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Home My WebLink AboutAGENDA REPORT 1996 1002 CC REG ITEM 10B� �, a w 3 Ofj' 308• � 15�� 1 Q ITEM •_ CITY OF MOORPARK CITY COUNCIL AGENDA REPORT TO: The Honorable City Council _ FROM: Donald P. Reynolds Jr., Administrative Services Manage DATE: September 25, 1996 SUBJECT: Consider the Purchase of a High Volume Copier- Additional Information Related to Item 10. B., on the Council's September 18, 1996, Agenda During the informal bid process, staff received updated information from two vendors being considered while the September 18, 1996, staff report was written. On September 18, 1996, the Council continued Item 10.B per staff's request, so that the additional information could be factored into the recommendation. In staffs September 18, 1996, report, two vendors were identified as being the preferred choices for high volume copiers: Kodak and Xerox. New information concerning the specifications and prices in this report, corporate changes and general service provided by the City's current vendor Kodak, have caused staff in this report to change the recommendation to a Xerox machine. Staff identified in its research for the September 18, 1996 report, that the service rate from Kodak escalated as the 1988 machine grew older, from $200 per month to $400 per month, regardless of the volume of copies made. This concern led to additional inquiries for information pertaining to service and supplies. During the week of September 16, 1996, staff received revised proposal from both Kodak and Xerox. In revising its recommendation to the City related to service costs, Xerox proposed a new machine; the Xerox 1090. This machine is a reputable design which has been available for several years. It has fewer features than the Xerox 5385 and 5680 machines referenced on September 18, but very similar features as the Kodak 2085 machine. It has been offered to the City using County of Los Angeles cooperative purchasing arrangements at $28,900 not including tax. This is $300 1 7,70 f less than the Xerox 5385 and approximately $5,000 less than the 5680. The Kodak 2085 pricing remained at $24,263 after staff initiated this additional research. Both machines are very basic high volume copiers, however, the Xerox 1090 makes 92 copies per minute holding 75 pages in its document feeder, and the Kodak 2085 makes 85 copies per minute, holding 60 pages in its document feeder. The change in price makes Xerox slightly more competitive than originally presented, and offers faster copy speeds with higher volume specifications. The amended service rates are where the significant price differences are found. Xerox offers a one year warranty for their 1090, where only the cost of toner and developer are applied. Staff confirmed with Kodak that the 2085 machines service contract is required to be initiated as soon as the machine is placed, incurring the service cost immediately, plus toner and developer. Both Xerox and Kodak were able to provide fixed pricing for service over the next five to six years. The attached summary comparing the two vendors, shows that with fixed pricing for services and supplies, Xerox is the least expensive, saving the City $2,212. As significant as the difference service pricing, is the actual experience of service received. Kodak copier service was acquired by another corporation the first week in September. Where in 1988, IBM, Kodak and Xerox were the exclusive service companies for the equipment they made, now only Xerox services the equipment it makes. For the past year, Kodak services have not always met expectations, and other qualified vendors for Kodak equipment have not been identified. Rather than speculate that the new company which will not make Kodak copiers, but service the machines, will be more reliable, staff is more confident changing vendors to Xerox at this time. Staff has received favorable references for Xerox from the City of Thousand Oaks, and Ventura Unified School District. Moorpark Unified School District has recently discarded its IBM 111 85 and will be changing to Xerox. Staffs September 18, 1996, report to Council requested funding from the Equipment Replacement Fund, and did not include sales tax. The purchase price of the Kodak 2085, (which includes a credit for the IBM machine of $2,000), with tax is $26,022.06, (increase from September 18 of $1,759.07), and the Xerox 1090 (which includes a $4,000 credit for the IBM) is $30,995.25 including tax, for an increase of $4,973 ($3,476 derived from the General Fund portion of the Fund). This is a $6,732.25 increase above the original amount requested September 18. 