Internal service fund overview r3
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Transcript of Internal service fund overview r3
WHAT is an Internal Service Fund?
Method of accurately associating the total cost of a service across the proper mix
of consumers
WHERE are ISF’s Used?
Common in most public sector environments to better manage and track cross-departmental operational costs, as well as control and pay for major capital-related expenditures
WHY are we using the ISF model?
Increase Fiscal Accountability
Accurately assess the Total Cost of Ownership (TCO)
Ensure Value / Competitiveness with the Services provided
Allow Customer influence over their own budget (CHOICE)
Internal Service Fund Process
Charge for Services
-Base Services-Discretionary Services
Review Usage / Need
Refine RatesNext Fiscal Year
Process Changes, Efficiencies andService Delivery
Improvements
ISF Road Map
76% 85%98%IT Staff
Centralization
ISF All IT
Services in ISF
Hybrid - General Fund and
ISF
Type of Fund - General, CIP, ISF, Other
$11.2M $7.5M$5.8M Budget for 2008
2,606 1600600 -# of PCs
81 4524 (28) -IT Employees
2,840 2,200700 -Employees
Demographics
JeffcoFort CollinsArvada
ISF Roadmap
JeffcoFort CollinsArvada
Unintended behaviors, “less calls to help desk”
Spotlights cost and service allocation inequities; forces debate.
General Fund scrutiny could cause staff reductions
Cons
ISF, increase overall financial awareness of IT budget throughout county, less reductions in tight budgetary times, customers appreciate value of IT
Better transparency, protected reserves and working capital through fund balance,
Don't compete for CIP Funding for existing infrastructure. Staff costs in GF. Operating Costs in ISF, $ rolls, $5m balance
Pros
ISF Roadmap
JeffcoFort CollinsArvada
DecentralizedHybridHybridSoftware
DecentralizedCentralized in ITCentralized in ITServers
DecentralizedCentralized in ITCentralized in ITPCs
Procurement
Practices
YesIn process In process Service Catalog
YesA mix Yes Charge Backs
NoSort of Yes General Fund
Sweep
No YesNo General Fund
Revenue / Cost
Allocation
Expenditures by Division
2006 Actual 2007 Revised 2008 Revised
Print Shop 346,611$ 339,377$ 357,211$
General Services 151,999 208,489 216,796 Information Systems 2,371,989 2,784,437 2,834,365
Computer Replacement 1,462,363 2,017,110 2,465,390 4,332,962$ 5,349,413$ 5,873,762$
Central Services
General Fund
Replacement
Total Information Technology Department
Operating Expenditures by Division
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
2006 2007 2008 2009 2010 2011
General Services Information Systems
Computer Replacement Print Shop
Arvada Charge Backs Unit Cost of Laptops per year – 4 Year LC $650.25 Unit Cost of desktop ,Monitor, UPS – 4 Year LC $300.00 Unit Cost of MDC for PD – 4 Year LC $1,800 Unit Cost of Laser Printers - Failure $525.00 Desktop PC Software, Office other software $156.50 Cost per PC for Network Hardware $527.96 Cost per PC for Network software $23.84 Network Fileservers "Per PC in replacement fund“ $39.27 Price per users for SPAM/Zen $18.92 Price per GroupWise Users $20.00 Price per Netware Users $24.00 Price per FTE Finance system (Oracle Financials) $520.78 Price per FTE Phone System $178.09DIVISIONAL COSTS: Arts Ticketing System $32,362.67 GIS System $53,475.85 Document Imaging System $36,766.67 Courts System $34,750.00 Police Intergraph System $378,756.23 ETC
Arvada Network Charge Backs
Network Hardware/Maintenance charged per PC
