REPORT TO COUNCIL
SUBJECT
Title
Action to Authorize the City Manager to Issue Purchase Orders and/or to Negotiate and Execute Agreements with Dell Marketing LP, SHI International, CDW Government LLC, Carahsoft Technology Corp., Presidio Network Solutions, LLC, Insight Public Sector, TD Synnex Corporation, and/or their Authorized Resellers, Under Cooperative Purchasing Agreements for the Purchase of Various Information Technology Products and Services for Silicon Valley Power, for a Total Amount Not-to-Exceed $12 Million, and Approve Related Budget Amendment
Report
BACKGROUND
Information Technology (IT) serves as a key enabler for the City of Santa Clara’s Electric Utility, Silicon Valley Power’s (“SVP”), mission to provide safe, reliable, and efficient electric service to the community. IT systems support every aspect of utility operations - from power generation and distribution management to customer service, cybersecurity, and data analytics. As technology continues to evolve, continuous improvement and modernization of SVP’s IT environment are vital to ensuring system reliability, protecting critical infrastructure, enabling data-driven decision-making, and improving service delivery. By maintaining the ability to procure, upgrade, and enhance technology systems, SVP safeguards its capacity to adapt to future challenges - including its growth targets, increased grid complexity, renewable integration, and heightened security requirements - while continuing to deliver exceptional value and service to the community and meeting the growing expectations of customers, regulators, and stakeholders.
This report seeks authorization to pursue ongoing investments in IT systems to support SVP’s operational, administrative, and strategic needs. These investments include acquiring new technologies, enhancing existing systems, and replacing legacy platforms that have reached end-of-life or no longer meet modern performance, integration, or cybersecurity standards.
SVP’s IT environment is complex and encompasses both enterprise business systems and mission-critical operational technologies and covers approximately 2,000 managed devices. Current scope includes:
• Desktop and Mobile Computing: Approximately 225 desktop computers, 175 laptops with docking stations, and 500 monitors are deployed to SVP staff and field personnel to support daily work activities. Many of these systems are high-performance workstations used for engineering, AutoCAD, GIS, SCADA configuration, and other specialized applications.
• Server and Data Center Infrastructure: Approximately 97 physical and virtual servers located in SVP-managed data centers that host key applications such as GIS, energy management, work orders, and financial systems. These systems require ongoing maintenance, hardware refresh, and operating system upgrades to maintain reliability and security.
• Storage Area Network (SAN) and Enterprise Backup Solutions: SVP uses a SAN and Enterprise Backup Solution for Disaster Recovery. The SAN and Backup Solution have reached their end-of-life and are no longer supported by Hewlett Packard Enterprise Development LP (HPE).
• IT and Operation Technology (OT) Network and Communications Equipment: Numerous core switches, routers, firewalls, networking components for SVP’s secure communication segmented backbones, securely connecting substations, control rooms, AMI network, and administrative offices.
• Cybersecurity and Data Protection Systems: Firewalls, endpoint protection, vulnerability management, cloud security, network intrusion detection systems, backup appliances, and monitoring tools essential for maintaining the security and resiliency of SVP’s IT and OT environments.
• Enterprise and Business Applications: Software licenses and maintenance for productivity, asset management, GIS, and specialized utility applications that require ongoing vendor support.
• Peripheral and Specialty Equipment: Printers, plotters, scanners, and other hardware supporting engineering design, field data collections, and administrative operations.
• Audiovisual Equipment: Audio, video, projection, and photographic equipment, screens/displays, and peripherals/accessories.
DISCUSSION
SVP System Support Group (SSG) recently conducted a review of anticipated IT system requirements. Based on that review, staff developed an estimate of expenditures required to maintain, upgrade, and replace IT equipment and services necessary for SVP’s ongoing operations. The IT goods and services anticipated under this report are essential to support enterprise systems, network infrastructure, and cybersecurity tools, enable SVP’s business continuity and operations, replace aging hardware and avoid technical obsolescence, and mitigate security risks from malware, and other vulnerabilities.
Table 1 below summarizes the estimated five-year expenditures for IT goods and services needed to support SVP’s operations. While this request seeks multi-year spending authority, a portion of the funding is requested in this fiscal year to address immediate, high-priority needs, including cybersecurity enhancements required in advance of the SBLX and FIFA World Cup events and replacement of end-of-life OT/IT networks and storage infrastructure. Several core network components and the Storage Area Network are nearing end-of-life and expiration of vendor support. All remaining expenditures would be phased over the five-year period to support planned system upgrades and ongoing security and infrastructure requirements.
