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M E M O R A N D U M
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-Communication Packet-
-Communication Packet-
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Memorandum Date: November 3, 2022 To: Executive Management Team From: Chelsea Clinton, IT Finance and Administration Manager Subject: Proposed 2023-2025 IT Rates – Fund 611 Fund Overview Historically, ISD has supported many centralized IT functions including:
•Network Team including network infrastructure, server management, and some data storage
•Service Desk technical support
•Phone system infrastructure including VoIP telephones and support
•Software and hardware procurement and asset management
•A portion of the enterprise-wide cyber security expenses
•A portion of the division’s administrative functions
•Multi-function device (MFD) program
•Low-voltage cabling installation for VoIP phones and network connectionsThe IT rate model provides revenue to support most of these services, with the following exceptions:
•The MFD program, which has its own revenue collection mechanism based on usage of thedevices, and
•Pass-through charges for low-voltage cabling installations, non-VOIP phone service, and one-timesoftware and hardware purchases (non-leased devices).This memorandum proposes moving funding for some additional IT functions into Fund 611 previously funded by the General Fund, including:
•An additional portion of the division’s administrative functions, including Business RelationshipManagement
•A portion of the enterprise-wide cyber security expenses
•IT Service Management
•Data storage including the Lane County Data Center contract
•IT Project Management
•Database Administration
•Application Development servicesThe methodology for calculating the annual IT rates is included in Appendix C to this document. Biennial Budget Changes The biennial budget process will have little impact on Option 1: Status quo model, which only relies on inflating rates year over year. The IT Rates Subcommittee considered several challenges associated with the biennial budget transition associated with Option 2: Budgeted FTE Model. For example, the group discussed how to account for FTE changes and how the mechanics of a lookback process will work. These were minor challenges overall. Details of how to address each are included in the following sections. Information Systems and Services Fund Rate Recommendation ISD is submitting two 2023-2025 proposals for consideration. The Technology Advisory Board (TAB) IT Rates Subcommittee approved this rate proposal and recommended Option 2 at their meeting on September 28, 2022. TAB approved this rate proposal the following day, and recommended serious consideration of funding Sustainable Budget requests with a nexus to cyber-security.
6. Information Services
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. 1. Option 1: Existing IT Rates Model with adjustments. This option uses the same methodology used to develop rates for FY23. It also includes specific funding increases to add back funding an FTE held vacant in FY22 and to account for the increased cost of the Microsoft Enterprise Agreement. This proposal also increases balance available to 2 months of operating expenditures. This option calls for an average 9% increase in IT Charges and an overall 17% annual increase to FY23 IT Rates. 2. Option 2: Budgeted FTE IT Rates Model. This model includes a number of significant changes to IT Rates including:
• Consolidating ISD funding from the General Fund and Fund 611 into Fund 611 and eliminating the IT portion of the Central Services Allocation and General Fund transfer;
• Formally including a lookback mechanism in IT Rates;
• Charging each budgeted FTE an equal share of IT Rates (account 681200);
• Removing most software costs from account 681200 and directly billing customers for those software costs using account 681XXX;
• Adjusting software costs to reflect the increase in the anticipated Microsoft Enterprise Agreement;
• Increasing balance available to 2 months;
• Adding back funding for an FTE held vacant in FY22. Overall, IT Charges will increase by about 70%. This includes a $5 million increase in rates that shifts funding for IT services from the General Fund to the Information Services Fund.
1Represents the total increase between FY23 and 2023-2025. 2Represents the average annual % increase. 3See Appendix C for details. 4The FY24 rates include the addition of $5 million to transition staff and associated costs from Fund 011 to Fund 611.
Base Rate FY23 FY24 FY25 2023-2025 $ Difference1 % Difference2
General Fund 3,476,277 3,625,757 3,781,664 7,407,421 3,931,144 4.3%
Non General Funds 2,205,591 2,300,431 2,399,350 4,699,781 2,494,190 4.3%
Total3 5,681,868 5,926,188 6,181,014 12,107,203 6,425,335 4.3%
Option 1 FY23 FY24 FY25 2023-2025 $ Difference1 % Difference2
General Fund 3,476,277 4,016,433 4,595,990 8,612,424 5,136,147 15.0%
Non General Funds 2,205,591 2,623,559 2,986,524 5,610,083 3,404,492 16.4%
Total3 5,681,868 6,639,992 7,582,515 14,222,507 8,540,639 15.5%
Option 2 - TAB
Recommended Rate FY23 FY244 FY25 2023-2025 $ Difference1 % Difference2
General Fund 3,476,277 7,017,494 7,117,155 14,134,648 10,658,371 52%
Non General Funds 2,205,591 6,192,898 6,276,611 12,469,509 10,263,918 91%
Total3 5,681,868 13,210,391 13,393,766 26,604,158 20,922,290 67%
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Analysis of Rate Recommendation 2023-2025 IT Rate Model Proposal Development Process ISD and its partners last updated the IT Rate Model structure for FY17. FY19 was the last year that the IT rate was able to be fully updated, a result of many environmental changes like the Chart of Accounts update, a new PeopleSoft Financials system, and migration to a new ISD ticketing system. The software and reporting changes negatively impacted the complex set of metrics used to equitably allocate the IT Charges and there are now significant data gaps that make it nearly impossible to replicate the previous calculation methods. Option 1: Existing Model with Adjustments Option 1 model provides steady funding for ISD as a division but is increasingly inequitable as it is based on how the organization looked when planning for FY19. Additions of new work units and other changes are not reflected in the rates. To create a new model option, the Technology Advisory Board (TAB) appointed the IT Rates Subcommittee (Rates Committee) in early 2022. The Rates Committee was facilitated by ISD staff, included representatives from every department, and received significant support from Finance staff. The group met 10 times between March and September 2022. ISD staff also formally met with representatives from every department individually 3 times to gain input and work through challenges that emerged during the process. Option 2: Budgeted FTE IT Rates Model reflects the collective effort of this group to find a path to meet the following best outcomes defined together at the outset of the process: IT Rate Model Revision Best Outcomes • Transparent and simple to understand. It’s to be easy to understand and explain what’s included in the IT Rates. It’s easy to articulate what’s driving costs. • Easy to administer. The monthly and annual tasks associated with the rates do not significantly add to the current workload of any employees, and ideally would be less than the current model. • Equitable. The distribution of costs aligns with the amount of IT services customers and departments are receiving as much as possible. • Adequate funding and flexibility for ISD to meet business needs. ISD has adequate funding and flexibility to meet the business needs for COE at the service level expected by customers. • All departments agree on the new model. Option 2: Budgeted FTE Model (Rates Committee Recommendations) 1. Consolidate ISD Funding in Fund 611 and eliminate the Central Services Allocation/General Fund Contribution to ISD: Consolidate ISD funding from General Fund Allocation and Fund 611 into Fund 611. This includes eliminating all IT Charges from the Central Services Allocation. (The FY23 General Fund Allocation to ISD was about $5 million.) Consolidating ISD funding into Fund 611 creates transparency for ISD customers as all funding will be based on the same measures created and maintained collaboratively by the Rates Committee and TAB. It simplifies administration for multiple teams who collect and administer the Central Services allocation. Last, it also increases flexibility for ISD, removing restrictions on funding that are based on historical circumstances, and allowing staff to focus on using the budget to deliver services in the way that best meets the organization’s needs.