2 )'7 There are sufficient monies a�ailable the ;- jijiprntant Repiacement Fund to account for this c-hanqP inow io to )II(IVv<; Cienw ai calmol-111 ede dotal uric Development velopment Reserved for 4 41C Summary Staff continued to resear,'.J-,, me cost of all t)t the proposed copier and arrived at a higher price tot a ri-iachine witr ;,q niql-,& capacit \l which will be serviced by the manufacnirei If iRf IAS a current stable reputation The increased price is absorbed by available valances in the Equipment Replacement reserve vnere the cost for s}y and savings in these costs) over the next five years will riot of- paid by +, ind, Recommendation (Roll ..Al (. V o(e) That the City COUVICII ap()f()pF late $31 000 wr tne r. i-quipment Replacement fund for the purchase of a xoro ',')90, lwhj�7h, ivi( tube -1 $4,000 ,�redit for the IBM), and declare the IBM 111 81, i� iiipli ps eauivr-nr�i iced for redit towards the new machine Attachment- Kodak+Xei( , .,-s' I orlipailLIA Xerox and Kodak Cost Comaparison Over a Six Year Period ITEM TOTAL PERCENT Xerox 1090 Kodak 2085 DIFFERENCE DIFFERENCE PURCHASE 'PRICE am' 28900 24263 4637 tax 2095 1.759 336 XEROX IS HIGHER CTRL 30995 26022 4973 19.11% SL f—p Mllconthly r Ixea Ratp 136 396 per Copy Rate @ Includes supplies; 00760 , r 0950 Ot? 190 r1Ct Pfz.r Mnntn 01 annual 7387 `° 7445 XEROX IS LOUVER ,)„er Sixty Months 30038 j7223 7185 7.47% Per Month over 60 months 501 620 120 2,212 NET SAVINGS /INCREASE includes 40,000 copies, so this factor is only multiplied by 11,000 copies ** The first year is provided at a cost of supplies only. at .0008 per copy C0PY96AN. WK4 TO: FROM: DATE: SUBJECT: Background 10.8: CITY OF MOORPARK CITY COUNCIL AGENDA REPORT The Honorable City Council �?_/ Donald P. Reynolds Jr., Administrative Services Mana er 9 September 11. 1996 Consider Replacement for the City's High Volume Copier In October, 1988, the City entered into a 60 month lease /purchase agreement for a high volume copier made by IBM, to accompany the City's Canon NP7550 bought in 1985. The IBM 111 85 ( "IBM ") service and lease were purchased by Kodak, and the City has maintained a dual relationship with Kodak and various Canon copier dealers since this time. The total cost of the IBM was $44,140. Each year, as the IBM ages, the City pays more for fewer copies. In 1993, when the volumes peaked at 682,000 copies, the City paid approximately $300 per month for service. Now, at a volume of 255,900, the City pays approximately $500 per month for service. On July 31, 1996, Kodak discontinued service of the machine, having met their seven year obligation to support this equipment. The original goal of having a high volume copier was to produce the Council agenda. This IBM performed satisfactorily except that it would over -heat when duplexing. The City's decision to out - source the Agenda in 1994/95, coincided well with the aging IBM that would no longer duplex reliably. In 1990, the City bought a small copier (Canon NP2020) to accompany the Canon NP7550 and the IBM. The old Canon was moved into the Annex in 1991. Decreasing reliability of the IBM was part of the factors that led the City to purchase a new mid - volume machine for City Hall in 1993: a Kodak 95s. This was also a 60 month lease /purchase agreement. In 1994195, three low to medium volume copiers were added to the City's inventory including: Canon NP4835- a low to medium volume machine for the Senior Center; Canon NP3325- a slightly smaller machine for AVCP, and; a rebuilt Canon 6060 for the Annex, moving the old Canon NP7550 to the Public Works Yard. The Canon 6060 and the Kodak 95s are the same medium volume machine, except for a few minor changes made by Kodak to the Canon equipment. Now, the City uses seven copiers, four at City Hall (one low, two medium and one high volume machine), and three off - premise. 000,71#X Attachment "A" summarizes the City's copy volumes since FY 1993/94. Copy volumes at City Hall decreased by 90,000 in 1994/95 when the Agenda was contracted for reproduction. However, the total copies being made in the City remained stable at between 1.17 to 1.16 million copies per year. The additional programs being managed by the Senior Center and the Arroyo Vista Community Center more than offset the reduction in volume at City Hall. Because the IBM can no longer handle the large projects, the Kodak 95s is functioning at a capacity higher than anticipated when originally purchased. The copiers at AVCP and the Senior Center are also operating at a 30 percent higher rate than anticipated. Attachment "B" illustrates how the copy volumes are being distributed, and shows the disproportionate relationship between the 95s and the IBM. For example, in 1993/94, the IBM was produced 