At the January 4 City Council meeting, Council unanimously agreed to have the City Manager enter into a four-year, zero-interest lease agreement for new enterprise network storage that will ultimately save the City over $1 million.
Data storage is one of the most critical and costly components of the City’s information technology infrastructure. The City purchased a state-of-the-art network storage system in 2013 that has served as the backbone of the City’s computing environment. New technology advancements now provide the City with the opportunity to replace that system with a more cost effective alternative.
The new technology is called Hyper Converged Infrastructure (HCI) and it merges servers, high performance flash storage, and networking into a single appliance called a node. Nodes can be grouped together to provide extremely large and efficient storage and server capabilities. The resulting solution is less expensive to build, less expensive to maintain, easier to manage and more efficient than the technology purchased in 2013.
The system was not scheduled to be replaced until 2019. However, maintenance costs have increased to the point that the City is spending approximately $250,000 per year just to maintain the current system. In response to a request to find a way to reduce ongoing maintenance costs, the City discovered a way to obtain discounted pricing along with a zero-interest, four-year lease (with an option to purchase) agreement that would replace the network and seven related servers, including full maintenance coverage for a $203,359.72 annual payment. The equipment can be purchased for $1.00 at the end of the lease period.
The lease payment will be paid using operating funds approved in the Information Technology 2017 budget that were slated for the network maintenance agreement. Additional savings will be realized by not having to purchase four replacement servers and associated licensing increases. Operating cost savings for 2017 are expected to be $300,000. In addition, the lease arrangement will free up $800,000 in funds accrued for the replacement of the network and related servers. The combined savings and accrual fund return in 2017 should be $1,100,000.
Contact: Sam Rainguet, Communications Manager 970-244-1507