P10-H25006.A2 - Approve an ordinance amending Ordinance No. 2014-756 (approved August 6, 2014) to increase the maximum contract amount from $22,106,523.00 to $34,998,515.54; approving and authorizing a second amendment to Contract No. 4600012882 between the City of Houston and SAP Public Services, Inc. modifying the terms of the agreement and extending the contract term from August 19, 2024, to August 19, 2027 for the Enterprise Resource Planning System and related solutions for Houston Information Technology Services.
Specific Explanation:
The Chief Information Officer and the Chief Procurement Officer recommend that City Council approve an amending ordinance to increase the maximum contract amount from $22,106,523.00 to $34,998,515.54 and approve a second amendment to the contract between the City of Houston and SAP Public Services, Inc. modifying the terms of the agreement and extending the contract term from August 19, 2024 to August 19, 2027 to continue receiving services for the Enterprise Resource Planning (ERP) System and related solutions for Houston Information Technology Services.
The Agreement was awarded on August 6, 2014, by Ordinance No. 2014-0756, for a four (4) year term, with five (5) successive one-year renewal terms, in the amount of $18,000,000.00. On November 18, 2020, a First Amendment was approved pursuant to Ordinance No. 2020-0996, which increased the maximum contract amount from 18,000,000.00 to $22,106,523.00, extended the contract term to August 19, 2024, and modified the terms of the agreement allowing for the purchase of SAP Cloud products and services. Expenditures as of September 14, 2023, totaled $19,883,243.59. This request for a second amendment to the agreement will modify the terms of the agreement, extend the contract term, and increase the maximum contract amount to allow the City to receive continued services for the ERP system and related solutions.
SAP Public Services will provide licenses, maintenance, and related professional services. The agreement allows the City to receive services for Human Capital Management and Payroll solutions, Employee Benefits Management, Cloud-based Analytics solutions, Contract and Procurement Management solutions, Contingent Workforce solutions, as well as system and application maintenance.
This initiative was presented to the Transportation, Technology, and Infrastructure Committee on July 13, 2023.
M/WBE Subcontracting:
This contract was awarded with a 35% M/WBE participation goal for the professional and consulting services portion of this contract related to the City’s Enterprise Resource Planning system. This contract thus far has been used to procure software licensing only, and not professional or consulting services. Therefore, the vendor is currently achieving a 0% participation level due to no subcontracting opportunity. However, the City is utilizing ERP-related professional services under two separate agreements, all which were competitively procured and are currently achieving M/WBE participation goals of 20.06% and 27.07% in their respective contracts. The Office of Business Opportunity has determined that 35% M/WBE goal is not applicable for this phase of the contract and approved a 0% MWBE goal.
Fiscal Note:
Funding for this item is included in the FY2024 Adopted Budget. Therefore, no fiscal note is required as stated in the Financial Policies.
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Jedediah Greenfield,
Chief Procurement Officer,
Finance/Strategic Procurement Division
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Lisa Kent, Chief Information Officer
Houston Information Technology Services
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Estimated Spend Authority
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Department
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FY2024
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Out-Years
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Total
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HITS
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$962,904.14
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$11,929,088.40
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$12,891,992.54
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