Template revised January 10, 2019.

COMMISSION

AGENDA MEMORANDUM

Item No.

ACTION ITEM

Date of Meeting

January 28, 2020

DATE: January 17, 2020

TO: Stephen P. Metruck, Executive Director

FROM: Matt Breed, Chief Information Officer

SUBJECT: Phone System Replacement (CIP #C801083)

Amount of this request:

$3,900,000

Total estimated project cost:

$3,900,000

ACTION REQUESTED

Request Commission authorization for the Executive Director to (1) proceed with the Phone

System Upgrade project; (2) execute a contract for software, equipment, vendor

implementation services, and recurring maintenance fees for up to ten years; and (3) use port

staff for implementation. Total project cost for authorization of $3,900,000 is comprised of

$1,900,000 in capital project costs and an estimated $2,000,000 in recurring maintenance fees

for a period of up to ten years.

EXECUTIVE SUMMARY

This project will competitively procure and implement a system that will provide phone service

for employees and tenants at 16 different port locations that include Seattle Tacoma

International Airport, Pier 69, Pier 66 (Cruise Terminals of America), and Terminal 91. In

addition to approximately 4,000 desk and conference phones, the phone system supports three

call centers, 911 Dispatch, terminal and firehouse paging, parking and rental car facility call

boxes, and Terminal and Rental Car Facility hotel direct lines. The port’s Avaya/Nortel phone

system was installed in 2007 and last upgraded in 2013. Due to the age of the system, we no

longer receive software updates. Further, the equipment will no longer be supported in the

next couple of years leaving the port vulnerable to system outages and increasing maintenance

costs. A new phone system provides an opportunity for enhanced security, greater reliability,

and more efficient system operations and maintenance.

Information and Communication Technology (ICT) will complete this project with a vendor

selected through a request for proposal (RFP) process. The capital project, estimated at

$1,900,000, was included in the 2020-2024 capital budget and plan of finance. Recurring

maintenance costs estimated at $2,000,000 for up to ten years will be budgeted in the ICT

Operating Budget.

COMMISSION AGENDA – Action Item No. 6b Page 2 of 5

Meeting Date: January 28, 2020

Template revised June 27, 2019 (Diversity in Contracting).

JUSTIFICATION

This project provides important benefits for continued operations, security, and safety.

(1) Lack of full vendor support with no software updates increases the risk of failure and

security vulnerabilities.

(2) Phone sets are failing at an increasing rate, replacements are difficult to procure, and

we are paying a premium for outdated equipment to be compatible with an aging

phone system.

(3) The current system is comprised of several different vendor technologies making

system troubleshooting challenging. For example, in August 2019, the phone system

was unavailable for a sustained period of time and efforts to resolve the issue were

hampered by the lack of end-to-end diagnostic capabilities.

(4) Modern phone system architecture includes features that improve flexibility, capacity,

and security.

Diversity in Contracting

Project staff are working with the Diversity in Contracting Department to determine if a direct

women- and minority-owned business enterprise (WMBE) aspirational goal should be assigned.

Typically, subcontracting opportunities under technology projects are limited.

DETAILS

Scope of Work

(1) Replace Avaya/Nortel phone system and related components

(2) Integrate new phone system with existing systems to provide continued services

(3) Review carrier-provided interchanges for cost saving opportunities in the network

architecture

(4) After analysis on phone usage and preferences, replace up to 4,000 phones at 16

locations.

Schedule

Commission authorization

2020 Quarter 1

Procurement Completed

2020 Quarter 4

In-use date

2021 Quarter 4

Cost Breakdown

This Request

Total Project

Project

Hardware, Software, and Vendor

Services

$1,125,000

Port Labor

$660,000

Taxes @ 10.1%

$115,000

Project Total

$1,900,000

COMMISSION AGENDA – Action Item No. 6b Page 3 of 5

Meeting Date: January 28, 2020

Template revised June 27, 2019 (Diversity in Contracting).

Recurring

Maintenance

Estimated $200,000 per year for up

to ten years

$2,000,000

Authorization

$3,900,000

ALTERNATIVES AND IMPLICATIONS CONSIDERED

Alternative 1 – Procure a cloud phone solution. Cloud phone solutions are systems hosted by a

third-party provider and delivered through the internet.

Project Cost Implications: $1,800,000 - $2,500,000

Pros:

(1) The vendor has full responsibility for maintenance, reliability, and fail-over.

(2) Depending on scope of the implementation, there could be more integration with our

current communication technology such as chat, conferencing, and team

collaboration.

Cons:

(1) This solution likely precludes the port from leveraging current investments in

communication technology such as interactive voice response and call center

management because the vendor will require the use of their own hardware and

software.

(2) While this alternative may work well for port employee phone service, there are

several requirements that will likely need an on-premise, traditional phone service for

integration with paging systems, call boxes, and tenant services. Multiple products will

increase cost and complexity.

(3) Cloud solutions are new to the telephony industry. As such, products are not as

robust, may not yet be as reliable, and will likely have frequent changes that hamper

user acceptance.

This is not the recommended alternative.

Alternative 2 – Delay a system replacement

Project Cost Implications: $0

Project costs are delayed but recurring costs will escalate as phone system replacement parts

are procured.

Pros:

(1) Project funds are available for other opportunities.

Cons:

(1) Risk of phone system failures increase. In August of 2019 the port had a major phone

system outage with a delayed recovery due to the aging technology and lack of end-

to-end diagnostic tools.

(2) Phone system equipment is currently failing at an increasing rate. We are purchasing

outdated replacement equipment for compatibility with an aging system.

COMMISSION AGENDA – Action Item No. 6b Page 4 of 5

Meeting Date: January 28, 2020

Template revised June 27, 2019 (Diversity in Contracting).

(3) Security patches will no longer be available after software is not supported by vendor.

This significantly increases cyber threat.

This is not the recommended alternative.

Alternative 3 – Procure new phone system leveraging recent telephony-related investments

Project Cost Implications: $1,900,000

Pros:

(1) Procuring a new system ensures the port and tenants’ phone communication system

remains reliable for continued operations, safety, and security.

(2) Leveraging the port’s recent investments in communication technology reduces

project costs and will result in a system that is easier to support and maintain.

(3) Cloud based phone systems will likely mature rapidly in the next few years providing

an interesting alternative for future benefit. This upgrade will provide the phone

service stability needed over the next five to ten years until new options are viable.

Cons:

(1) Funding is not available for other alternatives.

(2) Integration with other office communication technology for port employees such as

chat, conferencing, and team collaboration is not likely available with the