2. Formally add a lookback to IT Rates: The Rates Committee recommends adding a lookback mechanism to the Fund 611 as a formal component of the Fund 611 rate process. With the transition to the biennial budget, the next lookback will happen with the preparation of the 2025-2027 rate setting process. To calculate the lookback credit, ISD staff will calculate the difference between budget to actuals from FY23 and FY24. Staff will adjust for the 2025-2027 IT Rates to reflect the difference between budget to actuals.
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3. Use budgeted FTE to allocate IT Rates: Change the IT Rates allocation mechanism to Budgeted FTE. Specifically, each budgeted FTE will pay an equal share of the IT Rates included in Fund 611. This method supports the Rate Committee’s best outcomes of transparency and ease of administration. It also helps move towards equity compared to the status quo model in that the model allows to easily add and remove work units and FTE as changes occur in the City’s footprint. The Rate Committee considered weighting IT Rates based on the amount of technology an FTE uses as well as charging different rates based on temporary and limited duration status. Ultimately the Rate Committee felt the costs associated with differentiating rates for different types of employees were greater than the benefits. It is something the Rate Committee wants to continue exploring in subsequent rate conversations to keep working towards greater equity. The Rate Committee also considered a process to adjust FTE counts mid-year or mid-biennium. The group decided that the administrative burden of applying an adjustment mid-cycle was too high and would not provide enough of a benefit to warrant the adjustment.
4. Bill customers for software rather than including it in the blended rate: Begin direct billing of Software Costs in 2023-2025 and work towards more direct billing in the future. ISD tracks about $570,000 in software costs that can be direct-billed to customers beginning in 2023-2025. Examples of software products expected to be directly billed include Microsoft 365, all Adobe products, Visio, Power BI, and Tableau. This project will take staff resources for both ISD and departments to implement a process and ensure data is acceptable to all parties involved. ISD and TAB believe this is a worthwhile and manageable project to accomplish in the next year and will help make IT Rates more equitable. In addition, the Governmental Accounting Standards Board (GASB) enacted a new requirement to include a record of all software licensing in the annual audit so the organization will be tracking this at a more detailed level for that purpose too.
5. Increase balance available to 2-months of operating expenditures. Increase balance available to 2-months of operating expenditures. This increase with bring Fund 611 in alignment with recommended levels and provide reserves for the fund to weather unexpected mid-biennium changes to a greater extent. 6. Incorporate the cost of the Microsoft Enterprise Agreement Renewal into IT Software Rates. Include package that includes Security Suite. The City’s Microsoft Enterprise Agreement (EA) expires in December 2022. Microsoft negotiates 3-year fixed price agreements with the City. The main portion of the EA covers the cost of employee Microsoft 365 (M365) licenses, and cost about $490K. Price estimates to maintain this service level purchased in the last EA are $618K. The Rates Committee recommendation included an M365 license that includes the Microsoft Security Suite, which will cost an estimated $827K. The City had access to this product for free during 2022 due to a White House initiative to support local governments with cybersecurity efforts. The funding for this tool will go away in FY23. Without this product, ISD would likely never learn about many of these threats or would learn about them after they have spread in our environment. ISD would also lose some capacity to remediate these issues, a portion of which is currently done by this product. This product currently removes about 54% of emails sent to City employees, flagging them as spam or malicious.
7. Unfreeze Service Desk Position. ISD removed funding from its FY22 and FY23 budget for position 770, a Service Desk position, and held the role vacant in FY22. The Rates Committee supported adding funding back to support this role for several reasons: a fully staffed Service Desk improves
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cybersecurity, it increases ISD’s ability to meet customer needs, and it helps strengthen and develop ISD’s workforce as the Service Desk has proven to be an entry point for other positions in ISD. 8. Allow some funds to transfer increases in IT Rates to the General Fund Funds for Special Consideration. The Rates Committee identified six funds that need special consideration if Option 2 is approved. Funds 031 (Cultural Services), 111 (Library Levy), and 112 (Parks and Recreation Levy) have not previously paid the Central Services Allocation (CSA) to the General Fund and they all operate on fixed revenue sources that are not easily adjusted. For 2023-2025, the recommendation is to transfer the increase in costs to the General Fund. The expectation is that subsequent levies will include the full cost of IT Services. Funds 171 (Community Development Block Grant), 178 (HOME), and 132 (Public Safety Answering Point) are subject to certain legal requirements. The Rates Committee recommended that these charges be shifted to the General Fund initially. The funds can be billed over the course of the biennium in alignment with the Federal and State rules that govern them. Both models incorporate the following additional IT Charges:
Phone Hardware (account 681220) charges in Options #1 and 2 are identical, and are projected to increase by 2.1%, or $3,873, in year 2 of the biennium over FY23 levels due to an increase in the number of devices. The organization’s footprint has increased over the last several years due to new revenues from the Parks and Rec levy, the Library levy, and the Community Safety Initiative. Additional devices have been requested to support the necessary connectivity for these critical services, which results in overall increases to revenue collected to support the future replacement of the hardware. Even as some staff continue to work from home and use Microsoft Teams technology for placing and receiving phone calls, maintaining a robust environment that supports physical phones is still necessary. All phone types (physical phone, Teams phone, etc. have associated core expenses such as the cost for the extension, 911 fees, etc.
Leased Hardware charges (account 681201) in Options #1 and 2 are identical, and are projected to increase by 3.2%, or $19,759, over FY23 levels. Staff have updated the methodology used to project future lease rates to provide better accuracy for budgeting and financial projections, which has led to the significant increase in the projected rates. Software charges (account 681XXX) in Options #1 and 2 are identical and is summarized in the discussion above. If approved, expenses will increase about 55%, or by $325K, primarily driven by increases in the Microsoft Enterprise Agreement.
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Cost Drivers & Trends There are several considerations for the fund:
• There is a salary disparity between the private and public sector for IT positions, and in some cases even between public agencies. While this is generally true across the organization when compared to the private sector, the challenge to recruit and retain IT professionals remains constant and can lengthen the hiring process, negatively impacting customers, service levels, and the ability to protect against cybersecurity events.
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• It remains an ongoing challenge to limit year-to-year price increases for software and hardware maintenance contracts to CPI-U. As the organization continues to move more applications to off-the-shelf solutions and the cloud, this will continue to put pressure on the fund.
• The fund forecast assumes normal increases in expenditures over the forecast period without significant changes in the level of service. Options 1 and 2 adjust rates to reincorporate a Service Desk position previously held vacant. ISD continues to hold 1.25 FTE vacant that formerly were used as staff to the Print Shop.
• The fund includes an annual budget of $200,000 for unanticipated/contingency expenses that is intended to be used for unexpected and urgent circumstances. This buffer provides ISD with the ability to react quickly in emergency situations, such as stocking up on laptops before the full impact of the pandemic affected hardware supply chains. This funding allows the division to be nimble in meeting emergent needs and is only spent when necessary. The contingency is not included in the IT rate charges but does draw down Balance Available. When unspent, the remaining amount would return to Balance Available to be reallocated for the following fiscal year.
• The Microsoft Enterprise Agreement and associated licensing structure have changed in recent years. Anyone who needs to use a computer in the City’s environment must be licensed regardless of whether they’re regular or temporary staff. We are continuing to encourage the use of this reduced-cost license model for staff that need to use a computer but do not have robust needs for Office programs like Word and Excel. ISD staff are collaborating with customers to continue to address licensing issues and determine and changes to product and licensing as we work towards renewal of the Enterprise Agreement, which expires in December 2022.
