Template revised January 10, 2019.
COMMISSION
AGENDA MEMORANDUM
Item No.
6b
ACTION ITEM
Date of Meeting
September 24, 2019
DATE: September 17, 2019
TO: Stephen P. Metruck, Executive Director
FROM: Matt Breed, Chief Information Officer
SUBJECT: Server Virtualization Upgrade (CIP #C801142)
Amount of this request:
$368,000
Total estimated project cost:
$368,000
ACTION REQUESTED
Request Commission authorization for the Executive Director to (1) proceed with the Server
Virtualization Upgrade project; (2) execute a contract for equipment and vendor
implementation services; (3) and use Port staff for implementation for a total project cost not
to exceed $368,000.
EXECUTIVE SUMMARY
Port of Seattle software applications run on a virtualized server platform that maximizes the
utilization of our hardware investments by condensing the number of physical servers to virtual
servers at a ratio of 35 to 1. This is accomplished because one physical server can host multiple
applications. This project will upgrade the server virtualization software at our local and remote
data centers and replace servers that are at their published end-of-life. Support for our
software ends in March 2020 requiring an upgrade to continue to receive security and other
critical updates. Due to technology advancements that increase server capacity, we can further
reduce our physical server count by 30% resulting in a 50 to 1 physical to virtual ratio.
Information & Communication Technology (ICT) will complete this project. This project was not
budgeted as a large capital project for 2019 but $368,000 will be transferred from the
Technology Infrastructure Small Capital CIP (#C800009) resulting in no change to the 2019-2023
plan of finance. There is no change in estimated recurring maintenance costs as a result of this
project.
JUSTIFICATION
This technology platform hosts most of our applications critical for successful Port operations.
These include our Financials, Human Resources, Maintenance, Access Control, and Public Safety
systems among many other important applications. Supported technology infrastructure with
COMMISSION AGENDA – Action Item No. 6b Page 2 of 4
Meeting Date: September 24, 2019
Template revised June 27, 2019 (Diversity in Contracting).
current security and feature updates is critical to provide a stable and secure environment for
continued operations.
Diversity in Contracting
There are no WMBE goals established as it is highly unlikely there will be subcontracting
opportunities. Outreach with the support of the Diversity Contracting Office will be conducted
to maximize women and minority businesses knowledge of the project.
DETAILS
Scope of Work
(1) Upgrade virtualization software at our local and remote data centers
(2) Replace 13 servers at our Sea-Tac data center with 9 servers
Schedule
Commission authorization
Procurement Completed
In-use date
Cost Breakdown
This Request
Total Project
Hardware/Software
$310,000
Vendor Services
$10,000
Port Labor
$48,000
Total
$368,000
ALTERNATIVES AND IMPLICATIONS CONSIDERED
Alternative 1 – Procure new software via competitive procurement
Cost Implications: $750,000-$1,000,000
Pros:
(1) Current software and maintenance agreements for critical upgrades will decrease risk
of failure.
Cons:
(1) This is the highest cost alterative and will require significantly more time for
implementation and training.
(2) The current software, used over the last 15 years, is an industry leader and meets Port
requirements. A formal procurement for new software would likely result in the
selection of the same vendor.
This is not the recommended alternative.
COMMISSION AGENDA – Action Item No. 6b Page 3 of 4
Meeting Date: September 24, 2019
Template revised June 27, 2019 (Diversity in Contracting).
Alternative 2 – Upgrade existing software and replace end-of-life servers
Cost Implications: $368,000
Pros:
(1) Current software and maintenance agreements for critical upgrades will decrease risk
of failure.
(2) Since licenses are already purchased and software upgrades are included with
maintenance agreements, this is the most cost-effective alternative
(3) Requires minimal training
Cons:
(1) While current system meets Port requirements, other beneficial features might be
available in another system discoverable through a competitive procurement.
This is the recommended alternative.
FINANCIAL IMPLICATIONS
Cost Estimate/Authorization Summary
Capital
Expense
Total
COST ESTIMATE
Original estimate
$368,000
$0
$368,000
AUTHORIZATION
Previous authorizations
$0
0
$0
Current request for authorization
$368,000
0
$368,000
Total authorizations, including this request
$368,000
0
$368,000
Remaining amount to be authorized
$0
$0
$0
Annual Budget Status and Source of Funds
This project was not budgeted as a large capital project in the 2019-2023 capital budget and
plan of finance. $368,000 will be transferred from the Technology Infrastructure Small Capital
CIP (#C800009) for no change to the plan of finance. This project will be funded 88.2% Airport
Development Fund and 11.8% General Fund.
Financial Analysis and Summary
Project cost for analysis
$368,000
Business Unit (BU)
Corporate division allocations
Effect on business performance
(NOI after depreciation)
NOI after depreciation will increase
IRR/NPV (if relevant)
NA
CPE Impact
NA
COMMISSION AGENDA – Action Item No. 6b Page 4 of 4
Meeting Date: September 24, 2019
Template revised June 27, 2019 (Diversity in Contracting).
Future Revenues and Expenses (Total cost of ownership)
Recurring costs are not expected to change as a result of this project.
ATTACHMENTS TO THIS REQUEST
None
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
None