ITEM Description Notes Locations Quantity Acquire Year Life SpanAcquire Cost
Cost per PC per year if in Fund
In Fund Y/N
yearly contribution to replacement fund
2008 Budget Expenses
2009 Budget Expenses
Foundry Network Equipment
This is all switches, rotuers, spares,RAD All over 1 2006 7 $300,776.80 $69.53 Y $42,968.11 $0.00 $0.00
Foundry Network Maintenance
Maintenance for all switches, rotuers, All over 1 2006 1 $23,267.00 $37.65 Y $23,267.00 $23,267.00 $23,267.00
StorServe Backup Appliance
Enterprise backup hardware and software All over 1 2006 5 $125,000.00 $202.27 Y $125,000.00 $0.00 $0.00
StorServe Backup Appliance Maintenance
Maintenance for Enterprise backup hardware and software All over 1 2006 1 $25,641.00 $44.71 Y $27,629.00 $28,269.20 $29,682.66
IT SANUpgraded to the compellent SAN CityHall 1 2007 8 $350,000.00 $70.79 Y $43,750.00 $0.00 $0.00
SAN disk drives Cityhall 1 $17,000.00 $27.51 Y $17,000.00 $17,000.00 $17,000.00SAN Maintenance 1 2007 1 $35,000.00 $56.63 Y $35,000.00 $43,750.00 $43,750.00Network Management All over 1 1 $10,000.00 $16.18 Y $10,000.00 $10,000.00 $10,000.00CD Jukebox CityHall 1 2002 3 $5,000.00 $2.70 Y $1,666.67 $0.00 $0.00Cisco Routers CityHall 2 2001 3 $10,000.00 $0.00 N $3,333.33 $0.00 $0.00Packeteer CityHall 1 2002 5 $8,000.00 $0.00 y $1,600.00 $0.00 $0.00Packeteer Maintenance CityHall 1 2002 1 $1,500.00 $0.00 y $1,500.00 $1,500.00 $1,500.00Wireless Devices New for 2007 3 $10,000.00 $5.39 Y $3,333.33IronPort Maintenance Email Encryption CityHall 1 2007 3 $15,000 $8.09 Y $5,000.00Iprism Maintenance Web Filtering CityHall 1 2005 3 $14,500.00 $7.82 y $4,833.33 $0.00 $0.00
$113,850.00 $123,786.20 $125,199.66Total cost per PC per year $527.96
COURTS
ITEM LocationsAcquire Year Life Span
Acquire Cost
Replacement Cost
Yearly contribution to replacement fund
2008 Budget Expenses
2009 Budget Expenses
2010 Budget Expenses
2011 Budget Expenses
2012 Budget Expenses
Server City Hall 2002 5 $15,000.00 $15,000.00 $3,000.00 $0.00 $0.00 $0.00 $0.00 $0.00Full Court Software City Hall 2000 6 $75,000.00 $75,000.00 $12,500.00 $75,000.00 $0.00 $0.00 $0.00 $0.00Full Court Maintenance City Hall 2000 1 $15,110.00 $15,110.00 $15,110.00 $15,110.00 $15,110.00 $15,110.00 $15,110.00 $15,110.00
LaserJet 4200 courts 2004 5 $2,000.00 $2,000.00 $400.00 $0.00 $2,000.00 $0.00 $0.00 $0.00
LaserJet 4050 courts 2003 5 $2,000.00 $2,000.00 $400.00 $2,000.00 $0.00 $0.00 $0.00 $0.00
LaserJet 4050 courts 2003 5 $2,000.00 $2,000.00 $400.00 $2,000.00 $0.00 $0.00 $0.00 $0.00
Epson LQ570 courts 2000 5 $500.00 $500.00 $100.00 $0.00 $500.00 $0.00 $0.00 $0.00
Epson LQ570 courts 2000 5 $500.00 $500.00 $100.00 $0.00 $500.00 $0.00 $0.00 $0.00Receipt Printer Ithica series 150 quanity 4 courts 2006 5 $1,200.00 $1,200.00 $240.00 $0.00 $0.00 $0.00 $1,200.00 $0.00Video arraignment equipment courts 2005 10 $25,000.00 $25,000.00 $2,500.00 $0.00 $0.00 $0.00 $0.00 $0.00
Total per year $34,750.00 $94,110.00 $18,110.00 $15,110.00 $16,310.00 $15,110.00
Divisional Example
REPLACEMENT FUND REVENUE
ID used by IT
Fund-DivAccount #54008 Division
Unit Cost of Laptops per year
Unit Cost of desktop ,Monitor, UPS,
Unit Cost of MDC for PD
Unit Cost of Laser Printers
Desktop PC Software, Office other software
Cost per PC for Network Hardware
Cost per PC for Network software
$650.25 $300.00 $525.00 $156.50 $527.96 $23.84
CMCMLT 01-0191 City Council $4,551.75 $0.00 $1,095.50 $3,695.74 $166.90
JDMC 01-0271 Judicial $0.00 $3,600.00 $0.00 $1,878.00 $6,335.55 $286.12
CMCM 01-0392 CMO $1,950.75 $4,200.00 $1,050.00 $2,660.50 $8,975.36 $405.34
