kg1 BOARD OF AIRPORT COMMISSIONERS G, Meeting Date: REPORT TO THE

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1 ' Los Angeles Work! Airports REPORT TO THE BOARD OF AIRPORT COMMISSIONERS G, Meeting Date: 'f:, =1 ber Approved by.: Aura M a ief Information Officer 6/1/2017 Reviewed by Justin Erb:cci Chief Innovation & Technology S '' City 'tto G - kg1 Deborah Flint - ie xecutive Officer er Completed CAO Review: Pending 10 N/A Reviewed for Date!Approval Status Ely Finance 5/17/2017 I NY N NA CEQA i 5/15/2017 i Y N Procurement 5/12/2017 I Y ON Cond Guest Experience 5/17/2017 I MY ON RW AE MT BY SUBJECT: Contract Award to Phoenix Business Inc. dba Phoenix Business Consulting for SAP BASIS Maintenance and Support Services Award a three -year contract to Phoenix Business Inc. dba Phoenix Business Consulting to provide SAP BASIS maintenance, as- needed programming, and functional support services in an amount not to exceed $347,000. RECOMMENDATIONS: Management RECOMMENDS that the Board of Airport Commissioners: 1. ADOPT the Staff Report. 2. DETERMINE that this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Article II, Section 2.f of the Los Angeles City CEQA Guidelines. 3. FIND that the work can be performed more economically or feasibly by an independent contractor than by City employees. 4. APPROVE the award of a three -year contract to Phoenix Business Consulting to provide professional SAP BASIS maintenance, as- needed programming, and functional support services for the SAP system in an amount not to exceed $347, AUTHORIZE the Chief Executive Officer to execute the contract after approval as to form by the City Attorney. Page 1

2 DISCUSSION: 1. Purpose The proposed replacement contract will provide professional SAP BASIS maintenance, asneeded programming, and functional support services for the SAP system at the Los Angeles World Airports (LAWA). 2. Prior Related Actions October 15, Resolution No (DA -4766) The Board of Airport Commissioners (Board) awarded a three -year contract to The Basis Group Inc. dba Group Basis in an amount not to exceed $450,000, which began on October 24, 2012 and expired October 23, Subsequently, LAWA issued a new Request for Proposals and established Service Agreement No with Blue Pier Management effective November 30, 2015, and expiring on June 30, 2017, to cover SAP BASIS remote services. 3. Current Action Systems, Applications, Products (SAP) is an enterprise resource planning system which requires a complex set of technical skills to properly develop and maintain operations at LAWA. This includes knowledge and experience in Structured Query Language (SQL), Windows, and the critical SAP component known as Business Application Software Integrated Solution (BASIS). SAP BASIS services are used by LAWA to monitor the system and database, identify performance issues, and take necessary corrective action. While the LAWA technical team dedicated to the system is responsible for setting up and maintaining the integrity of the data and establishing system parameters, the team requires additional as- needed support services for complex system issues and implementation of new functions within SAP. A summary of past expenditures is listed below. Description BASIS Monthly Maintenance Support Services ($51,446.67/year x 3 years) Expenditures $ 154,340 BASIS Special Projects $ 41,330 Total Expenditures $ 195,670 Procurement Process On September 19, 2016, LAWA advertised the opportunity for SAP BASIS and Support Services RFP on the Los Angeles Business Assistance Virtual Network (LABAVN). No Small Business Enterprise (SBE) Program or Local Business Enterprise (LBE) subcontracting participation levels were required for this procurement due to the low dollar value of the contract. The BAVN posting was viewed by 205 unique users. RFP responses were due on December 7, 2016, and the evaluation panel included the following staff: Chief Financial Officer - Finance & Budget Division Chief Management Analyst - Financial Management Systems Page 2