• ISD experienced a significant number of vacancies in FY21 and FY22. These vacancies resulted in savings in the personnel and M&S budgets because the division has lacked the personnel to push some projects forward. These savings have historically helped to offset the ongoing deficit that results from the fund’s budgeted expenses outpacing revenues. The short-term savings also create long term technical debt as ISD staff fall behind on upgrading core operating systems.
• After experiences a significant number of vacancies for several years, ISD has filled all but 3 positions early FY23.
• This fund relies heavily on the Telecom Fund’s Equipment Replacement Fund awards to assist with large infrastructure replacements and updates, namely for equipment like servers and networking equipment. As Telecom Fund revenue declines due to industry changes and technology changes in ways that are no longer consistent with ERF requirements, this funding source is more constrained, and staff are discussing alternatives. Reserves and Balance Available Fund 611 has struggled to achieve the minimum recommended 2 months balance available target for several years. In FY23, the fund only carried 1.8 months. Balance available in analysis after the fact due to significant underspending. For 2023-2025, the IT Rates Committee recommended adjusting Fund 611 to achieve 2 months balance available. Both models have been adjusted to achieve that level. Accomplishments & Major Activities Please see Appendix F for more information on major activities and accomplishments over the past year for this service.
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Appendices: Appendix A: Information Services Fund Forecast Option 1 – Status Quo IT Rate Model Appendix B: Information Services Fund Forecast Option 2 – Budgeted FTE IT Rate Model Appendix C: 2023-2025 Information Services ISF Charges – Options 1 & 2 Appendix D: Rate Methodology Appendix E: TAB IT Rates Subcommittee Process and Outcomes Summary Appendix F: Accomplishments & Major Activities
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Appendix A:
Fund 611: Trends to watch
Actual Actual & Budget
2019-2021 2021-2023 2023-2025 2025-2027 2027-2029
(FY20 & FY21)(FY22 & FY23)(FY24 & FY25)(FY26 & FY27)(FY28 & FY29)
ResourcesBeginning Working Capital $2,374,448 $2,436,268 $1,978,927 $1,297,044 $1,374,429Revenues10,782,712 11,574,029 14,684,307 16,351,574 16,969,310
Total Resources $13,157,160 $14,010,297 $16,663,234 $17,648,618 $18,343,739
RequirementsExpendituresDepartment Operating (1)10,155,893 12,002,370 15,200,437 16,081,189 16,692,395Non-Departmental (CSA)565,000 479,000 565,754 593,000 622,000Contingency(2)(450,000)(400,000)(400,000)(400,000)Total Expenditures 10,720,893 12,031,370 15,366,191 16,274,189 16,914,395
Annual Operating Surplus/Deficit 61,819 (457,341) (681,884) 77,385 54,915 Balance Available and Reserves 2,436,267 1,978,927 1,297,043 1,374,429 1,429,343
Total Requirements 13,157,160 14,010,297 16,663,234 17,648,618 18,343,739 Target Balance Available and Reserves (3)893,000 1,003,000 1,281,000 1,356,000 1,410,000
Amount Above or (Below) Target $1,543,267 $975,927 $16,043 $18,429 $19,343Months of Expenditures 5.5 3.9 2.0 2.0 2.0 (1)(2)(3)Based on historical trends, assumes $105k in vacancy savings from FY21 and beyond by holding 1.25 FTE from the former Print Shop program. 1.0 Contingency funds are for expenses that are outside of budgeted amounts. Contingency is not included in the rate model calculations.Target Balance Available is set at two months of operating and non-departmental expenditures per City policy.
Information Services Fund (Fund 611) Six-Year Financial Forecast FY24-FY29
Executive Summary - Option #1: Status Quo Model
Forecast
1) This option realigns operating expenditures and revenues and increases balance available to 2 months. It will be important to monitor inflation pressures on software and hardware, in addition to any wage realignments that result from the study on non-presented staff wages. This fund is also expected to pick up the costs associated with supporting new and emerging technologies, particularly the maintenance costs that are not eligible for other funding sources, such as the Telecom ERF. In the past, this fund made significant investments in the IT projects that benefit the entire City organization, e.g. the $1.2 million invested in VoIP. This forecast assumes that, without increases in rates, Fund 611 will not be able to make such investments in the future. 2) The rising danger of cybersecurity events will require an increase in the investment to support security tools. The June 2021 update to City Council Goals and Outcomes for "Safe Community for Community Wellbeing" included increasing the security of information technology systems.
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Appendix B
Fund 611: Trends to watch
Actual Actual & Budget
2019-2021 2021-2023 2023-2025 2025-2027 2027-2029
(FY20 & FY21)(FY22 & FY23)(FY24 & FY25)(FY26 & FY27)(FY28 & FY29)
ResourcesBeginning Working Capital $2,374,448 $2,436,268 $1,978,927 $2,261,849 $2,401,560Revenues10,782,712 11,574,029 27,069,714 28,566,520 29,615,404
Total Resources 13,157,160 14,010,297 29,048,641 30,828,369 32,016,964
RequirementsExpendituresDepartment Operating (1)10,155,893 12,002,370 26,573,793 28,185,809 29,249,429Non-Departmental (CSA)565,000 479,000 613,000 641,000 672,000Contingency(2)(450,000)(400,000)(400,000)(400,000)Total Expenditures 10,720,893 12,031,370 26,786,793 28,426,809 29,521,429
Annual Operating Surplus/(Deficit)61,819 (457,341)282,921 139,711 93,975 Balance Available and Reserves 2,436,267 1,978,927 2,261,848 2,401,559 2,495,535
Total Requirements 13,157,160 14,010,297 29,048,641 30,828,369 32,016,964 Target Balance Available and Reserves (3)893,000 1,003,000 2,232,000 2,369,000 2,460,000
Amount Above/(Below) Target $1,543,267 $975,927 $29,848 $32,559 $35,535Months of Expenditures 5.5 3.9 2.0 2.0 2.0 (1)(2)(3)Contingency funds are for expenses that are outside of budgeted amounts. Contingency is not included in the rate model calculations.Target Balance Available is set at two months of operating and non-departmental expenditures per City policy.
1) This option realigns operating expenditures and revenues and increases balance available to 2 months. It will be important to monitor inflation pressures on software and hardware, in addition to any wage realignments that result from the study on non-presented staff wages. This fund is also expected to pick up the costs associated with supporting new and emerging technologies, particularly the maintenance costs that are not eligible for other funding sources, such as the Telecom ERF. In the past, this fund made significant investments in the IT projects that benefit the entire City organization, e.g. the $1.2 million invested in VoIP. This forecast assumes that, without increases in rates, Fund 611 will not be able to make such investments in the future. 2) The rising danger of cybersecurity events will require an increase in the investment to support security tools. The June 2021 update to City Council Goals and Outcomes for "Safe Community for Community Wellbeing" included increasing the security of information technology systems.
Forecast
Information Services Fund (Fund 611) Six-Year Financial Forecast FY24-FY29
Executive Summary
Based on historical trends, assumes $105k in vacancy savings from FY21 and beyond by holding 1.25 FTE from the former Print Shop program. 1.0 FTE from the Service Desk reintegrated into this proposal with support of IT Rate Committee.
