HomeMy WebLinkAboutMinutes_GGAF_06.24.2020Minutes of Meeting of the
GENERAL GOVERNMENT AND FINANCE ADVISORY BOARD (GGAF)
City of Georgetown, Texas
June 24, 2020
The General Government and Finance Advisory Board met on Wednesday, June 24, 2020 at 4:30 PM
at the Georgetown Public Library, located at 402 W 8" Street, Georgetown, Texas.
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The meeting was held with the Governor's Order, all City Buildings are following these procedures:
• Masks are recommended
Physical distancing; 6 feet between you and anyone not in your household
Practice good hygiene and wash your hands
Board Members Present:
Tommy Gonzalez, Chair
Kevin Pitts, Vice -Chair
Stu McLennan, Secretary
Eric Corp
Robert Witt
Others present:
Tim Pinon, Valley View Consulting, LLC
Susan Anderson, Valley View Consulting, LLC
Legislative Regular Agenda
Tommy Gonzalez called the meeting to order at 4:32 p.m.
City Staff Present:
David Morgan, City Manager
Laurie Brewer, Assistant City Manager
Leigh Wallace, Finance Director
Elaine Wilson, Controller
Chris Bryce, IT Director
Daniel Bethapudi, General Mgr, Electric Utilities
Mayra Cantu, Management Analyst
Karrie Pursley, Treasurer
Danella Elliott, Board Liaison
Tommy asked everyone to introduce themselves and the two new GGAF Board Members, Eric Corp and
Robert (Bob) Witt gave their background information. He welcomed them to the board and said that we
look forward to their expertise!
A Review minutes from the February 26, 2020 General Government and Finance Advisory Board
Meeting -Danella Elliott, Board Liaison
Motion to approve the amended minutes (with the comments below included) by Stu McLennan;
second by Tommy Gonzalez. Approved 4-0. Kevin Pitts absent during this vote.
AMENDED MINUTES TO INCLUDE THE INFORMATION BELOW:
Stu made some observations/suggestions/comments on the minutes.
• Minor point -The header should state the type of meeting (e.g., Regular).
• Main point -The body should contain more detail about our discussions. They always
contain appropriate details about the motions, votes, and points of order, but often lack the
same about our discussions, specifically post -meeting staff actions and due -outs.
• Minor Point — The final paragraph should contain guest speakers and topics, which we often
have, as well as the chairman's closing remarks.
• Para C. Staff actions.
o RFP utility billing in summer 2020 to secure options.
o Include the need for on-line billing in the "campaign ".
• Para E. Staff actions.
o Contract design for the Natatorium HVAC and then bid the project.
o Fund FS1 and FS3 as Capital Improvement projects in the annual budget.
o Provide GGAF visibility of the HVAC replacement plan.
o Inform Council about how many of the city's 22x HVAC systems have transitioned
from R-22 to R-410, and the plan to transition the remainder.
B Election of a Vice Chair and Secretary for the General Government and Finance Advisory Board
— Tommy Gonzalez, Board Chair
Motion by Tommy Gonzalez•, 2"a by Robert Witt to nominate Stu McLennan as Secretary. Approved
4-0. Kevin Pitts absent during this vote.
Motion by Tommy Gonzalez; 2"d by Stu McLennan to nominate Kevin Pitts as Vice Chair. Approved
4-0. Kevin Pitts absent during this vote.
C Review and discuss board purpose and bylaws — Tommy Gonzalez, Board Chair
Tommy discussed the board purpose and told the committee that we would send out the information
via e-mail for their review.
D Review of the City Council's Boards and Commissions Attendance Policy — Danella Elliott, Board
Liaison
Tommy discussed the attendance policy told the committee that we would send out the information via
e-mail for their review.
Stu asked for a list of the items that would have gone before the GGAF Board from March, April and
May but due to the cancellation of meetings due to the pandemic, these items went straight to Council.
Tommy said that we would e-mail that information to the members.
E Presentation and discussion with possible action regarding a utility technology review of the
City's Customer Information System and Meter Data Management systems — Laurie Brewer,
Assistant City Manager - Note: Kevin Pitts arrived at 4:50 p.m.
Laurie said that the presentation would give an overview of our investment in the City's utility
technology and noted that many decisions were guided with a previous vision for the Utility systems
which have since changed. The presentation reviewed the City's history implementing utility
technology within Water, Electric, IT and Customer Care, in particular the Customer Information
System and Meter Data Management systems.
Laurie explained that the City has done good work in moving operations and customer programs into
the new millennium, but since 2010, "Customer Operations" has evolved into a larger role within each
utility, acting as point of contact for all customer interactions instead of only a billing point of contact.
When these technology and operational projects were begun in 2009, a different philosophy and
direction was being prescribed and followed. While fully supportive of changes in vision and strategic
goals, it is important to step back and understand the framework that was in play during the time the
original decisions were made to gain clarity and understanding.
