200 appropriated to "Other Purchased
Services" and $13,000 appropriated to "Computer Hardware ",
as more particularly described in Exhibit "A" attached
hereto and made a part hereof.
PASSED AND APPROVED this 20th day of January 1998.
Patrick Hunter, Mayor
ATTEST:
Deborah S. Traffenstedt, City Clerk
000:,35-
Resolution No. 99 -
Exhibit "A"
BUDGET AMENDMENT DETAIL
SECTION 1.
FUND
ACCOUNT NUMBER
AMOUNT
Tierra Rejada Area of
Contribution
211.900.0000.000.5100
$(11,000)
Los Angeles Avenue
Area of Contribution
211.901.0000.000.5100
$(11,000)
Community Development
Fund
220.000.0000.000.5100
$ (4,000)
Gas Tax
240.000.0000.000.5100
$(12,200)
Community Development
Block Grant (CDBG)
245.000.0000.000.3400
$ (7,000)
Redevelopment Agency
410.000.0000.000.5100
$(8,000)
TOTAL
1
$(53,200)
SECTION 2. Other Purchased Services
FUND
ACCOUNT NUMBER
AMOUNT
Tierra Rejada Area of
Contribution
211.900.0000.000.9199
$10,000
Los Angeles Avenue
Area of Contribution
211.901.0000.000.9199
$10,000
Community Development
Fund
220.600.0000.000.9199
$ 4,000
Gas Tax
240.800.0000.000.9199
$12,200
Community Development
Block Grant (CDBG) **
245.511.0000.000.9199
$ 4,000
Redevelopment Agency
410.510.0000.000.9199 1
0
TOTAL 1
1
$40, 200
SECTION 3. Computer Hardware
FUND
ACCOUNT NUMBER
AMOUNT
Tierra Rejada Area of
Contribution
211.900.0000.000.9906
$ 1,000
Los Angeles Avenue
Area of Contribution
211.901.0000.000.9906
$ 1,000
Community Development
Fund
220.600.0000.000.9906
0
Gas Tax
240.800.0000.000.9906
0
Community Development
Block Grant (CDBG) **
245.511.0000.000.9906
$ 3,000
Redevelopment Agency
410.510.0000.000.9199
$ 8,000
TOTAL
$13,000
0001.36