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Appendix C: 2023‐2025 Information Services Charges
Option 1: Status Quo Model
Dept Fund FY23 Total
Charges
FY24 Total
Charges
FY25 Total
Charges
FY24-FY25
Total Charges
2023-2023 $
Difference
2023-2023 %
Difference
Central Services 011 724,074$ 850,846$ 969,580$ 1,820,426$ 1,096,352$ 15.7%
115 2,835$ 3,454$ 3,960$ 7,414$ 4,579$ 18.2%
135 13,015$ 13,650$ 15,893$ 29,543$ 16,528$ 10.7%
136 2,002$ 7,664$ 7,825$ 15,489$ 13,487$ 142.5%
525 9,677$ 10,246$ 11,925$ 22,171$ 12,494$ 11.1%
611 261,511$ 276,400$ 318,974$ 595,374$ 333,863$ 10.5%
612 20,496$ 20,694$ 24,095$ 44,789$ 24,293$ 8.7%
613 52,182$ 56,603$ 65,447$ 122,050$ 69,868$ 12.0%
618 98,383$ 127,746$ 144,410$ 272,156$ 173,773$ 21.4%
622 73,284$ 78,204$ 90,506$ 168,710$ 95,426$ 11.2%
623 22,161$ 22,988$ 26,457$ 49,445$ 27,284$ 9.4%
635 23,384$ 26,335$ 29,993$ 56,328$ 32,944$ 13.3%
Central Services Total 1,303,004$ 1,494,831$ 1,709,066$ 3,203,896$ 1,900,892$ 14.5%
Fire & EMS 011 378,100$ 433,907$ 497,080$ 930,987$ 552,887$ 14.7%
136 ‐$ 292$ 298$ 590$ 590$ #DIV/0!
151 1,675$ 2,170$ 2,216$ 4,386$ 2,711$ 15.8%
511 420$ 853$ 871$ 1,725$ 1,305$ 52.7%
592 49,391$ 71,053$ 79,537$ 150,590$ 101,199$ 27.9%
Fire & EMS Total 429,586$ 508,276$ 580,002$ 1,088,278$ 658,692$ 16.2%
LRCS 011 960,541$ 1,073,772$ 1,235,329$ 2,309,101$ 1,348,560$ 13.4%
031 141,046$ 180,085$ 203,040$ 383,124$ 242,078$ 20.2%
111 22,658$ 28,753$ 32,887$ 61,640$ 38,982$ 20.6%
136 382$ 3,742$ 3,821$ 7,563$ 7,181$ 440.9%
LRCS Total 1,124,627$ 1,286,351$ 1,475,077$ 2,761,428$ 1,636,801$ 14.5%
PDD 011 205,526$ 255,664$ 289,365$ 545,030$ 339,504$ 18.8%
151 235,766$ 251,898$ 289,252$ 541,150$ 305,384$ 10.8%
152 16,257$ 16,340$ 18,878$ 35,218$ 18,961$ 8.0%
153 ‐$ 789$ 805$ 1,594$ 1,594$ #DIV/0!
155 17,066$ 21,589$ 24,371$ 45,960$ 28,894$ 19.7%
171 63$ 138$ 140$ 278$ 215$ 60.2%
525 26,540$ 29,590$ 33,899$ 63,489$ 36,949$ 13.0%
617 408$ 413$ 476$ 889$ 481$ 8.2%
PDD Total 501,626$ 576,420$ 657,187$ 1,233,607$ 731,981$ 14.5%
Police 011 1,071,095$ 1,243,962$ 1,423,906$ 2,667,869$ 1,596,774$ 15.3%
112 ‐$ 997$ 1,018$ 2,014$ 2,014$ #DIV/0!
132 4,157$ 9,978$ 10,777$ 20,755$ 16,598$ 74.0%
134 2,186$ 2,208$ 2,591$ 4,799$ 2,613$ 9.2%
136 170$ 17,369$ 17,734$ 35,103$ 34,933$ 5059.6%
511 ‐$ 2,709$ 2,766$ 5,475$ 5,475$ #DIV/0!
Police Total 1,077,608$ 1,277,223$ 1,458,792$ 2,736,015$ 1,658,407$ 16.4%
Public Works 011 136,941$ 158,281$ 180,731$ 339,012$ 202,071$ 14.9%
112 730$ 6,407$ 6,542$ 12,949$ 12,219$ 389.9%
131 207,286$ 247,609$ 281,169$ 528,778$ 321,492$ 16.5%
151 3,427$ 4,978$ 5,568$ 10,546$ 7,119$ 28.6%
332 4,439$ 5,553$ 6,304$ 11,857$ 7,418$ 19.3%
511 111,359$ 136,209$ 154,741$ 290,950$ 179,591$ 18.0%
533 185,092$ 228,286$ 261,130$ 489,416$ 304,324$ 18.9%
534 131,334$ 153,370$ 174,489$ 327,859$ 196,525$ 15.3%
535 199,594$ 240,706$ 273,425$ 514,131$ 314,537$ 17.1%
536 7,494$ 7,963$ 9,078$ 17,042$ 9,548$ 10.1%
619 86,268$ 104,822$ 118,785$ 223,606$ 137,338$ 17.4%
631 171,453$ 202,707$ 230,430$ 433,137$ 261,684$ 16.0%
Public Works Total 1,245,417$ 1,496,891$ 1,702,391$ 3,199,282$ 1,953,865$ 17.0%
Grand Total 5,681,868$ 6,639,992$ 7,582,515$ 14,222,507$ 8,540,639$ 15.5%
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Option 2: Balance Available and Budgeted FTE Allocation Model
Dept Fund FY23 Total
Charges
FY24 Total
Charges
FY25 Total
Charges
2023-2025
Total IT
Charges
2023-2023 $
Difference
2023-2025 %
Difference
Central Services 011 724,074$ 1,019,851$ 1,034,697$ 2,054,547$ 1,330,473$ 21.2%
115 2,835$ 645$ 659$ 1,304$ (1,531)$ ‐37.6%
135 13,015$ 14,844$ 15,045$ 29,889$ 16,874$ 7.7%
136 2,002$ 158,382$ 160,504$ 318,885$ 316,883$ 3906.3%
525 9,677$ 26,541$ 26,892$ 53,434$ 43,757$ 87.8%
611 261,511$ 38,116$ 38,916$ 77,032$ (184,479)$ ‐41.7%
612 20,496$ 15,999$ 16,219$ 32,219$ 11,723$ ‐10.3%
613 52,182$ 57,840$ 58,649$ 116,489$ 64,307$ 6.1%
618 98,383$ 385,784$ 391,101$ 776,885$ 678,502$ 146.8%
622 73,284$ 81,107$ 82,236$ 163,343$ 90,059$ 6.0%
623 22,161$ 49,173$ 49,842$ 99,016$ 76,855$ 61.6%
635 23,384$ 49,791$ 50,489$ 100,280$ 76,896$ 57.2%
Central Services Total 1,303,004$ 1,898,074$ 1,925,249$ 3,823,323$ 2,520,319$ 23.6%
Fire & EMS 011 378,100$ 1,256,768$ 1,273,790$ 2,530,558$ 2,152,458$ 116.9%
136 ‐$ 51,136$ 51,804$ 102,941$ 102,941$ #DIV/0!
151 1,675$ 16,697$ 16,932$ 33,629$ 31,954$ 449.1%
511 420$ 51,698$ 52,378$ 104,075$ 103,655$ 6105.2%
592 49,391$ 283,447$ 287,342$ 570,789$ 521,398$ 237.6%
Fire & EMS Total 429,586$ 1,659,747$ 1,682,245$ 3,341,992$ 2,912,406$ 143.9%
LRCS 011 960,541$ 1,486,822$ 1,509,446$ 2,996,267$ 2,035,726$ 28.2%
031 141,046$ 178,759$ 179,931$ 358,690$ 217,644$ 13.7%
111 22,658$ 28,509$ 28,632$ 57,141$ 34,483$ 13.1%
136 382$ 25,533$ 25,895$ 51,428$ 51,046$ 3292.7%
LRCS Total 1,124,627$ 1,719,622$ 1,743,904$ 3,463,526$ 2,338,899$ 27.2%
PDD 011 205,526$ 398,262$ 404,021$ 802,284$ 596,758$ 47.6%
151 235,766$ 400,015$ 405,573$ 805,589$ 569,823$ 35.5%
152 16,257$ 17,730$ 17,978$ 35,709$ 19,452$ 5.2%
153 ‐$ 789$ 805$ 1,594$ 1,594$ #DIV/0!