CMCC 01-0393 City Clerk $1,300.50 $3,300.00 $1,050.00 $2,034.50 $6,863.51 $309.96
CMTV 01-0395 KATV $1,950.75 $0.00 $469.50 $1,583.89 $71.53
LDCA 01-0472 City Attorney $1,300.50 $3,900.00 $525.00 $2,347.50 $7,919.44 $357.65
FDTR 01-0551 Treasury $650.25 $5,400.00 $1,050.00 $2,973.50 $10,031.29 $453.02
FDTA 01-0552 Sales Tax $1,950.75 $1,800.00 $525.00 $1,408.50 $4,751.66 $214.59
FDPU 01-0553 Purchasing $650.25 $1,200.00 $525.00 $782.50 $2,639.81 $119.22
HRHR 01-0654Human Resources $650.25 $3,000.00 $0.00 $1,721.50 $5,807.59 $262.28
PSOC 01-0701Office of the Chief $1,950.75 $900.00 $525.00 $939.00 $3,167.77 $143.06
PSCS 01-0702Community Services $0.00 $3,600.00 $525.00 $1,878.00 $6,335.55 $286.12
PSCM 01-0703Communications $0.00 $1,500.00 $525.00 $782.50 $2,639.81 $119.22
$431.93 $189.20 $200.00 $240.00 $4,687.05 $1,692.79 $1,200.00 Caterease $20,257.33
$0.00 $0.00 $0.00 $3,645.48 $1,316.61 $4,962.09
$196.33 $189.20 $200.00 $240.00 $2,083.13 $752.35 $10,628.54
$314.13 $264.88 $280.00 $336.00 $6,770.18 $2,445.14 $19,352.03
$196.33 $75.68 $80.00 $96.00 $2,083.13 $752.35 $8,850.02
$196.33 $113.52 $120.00 $144.00 $2,083.13 $752.35 $9,326.11$117.80 $0.00 $0.00 $0.00 $0.00 $0.00 $3,142.72
$196.33 $0.00 $0.00 $0.00 $0.00 $0.00 $5,237.86$6,458.00 For new officers $6,458.00
$23,481.34 $13,887.28 $14,680.00 $17,616.00 $332,259.49 $120,000.00 $555,369.54 $1,951,467.53
Annual ISF Revenue
BUDGET NUMBERS FOR THE REPLACEMENT FUND
Category2008 Budgeted
Expense2009 Budgeted
Expense2010 Budgeted
Expense2011 Budgeted
Expense2012 Budgeted
Expense
Computer Replacement NO PD Laptops $695,600.00 $0.00 $0.00 $0.00 $695,600.00Monitor Replacement $0.00 $0.00 $0.00 $0.00 $0.00Network Software $10,700.00 $10,700.00 $10,700.00 $10,700.00 $10,700.00Network Hardware $123,786.20 $125,199.66 $126,683.80 $253,242.14 $129,878.39IT Servers $34,500.00 $0.00 $0.00 $21,000.00 $0.00Printers $25,200.00 $25,200.00 $25,200.00 $25,200.00 $25,200.00PD Hardware/Software $766,959.64 $2,766,004.12 $290,782.98 $318,018.64 $347,955.74Phone $35,000.00 $35,000.00 $35,000.00 $35,000.00 $885,000.00Document Imaging $25,500.00 $43,500.00 $25,500.00 $25,500.00 $25,500.00GIS $50,320.79 $55,736.74 $67,699.56 $75,179.46 $83,977.70Finance $260,913.56 $186,459.58 $194,000.53 $923,534.68 $205,996.40Groupwise/Netware $46,183.28 $46,183.28 $46,183.28 $46,183.28 $46,183.28Desktop Software $253,456.26 $42,837.79 $43,943.52 $45,082.43 $0.00Arvada Center $16,800.00 $5,800.00 $5,800.00 $14,800.00 $150,800.00Courts $94,110.00 $18,110.00 $15,110.00 $16,310.00 $15,110.00BANQUETS $5,490.76 $5,490.76 $45,490.76 $5,490.76 $5,490.76Building Inspectors $0.00 $0.00 $0.00 $0.00 $0.00
Total $2,444,520.48 $3,366,221.92 $932,094.42 $1,815,241.38 $2,627,392.27
Estimated Balance of the replacement fund
2008 2009 2010 2011 20012
Replacement Fund Balance $4,663,187.53 $4,351,088.31 $3,181,260.29 $4,511,451.58 $5,024,387.73Revenue $2,132,421.26 $2,196,393.90 $2,262,285.72 $2,328,177.53 $2,350,141.47Expenditures ($2,444,520.48) ($3,366,221.92) ($932,094.42) ($1,815,241.38) ($2,627,392.27)
Balance $4,351,088.31 $3,181,260.29 $4,511,451.58 $5,024,387.73 $4,747,136.93
Chargebacks
Customer: I complain about IT because that is all that I can do!!! I have no direct influence over the level of ITspending or the IT charges I receive.
Chargebacks provide checks and balances
Chargebacks drive behavior
For IT, the behavior is to be competitive
For business, the behavior is to obtain value
Develop chargeback process with right objective in mind.
