COUNCIL OF THE CITY OF PHILADELPHIA COMMITTEE ON TECHNOLOGY AND INFORMATION SERVICES - - - Room 400, City Hall Philadelphia, Pennsylvania Thursday, May 8, 2008 9:35 a.m. - - - PRESENT: COUNCILMAN BRIAN J. O'NEILL, CHAIR COUNCILMAN FRANK DiCICCO COUNCILMAN BILL GREEN COUNCILMAN CURTIS JONES, JR. COUNCILMAN JAMES F. KENNEY COUNCILWOMAN BLONDELL REYNOLDS BROWN COUNCILMAN FRANK RIZZO BILL 080407 - An ordinance authorizing the City's Chief Information Officer, on behalf of the City, to enter into multi-year contracts with one or more providers of on-line legal research services... - - - V A R A L L O Incorporated Litigation Support Services Eleven Penn Center 1835 Market Street, Suite 600 Philadelphia, Pennsylvania 19103 215.561.2220 215.567.2670 2
Good morning. I'd like to call the meeting to order of the Committee on Technology and Information Services. We'll be hearing Bill No. 080407. We have a quorum. For the record, Councilman Rizzo to my far left, Councilman Jones, Councilman Green to my right. And we'll get started. Could the Clerk read the bill, title of the bill.
Bill No. 080407, an ordinance authorizing the City's Chief Information Officer, on behalf of the City, to enter into multi-year contracts with one or more providers of on-line legal research services to be used by various City and City-funded agencies, all under certain terms and conditions. (Witnesses approached witness table.)
Good morning. My 3 5/8/08 - TECHNOLOGY - BILL 080407 name is Joseph James. I'm the First Deputy Chief Information Officer for the Mayor's Office of Information Service. I'd like to provide testimony on behalf of the bill.
Councilman O'Neill, members of the Committee, on behalf of Terry Phillis, the Chief Information Officer, it is my distinct pleasure to appear before the Committee today to express the Department's support for this bill. Based upon the historical nature of procuring both legal and non-legal research information, the Department recommends that City Council give its approval for this bill. The Department has since 1996 been responsible for the procurement, administration and contract compliance associated with on-line research services in direct support of over 17 departments and agencies with approximately 1,200 end 4 5/8/08 - TECHNOLOGY - BILL 080407 users. This on-line research is critical for the operation of several key departments and agencies, such as Police, Courts, District Attorney, Law and City Council. The level of research in this new procurement has determined that the prospective bidders would provide the City with the highest level of cost-effective pricing and services if the contract was a multiple-year agreement. In conclusion, the terms proposed by this ordinance will not exceed four years, which is acceptable to the Department. I respectfully ask the Committee that the rules of Council be waived to allow this bill to be reported out of the Committee and have its first reading at the next Council session. I now stand available for any questions you may have.
Mr. Jones -- James. I'm sorry, Joe. 5 5/8/08 - TECHNOLOGY - BILL 080407
The question I have right off the bat is, I see you here. We have a very large city. We have many users, many users that use it a lot. I'm talking about frequent users.
I would think the Law Department would certainly be one right off the top of my head. Do you know who our most frequent users are by department?
Sure. In addition to myself, Christopher Lane is here, who used to be with the Law Department, who has been consulting and advising us on the new procurement. He can speak specifically to the details of what's been the history of the users.
The reason is, I'd like to know who is, but I'd also like to note more than likely their absence here at the hearing, I would like 6 5/8/08 - TECHNOLOGY - BILL 080407 to hear if people that use it feel -- forgetting the price and how many years and who gets it, whether it has what they want, what they need, have they been satisfied with the service that they have, in case the incumbent is one of the bidders, and I assume that would be the case. So can we start with that? Because we may need more testimony.
Well, I'll let Chris give more of the background, but through this RFP process, as we've gone through for procuring the service, we attended many of the meetings with all of the agencies and departments who are active users of it, and for the most part, everyone seems to be very pleased with the amount of services and research capabilities that we currently have through the services we get from LexisNexis and Westlaw. I think for the most part the information that we receive from the bidders is, this is probably one 7 5/8/08 - TECHNOLOGY - BILL 080407 of the top of the line research for on-line research for a lot of both public safety and non-public safety research. Chris?