155 17,066$ 48,984$ 49,673$ 98,657$ 81,591$ 94.2%
171 63$ 138$ 140$ 278$ 215$ 60.2%
175 ‐$ 4,358$ 4,415$ 8,773$ 8,773$ #DIV/0!
178 ‐$ ‐$ ‐$ ‐$ ‐$ #DIV/0!
332 ‐$ 3,632$ 3,679$ 7,311$ 7,311$ #DIV/0!
525 26,540$ 114,647$ 116,184$ 230,831$ 204,291$ 166.7%
527 ‐$ 13,801$ 13,980$ 27,781$ 27,781$ #DIV/0!
617 408$ 3,696$ 3,745$ 7,441$ 7,033$ 403.6%
PDD Total 501,626$ 1,006,052$ 1,020,195$ 2,026,247$ 1,524,621$ 51.0%
Police 011 1,071,095$ 2,503,529$ 2,538,082$ 5,041,611$ 3,970,516$ 67.6%
112 ‐$ 997$ 1,018$ 2,014$ 2,014$ #DIV/0!
132 4,157$ 126,079$ 127,768$ 253,847$ 249,690$ 1467.1%
134 2,186$ 29$ 30$ 59$ (2,127)$ ‐48.3%
136 170$ 401,172$ 406,531$ 807,704$ 807,534$ 117942.5%
511 ‐$ 46,290$ 46,914$ 93,204$ 93,204$ #DIV/0!
Police Total 1,077,608$ 3,078,096$ 3,120,343$ 6,198,439$ 5,120,831$ 93.5%
Public Works 011 136,941$ 352,262$ 357,119$ 709,381$ 572,440$ 79.3%
112 730$ 6,407$ 6,542$ 12,949$ 12,219$ 389.9%
131 207,286$ 587,743$ 595,901$ 1,183,644$ 976,358$ 92.5%
151 3,427$ 30,882$ 31,299$ 62,181$ 58,754$ 401.2%
332 4,439$ 15,965$ 16,184$ 32,149$ 27,710$ 130.5%
511 111,359$ 393,535$ 398,932$ 792,467$ 681,108$ 127.4%
533 185,092$ 622,941$ 631,419$ 1,254,360$ 1,069,268$ 119.0%
534 131,334$ 384,065$ 389,362$ 773,427$ 642,093$ 96.9%
535 199,594$ 719,935$ 729,794$ 1,449,729$ 1,250,135$ 131.0%
536 7,494$ 10,176$ 10,323$ 20,499$ 13,005$ 18.6%
619 86,268$ 257,400$ 260,978$ 518,377$ 432,109$ 99.9%
631 171,453$ 467,490$ 473,978$ 941,468$ 770,015$ 87.0%
Public Works Total 1,245,417$ 3,848,801$ 3,901,831$ 7,750,631$ 6,505,214$ 105.2%
Grand Total 5,681,868$ 13,210,391$ 13,393,766$ 26,604,158$ 20,922,290$ 66.9%
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Appendix D: Rate Methodology From start to finish, the annual proposed IT rates go through a comprehensive analysis and review process. A subcommittee of the Technology Advisory Board (TAB), the IT Rates Subcommittee, meets several times during the year to discuss rate methodology changes if needed. Additionally, in late summer, the Finance Division releases internal service fund (ISF) baselines for each of the City’s ISFs, with the exception of Fleet, which has its own review process. These baselines intend to project anticipated ISF rate increases based on known service level changes and various inflationary projections. The upcoming year’s IT rates are built based on many of the assumptions included in this baseline, and take into consideration upcoming strategic initiatives or anticipated contractual changes and staff vacancies. The proposed rates are then presented to TAB, which acts as the governing and advisory body for information technology at the City and has at least one representative from each of the City’s six departments. After TAB reviews and votes on a recommendation for the upcoming year’s IT rates, the proposal is then reviewed as an informational item by the Department Budget Managers group. After this review, the rates are re-packaged for the Executive Team, the body that makes the final determination about the level of rates to be charged by each ISF in the upcoming fiscal year. The Exec-approved rates are then provided to the Finance Division to be included in the budget system prior to departmental planning and entry for the upcoming year. Both proposed models include the following IT Rates: IT Charges (account 681200), Hardware Charges (account 681201) and Phone Hardware Charges (account 681220), . IT Charges reflects ISD’s anticipated annual rate model-related costs such as personnel, various materials and services (M&S) for all teams included in Fund 611. For Option 1, this includes the Network Operations Team, the Service Desk, some cybersecurity costs, and some aspects of the asset management team, as well as cyber security costs. Option 2 includes all items included in option 1, and moves the IT Administration, Project Management Team, Application Development Team, and the Lane County Data Center costs to Fund 611. Option 1 charges customers for Fund 611 Rates by inflating previous years rates and adding extra costs as needed. Option 2 transitions the funding model, charging each budgeted FTE an equal share of IT Charges. This option increases transparency, simplifies administration of the fund and moves towards a more equitable funding model. In FY23, IT Charges represented 91% of the revenue budgeted in the IT Rate Model.
Hardware refers to the personal computing assets purchased on the lease model, which was developed during the last recession as a mechanism to ease departmental upfront costs to procure necessary equipment like desktops, laptops, monitors, etc. The lease model uses ISD’s operating budget to purchase the equipment initially, and ISD recovers these costs from customers by dividing the purchase price over 60 months of interest free payments. After 60 months have passed, payments are reduced to 20% of their original value. This ensures that ISD receives full cost-recovery for the upfront cash outlay to purchase the leased devices, and it recognizes that older devices, while more cost-effective due to the decreased rate, often require more support to operate in the City’s complex technical environment. This method gives customers more power over reviewing their inventory and making decisions about replacements or new devices, while recognizing their current rate commitments. Rates may
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continue to increase in future years as many users make a switch from desktops to laptops, which provide more mobility but at an increased cost. A snapshot of Hardware inventory is taken in August and is used to provide a recommended annual amount for budget preparers, but the actual amount charged will be via monthly journals and reflective of the inventory at the time of billing. In FY23, Hardware Charges represented about 7% of the revenue that is expected to be collected through the IT Rate Model. Phone Hardware refers to the physical, desk VOIP phones that are used by the majority of the City for telephone service, and this amount reflects a phone hardware replacement charge for each device. The rate per line is $5.17 in FY23 and is billed via monthly journal, with charges based on the actual inventory of devices at the time of billing. In FY23, Phone Hardware Charges represented around 2% of the revenue collected through the IT Rate Model.
Software refers to products including Microsoft 365 licenses and Adobe products that ISD will track in Service Connect and bill back to customers on a monthly basis. This will be a new charge in FY24, added at the recommendation of the Rates Committee. This method gives customers more power over reviewing their inventory and making decisions about replacements or new devices, while recognizing their current rate commitments.
