TO:
Honorable Mayor and Members of the City Council
THROUGH:
Mark Danaj, City Manager
FROM:
Bruce Moe, Finance Director
Steve S. Charelian, Revenue Services Manager
Gwen Eng, Purchasing Manager
SUBJECT:Title
Contract with Turbo Data Systems, Inc. for Parking Citation Processing for an Estimated Annual Amount of $135,000 (Finance Director Moe).
WAIVE FORMAL BIDDING; APPROVE
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Recommended Action
RECOMMENDATION:
Staff recommends that the City Council waive formal bidding per Municipal Code Section 2.36.150 (cooperative purchasing) and approve a parking citation processing contract with Turbo Data Systems, Inc. for an estimated annual amount of $135,000.
FISCAL IMPLICATIONS:
The annual estimated value of the contract is $135,000. This is based on annual volume of 65,000 citations. In the event citation volume exceeds this threshold, the actual amount paid to Turbo Data Systems may exceed $135,000. However, this would also result in higher citation revenue to the City.
The City currently contracts with Turbo Data for citation processing, with current annual costs of $150,000. As a result of this new contract, and assuming like citation volume, the City will realize estimated annual savings of $15,000.
The City receives approximately $2.8 million in revenue annually from parking citations.
Sufficient funds are budgeted in the fiscal year (FY) 2015-2016 Finance Department budget for these services. Future annual costs will be budgeted accordingly.
BACKGROUND:
In 2006, the City Council approved outsourcing parking citation processing, and contracted with Turbo Data Systems, Inc. for that service. Outsourcing was determined to be the best method of processing and collecting parking citations due to the need to maintain certain technologies, as well as to achieving maximum efficiencies (see Attachment 2 for original staff report from 2006). Turbo Data Systems handles the entire payment collection process from accepting payments via mail and online (including through the City’s own Go Reach App), to Department of Motor Vehicles (DMV) and Franchise Tax Board reporting for past due accounts. They issue reminder notices as well as late notices.
Turbo Data’s services have expanded accessibility for our customers by providing 24-hour payment options through a well-staffed call center and an internet based credit card payment product that allows customers to view specific citations, obtain information about the citation process including adjudication and appeals, make payments, and contact a live operator with questions. Turbo Data also provides automation and integration through the City’s handheld parking citation devices, importing City-issued electronic citations into their database within one business day of issuance.
Turbo Data recently increased its collection rates through a new relationship with the National Law Enforcement Telecommunications System (NLETS). This relationship allows Turbo Data access to out-of-state DMV records, providing an additional avenue to collect citation payments. Their strong client interface and continuous expansion of collection methods consistently results in a collection rate of over 90%. Additionally, the strong tie between DMV agencies and the citation processor has reduced collection times.
DISCUSSION:
Over the course of the last ten years, Turbo Data has provided excellent, cost effective, efficient service to the City. As a result, staff recommends that the City continue to utilize them for parking citation services.
Whenever practical and in the City’s best interest, the City “piggybacks” onto contracts which are economically advantageous. Piggybacking is the extension of pricing, terms, and conditions of one agency’s contract to other governmental agencies at the mutual consent of all parties. This is permissible under the City’s Municipal Code, Section 2.36.150.
In this case, Turbo Data has offered the City pricing from a 2014 City of Anaheim contract. The City of Anaheim had competitively solicited proposals and received three responses. After thorough analysis, the contract was awarded to Turbo Data based on their pricing, hardware and software, redundant systems and well-structured customer support system. By piggybacking on the Anaheim contract, the Manhattan Beach will receive the same rates as Anaheim, despite the fact that Manhattan Beach issues 25% fewer parking citations (13,000) annually than Anaheim.
Based on this available piggyback opportunity, staff recommends City Council authorize the City Manager to execute a contract with Turbo Data. The contract period is for one year plus up to six one-year options. If all options are exercised, the contract would end on January 1, 2022. Staff is requesting that the City Manager be given the authority to exercise the option years based upon staff’s recommendation. The City may cancel the contract at any time without cause if necessary.
Attachments:
1. Agreement with Turbo Data Systems, Inc.
2. 2006 Staff Report