The URL can be used to link to this page

Home My WebLink AboutNB 4 PADS 1980-81 BUDGET 3-3-80~DATE: FEBRUARY 26, 1980 NEW BUSINESS 3-3-80 I e.r-Corn TO: fl%tEMBEES OF TilE CITY COUNCIL ,STEPILEN :L. SCHUSTER, DELEGATE TO PADS 5~B~fCT: ;.PTJIILIC ,~iGE:NCIES DATA :SYSTEMS (, ]~ADS ) 19,8~0~81 ,:BUDGET AND ~DECENTRALIZAT ION PLAN. On ~'ebruary 21, 1980, the PADS Board of Directors unanimously approved a plan for decentralizing PADS data processin'g operations and the tentative budget for FY 1980-81. Attached is a report from Dan Blankenship to me which explains the background. I re~:ommend that our city support the decentralization plan and tentative budget for several reasons. 1. It is the lowest cost alternatiw~ which affords the ability to add systems at very little operational cost. 2. Ir gives the city the best response time and turn around service while eliminating driving to pick up reports. i~ reduces the city's dependence on PADS to program main- ~nance a~d ~opzional systems development so!that the city could continue ~o operate even if ~PED$'folded or the city chose~Zo te~ve membership. · ~,~e PADS ~ssaff is kept relatively small and not burdened ~,~i~h sn~ervision ~of Operational personnel. 5. 'The purchase of equipment will improve the city's position under proposition 4 which limits budget growth. Centralization (central facility housing a large computer or several compubers to do-the actual work) is not really an alternative because of ,many reasons and ~he fact that Fountain Valley must decentralize from an economics standpoinz. They save significant funds over the cost of the centralized operations. If we are to decentralize, then we need to acquire a larger printer than we included in the current budget, and we also need a check imprinter, bursters and related equipment. The cost of this equipment above the $3,450 included in the budget is $9,935, according to the attached memorandum from Ed Bushong. Yime is of the essence since the sooner PADS can phase out its operational staff and focus on programming and delivering the systems it has sold, the better the cities.will be and the less unnecessary pressure on the PADS staff. In addition to the costs shown, there will also be some building modification costs which will depend upon the computer which our city ~ultimately accepts. The equipment recommended to be purchased now will / PADS ~80-81 BUDGET AND DECENTRALIZATION PLAN PAGE TWO actually reduce the $22,000 per year lease payment by 15% to 20% by re- .~uci~g :the amount of the lease. It may later be recommended to pay cash ~Tor the :computer itsel~f and,eliminate the annual lease payments entirely. .~t is thereTore recommended: 1. Council approve the decent~alizecl concept for PADS ,~n:d the$249,430 PADS budget. .~°uncil,~pp~ove T~stin's $29,000 share of the PADS budget for 1980-81 and authorize a supplemental appro- priation for part of the city's equipment in the current fiscal year. o The Council indicate a willingness to accept the larger Series 3 computer at the same cost as the smaller ~iodel 33 computer. Sincerely Yours, Stephen L. Schuster Mayor SLS/eab ~February 26, Dan ~BlaD~kenship, City .Admini~str. ~I/:~T 'CO:S T .FOR ~OTE ~JOB ~Pl~OCES'SI NG 'As approved by the PADS Board of Directors at their last meeting, the City of Tustin will assume the computer · operational responsibilities during the month of April, 1980. This mode' of operation will require the immediate purchase of th~ computer output processing equipment that .will ~ltimately be needed when the Tustin in-house computer is installed sround August or September, 1980. The .equipment required now is as follows: ! - 'Printronix 3:00 line per minute, line printer with sta~d, paper rack & sound ;:cover $ 7,025 Used Burster-Imprinter ~for signin~ checks arid se.Da.rating/staCking $ 5,300 ]. - Used deuOl~aor to:separate multiple part ~repo~t$ ;a'nd checks $ 1,060 TOTAL $13,385 Le~s ~ri~n%er :funded in ~FY 79/80 ~udget $ 3,450 Net additional appropriation $ 9,935 The printer has a 90 day warranty and the burster/imprinter ~and~decollatGr have a 60 day warranty so no service agree- 'ment will be necessary this fiscal year. Next fiscal year the service agreements will be as follows: Printronix Printer Burster/Imprinter Decollator $950/annual $350/annual $ 75/annual It should be noted that the area presently occupied by the Administrative Assistant will be required for this addition of.equipment to the Finance Department. Also some electrical ;modification will be necessary as the area is already under- powered and several extension cords are in use which create an unsafe condition. DATE: FEBRUARY 19, 1980 TO: STEPHEN L. SCHUSTER, DELEGATE TO PADS FRO~: DAN BLANKEI~SHIP, CITY ADMINISTRATOR SUB,~[CT: FADS~B~)GET ~.AND METHOD OF OPERATION A major decision is now before the PADS Board of Directors on the method by whiCh the PADS organization will operate and provide data processing service to our City and the other members. This decision will also directly affect tee 1980-81 PADS budget. EXI~STI~ OPERATION At the present time, PADS has 8½ regular employees and is operating a computer in-a cen%ral service bureau mode while also providing systems maintenance sup- port,anaL systems development staff. About ~-,; years ago, the PADS Board decided that the central computer would no longer ;e "beefed up," but that the plan would be to decentralize the opera- tiona' : ..... ' ~ ~3on while maintaining the centralized programming staff for the mainm£;~n:e and de,.el;:ment functions. The current year's budget included a secon: z.