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04-06-87 Finance Comm Minutes• Finance and Administration April 6, 1987 Chairman Palmer called the meeting to order at 4:17 pm. Committee members Ruiz and Nystul were attending along with Mayor Kennedy and Clerk/Treasurer Halver. Fred Kluesner of Northwestern Telephone, Jim Atkinson of All-tel Communications and Roger Hopkins of the Daily inter Lake also attended. C/T Halver passed out his report regarding recommendations on the Telephone System bids. He also pointed out that Northwestern Telephone would be replacing existing equipment with new under the maintenance contract. However, Halver said if later on he decided it would be better to go on a time and materials method rather than maintenance contract, conditions could change. ,Fred Kluesner said then they would be replacing with remanufactured equipment unless we requested new. Chairman Palmer read the paragraph in the bid specs allowing the Counci] to waive any technicality or informality and accept any bid which they deem to be in the best interest of the City. F.alver is recommending the low bid of A11-tel Communications be accepted, without cost accounting and the pay phone. He reported the system would be paid for on a time payment contract. The existing budgeted rental costs should pay for the system in • three to four years. Councilman Ruiz asked if Toshiba would continue to provide warranty service if All-tel failed. Jim Atkinson said they (Toshiba) would continue to honor the warranty and provide a dealer for parts support. Fred Kluesner said if the basic systems were compared without the battery backup, Northwestern Telephone was the low bidder. He also objected that All -tells original bid did not provide references for Toshiba Systems, but they brought them in later. Councilman Ruiz said he agreed that the low difference in the bid prices of $164.15 would favor the higher bid of All-tel because they were providing all new equipment. Kluesner again objected to the references of All-tel because they did not meet the specs. Jim Atkinson explained that All-tel has not installed a Toshiba system and therefore could not provide references for maintenance of these systems. They provided references for All-tel maintenance work. Halver requested references for the Toshiba Perception System and called some of them and determined that the Toshiba was a good system. Councilman Nystul suggested the committee concur with the Clerk's recommendation and Councilman Ruiz agreed. Chairman Palmer stated the various points would be reviewed with the full council. Councilman Nystul and Chairman Palmer thanked the bidders for the work they had done. r 1 U 0 \J • CITY OF KALISPELL DON HALVER, CLERK/TREASURER TO: Finance Committee DATE: April 6, 1987 SUBJECT: Telephone System Bids I am recommending the Council accept the Bid of All-tel Communications for a Toshiba Perception Electronic Digital Business Communication System plus their options of wiring to the Emergency Backup Power System and the Battery Back-up. I do not feel we need the Cost Accounting System Option and I would like to pursue some more quotes before we make a decision on a pay phone. The total price of the recommended bid is $41,745.00. However, I would like to remove the second and third year maintenance costs ($ 1,757.00 x 2) from the purchase price and pay these costs seperately when due. Thus the total proposed purchase price would be $36,231.00. I request authorization to solicit quotes for a municipal lease purchase in order to pay for the system. I also request the purchase contract be contingent upon our receiving a satisfactory "comfort letter" from the manufacturer. (This has been promised by telephone by Toshiba.) I further suggest the contract call for proof of certification of maintenance personnel by Toshiba. I have based my recommendation on two factors. 1. The cost comparison of the two proposals including the battery backup and wiring to the City's existing Emergency Generator (less 2nd & 3rd year maintenance costs) favors the bid of All -Tel. All -Tel N.W. Telephone Requested Basic System 38,081.00 37,916.85 Battery Back-up 150.00 5,064.34 Price of Requested Equip. 38,231.00 42,981.19 2. Although the base bid of Northwestern Telephone is 164.15 less than the other, the bid includes our existing in -place Console, Phones, Speakers and Modules, some of which is about seven years old. I feel the additional price of $164.15 for the base system with all new equipment is more cost effective over the expected life of the system.