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HomeMy WebLinkAbout3.b. Enterprise Resource Planning (ERP) Upgrade EXECUTIVE SUMMARY City Council Regular Meeting: October 4, 2022 AGENDA ITEM: Enterprise Resource Planning (ERP) Upgrade AGENDA SECTION: Discussion PREPARED BY: Teah Malecha, Finance Director AGENDA NO. 3.b. ATTACHMENTS: None APPROVED BY: LJM RECOMMENDED ACTION: Discuss LOGIS ERP option and provide staff with direction BACKGROUND The City has been utilizing Tyler Technologies Incode for roughly 20 years for general ledger, accounts payable, and payroll functions, and Civic Systems Clarity for utility billing for 10 years. As we have expanded as a city, the functionality has remained limited and requires an inefficient amount of staff time. We continue to do many tasks manually in Finance. Until roughly a year ago, staff was hand-stamping signatures on checks through accounts payable. Payroll stubs are still printed and distributed to staff. Laserfiche has added numerous forms to help ease the paper processes, but in some cases, it has created more staff time rather than saving time. The current annual costs are roughly $30,000 for Incode and Clarity with the utility billing expenses split between water, sewer, and storm water funds. Because of these issues, for many years staff has mentioned to Council the long-term need for a change. The City has the option to conduct a Request for Proposal (RFP) for a new ERP solution or choose to utilize Local Government Information Systems (LOGIS) which offers an ERP solution through a Joint Powers Agreement (JPA) that currently includes 27 participating agencies. Some of the current participating LOGIS members include: DCC, Ramsey County, South St. Paul, Austin, Farmington, Golden Valley, Shakopee, Eden Prairie, Lakeville, and Apple Valley. Rosemount utilizes LOGIS for police and fire records along with some network assistance. LOGIS has been utilizing JD Edwards for financial software and Advanced Utility Systems CIS for utility billing and recently completed an RFP to bring in a modern application at the request of the current LOGIS members. The LOGIS RFP began in December 2020 and concluded in August 2022 with a culmination of over 1,500 collective hours from the LOGIS membership and LOGIS staff. The RFP was guided by the Government Finance Officers Association (GFOA) using governmental best practices associated with software selection. The participating agencies established the functionality requirements and participated in software demonstrations. Proposals were received from Advanced Utility Systems, Central Square, Oracle Fusion, SpryPoint, Tyler Technologies MUNIS, and Workday. After evaluation and price negotiation, LOGIS is proceeding with Oracle Fusion for financial software and SpryPoint for utility billing with a 10-year contract. The Oracle pricing includes all system components including financial, HR, payroll, workflow tools, and advanced reporting tools. The costs were split by small, medium, and large organization for annual costs and implementation. The SpryPoint pricing includes all utility system components including billing and payments, meter management, and mobile field service. It includes the software costs for Oracle and 2 SpryPoint along with LOGIS costs which include all software support and training. The annual cost for Oracle is fixed for 2023-2027 followed by a two percent annual increase from 2028-2032. The annual cost for SpryPoint will increase five percent annually from 2024-2032. Annual Costs General Fund Water Sewer Storm Water Total Cost Oracle 116,914.50 12,990.50 12,990.50 12,990.50 155,886.00 SpryPoint - 31,565.33 31,565.33 31,565.33 94,696.00 The implementation costs will be paid at various milestones throughout the project or can be paid at one- time. The implementation costs are direct vendor costs. One-Time Implementation Costs General Fund Water Sewer Storm Water Total Cost Oracle 189,416.25 21,046.25 21,046.25 21,046.25 252,555.00 SpryPoint - 36,360.33 36,360.33 36,360.33 109,081.00 There is currently $210,000 in an assigned fund for City-wide software that can be utilized for the expenses. Costs assigned to the different utilities would be built into the rate models. LOGIS anticipates implementation for all agencies to take roughly three years. At this time, we anticipate Rosemount would begin implementation in 2024. Costs would not be incurred until that time. Both products are cloud-based and would reduce the server storage space, disaster recovery costs, virtualization license costs, and IT management needed. There have also been integration difficulties with Incode and Laserfiche that require both vendors and our IT staff for any changes made. The programming used by the current version of Incode is obsolete and will require an upgrade to a newer version of Incode if we continue to use the software, which is estimated to be a six-figure cost. LOGIS offers on-demand local technology support for Minnesota cities, counties, and other public organizations. They have dedicated support staff along with network services and continual research and development. They anticipate that 90 percent of the support tickets received will be able to be resolved in- house before needing to involve the vendor. With the same software being used across numerous agencies, staff is able to have a network to reach out to for best practices and procedures. LOGIS also hosts user group meetings for the LOGIS members, which is a level of peer support we have never had. LOGIS builds and maintains the interfacing between programs ensuring that everything flows smoothly. LOGIS also offers other software including a special assessments module. We currently maintain all special assessments manually through Excel spreadsheets with 21 active assessment rolls for 1,208 active parcels. This requires an estimated Finance department time of 423 hours per year. The Special Assessment System (SA) is a LOGIS program that provides automated management and support for many of the tasks that are currently done manually, including calculating interest and repayment schedules, reporting, and certification. Finance receives a vast number of requests regarding special assessments on properties, typically by title companies. There is a web hosting feature available with the SA system that provides a link on our webpage for people to search an address or property identification number for outstanding special assessments without having to call the City. This program could also be utilized by Engineering for assessment administration. The annual cost is $20,450 and will free up a vast amount of the finance department time to dedicate to other tasks. 3 Lastly, the current building permit software has been in use for roughly 25 years. The capabilities of the program are limited and unable to expand to our future needs. Staff would like to implement a solution that allows flexible reporting, an external customer portal, and a code enforcement module, along with other items. Once a new ERP is in place, staff will further research the building permit program options. As Rosemount continues to grow, it is critical that our internal systems integrate to provide the most efficient support both internally and externally. LOGIS has requested a formal commitment from each agency by November 15th to guarantee the contract pricing. Expenses would not be incurred until implementation begins. The contract pricing runs through 2032 for Oracle and SpryPoint. RECOMMENDATION Staff requests the City Council to provide direction on proceeding with an ERP solution.