Laurie went over some of the history and timeline of the current system. She explained some of the
major challenges from 2015 to now, including:
• data migration of the legacy system that was not included in the initial pricing,
• staff changes,
• organizational philosophies that required UMAX to adapt to current processes,
• complex system and lack of internal technical knowledge,
• realization that the system required a level of support much higher than expected from the
preliminary studies by the vendor and selection consultants.
The business and technology leaders in the City agree that the ongoing systems will require long-term
growth in staffing, consulting and technology resources to get value from the system which will add
further overhead costs. There have been numerous system failures, typically due to system updates and
patches. Support staff are either unaware of, or unable to check these on a routine basis. With such a
large system, there are requirements for a lot of report writing so it will adapt to our processes.
Laurie highlighted the "then and now" of various topics regarding the system and noted that we have
done good work in moving operations and customer programs into the new millennium. She said that
future requirements need a CIS and MDM system that can easily be supported and is in scope with the
current utility system, create a system that adds value to our customers, reduction in risk within the CIS
an MDM systems, staff with the needed business system and data skillsets to support the system and
an understanding the ten-year cost of ownership to ensure we have adequate personnel and financial
support. Additionally, because we implemented processes that were not standard to the system, there
is limited knowledge on how those changes/configurations are impacted when they are updated.
In 2022-23, our current CIS software is moving to a cloud product and will host customers on that
platform, so we would need to upgrade to the cloud -based system. Staff discussed if it would be best
to upgrade or take a step back and reevaluate our current system.
Staff is recommending to have Gartner (recognized internationally as "experts") conduct a utility
technology review to analyze the systems in place and utilize the study for future strategic decisions
regarding the CIS and MDM systems.
• Cost: $210,000
■ Funding Sources — shared between Water, Electric and Information Technology Funds
The study would evaluate the current system to determine:
• Cost of ownership (staffing and financial)
■ Risk levels
• Expectations for the system
• Operating models of Customer Care and IT
• System's functional scope
• Determine whether these systems are still appropriate and utilizing the analysis to drive future
strategic decisions around the meter -to -cash technology ecosystem.
Each director from the areas listed above have all been involved in discussions, and the IT, HR and
Finance directors all agreed on the recommendation of a possible review by Gartner, Inc. to assess the
systems.
Comments:
• When we replaced Incode with the current system, the vision was very different at what the goal
was and has changed drastically; compatibility was lost. In-house expertise that is needed wasn't
there and that is where the gaps happened. We are now stepping back and looking to future needs
which are completely different. During this process, we learned what we are "not" going to be but
we need to learn the processes, etc. that we will need. Gartner is DIR vendor, which provides better
rates for State of Texas and Municipalities. We have worked with Gartner before and we actually
subscribe to service where we can get expertise for extremely technical questions.
• Is this a reasonable cost? Chris said that with Gartner's expertise and depth of knowledge, he
believes it is definitely a good price.
• What are our expectations/recommendations? Full cost of ownership (10 years); very detailed on
their analysis on what we will need, plus their technology detail.
• Stu went over his notes from November 2018 and questioned Council's reaction to the money spent
to date. He commended staff for always recognizing when things need to be looked at and taking
a knee if needed.
• Do we have the current system's support through 2021? Yes. We recognize that they are doing all
they can to help us, but it isn't functioning to meet our needs.
• Tommy said that part of the problem is that we are paying for things we have no use for and do not
need. Now, we are taking a step back and although it is hard to justify the costs associated with it,
we need to correct it now and fix it.
• David explained that we just didn't get the functionality out of system; we need outside experts to
assist.
• We need an exact plan and cost of that plan over 5-10 years to justify spending more money. This
has been a bit of a learning curve but we need to make sure we get solutions to what is wrong.
• We are a city that learns, but recognize we made a mistake. We want to have justifications going
through cost analysis and come up with solutions that could possibly be a cost savings over the
long haul.
• We need to own a system that meets our goals and benefits the customers, but we need outside
expertise to map out the process.
• Bob asked if the City has financial policies for fund balances, etc. Yes, we go over those with this
Board annually.
• Stu clarified the offer period and data collection via telephone. Chris said the offer period, pricing
and data collection methods are all in effect and good until we make our decision.
Motion to approve the contract with Gartner for a utility technology review of the City's Customer
Information System and Meter Data Management systems by Kevin Pitts, second by Stu McLennan.
Unanimously approved 5-0.
F Discussion and possible selection of JP Morgan Chase for Bank Depository Services for a two
year and eight -month period beginning September 1, 2020 through April 30, 2023, with options
to renew for up to two additional one year terms (maximum of four years eight months) — Elaine
Wilson, CGFO, Controller
Elaine gave a presentation and background on the current bank depository contract. She noted that the
Texas Local Government Code, Cbapter105 requires that we solicit applications every 5 years.
JPMorgan Chase has been the City's depository since 2006 and the current contract expires 8/31/2020
with no renewal options remaining.
She said that due to certain factors considered, the City is looking to change the new initial contract
term with this Board's guidance. Valley View Consulting provides depository evaluation services as
part of our Investment Advisory Services agreement, and their knowledge in this area gives the City
good comparison in all aspects of evaluation.
