South Coast Air Quality Management District

Execute Contract to Purchase Leased Business and Development Computers

SYNOPSIS: 

In March 1996, AQMD entered into a five-year Technology Management Maintenance Service (TMMS) lease with Avnet Enterprise Solution Division to acquire DEC Alphaserver 8400 and 4100 computers. The DEC 8400 is the business computer system, which supports all defined production programs such as CLASS, NSR, compliance, permits, and finance. The DEC 4100 computer system supports development of new applications prior to implementation as production systems on the DEC 8400. This action is to execute a contract with Avnet Enterprise Solution Division to exercise the buy-out option in the TMMS lease agreement, which expires March 20, 2001. Funds ($60,000) for this purchase are included in the FY 2000-01 Budget.

COMMITTEE: 

Administrative, January 12, 2001, Recommended for Approval

RECOMMENDED ACTION:

1. Authorize the Executive Officer to execute a contract with Avnet Enterprise Solution Division to exercise the buy-out option in the TMMS lease agreement for the DEC 8400 and 4100 computers.
   
   
2. Authorize the transfer of $60,000 from Information Management Services and Supplies Major Object, Rent and Leases of Equipment account to the Fixed Assets Major Object to exercise the buy-out of the leased DEC 8400 and 4100 computers.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

The AQMD entered into a five-year TMMS lease agreement with Avnet Enterprise Solution Division to acquire a DEC Alphaserver 8400 (business computer) and a DEC Alphaserver 4100 (development computer). These computers support the development and operation of all defined production programs such as CLASS, NSR, compliance, permits and finance. In April of 1999, the Board approved the use of the upgrade option included in the TMMS lease in order to upgrade the storage capacity of both systems and the processing power of the development system. This lease agreement expires March 20, 2001. Under the TMMS agreement, AQMD is given the following end-of-term options:

1. purchase all or some of the equipment at the then fair market value;
   
   
2. return all the hardware to Avnet; or
   
   
3. renew the lease for an additional 12-month non-cancelable term at a reduced payment.

Staff has reviewed all of the options and determined that the purchase option would be the most cost-effective alternative for the AQMD. These computers should still serve their intended purpose with incremental upgrades as needed. Returning the computers to Avnet would necessitate the purchase of a new computer system, and renewing the lease would mean funding the lease for another year and funding for the purchase of a new computer system after the lease term. Staff recommends taking advantage of the option to purchase all equipment at the fair market value not to exceed $60,000. In addition, staff intends to upgrade the processing power of the business computer this fiscal year.

Resource Impacts

Funds for this purchase are included in the FY 2000-01 Budget.

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