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Appendix E: FY23-25 IT Rate Model Proposal Development Process ISD and its partners last updated the IT Rate Model structure for FY17. FY19 was the last year that the IT rate was able to be fully updated, a result of many environmental changes like the Chart of Accounts update, a new PeopleSoft Financials system, and migration to a new ISD ticketing system. The software and reporting changes negatively impacted the complex set of metrics used to equitably allocate the IT Charges and there are now significant data gaps that make it nearly impossible to replicate the previous calculation methods. Option 1: Existing Model with Adjustments Option 1 model provides steady funding for ISD as a division but is increasingly inequitable as it is based on how the organization looked when planning for FY19. Additions of new work units and other changes are not reflected in the rates. In an effort to create a new model option, the Technology Advisory Board (TAB) appointed the IT Rates Subcommittee (Rates Committee) in early 2022. The Rates Committee was facilitated by ISD staff, included representatives from every department, and received significant support from Finance staff. The group met 10 times between March and September 2022. ISD staff also formally met with representatives from every department individually 3 times to gain input and work through challenges that emerged during the process. Option 2: Budgeted FTE IT Rates Model reflects the collective effort of this group to find a path to meet the following best outcomes defined together at the outset of the process: IT Rate Model Revision Best Outcomes • Transparent and simple to understand. It’s to be easy to understand and explain what’s included in the IT Rates. It’s easy to articulate what’s driving costs. • Easy to administer. The monthly and annual tasks associated with the rates do not significantly add to the current workload of any employees, and ideally would be less than the current model. • Equitable. The distribution of costs aligns with the amount of IT services customers and departments are receiving as much as possible. • Adequate funding and flexibility for ISD to meet business needs. ISD has adequate funding and flexibility to meet the business needs for COE at the service level expected by customers. • All departments agree on the new model. The Rates Committee began its work by reviewing the main cost drivers of ISD’s budget and digging into how those cost drivers work. ISD staff was able to leverage ISD’s program list from Priority Based Budgeting (PBB) to help illustrate different types of services and cost drivers as shown in Chart 1. Staff identified three types of programs: 1) “Light switch programs” (blue) are either on or off and have little scalability; 2) “stairstep programs” (yellow) are scalable at the department, work unit, location level and have moderate scalability; 3) “linear programs” (green) are saleable at the FTE, device, or some other discrete unit level. This work supported transparency in the process and helped the group consider what type of rate model will support meeting the organization’s needs.
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The Rate Committee also built on the work of the FY23 IT Rates Subcommittee’s, using the following roadmap to guide the process: 1. What should be included in the rate model? (Recommendation 3 from FY23 Roadmap) 2. What rate model structure should we use? (Recommendation 1 &2 from FY23 Roadmap) • What allocation methodology should we use? Move to an FTE model?
• What services should be billed directly? 3. Rate Model Level (Recommendation 4 &5 from FY23 Roadmap)
• Include GIS Services?
• Appropriate level for balance available? 4. Additional considerations for FY23-25 The remainder of this process summary will focus on the recommendations on each of the items on the roadmap. Option 2: Budgeted FTE IT Rates Model
1. What should be included in the rate model? (Recommendation 3 from FY23 Roadmap)
Challenge with the status quo: As of FY23, ISD has six different funding sources. Most funding comes from two funds: The General Fund Allocation including Central Services Allocation (CSA) contributions and Fund 611: IT Rates. This split is confusing to customers, especially as they try to understand their IT rates, and runs counter to ISD’s goals to increase transparency into our operations and charging mechanisms. As a division, each section within ISD is dependent on each other for various activities. An increase in application development activity (housed in the General Fund), could lead to additional calls to the Service Desk, or updates and changes to the networking environment, both functions that are housed in the IT Rates fund. This interdependency can be strained when these areas are partitioned
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through funding mechanisms that have different processes and methodologies. Additionally, this split can hinder technological innovation. For example, one of ISD’s largest contracts is with Lane County for technical services, where they host a data center. ISD has concerns about the cost of this contract, the continuity of operations in the event of an emergency, and remote access to this data. To that end, ISD has been steadily moving more operations to the Microsoft cloud environment, Azure, which is consistent with trends in the overall IT industry. However, the Lane County technical services contract is paid out of the General Fund and Microsoft costs are paid from the IT Rates fund. As we lessen our reliance on the Lane County contract and shift more data and applications to the cloud, our General Fund costs will likely decrease along with a commensurate baseline decrease, but the IT Rates would need to be increased to absorb the additional costs of Microsoft services. ISD anticipates that overall, the move to Azure will save the City money but in order to realize those savings, a commensurate decrease in General Fund costs would likely be necessary to avoid negatively impacting non-General Funds, who are the rate payers of the CSA. TAB Recommendation: Consolidate ISD funding from General Fund Allocation and Fund 611 into Fund 611. Formally include a lookback as part of Fund 611 rate-setting.
Consolidating ISD funding into Fund 611 creates transparency for ISD customers as all funding will be based on the same measures created and maintained collaboratively by the Rates Committee and TAB. It simplifies administration for multiple teams who collect and administer the Central Services allocation. Last, it also increases flexibility for ISD, removing restrictions on funding that are based on historical circumstances, and allowing staff to focus on using the budget to deliver services in the way that best meets the organization’s needs. The Rates Committee recommends adding a lookback mechanism to the Fund 611 as a formal component of the Fund 611 rate process. With the transition to the biennial budget, the next lookback will happen with the preparation of the FY25-27 rate setting process. To calculate the lookback credit, ISD staff will calculate the difference between budget to actuals from FY23 and FY24. Staff will adjust for the 25-27 Biennium IT Rates to reflect the difference between budget to actuals. 2. What rate model structure should we use? (Recommendation 1 &2 from FY23 Roadmap) a. What allocation methodology should we use?
Challenge with the status quo: FY19 was the last year that the IT Rates was able to be fully updated, a result of many environmental changes like the Chart of Accounts update, a new PeopleSoft Financials system, migration to a new ISD ticketing system, and a long-term vacancy in the ISD financial management position. IT Rates are currently set by inflating the previous year’s rates without regard to changes in service level or customer composition. As work unit, FTE, and device usage change, this creates an increasingly inequitable model. The current model’s level of complexity also presents a barrier to customers that want to understand their charges and determine the best way to impact their rates. Rate Committee Recommendation: Change the IT Rates allocation mechanism to Budgeted FTE. Specifically, each budgeted FTE will pay an equal share of the IT Rates included in Fund 611. This method supports the Rate Committee’s best outcomes of transparency and ease of administration. It also helps move towards equity compared to the status quo model in that the model allows to easily add and remove work units and FTE as changes occur in the City’s footprint.
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The Rate Committee considered weighting IT Rates based on the amount of technology an FTE uses as well as charging different rates based on temporary and limited duration status. Ultimately the Rate Committee felt the costs associated with differentiating rates for different types of employees were greater than the benefits. It is something the Rate Committee wants to continue exploring in subsequent rate conversations to keep working towards greater equity. The Rate Committee also considered a process to adjust FTE counts mid-year or mid-biennium. The group decided that the administrative burden of applying a adjustment mid-cycle was too high and would not provide enough of a benefit to warrant the adjustment. b. What services should be billed directly? Challenge with the status quo: Direct billing in the context of IT Rates means separating out the basic costs for providing IT services for the organization versus those costs that are not of general benefit, and then directly charging the customer that incurs those non-general benefit costs. One of the greatest benefits of expanding direct billing is that it shifts more power to customers to control and influence the costs that are not considered general benefit. The Rate Committee has emphasized a need for customers to have more influence over their ISF costs to help manage their budgets. More direct billing provides greater transparency on these additional costs and puts the power into the hands of our customers to make decisions about the tools and services they need to run their day-to-day business. Direct billing is already in place for some ISD services, namely low-voltage cabling, outright purchases of hardware and software, non-VoIP phone usage, and the MFD program. A lease model is in place to charge departments directly for items like computers and monitors.