Good morning. I'm Christopher Lane. I was former Director of Administration for the Law Department from 1980 through 2006, and during that time, I worked with MOIS to administer this contract from the standpoint of the legal users of the contract services. And we have done this as a four-year contract for most of the time that I was there because we found that the vendors would give us the most aggressive pricing if they knew we had a multi-year commitment. The other reason they wanted a multi-year commitment was that we asked them for certain things that was difficult for them to provide on a one-year-at-a-time basis, like a T1 line to make sure that we get maximum speed in transmitting data back and forth to their 8 5/8/08 - TECHNOLOGY - BILL 080407 services, for printers that they provide for on-line printing in the agencies that have the heaviest printing needs and various other things like that. It made it easier for them to give us aggressive pricing if we could guarantee a four-year agreement. We have included in the contract language in each of those four-year agreements that as they add new services, that if they fit into categories that we've included in our contract, that those services would be made available to us at no additional cost. So that, as you know, data services are rapidly changing field, and we did not want our contract to be obsolete after the first year because new things came in that we couldn't get. We do in fact include language in the contracts that they add these things to our agreement as they make them available to other customers. What we do each time this 9 5/8/08 - TECHNOLOGY - BILL 080407 four-year agreement comes due is put together a committee, a steering committee, which comprises the major user agencies, and that includes the Law Department, the Courts, the DA's Office, the Public Defenders, MOIS itself, Police Department, which is a very heavy user, and several other City agencies. DHS uses it to track dead-beat dads. Law uses it to track delinquent taxpayers and their assets. What we found over the last four years is that more and more of the services are investigative in nature and less and less legal in nature. So, for example, four years ago, approximately 35 percent of the usage was for legal -- I'm sorry; 35 was non-legal. Each year since then it's gone up five percent. So at the present, for Fiscal 2008, approximately 50 percent of the use of the service is for investigative purposes, and a lot of that is police detectives who are using it to track 10 5/8/08 - TECHNOLOGY - BILL 080407 witnesses, criminals, their relationships. The service provides a very sophisticated way of tying a person to various other members of their family and friends, so the Police Department can track them down, and they found it to be a very essential tool. Of course, they have very restricted -- the number of people who have that kind of access is very specifically restricted, so that not everybody who has the service can do the kinds of things that the police detectives can do. So that provides some history. What we found is that by lumping all these City agencies together and going to the vendors and saying, Give us your best price, that we are getting -- we are paying approximately three percent of the full retail price of these services. In other words, a small law firm would come to these guys and say, Give us your services, and they would pay so much per 11 5/8/08 - TECHNOLOGY - BILL 080407 search or so much per hour. We're paying three percent of that retail price, because they're getting the benefits of economy of scale with our large number of users. And the fact is, adding users to a system that's mainframe based in Dayton, Ohio, for them the incremental cost of adding another 1,200 users is not that great, so they can afford to give us those very deep discounts.
In Commissioner James' last remark before you testified, he mentioned people have been pretty happy with LexisNexis and Westlaw.
What we have right now is LexisNexis for both legal and non-legal service. That's a citywide contract. And two agencies, maybe three -- I know the Law Department and the Courts -- choose to purchase a 12 5/8/08 - TECHNOLOGY - BILL 080407 certain number of passwords from Westlaw for those types of higher-level legal research services that they feel Westlaw gives them a little more utility. The DA's Office uses it for some of their federal cases that they get involved in. Law Department does the same. Some of our appeals, our appellate guys, like to use Westlaw a little bit better.
That's a relatively small piece, and it's more preference than an absolute need. They just find it a little more efficient for this specific type of law that they practice.
Let's go back to your steering committee of your major users. When you've had meetings on the renewal, I assume you also meet during the period of the contract on some regular basis. What complaints do you have? You mentioned that people are pretty well satisfied, but are there some 13 5/8/08 - TECHNOLOGY - BILL 080407 things people say we wish we had, can we get it, and what are your views on reacting to that?
What we found is that certain people like the Headnotes feature on Westlaw, for example. Certain lawyers are used to having that feature.
Yeah. They find that feature very nice. But there are others who like the Sheperd citation feature, and that used to be a Westlaw feature, now it's been purchased by LexisNexis. So what we found is that the consensus of the committee and after lots of discussion and debate and feedback that they got from their user community is that they get more value from a LexisNexis contract for all services, with a few supplemental passwords from Westlaw for those users that really need it. 14 5/8/08 - TECHNOLOGY - BILL 080407
And is that pretty much it? There aren't any other requests out there that are pushing the envelope on this?
As new needs come up and we address them with the vendor, they've usually been responsive. Every time we need to add something, like when we needed to add DHS for tracking down dead-beat dads, we have a term in the contract that allows us to increase the number of accounts, subaccounts, by up to five percent of total usage of the account without any additional cost, and we were able to bring in DHS users that way, we were able to bring in some from the Controller's Office, from the Revenue Department. The Inspector General's Office has a number of users in the system now. We keep bringing more and more people into the fold as these needs come up. As we discover these needs, they bring them to our attention. We get them 15 5/8/08 - TECHNOLOGY - BILL 080407 hooked up with the LexisNexis service and at no incremental cost to the City.
In addition to that, Councilman, in the past we had some concerns about the billing, and since this was a multi-year contract, from the time that they initially started, they've built a web portal that allows us to better administer that, and that came at no additional cost for us, so that we can actually get the billing information online, do the trending and analysis on our side and support verification of the billing, which is something they added, and, again, it was something that didn't have any additional cost for us.
