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- . � <br /> MANAGEMENT SERVICES DEPARTMENT <br /> MANAGEMENT INFORMATION SYSTEMS DIVISION <br /> Memorandum No.2003-01 <br /> January 14,2003 <br /> MEMORANDUM FOR: Honorable Mayor Howley and City Council <br /> FROM: Stephen L. Garman, City Manager <br /> Michael L.Mowen,Assistant City Manager for Administration <br /> � Gerard J.Bauer,Management Services Directo <br /> David S.Johnston,Manager,MIS Divisio� <br /> SUBJECT: City Telephone Service Contracts <br /> SiJMMARY Staff recommends that Council approve the resolution at Enclosure 1, authorizing <br /> RECOMMENDATION: the City Manager to execute the contracts shown at Enclosures 2 and 3 with SBC <br /> Global Services,Inc. for voice telephone Centrex service and reduced rate calling. <br /> BACKGROUND: The City's main voice telephone service is provided by SBC (formerly Ameritech) <br /> under a Centrex agreement approved by City Council in 1996,which has now <br /> expired. The contract presented at Enclosure 2 renews that agreement for a 60 <br /> month period, at essentially the same discount rate of$3464.75 (versus the standard <br /> tariff rate of$5241.03 per month which would apply were the contract not <br /> approved), for the fixed cost, or infrastructure portion of the city's local telephone <br /> expenses. The second contract, at Enclosure 3, is a"CompleteLink"usage <br /> agreement which will effectively lower the city's variable cost for all "local"Band <br /> A(in-town)through Band C (Springfield-area) calls. The contract provides for <br /> discounted per minute charges in return for the city commitment to generate a <br /> minimum annual revenue level to SBC of$35,000, an amount already achieved <br /> under the terms of the Centrex agreement. <br /> POTENTIAL None anticipated. <br /> OBJECTION: <br /> INPUT FROM OTHER Staff evaluated other technologies which could potentially replace Centrex <br /> SOURCES: telephone service at a lower cost, including ISDN and Voice-over-IP. However, it is ' <br /> our judgment that such technologies are not yet sufficiently mature to risk public <br /> safety or responsiveness to citizens on. We will reexamine existing and emerging <br /> technologies prior to the expiration of the agreement under consideration. , <br /> STAFF REFERENCE: Gerard J.Bauer,Management Services Director(424-2805);David S. Johnston, <br /> MIS Manager(424-2703); Randy G. Aldrich,MIS Technical Support Branch <br /> Supervisor(424-2703). ' <br /> BUDGET/TIlVIE The Centrex agreement will continue infrastructure costs at a discounted rate, ! <br /> IMPLICATIONS: providing$1776.28 in monthly savings over the tariff rate, for a total savings of , <br /> $106,577 over the life of the contract. Since the CompleteLink contract provides <br /> variable savings, depending on the level of service used, savings can only be ', <br /> estimated. Based on the usage shown in the city's September 2002 billing,that '', <br /> savings could approach$1200 per month. I� <br /> 3 Encls I <br /> as stated �I <br />