Rate Committee Recommendation: Begin direct billing of Software Costs in FY23-25 and work towards more direct billing in the future. ISD tracks about $550,000 in software costs that can be direct-billed to customers beginning in FY23-25. Examples of software products expected to be directly billed include Microsoft 365, all Adobe products, Visio, Power BI, and Tableau. This project will take staff resources for both ISD and departments to implement a process and ensure data is acceptable to all parties involved. ISD and TAB believe this is a worthwhile and manageable project to accomplish in the next year and will help make IT Rates more equitable. The Rate Committee agreed to the following parameters for software direct-billing:
• Customers are responsible for payment of the full term of the software license.
• Upon request, ISD will try to redistribute software licenses to other employees within the term of the software license. At the time of the transfer, ISD will also transfer financial responsibility to the new software license holders’ work unit. • Requests to transfer licenses are limited to every 90 days per license. This is to protect ISD staff capacity and may be reevaluated as needed. Changes will be made in collaboration with TAB. • Software will be billed monthly via a journal. TAB would like to see more programs characterized as “stairstep programs” in Chart 1 move toward a direct bill model to increase equity. The administrative burden to parse out which department should pay which component of those programs is considerable and it wasn’t feasible
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to do in time for this rate setting process. It is something the ISD and TAB will try to incorporate in the future as resources allow. 3. Rate Model Level (Recommendation 4 &5 from FY23 Roadmap) a. Include GIS Services?
Challenge with the status quo. GIS is an integral part of the City of Eugene’s operations, and its nexus with technology and the systems that rely on it align well with the functions of ISD. The previous IT Rates Subcommittee recommended taking a deeper look at GIS functions at the City and determine if aligning with industry best practice and centralizing these operations would make sense for the organization. TAB Recommendation. Do not include GIS funding in IT Rates from FY23-25. Support the existing GIS Funding Committee and consider their recommendations during the next IT Rate-setting process. This work is in progress and wasn’t ready for consideration for the FY23-25 rates.
b. Appropriate level for balance available?
Challenge with the status quo. As the FY23 proposed rates and six-year forecast note, the current IT Rates fund is highlighting a structural imbalance between its annual revenues and planned expenditures. This imbalance has led to a steadily declining Balance Available because budgeted expenses are growing at a faster rate than the rates that are charged. Budget constraints since the Great Recession in 2008 have generally limited the scale of the requests for annual rate increases. In addition, moving ISD funding out of the General Fund Allocation comes with an accompanying need to add balance available to support the overall budget increase.
Rates Committee Recommendation. Increase balance available to 2-months of operating expenditures. This increase with bring Fund 611 in alignment with recommended levels and provide stability to the fund.
Additional Considerations for FY23-25 Funds for Special Consideration The Rates Committee identified six funds that need special consideration if Option 2 is approved. Funds 031 (Cultural Services), 111 (Library Levy), and 112 (Parks and Recreation Levy) have not previously paid the Central Services Allocation (CSA) to the General Fund and they all operate on fixed revenue sources that are not easily adjusted. For FY23-25, the recommendation is to transfer the increase in costs to the General Fund. The expectation is the subsequent levies will include the full cost of IT Services. Funds 171 (Community Development Block Grant) and 178 (HOME) are subject to certain legal requirements. The Rates Committee recommended that these charges be shifted to the General Fund initially. The funds can be billed over the course of the biennium in alignment with the Federal and State rules that govern them.
Microsoft Enterprise Agreement Renewal The City’s Microsoft Enterprise Agreement (EA) expires in December 2022. Microsoft negotiates 3-year fixed price agreements with the City. The main portion of the EA covers the cost of employee Microsoft 365 (M365) licenses, and cost about $490K. Price estimates to maintain this service level purchased in the last EA are $618K.
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The Rates Committee recommended included an M365 license that includes the Microsoft Security Suite, which will cost an estimated $827K. ISD staff had access to this product for free during 2022 due to a White House initiative to support local governments with cybersecurity efforts. The funding for this tool will go away in FY23. Without this product, ISD would likely never learn about many of these threats, or would learn about them after they have spread in our environment. ISD would also lose some capacity to remediate these issues, a portion of which is currently done by this product. This product currently removes about 54% of emails sent to City employees, flagging them as spam or malicious. Unfreezing Position 770 ISD removed funding from its FY22 and FY23 budget for position 770, a Service Desk position, and held the role vacant in FY22. The Rates Committee supported adding funding back to support this role for several reasons: a fully staffed Service Desk improves cybersecurity, it increases ISD’s ability to meet customer needs, and it helps strengthen and develop ISD’s workforce as the Service Desk has proven to be an entry point for other positions in ISD.
Challenges for Future Rate Model Discussions
Funding New IT Needs Rates Committee discussed how fund new IT needs that emerge during the biennium. While MOUs are in place between most departments and ISD, there’s more work to be done to come to mutual understanding on this item. Next steps include TAB and ISD staff completing an ISD-specific strategic plan in FY23 and then tying that to the budget and services ISD offers. The goal is to have clarity around this issue for the FY25-27rate setting process. Application Support Technician (AST’s) Many work units employ AST’s to support their technology needs. The Rates Committee considered how to incorporate the contributions of AST’s into IT charges. The group did not come to consensus but agreed to continue considering how to work incorporating this element in the future.
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Appendix F: Accomplishments & Major Activities
ISD Staff faced new challenges as the pandemic continued to impact everyone’s day to day work life in
FY22 and early FY23. The division continued to experience staffing shortages and supply chain issues
that impacted the team’s ability to provide services on projected timelines. Starting in mid FY21 and
spanning through FY22, 24% of staff members (12 skilled professionals) exited the division. While
remaining staff stepped up to fill gaps, staffing vacancies took a toll. ISD filled all but three of those
positions by mid-calendar 2022, including the critical IT Director position.
The IT Cyber Security program was re-booted this year with the hiring of a new IT Security Analyst. Key
accomplishments included completing the annual PCI compliance audit, renewing the cyber security
insurance coverage, rolling out cybersecurity training to the entire organization, supporting
cybersecurity alert responses, participating on the cyber security response team for Oregon22 and
leveraging ARPA dollars to strengthen the City’s cyber security posture. The tools currently in place block
hundreds of millions of malicious items, helping to keep the City’s network and data safe.
The Project Management and Application Development teams completed a number of projects. August
saw the rollout of PeopleSoft’s Enterprise Learning Management (ELM) system. The city-wide system
incorporates old training records and allows us to retire two older systems. The PMO Team also
supported the Airport by creating three different website widgets that support a better customer
experience: 1) parking cost calculator for customers to estimate how much their parking will cost, 2) live
occupancy rates of each of the parking lots, and 3) an enhanced, bilingual flight status page for
customers to determine if their flights are arriving on time. All three of these widgets have provided our
customers with tools to prepare for travel and eased direct customer calls to the Airport administration
office.
The Public Safety Technical team assisted with the implementation of Switch to Switch, a software that
will assist with information sharing between the City of Eugene and the Willamette Valley Consortium
(Linn County Sheriffs and other local agencies).
As directed by City Council and as provided in the Envision Eugene Comprehensive Plan, a cross-
department staff team have been developing the growth monitoring program, led by Planning and
Development and Central Services/Information Technology staff. The team reached a big milestone this
summer, publishing the first Envision Eugene Growth Monitoring Comprehensive Report.
