The Vision and Proposed Platform.  Since April of 2012, the cities of Reno and Sparks, Washoe County, and the Washoe County Health District have been working collaboratively to find a regional solution for a business license and building permit platform.

This combined team has determined a recommended regional path forward.

The vision for the new platform – any license or permit, anytime, anywhere – is responsive to community and business needs, shares resources across the entities, provides substantial savings to each participating entity, enables critical on-line access and paves the way for other entities to join the shared platform.

Strategically, the platform investment aligns well with cross-jurisdiction priorities:

Winning Vendor, Program Costs and Regional Partnership.  After a formal request for proposal (RFP) process and evaluation, the team selected Accela™ as the winning software vendor.  The regional platform will be subscription-based, in an Accela-hosted cloud architecture.  In this model, the more seats we buy (or “subscribe” to), the lower our cost per seat.  Thus, entities that combine together will receive significant licensing savings.  While finalization of contract terms is pending further negotiations, currently negotiated subscription licensing and implementation costs are as follows:

Source: Attachment A -- Washoe County Technology Services – Regional Permits and License Platform costing analysis

Notes:

• Washoe County Health District (Health) costs are imbedded within the above “Washoe” numbers.  Licensing/maintenance costs shall be allocated to Health based upon the number of seats for Health users.
• By combining efforts, Reno, Sparks and Washoe realize:
  • Licensing/maintenance savings = ~$289,104/year for first 5 years
  • Implementation savings = ~$206,383.

• For the City of Sparks, a cost comparison of a regional effort vs. a city only effort:
  • Licensing/maintenance savings = ~$22,550/year for first 5 years
  • Implementation savings = ~$76,439.

Because of the compelling business case and economies of scale by working together, Reno and Washoe County’s managers and Washoe District Health’s officer have signed a letter of intent to share the Accela™ regional platform.  With Sparks Council approval, the City Manager would join in this letter of intent on all further action with Accela™.

To codify this regional partnership as well as to establish a legal means for additional entities to join the platform, the four entities also wish to next enter into an inter-local agreement.  The inter-local agreement would also be written to accommodate future members joining the regional platform.  See Attachment B – Regional License and Permit Program – Talking Points (PowerPoint Slides).  Cost Breakdown Analysis – City of Sparks Licensing and Permitting.

For the City of Sparks, the projected cost breakdown for the regional business licensing and building permitting proposed technology solution is as follows:

Benefits and Funding.  As outlined earlier, the vision for the new platform is “any license or permit, anytime, anywhere.”  This is essential in today’s digital age and enables critical business and citizen conveniences that are baseline services for our regional economy.

Quick highlights of platform benefits include:

• 24 hours on-line access for license and permit submission and/or renewal, status updates, results, etc.
• Updated, customer-centric processes that are aligned with industry best practices.
• Regional sharing and re-use of platform processes, data, interfaces, reports, etc.
• Electronic access and reduction of paper:
  • Application
  • Renewal
  • Electronic documentation submission – e.g., plans, applications, etc.
  • Electronic routing and review.
• On-line inspections – scheduling, recording of inspections, routing of results, etc.
• Mobile access by entity staff in the field.
• On-line payments.
• Future anticipated costs savings – examples include paper reduction, staff efficiencies through improved regional processes and hardware savings due to using the cloud-based subscription model.

In order to realize these benefits through the proposed regional Accela™ solution, the project team has explored various financing options:

• Capital improvement project(s) and/or general fund budget.
• Accela lease purchase financing through Government Capital Corporation.
• Regional technology fee (not mutually exclusive of the other two options / will work with either of the two above options).

While entities could cover their share of the platform cost immediately from budget sources, the initial entities on the platform can also choose to do a lease purchase finance option through Government Capital Corporation.  Highlights of the financing option:

• All initial subscribers/entities would need to do this collectively as per the financing offer.
• 1.99% effective lease rate (subject to underwriting approval and mutually accepted documentation).
• Payments would be annually beginning on July 1, 2014 (assumes a contract in place in Fiscal Year 2013-14), for five (5) annual payments in total.
• Financing covers the first year of implementation + licensing/maintenance and four (4) subsequent years of licensing/maintenance.

Each entity would need to cover its respective portion of the annual payment according to their percentage responsibility as determined by the project team (and subsequently by the fiscal agent of the inter-local agreement) and based upon user counts and population.

The proposed regional technology fee would explore additional flat fees for business licenses and percentage fees for all other permits.  Proceeds would be managed under the inter-local agreement and associated fiscal agent, with cost recovery for both the initial capital outlay and for annual sustenance for the platform (e.g., annual subscription fees and technology upgrades and improvements).

Working with operational departments in each entity, legal staff and finance staff, the team has developed descriptions and financial scenarios for a possible regional technology fee structure (See Attachment C – Regional License and Permit Program – Regional Technology Fee Policy (current working document).

Example platform funding matrix of options:

City of Spark Technology Fee

The use of a technology fee for the acquisition, implementation and operations of computer systems is a new concept in local government. The use of recovery fees is common in enterprise funds for the recovery of operating cost which have included equipment, personnel, and technology.

The funding question is one of sustainability. First is to bring the new technology on board to serve the customer. Second is to provide a way to provide for continued investment in technology for the future.

By developing a cost-recovery methodology through funding mechanisms like a technology fee, the city will provide quality customer service in the permitting and licensing areas for now and into the future. The funding mechanism should focus on the capital or operating investments needed for new systems and the ongoing annual operational and maintenance needs.

Examples of a possible technology fee for the city based on business licensing and building permitting volumes could be as follows:

Whether the final funding mechanism is through a technology fee or a new budgetary line item, the ultimate goal is fiscal sustainability providing ongoing innovative serve to the customer.

Next Steps.  To continue on with the Regional License and Permit Program, staff will need to do the following:

• Finalize contract details with Accela™.
• Determine a financial funding mechanism and, if recommended, pursue lease purchase next steps.
• Develop an inter-local users agreement.
• Explore a regional technology fee mechanism with community and entity staff and, if appropriate after further research, recommend implementation steps.

1. The Council could approve the city’s participation in the Regional License and Building Permits team’s negotiations and provide the City Manager with direction on future budget recommendations.

2. The Council could not approve the city’s participation in the Regional License and Building Permits team’s negotiations and provide the City Manager with direction on future budget recommendations.

3. The Council could not approve the city’s participation in the Regional License and Building Permits team’s negotiations and provide other direction to the City Manager.