Elaine went over the background and terms, services and evaluation criteria requested. She also
explained additional factors and risks which included:
• The City just spent $33,840 in setup and testing of bank integrations between the Workday
Financial system and JPMorgan Chase (incumbent bank).
• Staff is still working through Workday conversion related issues to stabilize the system prior
to fiscal year and audit. Bank integrations are stable at this time.
• Transition to a new bank will require 8-12 weeks of transition set up and testing which will
crossover into fiscal year-end.
• This will be the first year-end close in the new Workday financial system which will require
staff dedication to the close process to ensure a timely and accurate year end close and a
successful audit.
• Staff turnover
• COVID-19 Pandemic
Elaine gave the names of applicants and noted that Independent Financial and Verabank submitted
applications with overall lower costs, they were not able to provide all the required services
requested, so the 2 banks considered for selection were JPMorgan Chase and BBVA. She went
over the fees and cost of service, earning potential, initial term and differences in service provided
comparisons between the two banks.
Elaine told the Board that typically, there is an initial term of two years for the new contract, but in
order to try and prevent overlapping with fiscal year end, staff is recommending the contract be
for one year 8 months or 2 years 8 months.
Staff recommendation (based on some of the challenges) is to stay with the incumbent, JPMorgan
Chase due to the following with the 2 year 8 month period beginning September 1, 2020.
• Based on cost of service including incentives and transition costs
■ Costly conversion costs, including staff time required
• Workday integration costs already incurred
• Workday system stabilization before year end
• Year-end close of new financial system brings new processes and requirements for staff
Kevin Pitts (full disclosure) said that he used to work for BBVA (does not now) but the last time
this RFP was solicited, he was the respondent. He said that at that time (as in this time, his bid was
low bid and was not chosen). He asked for clarification and a breakdown of the contract (payment
to an outside consultant and staff costs/time) that equates to the $36,000 estimated transition costs
for BBVA. Elaine said that she would get that information for him.
Kevin said that looking at the information provided, BBVA's bid is better. He noted that staff time
should not be figured into the costs, as we would be paying them anyway, and feels that the $36,000
is bogus and was figured in to help Chase look better. He understands that changing banks is a
hard thing to do but being short-staffed and going through the Workday implementation shouldn't
be the deciding factor as it is not listed in the evaluation criteria and scoring matrix for scoring the
respondents. Kevin's opinion is that Chase didn't sharpen their pencil or cut their rates on this deal
because they didn't have to due to the fact that they always win the bid. The City of Georgetown
always tries to get the best deal for the citizens. There are underlying circumstances and he
understands that, but he doesn't want to do 1 year 8 month with extensions bid award... he does not
want any extensions. He feels that Chase should actually bid their best offer as if we were a new
customer, and that is why their bid is not better than BBVA. He is fine staying with Chase, but
noted that he did not like the presentation, he did not like the way it was presented, and he did not
like the way Chase submitted their bid.
Full disclosure from Tommy - he clarified that he currently does currently work for BBVA, but in
a different department and division. He has no say or input in any of this, and if staff would have
recommended BBVA, he would have recused himself, but he feels that he is well qualified to judge
on another proposal. At this time, he does agree with the shorter term. With the process transition
costs and going through the Workday implementation, then we may not be getting the best deal,
and in the future, if this is the situation, we should not even do an RFQ knowing that we are not
going to change. If it is required to go out for bid, then state in the request that we are not going to
change but just following policy. There are just too many things going on right now to switch and
would agree with staffs recommendation to maximize the full cost benefit.
Kevin said that his recommendation for the 1 year 8 months was to send Chase a message that they
would actually have to bid the next time, and not just throw something up in the air knowing they
would win.
Motion to approve the selection of JP Morgan Chase for Bank Depository Services for a two year
and eight -month period beginning September 1, 2020 through April 30, 2023, with options to renew
for up to two additional one year terms (maximum of four years eight months) by Stu McLennan;
second by Robert Witt.
Amendment to the original motion, approving the selection of JP Morgan Chase for Bank
Depository Services for one year and eight -month period with no extension options by Kevin
Pitts; second by Eric Corp. Approved 3-2 (Stu McLennan and Robert Witt voting against)
Eric and Tommy asked for clarification on staff time required to do another RFP at the end of
the one year and eight -month period and if everyone feels that we will be in a non -transitional
period with no additional burden on staff in two years. David and Leigh said that there should
be no issues.
Motion for approval of the original motion to move forward with the selection of JP Morgan Chase
for Bank Depository Services with the approved amended motion for one year and eight -months
with no extension options. Approved 3-2 (Stu McLennan and Robert Witt voting against)
Motion to adjourn meeting by Stu McLennan, second by Eric Corp, approved 5-0. Meeting adjourned
at 6:10 pm.
Tommy Gonzalez Date
Board Chair
Stu McLennan
Board Secretary
Date
Danella Elliott Date
Board Liaison