Table 1 - Estimated Five-Year IT Expenditures
|
IT Category |
Description |
Anticipated Timing |
Estimated Five-Year Spend |
|
Desktop and Mobile Computing |
Replacement of desktop computers, laptops, docking stations, and monitors based on established equipment life cycles |
Phased over the five-year term as equipment reaches end of life; estimated FY 2025/26 spend is $250,000 |
$750,000 |
|
Server and Data Center |
Ongoing refresh and support of servers and data center systems |
Phased over the five-year term as equipment reaches end of life; estimated FY 2025/26 spend is $250,000 |
$700,000 |
|
Storage and Backup Infrastructure |
Replacement of SAN and enterprise backup systems at two locations |
Near-term; system configuration and purchase anticipated by March 2026; estimated FY 2025/26 spend is $2,700,000 |
$2,700,000 |
|
Cybersecurity and Data Protection |
Cybersecurity platforms including vulnerability management, remediation, log management, secure remote access, security operations, data governance, and endpoint detection and response |
Near-term replacement of end-of-life systems with additional upgrades phased over the term; estimated FY 2025/26 spend is $1,000,000 |
$2,350,000 |
|
IT and OT Network and Communications Equipment |
Network infrastructure supporting security IT and operational technology environments, including firewalls, core switches, core routing, access layer switches, wireless access points, network monitoring platform, and IDS/IPS |
Near-term replacement of end-of-life systems with additional upgrades phased over the term; estimated FY 2025/26 spend is $3,000,000 |
$5,400,000 |
|
Peripheral and Specialty Equipment and Audiovisual Equipment |
Replacement and upgrades of various equipment |
Replaced on an as-needed basis; estimated FY 2025/26 spend is $50,000 |
$100,000 |
|
|
|
Total |
$12,000,000 |
To efficiently procure the broad range of technology goods and services described above, staff recommend utilizing cooperative purchasing agreements. This recommendation is in accordance with Section 2.105.270(c) of the City of Santa Clara Code, which authorizes the City to contract with vendors under contracts awarded using preestablished cooperative purchasing agreements when such agreements result from a competitive bid process that meets or exceeds the competitive bidding process of the City, as determined by the Purchasing Division Manager.
Cooperative purchasing agreements have become a common strategy among public agencies for acquiring technology goods and services. By sharing procurement efforts with other government entities, agencies leverage the full competitive process, including solicitation development, bid advertising, evaluation, and award, conducted by a lead public agency. Using these competitively awarded contracts enables the City to benefit from lower pricing due to aggregated demand, reduced administrative workload, and shorter procurement timelines. These agreements are rebid and renewed upon expiration, ensuring that participating agencies continue to benefit from competitive pricing and contract efficiencies.
The City intends to use several competitive cooperative agreements for IT-related procurements. A summary of the cooperative programs is provided below:
• NASPO ValuePoint: NASPO ValuePoint is a national cooperative purchasing program facilitating public procurement solicitations and agreements using a lead-state model and provides the highest standard of excellence in public cooperative contracting. NASPO ValuePoint is available to public agencies and is a program under National Association of State Procurement Officials (NASPO), comprising of chief procurement officials of all 50 states, the District of Columbia, and U.S. territories.
• OMNIA Partners: OMNIA is a national government purchasing cooperative that administers competitive solicitations in partnership with lead public agencies. OMNIA’s process complies with public sector procurement requirements, allowing local and state government agencies, school districts (K-12), higher education institutions, and nonprofits to utilize competitively awarded contracts.
• Sourcewell: Sourcewell is a national cooperative procurement organization that conducts its own competitive solicitations as a lead agency. Its procurement process includes public advertising, evaluation, negotiation, and awarding that is consistent with public purchasing laws. Sourcewell’s competitively awarded contracts are available to government agencies, education institutions, and non-profits.
Staff requests approval for spending authority to execute agreements and/or purchase orders for a not-to-exceed amount of $12 million for a five-year period through December 31, 2030, and authorization to use the cooperative purchasing agreements listed in Table 2 below. In accordance with Section 2.105.270(c) of the City of Santa Clara Code, the Purchasing Division Manager has determined that the cooperative agreements listed in Table 2 resulted from a competitive bid process that meets or exceeds the competitive bidding process of the City. Staff also request the authority to substitute any of these cooperative agreements with the applicable replacement agreement issued by the same cooperative organization if the existing agreement expires during the purchase approval period; provided that the replacement agreement meets the requirements of Section 2.105.270(c) as determined by the Purchasing Division Manager.