64 percent of the City Hall work load, but only 22 percent last fiscal year. The Kodak 95s however, produced almost twice as much as the IBM (43 percent), and is a much smaller machine Discussion Equipment Needs In April, 1996, staff estimated the cost of a copier to replace the IBM, using copy volume statistics to arrive at the conclusion that another medium volume machine could replace the IBM (based on the IBM's 1995/96 statistics). The NP6060 was bought in 1995 reconditioned for $10,000, and based on this is the amount, the Council appropriated $11,250, split as follows: Gas Tax Fund- $2,250; Community Development Fund- $3,000 and; the General Fund- $6,000. Since July 1, 1996, staff has evaluated the actual use of City copiers, (Attachments "A" and "B "), and has also looked carefully at specific copy jobs and needs. Staff has concluded from this analysis, that a dependable high volume machine would be more efficient for staff to use at the Senior Center for copying the Senior News letter, and for AVCP when marketing various youth activities. This would cause a shift in volumes from these centers to a high volume machine at City Hall, extending the life of these machines and stabilizing the current disproportionate ratios of use. A reliable high production machine will make more efficient use of staff time, which equates to lower reproduction costs. Even though the City contracts for agenda reproduction, the City Clerk's office requires large attachments to be copied in -house by each department. The two City commissions are scheduled to meet twice a month, and these agendas are also reproduced in- house. Public requests for City reports including the budget, environmental impact reports, and studies pertaining to the City's five specific plans, require frequent one time high volume copy jobs. As the City develops its plan to network City computers, the use of digital copy equipment will be included. Copy machines are available today which will link directly to PC's in a network environment, and this technology may eventually reduce reliance on work station laser printers and mid - volume copiers. This concept of "work- groups" will include a fax, printer and low to medium volume digital copier. These digital copiers will then replace machines like the Kodak 95s, and the Canon NP6060, but won't replace the need to have a high volume machine. Based upon an evaluation of the four factors listed above (distribution of copy jobs, cost of staff to make copies, the continuing need to produce large copy jobs, and the development of future technology to reduce the City's reliance upon the current mid - volume machines), staff has concluded that at this time, the IBM should be replaced with a similar machine capable of high volume duplex production. This solution will allow the City to continue to expand public outreach programs without equipment limitations, reduce the staff and materials costs by duplexing more frequently, extend the life of the existing mid - volume machines and fit into the digital technology available now and in the future. Eft uiipment Options Attachment "C" is a review of various copy machines comparing lease to purchase and the purchase of rebuilt machines versus the purchase of new equipment. The "Capacity" category on the spread sheet is a generalization, based upon the capacity of the machine to handle original documents, the speed of the machine, the paper supply, and the sorting abilities. Although mid - volume machines are listed, staff is steering away from this direction. The highest end of the Canon line is the NP85 model, which maximizes at the volumes specified for the Sharp, Xerox and Kodak products, and would not accommodate City needs over an extended period of time. The Sharp prices are substantially higher than Xerox and Kodak, due to the fact that no cooperative purchasing options were made available to the City. This narrowed the focus to two vendors. Xerox and Kodak remain the most reliable high volume machines on the market, and because of their dominance, they are able to secure pricing from the State and Los Angeles County that the City can take advantage of. For example, a new Canon NP6060 machine is $9,000 less from Kodak (Kodak 95s), than it is from a Canon dealer. This arrangement applies to high volume copiers as well. Staff evaluated the Kodak 2085 before buying the Kodak 95s in 1993. Like the IBM, it copies at 85 pages per minute, but will hold 100 pages in the feeder and duplex mode, compared to only 50 in the IBM. The Kodak is more powerful than the IBM, making It a more reliable duplex machine. O WY1L;*11 In 1993, the Kodak 2085 was priced at $36,700. With the State's Multiple