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Exhibit 1 - Agenda Information Sheet - Amend 1City of Denton _____________________________________________________________________________________ AGENDA INFORMATION SHEET DEPARTMENT: Procurement ACM: Cassey Ogden DATE: December 12, 2023 SUBJECT Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal corporation, authorizing the approval of a first amendment to a contract between the City of Denton and Wells Fargo Merchant Services, LLC, amending the contract approved by City Council on December 14, 2021, in the not-to-exceed amount of $5,000,000.00, said first amendment to continue to provide debit/credit card processing for all City departments; providing for the expenditure of funds therefor; and providing an effective date (RFP 7436 – providing for an additional first amendment expenditure amount not-to-exceed $1,250,000.00, with the total contract amount not-to-exceed $6,250,000.00). STRATEGIC ALIGNMENT This action supports Key Focus Area: Pursue Organizational Excellence and Collaborative and Respectful Leadership. INFORMATION/BACKGROUND On December 14, 2021, the City Council approved a merchant services contract (Ordinance No. 21-2689) with Wells Fargo Merchant Services, LLC (WFMS). The contract is for a five (5) year term to expire on December 13, 2026. Card processing for the City is a complex system including other vendor contracts to successfully accept, process, and fund card revenue to the City’s depository bank. The contract’s estimated not-to-exceed (NTE) amount was established when creating the bid for services but did not account for several unknown factors listed below: • Several departments improving card acceptance by implementing additional card-paying options such as text-to-pay. • Customer Service removed their online card fee thus dramatically increasing their card volume. • All card devices updated to accept near-field communication payments (tap, Google, and Apple Pay. • Commercial and residential growth will continue to play a large role in the cost of processing all payment types. This amendment to increase the contract NTE should support the City’s card processing expenses through this fiscal year, but a new bid for card processing services will be issued before this contract is set to expire in 2026. City Hall 215 E. McKinney Street Denton, Texas www.cityofdenton.com PRIOR ACTION/REVIEW (Council, Boards, Commissions) On December 14, 2021, City Council approved a contract with Wells Fargo Merchant Services, LLC, in the not-to-exceed amount of $5,000,000 (Ordinance 21-2689). On December 11, 2023, this item will be presented to the Public Utilities Board (PUB) for consideration. RECOMMENDATION Award Amendment No. 1 with Wells Fargo Merchant Services, LLC, to continue to provide debit/credit card processing for all City departments, in a not-to-exceed amount of $1,250,000, for a total amended contract amount of $6,250,000. PRINCIPAL PLACE OF BUSINESS Wells Fargo Merchant Services, LLC Dallas, TX ESTIMATED SCHEDULE OF PROJECT This contract will expire on December 14, 2026. FISCAL INFORMATION These services will be funded by various operating funds. Requisition #161747 has been entered into the Purchasing software system in the amount of $1,850,650 for fiscal year 2024. The total amended amount of this contract is $6,250,000. EXHIBITS Exhibit 1: Agenda Information Sheet Exhibit 2: Original Ordinance and Contract Exhibit 3: Ordinance and Amendment 1 Respectfully submitted: Lori Hewell, 940-349-7100 Purchasing Manager For information concerning this acquisition, contact: Randee Klingele, 940-349-8206. Legal point of contact: Marcella Lunn at 940-349-8333.