Table 2 - Cooperative IT Purchases for SVP
|
Att. # |
Vendor Name |
Cooperative Purchase Agreement |
Description |
|
1 |
Dell Marketing L.P. |
NASPO ValuePoint Master Agreement No. 23026 (formerly No. 23004), which is effective through June 30, 2028, if all options are exercised |
Desktop and mobile computing, including computers, laptops, equipment, and peripherals |
|
2 |
SHI International |
Sourcewell Master Agreement No. 121923-SHI, which is effective through February 27, 2031, if all options are exercised |
Hardware, software, cloud, cybersecurity, networking, storage, peripherals, and services |
|
3 |
CDW Government LLC |
OMNIA Partners, Public Sector Master Agreement 2024056-01, which is effective from July 2, 2024, through July 1, 2034, if all options are exercised |
Laptops, networking equipment, system components, desktop and notebooks, networking equipment, servers, cybersecurity, and services |
|
4 |
Carahsoft Technology Corp. |
OMNIA Partners, Public Sector Master Agreement 23-6692-01, which is effective through April 30, 2028 |
Laptops, networking equipment, system components, desktop and notebooks, networking equipment, servers, and storage |
|
5 |
Carahsoft Technology Corp. |
OMNIA Partners, Public Sector Master Agreement R240303 which is effective through December 31, 2029, if all options are exercised |
Software solutions and services |
|
6 |
Presidio Network Solutions, LLC |
Sourcewell Master Agreement #120122, which is effective through March 17, 2028, if all options are exercised |
Cloud and artificial intelligence, cybersecurity, networking, end-point management and security, service desk, and business workflows |
|
7 |
Insight Public Sector |
OMNIA Partners Public Sector Master Agreement 23-6692-03, which is effective through April 30, 2028, if all options are exercised |
Cloud solutions, system components, desktop and notebooks, networking equipment, servers, and storage |
|
8 |
TD Synnex Corporation |
Sourcewell Master Agreement #020624-SYN, which is effective through May 3, 2031, if all options are exercised |
Private wireless networks, radio access networks, network management tools, site surveys and assessments, tier-one OEM solutions, advanced solutions, endpoint solutions, cloud, artificial intelligence, and cybersecurity |
Most purchases under these cooperative agreements will be made through standard Purchase Orders. However, certain purchases will require a separate contract that references the terms of the underlying cooperative agreement. Providing authority to negotiate and execute these agreements is necessary because some IT procurements require contract documents, particularly when they involve warranties, support services, cybersecurity requirements, or software licenses. Cooperative agreements such as Sourcewell, explicitly allow participating agencies to negotiate additional terms and conditions. This is beneficial to the City as it can negotiate terms that are equal to or more favorable to the City than those contained in the base contract. This flexibility enables the City to incorporate required provisions, such as insurance requirements, data security terms, confidentiality clauses, and City-specific legal requirements, into the final agreement and to negotiate pricing that may be lower than the published cooperative rates.
In addition, some purchases made during the approved spending period will include multi-year maintenance, warranty, support, or subscription services that extend beyond December 31, 2030. This is standard for technology purchases, as ongoing support is required after the initial product is deployed. Allowing multi-year terms does not increase the spending limit. To maintain full fiscal control, the entire contract value, including services that occur after 2030, will be charged against the $12 million authority at the time the agreement is executed. This ensures that all obligations incurred during the purchasing period remain within the approved spending limit. Staff will monitor all purchases and remaining spending capacity using the City’s financial management system, PeopleSoft. Staff will continue to manage and allocate purchases among the vendors as needed to meet operational requirements and will ensure that the total expenditure remains within the authorized $12 million spending limit during the five-year period ending December 31, 2030.
This request to use multiple cooperative agreements is consistent with practices used by other public agencies. For example, the City of Sacramento obtained City Council approval to use cooperative purchasing agreements for citywide IT purchases in an amount of approximately $34.5 million for FY 2025/26.
Approval of the recommendations in this report will allow SVP to procure the necessary IT goods and services through multiple cooperative purchasing agreement efficiently, transparently, and in compliance with the City’s procurement policy.
ENVIRONMENTAL REVIEW
The actions being considered do not constitute a “project” within the meaning of the California Environmental Quality Act (“CEQA”) pursuant to Section 15061(b)(3) of Title 14 of the California Code of Regulation in that it can be seen with certainty that there is no possibility that the proposed actions may have a significant effect on the environment as the proposed actions authorize the purchase of IT services, equipment and licenses necessary for the City to carry out critical administrative functions .
