To: Honorable Mayor and Members of City Council
From: Liz Habkirk, Assistant City Manager
Prepared By: Scott Nielsen, Information Technology Manager
TITLE:
Title
Enterprise Resource Planning (EERP) Support Agreement and Project Budget Amendment
LABEL
RECOMMENDED ACTION:
Recommendation
Adopt a resolution approving and authorizing the City Manager to (1) execute Amendment No. 2 to City Agreement No. C2025-037 with Koa Hills Consulting LLC, in the amount of $235,000 for a total contract amount not to exceed $535,000 for on-going technical and application support for the current Tyler Technologies Enterprise Resource Planning system; and (2) approving a transfer in the amount of $350,660 from the Nonrecurring General Fund to the Information Technology Fund as documented in Council Budget Amendment No. 5P06.
Body
DISCUSSION:
On March 13, 2025, the City entered into an Agreement, C2025 037, for Enterprise Resource Planning (EERP) Support for services including Enterprise Permitting & Licensing (EPL) Implementation, analyst on demand hours for financial support and project management with Koa Hills in an amount not-to-exceed $150,000.
It was determined that additional dollars were required to continue to perform the services in the agreement and on August 19, 2025, the City entered into Amendment No. 1 in an amount not-to-exceed $150,000, bringing the total not-to-exceed amount to $300,000.
The Information Technology Manager has determined that additional dollars are required to continue, modify, or expand the Services performed under Amendment No. 1 to the agreement for an additional not-to-exceed amount of $235,000
This amendment No. 2 will bring the total not-to-exceed amount to $535,000; $150,000 for the original agreement, $150,000 for Amendment No. 1, and $235,000 for this Amendment No. 2. The Agreement is subject to appropriations in any fiscal year.
Koa Hills Consulting LLC has consistently demonstrated reliability and professionalism, delivering a high level of technical expertise and responsive support. Their team members are uniquely adept at enhancing the online permitting customer experience.
Funding for the $235,000 amendment is proposed to come from the Nonrecurring General Fund’s contingency budget. An additional $60,000 is needed in Nonrecurring General Fund contingency for part-time staff support that is dedicated to the implementation of the Enterprise Resource Planning (EERP) project. The Nonrecurring General Fund’s contingency budget is for one-time or project needs and is therefore, an appropriate use of these contingency funds.
The Enterprise Resource Planning (EERP) project lives in the Information Technology Fund (630) in a sub-fund dedicated to Information Technology projects (63012220). The EERP project is currently the only project within this sub-fund. Staff recently reconciled the sub-fund and EERP project in order to assess funding needs. When reviewing all expenditures from the inception of the project, two invoices were discovered that had been paid in prior closed fiscal years from this sub-fund that were unrelated to the EERP project. These invoices, totaling $55,660, were for work related to the Information Technology Strategic Plan. Since these invoices were paid in a prior fiscal year, no action can be taken to correct the accounting. Funding for the Information Technology Strategic Plan was appropriated in the Nonrecurring General Fund. These funds were unexpended. A transfer of $55,660 from the Nonrecurring General Fund to the Information Technology Fund will correct this administrative error and right-size the Information Technology Fund’s fund balance.
FINANCIAL IMPACTS:
The proposed action would require the transfer of $350,660 from the Nonrecurring General Fund’s (101) contingency budget to the Information Technology Fund (630). There are sufficient funds in the Nonrecurring General Fund contingency budget.
$295,000 of the proposed transfer would go to the Enterprise Resource Planning (EERP) project (40LANDMGMT) and $55,660 of the proposed transfer will go to the Information Technology Fund’s fund balance to correct a prior year administrative error.
CEQA:
The Information Technology Manager has determined that the Recommended Action described in this Agenda Report is not subject to CEQA, pursuant to CEQA Guidelines Section 15060 (c).
DOCUMENTS ATTACHED:
ATCH 1 - Resolution
EX A - Council Budget Amendment No. 5P06
ATCH 2 - Amendment 2 to C2025 037
ATCH 3 - Amendment 1 to C2025 037
ATCH 4 - Agreement C2025 037
NOTIFICATION:
None.