~.~eu~er tcca~e~ in Fountain Valley, reflecting this philosophy of using smalie' :;mputers ;~at can be moved into the member cities (Brea, Placentia, Tustin, Fc;ntain Valley) rather than adding extra equipment on the central machine. DECEh, x.-.~_:Z,~TIO ,1 xD'~xi~l ~Aor_S The dssentralization decision was based on the basic reasons shown on Annex B. Also, a~y city operating police systems will find significant advantages in not being v~inerable to telephone lines tied to a central computer, nor to a lack of security for the computer and files. The cost advantages of decentralization are especially strong for the larger city or the city operating many systems. A city operating only the basic payroll, finance and business license systems has a marginal cost benefit but does have some operational advantages. COMPARISOi~ OF COSTS The following is a brief comparison of costs which are drawn from the detail contained in Annex A and Annex B: S1;e~phen L. Schuster, Del-egate to PADS ~Re: -PADS bu~l§.et and met. hod of ~operation February 19, 19SD Page 2 1979'80 'Bud.get lg80-81 Budget Gentralized Decentralized ~.~talPADS~B~dget ~n-member Costs PADS Member Costs 4 Cities Direct Cost Total Member Costs City of Tustin's Share ~$415,627 '$456~670 $'249;430 126,268 125,000 125,000 $289,359 $331,670 $124,430 -0- -0- 167,950 $289,359 $331,67D S292,380 $ 59,582 $ 68,292 $ 66,300 Tustin's share of the decentralized approach is 11.3% above the current year's bu~ge: but 3.0% less than the centralized approach. Being one of the smaller ~cities,,we do not benefit in cost as greatly from decentralization as the larger citie:, er cities presently operating large water billing activities (Brea and Foungai~ :V&lley), thus an 11.3% increase, when Total Member Costs are up only 1.0~. ~.,_ ~_. .......... ~ on cost includes a one,year assessment of $8,000 to Tus~--<'_~,O~n ~or !il four cities), which will drop our second-year cost by roL~'~c=iy ~nat amo~n.~ amd we will have the right to option out of participation in t~<~se:ond an~ subsequent years systems development program, which represents abou~ ~ ~ e~,OOu (SLO,O00 for all four cities.) In addition, after five years of .le~se ~rchase computer pa~ents, or if we have paid off the principal amount ~arl ~ , ,=: the Ciiy's annual cost will decrease about $22,000. If all of these op- tions weme pursued, our annual cost in today's dollars would represent about S~6_ ,300, for paper, computer maintenance, systems maintenance from PADS, and the equivalent of Dna-quarter of an employee for operating the computer and printer. The J ' ' ad~tlon of systems development ($10,000), if approved by the Council when the systems development program was established by the PADS Board, would only increase the cost to $36,300, or 54,8% of the 80-81 cost ($66,300). RECOMMENDATION Due ~o the advantages of decentralization,the ability~to add systems at Tittle increases cost, the ability to stabilize and decrease costs, and the greater con- trol; Ed Bushong and I recommend that Tustin support the decentralization plan at the PADS Board and to our City Council. Centralization will have a higher price and less fle×ibility. Stephen L. Schuster, Delegate to PADS Re: PADS budget and method of operation February 19, 1980 Page 3 IMPACT OF PADS SALES TO OTHERS PADS has.become~very%successful this year.as sales and/or contracts with others repPeserrt ~0.~4% ($126,268 of $415,627~) of the PADS budget, compared with only 7.9% in FY T978-79. These sources represent an estimated 27.4% of the PADS budget for FY 1980-81 in the centralized mod~or 29.9% in the decentralized mode, including direct member cities costs. PADS has sold systems to Mountain View, Azusa, E1Centro an~apparentl~West Covina, this year, and several other sales are already in the works for next year. These sales are allowing costs to be controlled while allowing PADS to maintain a larger staff less subject to the effects of turn-over. These sales are also bringing in systems development funds for systems in which our cities may be interested. DEVELOPMENT OF POLICE SYSTEM The ~ staff is presently developing a police system which should be helpful in hz!Lin§ down clerical increases in the future as well as giving the depart- ment be:ter access to their data on detecting trends and likely crime areas. This ,~id be most feasible with the decentralized