FISCAL IMPACT
Of the $12.0 million discussed in this Report to Council technology infrastructure improvements, $7.25 million is needed in FY 2025/26 as outlined in Table 1 of this report to allocate funds to begin several critical initiatives to address systems nearing end of life, and system enhancements, including an OT/IT Network and Communications Refresh, Cybersecurity and Data Protection strengthening, Server and Data Center Infrastructure upgrades, and Storage Area Network (SAN) and Enterprise Backup replacement.
Funding of $7,250,000 is available in the Electric Utility Fund Unrestricted Ending Fund Balance. The budget amendment below allocates funding from the Electric Utility Fund to the Electric Utility Capital Fund to increase the Operations and Planning Technology project.
Budget Amendment
FY 2025/26
|
|
Current |
Increase/ (Decrease) |
Revised |
|
Electric Utility Fund (091) |
|
|
|
Transfers to |
|
|
|
|
Electric Utility Capital Fund |
$70,541,000 |
$7,250,000 |
$77,791,000 |
|
|
|
|
|
|
Ending Fund Balance |
|
|
|
|
Unrestricted Ending Fund Balance |
$103,600,565 |
($7,250,000) |
$96,350,565 |
|
|
|
|
|
|
|
|
|
|
Electric Utility Capital Fund (591) |
|
|
|
Transfers from |
|
|
|
|
Electric Utility Fund |
$70,541,000 |
$7,250,000 |
$77,791,000 |
|
|
|
|
|
|
Expenditures |
|
|
|
|
Operations and Planning Technology Project (CIP 2395) |
$4,636,798 |
$7,250,000 |
$11,886,798 |
The remaining $4,750,000 needed will be incorporated in the Electric Utility Capital Fund in future years of funding in the FY 2026/27 and FY 2027/28 Proposed Biennial Capital Improvement Program Budget as part of the annual budget process. Ongoing software subscription costs will be incorporated in the Electric Utility Fund operating budget as part of the annual budget process.
COORDINATION
This report has been coordinated with the Finance Department and City Attorney’s Office.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov or at the public information desk at any City of Santa Clara public library.
RECOMMENDATION
Recommendation
1. Authorize the City Manager or designee to issue Purchase Orders and/or negotiate and execute agreements with Dell Marketing LP, SHI International, CDW Government LLC, Carahsoft Technology Corp., Presidio Network Solutions, LLC, Insight Public Sector, TD Synnex Corporation, and/or their authorized resellers, under cooperative purchasing agreements for the purchase of various information technology products and services for Silicon Valley Power, for a total compensation amount not-to-exceed $12 million during a five-year purchasing period through December 31, 2030, subject to the appropriation of funds and the review and approval as to form by the City Attorney;
2. Authorize the City Manager or designee to take any actions as necessary to implement and administer the Purchase Orders and agreements and negotiate and execute amendment(s) to (1) add or delete services or equipment, (2) extend the term, (3) update rates in compliance with Section 2.105.270(c) of the City of Santa Clara Code, and (4) make de minimis changes, subject to the appropriation of funds, as necessary, and to the final review and approval as to form by the City Attorney; and
3. Approve the following FY 2025/26 budget amendments:
a. In the Electric Utility Fund, increase the transfer to the Electric Utility Capital Fund and reduce the Unrestricted Ending Fund Balance by $7,250,000 (five affirmative Council votes required for the use of unused balances);
b. In the Electric Utility Capital Fund, increase the transfer from the Electric Utility Fund and increase the Operations and Planning Technology project in the amount of $7,250,000 (five affirmative Council votes required to appropriate additional revenue).
Staff
Reviewed by: Nico Procos, Director of Silicon Valley Power
Approved by: Jovan D. Grogan, City Manager
ATTACHMENTS
1. NASPO ValuePoint Master Agreement No. 23026 with Dell Marketing L.P.
2. OMNIA Partners, Public Sector Master Agreement 2024056-01 with SHI International
3. OMNIA Partners, Public Sector Master Agreement 2024056-01 with CDW
4. OMNIA Partners, Public Sector Master Agreement 23-6692-01 with Carahsoft
5. OMNIA Partners, Public Sector Master Agreement R240303 with Carahsoft
6. Sourcewell Master Agreement #120122 with Presidio Network
7. OMNIA Partners Public Sector Master Agreement 23-6692-03 with Insight
8. Sourcewell Master Agreement #020624-SYN with TD Synnex Corporation