Award Schedule, this cost has been reduced now to only $24,263. Kodak is offering a $2,000 credit for the old machine. The Xerox equipment handles the same volumes, at a higher cost for both the equipment and service, (applying pricing from the Los Angeles County), so Kodak is staff's preference at this time. If the Council concurs with the staff's conclusions, there will be a need to finance the difference between the $11,250 budgeted and the cost of $24,263, which is $13,013. Staff looked at lease options, which add as much as 38 percent to the original purchase prices, use of the Equipment Replacement fund, and the possibility of transferring the savings in service from the IBM, to the capital line item. The lease option has been eliminated because of the funding alternatives available. At an estimated cost of $500 per month, the annual service for the IBM currently included in the budget will cost $6,600. The month of July has been paid, but no additional payments are needed, leaving $6,000 available. The Kodak 2085 will use $1,500 of this savings, reducing this apparent surplus to $4,500. The IBM was scheduled on the Equipment Replacement inventory with a 10 year life in 1988. To date, $37,519 is available to replace this machine. The use of Equipment Replacement reserves appears to be more appropriate than relying on the current appropriation, and at this time, staff recommends using the Equipment Replacement fund to replace the IBM. The current budgeted monies could then be returned to the applicable undesignated fund balance in Gas Tax Community Development, Redevelopment and General funds. The status of the Equipment Replacement fund is as follows: 00031 "Reserve Balances" were established at the Council July 3, 1996, Council meeting. At this meeting, the Fund 02 (Vehicle Fines) obligation was consolidated with Gas Tax, and only 25 percent of the Community Development obligation of $68,220 was contributed. Summary Despite the reduced copy volumes at City Hall, staff has concluded that a high volume copier is still needed. By adding a new high volume copier to the City's inventory, new technology can be introduced as the existing machines reach their capacity. This can be accomplished using reserves in the Equipment Replacement fund freeing the current appropriation of $11,250 for other uses Recommendation (Roll Call Vote) That the City Council appropriate $24,500 from the Equipment Replacement fund for the purchase of a Kodak 2085, (which includes the $2,000 credit for the IBM), and declare the IBM 111 85 as surplus equipment to be used a trade -in for the new machine. Attachments: A) Copy Volumes B) Work Distributions C) Cost Analysis 00031.2.4 CITY COPY VOLUMES 1993/94 1994/95 1995/96 1071862 1176102 1163396 CITY HALL Volumes Since 1993 Purchased Company Model FY 1993/94 1994/95 1995/96 5/1985 10/1988 3/1990 12/93 6/95 NP4835 CANON KODAK CANON KODAK CANON 144,000 NP7550 IBM 11185 NP2020 95S NP6060 TOTAL 57,936 682,101 113,484 218,341 0 1,071,862 46,188 333,910 57,540 544,842 0 982,480 0 255,857 19,872 495,399 157,872 929,000 PUBLIC WORKS YARD Purchased mvd 6/95 Company CANON Model FY NP7550 1995/96 10,404 SENIOR CENTER Purchased 5/1994 Company CANON Model FY NP4835 1993/94 0 1994/95 132,000 1995/96 144,000 ARROYO VISTA COMMUNITY CENTER Purchased 5/1994 Company CANON Model FY NP3325 1993/94 0 1994/95 61,622 1995/96 79,992 ()()031!5 COPY96AN.WK4 CITY COPY VOLUME DISTRIBUTION FOR 1995/96 PW YD SR.CTR AVCR Purchased 10/1988 3/1990 12/93 6/95 5/1985 5/1994 5/1994 Company KODAK CANON KODAK CANON CANON CANON CANON Model IBM 11185 NP2020 95S NP6060 NP7550 NP4835 NP3325 TOTAL ACTUAL PERCENT 22% 2% 43% 14% 1% 12% 7% VOLUME 255,857 19,872 495,399 157.872 10,404 144.000 79,992 1163,396 PER MONTH 21.321 1.656 41,283 13,156 867 12,000 6,666 96,950 FLRZEG iOLUME tlATIUS 55% 1% 15% 15% 1% 80 /1 5 / 1 x PREFERRED VOLUME 639.868 11;634 174,509 174,509 11.634 93,072 58,170 1,163,396 BASED ON 95/96 PER MONTH 53,322 969 14.542 14,542 969 7,756 4,847 96,950 r� C COPY96AN.WK4 VENDOR MAKE MODEL REBUILT CAPACITY COST SERVICE TOTAL KODAK KODAK 95S NEW MEDIUM 12047 5548 17595 COPIERLIN=- CANON NP6060 NEW MEDIUM 21016 6400 27416 LAZER COPY CANON NP6060 REBUILT MEDIUM 13406 5760 19166 COPIERLINsE CANON NP6060 REBUILT MEDIUM 8146 6400 14546 ,— OPIFRLINr CANON NP8530 REBUILT MED /HIGH 9969 6400 16369 ADV. COPY SYS SHARP SD -3075 NEW MED /HIGH 20860 8954 29815 COPIERLINE CANON NP8530 NEW MED /HIGH 24555 6400 30955 ADV.COPY SYS. SHARP SD4085 NEW MED /HIGH 45040 7675 52715 XEROX XEROX XEROX 5385 NEW MED /HIGH 29195 6000 35195 XEROX XEROX XEROX 5680 NEW MED /HIGH 34055 5860 39915 KODAK KODAK KODAK2085AF NEW MED /HIGH 24263 1897 26160 COPY96AN.WK4