3 Information Systems Manager II - IMTG Information Systems Manager I - IMTG Database Architect - IMTG Below are the criteria used to evaluation respondents: SAP BASIS and Support Services Proposal Part A - Written Proposal Evaluation Criteria Points Section 1 - BASIS Support 45 Section 2 - Programming Support 20 Section 3 - Functional Support 15 Section 4 - Labor Rates Proposal 20 Total Evaluation Points 100 Proposal Part B - Administrative Requirements Pass /Fail LAWA received a total of 14 responses, and all firms passed the Administrative Requirements review conducted by Procurement Services Division (PSD). The combined written and oral evaluation rankings are as follows: Rank Proposer 1 Phoenix Business Consulting 2 V3iT Consulting, Inc. 3 Blue Pier Management 4 Quintel -MC, Inc. 5 Sage Group Consulting 6 Infosys Ltd. 7 Wipro, LLC 8 IBM 9 Ciber, Inc. 10 LSI Consulting 11 TriCore Solutions 12 Civatree Technologies 13 SAI Business Solutions, LLC 14 Stellar Services, Inc. The top five firms achieved a passing score of 65% or higher on the written proposal and were interviewed on April 19, At the conclusion of the interviews, the evaluation panel determined that Phoenix Business Consulting was the best qualified firm and possessed all the resources needed to provide the SAP BASIS, functional, and programming support services required by LAWA. Page 3

4 Action Requested Staff requests that the Board authorize the Chief Executive Officer to execute a three -year contract with Phoenix Business Consulting to provide 24 hours per day, 7 days per week, professional SAP BASIS maintenance support services, as- needed programming, and functional support services in an amount not to exceed $347,000. The table below provides a summary of expenditures for the next three years. The costs for SAP BASIS maintenance support services negotiated with Phoenix Business Consulting represent a decrease of approximately 12.5% from the current contract costs. The estimated special projects allowance will identify projects for additional software enhancements to improve database processing for SAP efficiency, customize the SAP graphical user interface to enhance the user experience, and stay current with the latest software version of SAP. Description 3 -Year Estimated Costs* SAP BASIS Maintenance Support Services ($45,000 /year x 3 years) $ 135,000 SAP BASIS Special Projects Allowance $ 212,000 Total Expenditures $ 347,000 *Costs for individual line items may vary, but the total expenditures shall not exceed $347,000. Fiscal Impact Costs incurred under this contract will be recovered through landing fees and terminal rates and charges as well as through non -aeronautical revenues. 4. Alternatives Considered Take No Action Without this contract, LAWA will not have available, qualified, professional resources to support, monitor, and maintain the SAP system on a 24 hours per day, 7 days per week basis. This may result in inaccurate tracking of annual revenues for LAWA if the critical business functions of the system become unavailable or interrupted. Use City Staff Neither LAWA nor the City has staff with the technical knowledge or expertise to resolve the complex problems periodically encountered with SAP, APPROPRIATIONS: Funds for this contract have been requested for the FY Los Angeles World Airports Operating Budget in LAX Cost Center Business Applications & Support Division, Commitment Item Contractual Services. Funding for subsequent years will be requested as part of the annual budget process. STANDARD PROVISIONS: Page Board Report SAP Basis Contract

5 1. This action, as a continuing administrative activity, is exempt from the requirements of the California Environmental Quality Act (CEQA) pursuant to Article II, Section 2.f of the Los Angeles City CEQA Guidelines. 2. This contract is subject to approval as to form by the City Attorney. 3. Actions taken on this item by the Board of Airport Commissioners will become final pursuant to the provisions of Los Angeles City Charter Section Phoenix Business Consulting will comply with the provisions of the Living Wage Ordinance. 5. Procurement Services has reviewed this action (File No ). No mandatory Small Business Enterprise (SBE) goal was set for the project as there were no subcontracting opportunities. 6. Phoenix Business Consulting will comply with the provisions of the Affirmative Action Program. 7. Phoenix Business Consulting must submit a Business Tax Registration Certificate number prior to execution of contract. 8. Phoenix Business Consulting will comply with the provisions of the Child Support Obligations Ordinance. 9. Phoenix Business Consulting will have approved insurance documents, in the terms and amounts required, on file with Los Angeles World Airports prior to issuance of a Notice to Proceed. 10. Pursuant to Charter Section 1022, staff determined the work specified on the proposed contract can be performed more feasibly or economically by an Independent Contractor than by City employees. 11. Phoenix Business Consulting has submitted the Contractor Responsibility Program Questionnaire and Pledge of Compliance and will comply with the provisions of the Contractor Responsibility Program. 12. Phoenix Business Consulting must be determined by Public Works, Office of Contract Compliance to be in full compliance with the provisions of the Equal Benefits Ordinance prior to contract execution. 13. Phoenix Business Consulting will comply with the provisions of the First Source Hiring Program for all non -trade Airport jobs. 14. Phoenix Business Consulting has submitted the Bidder Contributions CEC Form 55 and will comply with its provisions. Page 5