computer due to greater re- liab~'i~ly and~e.curity. The c~a] ~f participating in the system will be $6,000 for systems development ~ext year and ~he cos~ of the equipment in the Police Department. There would be n~ acded com?u~er cost, although we would assign part of the Finance Depart- ment '~ computer costs to the Police Department to distribute the cost more fairly. ~We v~iil ~e working with the Police Department to develop a request to the City Council for the funding. CHOICE OF COMPUTER ,Under the decentralized plan, the City of Tustin would have a PIodel 33 Hewlitt- Packard, which is a small but more than adequate sized mini-computer. However, PADS needs to have on of the cities accept the larger Series 3 Model we have as the central computer at the PADS office. This avoids having to buy a new com-- puter and makes available one that the PADS staff can use for systems development o~er telephone lines. Tustin is the ideal city for this arrangement, since we are the closest to the PADS office and telephone costs will be lower. The City would receive a much larger, faster computer at the same cost as we would pay for the smaller computer. The key issue will be finding space for the computer, which probably could be located in the City Hall basement. This will require some con- struction cost in order to erect a wall for dust protection and air conditioning for cooling and moisture control. We would like to have your concurrence in accept- ing the larger computer. Stephen L. Schuster, Delegate to PADS ~Re: PADS budget and method of operation · Pebruary 19, 1980 ~age 4 CONCLUSION ~Ed-~Bushoog~,and I recom,~ndyoursupport,of~the~Uecent'~alized~PADS~budget and-conc~rmence in T. ustin~accepting the l~r§er computer if~adequate space can be made available in the basement. Respectfully submitted, Dan Blankenship City Administrator ,DB/hlr Attachments N O0 000 0 0 CD 000 (CD 0 0 000 0 0 ~'- 090,.)00 05 tO U") t..O kC) CO ,-- ,-- 0'~ 020 cOO r~ o'10 COCO r-'O Annex A L~ ga_ or.- ~ I::: U Ir' ~ PUBLIC AOENC~S DATA=S~STEi~ l. ~all'to'~rd~r 2. Approval of Minutes T~e~surer',.s Report ACTION ITEMS 4. Approval of Adjustment to 1979-80 Budget~ ~he lg79~80 Budget of $.3'89,057 ~eeds to be increased to S.1:~,,627 provide for part-time help, the $10,000 Entrex settlement, a provision ,t~.~ will not require 'for video-taping training, and other minor cosls. addition, al -funds from member c'iti'es. '5. ]Z~m~mval .c'f ~qid;Year Salary Adjastme~t.s S;aiary leN~el=s in the data processing field are rising quite rapidix, ~ .... po~n~ that adjustments are merited and necessary te avoid further ~n~.~ver. ~he ~pe~al~ons Committee ~ecomn~ends ap~royal of .certain in- A~roval of Tentative Budget for 19~:~0-91 and Related Policy Decisions The :decision on the basic methed of operatinq daLa ',~'~, . sy~ .... and tentaLive i~=~OuS1 b~dget is now ~i~propriate. AFter Bmard~actiDn, each city ~ili me'ed .to go back and get Council authorization to c,)m,,~% ~o the tentative budget and related policies. SI~, ~S REPORTS 7. Ent~ex and General Automation These suits have both been resolved. ,:qar ket 1 OT~.~E'R .-BUSINESS Scheduled adjournment prior to 6:30'p.m. CITY OF TUSTIN COST (PADS) (In constant dollars) Dan Blankenship 2/20/80 S 8O 70 6o 5O 4O 3O 2O lO 79-80 81 82 83 84 85 86 a. b. ,c. d. e. f. a. 1st sear of decentralization including one-time cost of S~,~SC for Tustin ($66,300) b. 2nd year of decentralization excluding one-time cost of tst year ($58,300) c-e Same as 2nd year (,$58,300) f. 6th year of decentralization-computer paid off ($36.300) 37.7~'~ reduction ~bove based on Paying systems development of $10,000 each year 2. Disregards system development reduced computer cost after computer paid for in year "c" 3. Year "b" through "e" has 37.7% not subject to inflation for computer payment. 4. Disregards normal inflation 5. Disregards increased efficiency as new systems are added at same cost. Dan Blankenship .. 2/20/80 BREAKDOWN OF EXISTING LOANS (Payable After 6-'30,80) ~A¢~K OF WHITTI£R -~o$177,000 -84,000* $ 93,000 - 22,744 $ 70,256 + 6,000 S 76;256 - 60,O00 'After 6~30-80 Principal ~& Interest Principal Only Charge to Tustin (or?).equivalent new computer Remainder Sell to Cities $"8,000 burster-signers (2) $10,000 printer charge to Brea or Placentia as part of computer system $ 4,744 4 Adds Regent lO0 CRTS Assume by PADS Interest on $70,256 Less $20,000 for 3 years by system development $ 1:6,2'5 ~ ~4~K OF AMF. R:CA S123,322.70 - 16;020:8t ST07,~01.89 7,000.00 S100,301=89 - 84,000.00 * S 16,301.89 - 17,000.00 Responsibility ofmembers IF not paid off by sales- includes $42,000 for 3 ea. 50 MB Disc drives which 'could be sold as well. Principal & Interest Interest Principal Discount Due (7%) Charge to Fountain Yalley equivalent new computer Charge to Brea or Placentia as part of computer system -- the 120 )IB DISC drive GraphiCs printers for police system development free and clear, * Does not include sales tax of $5,040.00