The Network Operations Team completed and made progress on a number of projects even with
significant staffing challenges. The team complete firewall health checks with a third-party vendor.
Follow up remediation was completed, resulting in a better running system and stronger security for the
City of Eugene’s network. Staff led the Microsoft Windows 10 Upgrade project. The operating system on
City of Eugene computers was updated to the latest version. Approximately 1,970 computers were
updated, which is a noteworthy number in light of a high percentage of computers that are used
remotely. The build out of a cloud server environment continued. More than 30 servers now reside in
the Azure cloud environment and the number is growing. This work positions the City of Eugene in a
place where resources can be better managed by utilizing the cloud infrastructure. Despite being down
one network engineer for the year, switch and AP upgrades have continued. Approximately 35 switches
and 80 access points were upgraded.
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The Service Desk has completed and documented 3,745 Service Requests and 1,572 Incidents in 2022.
YTD FY23 the team has completed and documented 1,324 Service Requests and 85 incidents. The
numbers for FY23 will skew toward more Requests than incidents due to a major restructuring of our
service offerings. The Team also made significant process improvements in the onboarding process for
new Service Desk staff, a team that has experienced significant personnel movement in FY22. The new
process drops the amount of time taken to get new technicians into the ticket queues from months in
previous years, to 2-3 weeks in FY22, to taking tickets within the first week of work in FY23. Service Desk
staff also collaborated with staff from ERC, Facilities, and Finance to centralize the critical employee
offboarding process. This unified process alleviates pain points identified by all groups as well as eases
the burden from COE Supervisors. A single ticket now encompasses all of the work required from
Central Cervices in a way that is trackable, auditable, repeatable, while maintaining a lens on the
sensitivity that can sometimes arise from an employee departure.
ISD launched third-party software purchasing in Service Connect, with a goal of providing greater
transparency to customers on common third-party software pricing and features. This enhancement
also provides ISD with better data to track usage and support inventory work. Software purchasing helps
to standardize orders and license tracking, which has a downstream impact of requiring less ISD staff
time in processing these requests, will assist with turnaround time in orders and will provide greater
transparency on software costs. In addition to the Software purchasing in the equipment store, ISD staff
have made strides towards developing a refined and simplified Service Request catalog in Service
Connect. Work continues, but many new simpler categories have been released to start to remove or
combine categories and to open the door for self-help feature of Service Connect.
Among our completed projects was the acquisition of a fleet of 360-degree hybrid meeting cameras.
Acquired with ARPA funds, these cameras help City functions provide live meeting immersion to folks
working remotely or to the public tuning into work sessions.
The IT Asset Management Team (ITAM) focused on several internally focused projects in FY22. End-of-
life management of IT assets is a critical time in accurately managing electronic waste that, if not
handled correctly, can result in data loss, security breaches, environmental contamination, legal
violations, and fines. Staff developed a new process to support management of this process. In addition,
the team has been documenting processes to support increased efficiency and long-term sustainability
of the program. ITAM staff are also collaborating with partners across ISD and the organization on the
following projects: software onboarding, transition to Windows 11, and expanding the software catalog
in Service Connect.
The ISD team continues to improve processes by implementing industry best practices and find new and
better ways to support the organization in its mission of helping our community, all while protecting
critical City networks and data.
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FY24 Eugene WW - MWMC Exhibit 11 Detail ***EXPANDED WITH CROSSWALK***
*ESTIMATED
PERSONNEL
MWMC Account (Exhibit 11 Line Items) Account - Description (City of Eugene) FY23 Eugene Actuals FY24 Entry Eugene FY24 Budget Adjust FY24 Entry MWMC *Est. FY24 Eugene Actuals
REGULAR WAGES 511100 - Regular wages 5,956,033.71 6,360,465 97,531 6,457,996 6,376,653.99
OVERTIME 511200 - Regular Overtime 78,276.88 - 57,650 57,650 84,253.11
EMPLOYEE BENEFITS 5xxxxx - Benefits 2,553,015.75 2,916,206 (58,173) 2,858,032 2,883,578.09
PAID FAMILY MEDICAL LEAVE 560610 - Paid Leave Oregon ER - - 32,288 32,288 33.01
WORKERS' COMP/UNEMPLOYMENT INSURANCE 560200 - Worker's Compensation ISF 118,296.33 129,726 (3,177) 126,549 131,064.52
560300 - Unemployment Insurance ISF 4,511.28 3,837 (94) 3,743 3,756.00
HEALTH INSURANCE 570100 - Health Insurance ISF 1,348,510.95 1,995,340 (188,262) 1,807,078 1,574,691.65
Grand Total 10,058,644.90 11,405,574 (62,237) 11,343,336 11,054,030.37
MATERIALS & SERVICES
MWMC Account (Exhibit 11 Line Items) Account - Description (City of Eugene) FY23 Eugene Actuals FY24 Entry Eugene FY24 Budget Adjust FY24 Entry MWMC *Est. FY24 Eugene Actuals
UTILITIES 611100 - Utilities 1,331,107.53 1,277,800 144,200 1,422,000 1,545,417.43
FLEET OPERATING CHARGES 616561 - Fleet Maintenance Parts 761.73 2,900 (482) 2,418 59.98
6xxxxx - Fleet ISFs 592,394.94 662,042 (110,319) 551,724 581,102.72
MAINTENANCE-EQUIPMENT & FACILITIES 612100 - Building and Land Maintenance 24,285.25 54,000 10,819 64,819 43,038.29
612200 - Equipment Maintenance 115,827.68 144,100 28,870 172,970 116,099.70
CONTRACTUAL SERVICES 617800 - Temp Agency Extra Help 208,900.93 160,400 27,967 188,367 201,769.66
617900 - Contractual Services - Other 408,520.81 476,034 82,999 559,033 508,538.33
MATERIALS & PROGRAM EXPENSE 6xxxxx - Operating Expenses 451,579.74 698,372 38,171 736,543 799,309.26
6xxxxx - Operating ISFs 18,027.12 14,875 813 15,688 17,805.03
CHEMICALS 616600 - Chemicals, Paints, & Sealers 882,785.00 851,900 (51,400) 800,500 1,071,252.14
PARTS & COMPONENTS 616560 - Parts and Components 635,350.86 378,650 39,350 418,000 580,996.39
RISK INSURANCE - EMPLOYEE LIABILITY 681300 - Risk Rates ISF 61,869.00 104,202 (33,000) 71,203 104,124.00
COMPUTER EQUIPMENT, SUPPLIES, MAINTENANCE 6xxxxx - Operating Technology 132,566.63 280,347 (121,500) 158,846 335,293.13
6xxxxx - InfoTech ISFs 257,703.04 725,642 (314,488) 411,154 688,733.99
Operating M&S Total - Eugene / MWMC 5,121,680.26 5,831,264 (258,000) 5,573,264 6,593,540.05
Indirects (Fed Rate 5.47% for FY24) 1,119,528.05 1,300,000 - 1,300,000 1,000,988.29
Total Materials & Services 6,241,208.31 7,131,264 (320,237) 6,873,264 7,594,528.34
Capital Outlay - Other 96,930.33 380,000 - 380,000 195,190.43
*Est. Budget Overage
GRAND TOTAL 16,396,783.54 18,916,838 (320,237) 18,596,600 18,843,749.14 247,148.86
8/1/2024 1 of 1 FY24 Crosswalk Detailed Summary
Attachment 2
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