SR 02-27-2018 3A
City Council
Report
City Council Meeting: February 27, 2018
Agenda Item: 3.A
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To: Mayor and City Council
From: Susan Cline, Director, Public Works, Airport
Subject: Approve First Modification for Property and Assessment Management
Software
Recommended Action
Staff recommends that the City Council authorize the City Manager to negotiate and
execute a first modification to Software as a Service Subscription Agreement #10362
(SAAS) in the amount of $27,226 with Yardi Systems, Inc., a California-based company,
to obtain additional real property and asset management software licenses and change
the anniversary date from January 25 to December 31. This will result in a five-year
amended agreement (including renewal options) with a new total amount not to exceed
$106,510 with future year funding contingent on Council budget approval.
Executive Summary
The City uses Yardi Voyager®, a proprietary real estate property and asset
management software created by Yardi Systems, Inc. (Yardi), to manage the City’s
commercial real estate operations, execute lease agreements, run analytics, and
provide accounting process services. Staff now requires additional software licenses to
manage properties at the Airport due to the elimination of master tenancies. Staff
requests a first modification to the agreement with Yardi in an amount not to exceed
$27,226, for a new five-year contract total amount not to exceed $106,510.
Background
Yardi has provided real estate property and asset management software services to the
Housing and Economic Development (HED) department and the Airport since
November 21, 2007. Staff uses Yardi Voyager® software to execute leases, run
analytics, and provide accounting process services as well as to perform multiple
property management tasks. These tasks include, but are not limited to generating
monthly courtesy notices for tenants, recording payments, collecting monthly late fees
and security deposits, preparing monthly billing journal entries regarding lease and
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license agreements, tracking tenant insurance documentation, tracking lease/license
expiration dates, maintaining tenant contact information, and assessing Consumer Price
Index (CPI) increases annually.
On September 27, 2016, Council authorized a five-year agreement with Yardi for
software services for an amount of $14,933 in year one with four one-year options to
renew, subject to annual cost of living increases not to exceed 3% per annum, for a total
amount not to exceed $79,284 with future funding contingent of Council budget
approval (Attachment A).
The system was originally procured using a competitive process in 2007. The 2016
support agreement was approved using an exception to the competitive bidding process
because Yardi is the only vendor able to support its proprietary Voyager software. On
December 31, 2017, the City exercised its option to renew the agreement until
December 31, 2018.
Discussion
Currently, HED has two ledger user licenses, and the Airport has three ledger user
licenses and one read-only license. HED manages 157 leases and license agreements
in Yardi Voyager®, and the Airport manages 540 lease spaces in Yardi Voyager®,
including offices, hangars, tie-downs and land leases. Due to the phasing out of master
leaseholds, an additional 69 leasable spaces located at three Airport properties (2828
Donald Douglas Loop North, 3026 Airport Avenue, and 3100 Donald Douglas Loop
South) all of which will be tracked by Yardi in FY 2017-18.
Staff requires three additional ledger user licenses to support the management of the
additional properties and further increase the efficiency of the existing property
management functions. This modification would result in a modification not to exceed
$6,508 in FY 2017-18 and an additional $20,718 over the three subsequent years of the
agreement.
Staff also proposes a modification of the anniversary date of the contract to simplify the
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accounting process for the agreement, resulting in a one-year term from December 31,
2017 to December 31, 2018, with three remaining one-year options to renew. The
modification of the term date would have no impact on the FY 17-18 budget.
Vendor/Consultant Selection
In 2007, staff requested proposals for a web-based, fully integrated platform to manage
commercial real estate operations, execute leases, run analytics, and provide
accounting process services for HED and the Airport. Based on proposals submitted,
Yardi Systems, Inc. was recognized as the best bidder.
Yardi Systems, Inc. is the only vendor that can provide maintenance and support for its
proprietary Voyager software system and is therefore the exclusive vendor pursuant to
Section 2.24.080(d) of the Municipal Code. Staff recommends Yardi Systems, Inc. to
furnish and deliver/provide software updates and support for its proprietary Voyager®
software system as an exception to the competitive bidding process. On September 27,
2016, Council authorized the Software as a Service (SAAS) Subscription Agreement
No. 10362 as an exemption to the competitive bidding process.
Financial Impacts and Budget Actions
The contract modification to be awarded to Yardi Systems, Inc. is $27,226 for an
amended contract total not to exceed $106,510. Funds of $6,508 are available in the
FY 2017-18 budgets in the Public Works and Housing and Economic Development
departments. The contract will be charged to the following accounts:
Account Number Department & Division Amount
33431.588500 Public Works - Airport $5,916
012681.555060 Housing & Economic Development - EDD $ 592
TOTAL $6,508
Future year funding is contingent on Council budget approval.
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Prepared By: Kate Schlesinger, Administrative Analyst
Approved
Forwarded to Council
Attachments:
A. Sept 27, 2016 Staff Report
B. 10102017 Yardi Oaks Initiative Notice executed
REFERENCE:
Modified Agreement
No. 10362
(CCS)