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Home My WebLink AboutCS 24-05PICKERING REPORT TO EXECUTIVE COMMITTEE Report Number: CS 24-05 Date: June 7, 2005 Fro m: Gillis A. Paterson Director, Corporate Services & Treasurer Subject: Xerox Photocopier- Print/Mailroom Upgrade Current Model 5895 with Proposed Model 2101 Recommendation: 1. That report CS 24-05 of the Director, Corporate Services & Treasurer be received and that: the proposal submitted by Break-Away Business Systems, an authorized Xerox dealer, to replace and upgrade the existing photocopier Model 5895 to a Model 2101 be accepted; 3. Council authorize the Director, Corporate Services & Treasurer to execute an extension to the current lease agreement to provide for the above; Council authorize the Director, Corporate Services & Treasurer to alter terms, conditions and/or suppliers if necessary, for the Print/Mailroom to meet, maintain and provide high-speed photocopy services to the City; and, 5. Staff at the City be given the authority to give effect thereto. Executive Summary: The City conducted a review and analysis of its high-speed print/mailroom photocopier (Model 5895). The City's current copier is 5.5 years old and is based on old analogue technology. Xerox Canada has proposed to replace the current model with a new digital technology copier that offers the following benefits: higher quality, network capability and increased reliability. In addition Xerox has offered to remove the existing photocopier and install the new machine at no additional costs. A revised cost per copy, monthly lease cost and lease term structured to reflect our current copier expense, would take form in an extended lease agreement. The offer to upgrade is similar to that which was presented to the Region of Durham in 2003. This resulted in Xerox recommending a plan to restructure their current contract and the Region received approval to enter into a revised agreement presented in Regional Report 2004-F-32. This then led Xerox to respond favourably to the Region's enquiry regarding the existing photocopier. Report CS 24-05 Xerox Photocopier- Print/Mailroom Upgrade Current Model 5895 with Proposed Model 2101 Date: June 7, 2005 Page 2 Financial Implications: The current lease agreement makes provision for the agreement terms to be altered without penalty by upgrading the current model. Xerox would revise and extend the current lease to 2011 from its current expiry date of December 31,2006. Cost plus Benefits Summary: Current Lease Proposed Lease Features Model 5895 Model 2101 Technology Analogue Digital Pro Finisher Not Available Included Network Printing Not Available Included $0.0065 per copy no minimum Cost per copy $0.0142 X 2,640,000 plus minimum copies annual lease payment $23,398.00 Projected annual cost $37,488.00 $40,120.00 based on 2004 actual copy volume of 2,572,636 Average service interval 74,000 impressions 150,000 impressions resulting in equipment 3 times per month 1.5 times per month downtime As value added incentives, Xerox Canada Ltd. has also offered the following: professional finisher attachment - no charge (normally a $16,000.00 option) credit voucher to pay the first semi-annual payment ($11,699.00 savings) first 1,200,000 copies free ($7,800.00 savings) The Director, Corporate Services & Treasurer has certified that this lease agreement and repayment thereof falls within the City's Debt & Financial Obligations approved Annual Repayment for debt and other financial obligations for 2005 as established by the Province for municipalities in Ontario. Background: The current proposal made by Xerox to upgrade the existing machine is a promotional offer, providing mutual benefit to the City of Pickering and Xerox Canada Ltd. by allowing us the advantages of a new digital photocopier to replace our current 5.5 -year- old analogue model. Xerox will benefit due to reduced maintenance and repair costs. Report CS 24-05 Date: June 7, 2005 Xerox Photocopier- Print/Mailroom Upgrade Current Model 5895 with Proposed Model 2101 Page 3 The Supply & Services Section, in conjunction with the Clerk's Division has been provided a full demonstration of the proposed Xerox Model 2101. Clerk's Division staff, including the former Supervisor, Legislative Services and Print/Mailroom staff, has attended the demonstrations and agree the Xerox 2101 is a worthwhile upgrade, providing the City with improved reliability and digital technology. A benefit analysis has been conducted and has determined the following: · upgrade to current digital technology · new equipment incorporating new copying and printing technology provides for less moving parts and subsequent less down time · network interconnectivity allows staff network access to the print room photocopier and will produce better print quality, better reproduction of shades and tones and will reduce the demand on departmental photocopiers and laser printers · includes a professional finisher, which will reduce time during each print job where folding is also required to complete the task · increase the speed and quality of jobs, reduction in printing originals, paperwork and footwork. Council Resolution #237/99 provides the Director, Corporate Services & Treasurer the authority to make changes in respect of replacing photocopiers. Under Definition 01.04 of the Lease Financing Policy this upgrade is not deemed to be a Material Lease, in that there is no material financial impact for the municipality. However, since a new lease term of 66 months would be entered into, this report is submitted for Council's consideration. The offer made by Xerox to upgrade the current photocopier and provide value added incentives has been presented to the Treasurer by staff for consideration. It is recommended to accept this offer and complete a lease agreement with Xerox as presented. Attachments: Not applicable Report CS 24-05 Xerox Photocopier- Print/Mailroom Upgrade Current Model 5895 with Proposed Model 2101 Date: June 7, 2005 Page 4 Prepare~By: Vera A. Felgemacher Manager, Supply & Services Approved / Endorsed By: Gillis A. Paterson Director, Corporate Services & Treasurer Prepared By: I~urchasing A~alyst GAP:vf Copy: Chief Administrative Officer Recommended for the consideration of Pickering Cit~ ...Council /,' ..-.~ ~' Tl~r~s J. Ouir~, Ct'~ Adm~v. e~.