I'd like the record to reflect that Councilwoman Blondell Reynolds Brown has joined the Committee and Councilman Frank DiCicco has joined us. Councilman Green.
So according to your working group, the services are 16 5/8/08 - TECHNOLOGY - BILL 080407 equivalent between the two major on-line research providers?
The legal services are very close with, like I said, a slight preference for Westlaw in certain specialized types of practices. The non-legal services, the investigative part, the public records part, which is now 50 percent of the City's total usage, is far superior with LexisNexis. The Police Department was quite concerned that if we were to switch to a total Westlaw package instead of a total LexisNexis package, that it would be a very serious problem for them and they would have to go out and buy additional services from LexisNexis at significant cost. So to date, it's been beneficial to have the LexisNexis package.
Are we getting equivalent -- I mean, our user base is such a large number of people. Would we get equivalent pricing by dividing it 50/50 or doing long-term 17 5/8/08 - TECHNOLOGY - BILL 080407 contracts with both services, similar pricing?
We asked the vendors to bid that way, to give us two options, to bid that they were getting everything and to give us a bid for if they only got one piece or another piece. And when we pieced it together, the additional cost to the City if we got a Lexis package for non-legal and a Westlaw package for legal, the additional cost would be approximately 80,000 more per year, and we just thought that was excessive.
Did that take into account the discounts or provision on other things the City buys from these two providers, including legal publications?
Yes. Westlaw quoted us deep discounts on the printed materials, as much as 50 percent, if they were to get a whole package or if they were to get the legal side of the package. On the other side of the 18 5/8/08 - TECHNOLOGY - BILL 080407 coin --
That provided, I think it was, slightly over a hundred thousand dollars of savings in print costs, but it would lock the librarians into keeping those print materials for the next four years, and they were very concerned about that, because as more and more becomes available online and more users get comfortable with using services online, they didn't want to be locked into having to keep those publications for a four-year period, especially since the prices tend to go up between eight and 12 percent a year on the printed materials. On the other side of the coin, the LexisNexis package included up to 22 free Accurint passwords. LexisNexis 23 purchased a service called Accurint, 24 which is used, again, very heavily by the 25 Police Department, and those 25 free 19 5/8/08 - TECHNOLOGY - BILL 080407 passwords would save the City approximately $16,000 a year. So part of their package price was savings on the Accurint. Part of the Westlaw's was savings on the print.
But you're saying when you net it all out, net-net, it's 80,000 --
-- cheaper, including discount and legal publications, et cetera?
Okay. So your testimony is then that we're going with the lowest bidder; the low bid is winning this contract?
It's both the lowest bidder and it's also the best combination of options, the best combination of service.
When you're coming here to update us for the legal contract that you've put out an RFP for, you're not coming back with the contract asking us to approve it. This takes --
No. We're asking for the authorization to be able to have a four-year contract and negotiate and sign a contract for four years.
I know that we're required under the Charter to approve any contract longer than a year, and I assume that's why you're asking for this authorization.
I note that 21 5/8/08 - TECHNOLOGY - BILL 080407 this resolution -- or this ordinance. I guess this is a bill. This ordinance 4 does not mention a provider. Can we approve a contract when we don't know who the other party is? Have you checked with the legal department about that?
This is, as I understand it, this is how we've approved this in the past in the previous procurements for these services.
I mean, because technically we have to approve a contract that unless you know who the other party is and what the contract terms are, I don't see how City Council can approve a contract within the meaning of the Charter without that information being available.
Mr. James, can you get the Law Department to give us an opinion on that?
We can move the bill out and hold it until -- 22 5/8/08 - TECHNOLOGY - BILL 080407
Thank you. Any other questions from the Committee? (No response.)
We'll now move into our public meeting. That's the end of the public hearing. And the Chair recognizes Councilman Green for a motion.
I move that we approve Bill No. 080407 and report it out of Committee and request a suspension of the rules to allow it to have first reading. (Duly seconded.)
Councilman DiCicco and Councilwoman Brown is the second. All those in favor indicate by 23 5/8/08 - TECHNOLOGY - BILL 080407 saying aye. (Aye.)
The ayes have it, and the bill will be on our next Calendar for first reading. I just want to put on the record again that while this will come up for a vote next week based on that schedule, we hope to have the opinion from the Law Department by that time. Thank you. (Committee on Technology and Information Services adjourned at 9:55 a.m.) - - - 24 CERTIFICATE I HEREBY CERTIFY that the proceedings, evidence and objections are contained fully and accurately in the stenographic notes taken by me upon the foregoing matter on May 8, 2008, and that this is a true and correct transcript of same. ______________________________ MICHELE L. MURPHY RPR-Notary Public (The foregoing certification of this transcript does not apply to any reproduction of the same by any means, unless under the direct control and/or supervision of the certifying reporter.)