Finance & AdministrationFinance & AdministrationISF Chargeback MethodsISF Chargeback Methods
SBP Service Based Pricing Per measured unitSBP Service Based Pricing Per measured unit
Lowest complexity,
cost
Highest complexity,
cost
HLA High Level Allocation Revenue, # of FTE’sHLA High Level Allocation Revenue, # of FTE’s
LLA Low Level Allocation Accts, Logins, UsersLLA Low Level Allocation Accts, Logins, Users
DC Direct CostDC Direct Cost Time & Materials Time & Materials
MRU Resource UsageMRU Resource Usage Actual Consumption Actual Consumption
TFR Tiered Flat Rate Service Used or NotTFR Tiered Flat Rate Service Used or Not
NFR Negotiate Flat RateNFR Negotiate Flat Rate Projected Usage Projected Usage
Development and Consulting Services
Provides full life-cycle software development services where commercial products are unavailable, insufficient or cost-prohibitive.
A wide variety of computing environments are supported which include Internet, Intranet and Legacy (IBM mid-range computer) software applications.
Also provides a wide range of technical consulting services including assistance in the evaluation, selection and implementation of commercial software packages
Development and Consulting Services
Services provided include but are not limited to:
Business Analysis & Requirements Definition: Assist customers in matching business needs with technical solutions.
Project Estimation: Determine estimates for custom software development or commercial software package implementation. Estimates include project costs, duration, staff requirements, functionality and quality.
Project Management: Provide full project management services for custom software development or commercial software implementation.
Support & Maintenance: Provide on-going support for custom software modifications and enhancements. Where feasible, provide support for commercial software packages.
Integration Services: Provide custom integration applications enabling technically diverse software systems to share processes and data.
ISF Rates and Billing ProcessRates Preparation
Begin, circa firstquarter
Budget: S&B,Infrastructure
from F&A
Collectand
Collate
Account metricsfrom Service
Managers
Revenue (fromJDE)
Service ActivityProjection (by
Customer)
DetemineDistribution
Rules
CalculateServiceBurdens
ProduceReports
Budget Advicefor each
Customer
Service Rates
Verifyand
Validate
Gain Approvalfrom IT Services,
Budget, andCustomers
To ISFBilling
Process
$ 32,667.12 2,124.00 $
1,107.36 $
15.38 72.00A&RM Retrievals - Count
$ 258,559.31 12,686.91 $
5,322.85 $
20.38 261.18A&RM Storage - Cubic Foot
$ 291,226.43 $
6,430.21 Cubic Foot/Count
$ 84,290.40 1,665.16 $ 429.26
$ 50.62 8.48EDMS (Livelink)
$ 6,919.87 110.40 $
- $
62.68 0Records Management
$ 33,921.47 421.28 $
- $
80.52 0IVR
$ 193,218.50 2,680.24 $
- $
72.09 0Amanda
$ 288,398.54 3,659.88 $
1,074.83 $
78.80 13.64ERP/JDE
$ 153,252.84 2,228.16 $ 137.56
$ 68.78 2.00GIS
$ 1,480,823.96 18,706.72 $
116,571.02 $
79.16 1,472.60Development & Consulting
$ 9,786.84 91.68 $
- $ 106.75 0Enterprise Services
$ 206,271.38 4,086.20 $
3,390.24 $
50.48 67.16Customer Services/Help Desk
$ 190,119.26 2,911.92 $ 817.43
$ 65.29 12.52Telecommunication
$ 172,163.48 2,647.04 $
1,251.37 $
65.04 19.24System Admin
$ 2,819,166.54 $
123,671.70 Hours
CUSTOMER SPECIFIC
Total ITSCounty-wideInvestment
ITS ProjectedService
County-wide
2008 CustomerExpense
2008ITS Rate Per
Metric
2008 Custome
rMetricService Metric
$ 11,209,924.51 $ 206,193.52 TOTALS (Customer Specfic & Enterprise)
$ 185,260.85 37.00 $ 5,007.05 $ 5,007.05 1.00IVR Applications
$ 185,260.85 $ 5,007.05 IVR Applications
$ 376,986.96 24,933.00 $ - $ 15.12 0Amanda Folders
$ 376,986.96 $ - Amanda Folders
$ 137,965.98 2,610.52 $ 1,152.13 $ 52.85 21.80Records Management (Enterprise)
$ 811,454.04 2,610.52 $ 6,776.31 $ 310.84 21.80ERP/JDE
$ 949,420.02 $ 7,928.44 FTE
$ 1,076,199.78 3,299.00 $ 12,396.36 $ 326.22 38.00Telecommunication
$ 1,076,199.78 $ 12,396.36 Phone Lines
$ 347,692.52 2,606.00 $ 3,202.08 $ 133.42 24.00EDMS (Livelink)
$ 723,946.80 2,606.00 $ 6,667.20 $ 277.80 24.00GIS
$ 762,124.70 2,606.00 $ 7,018.80 $ 292.45 24.00Development & Consulting
$ 477,810.10 2,606.00 $ 4,400.40 $ 183.35 24.00Enterprise Services
$ 555,833.74 2,606.00 $ 5,118.96 $ 213.29 24.00Customer Services/Help Desk
$ 236,103.60 2,606.00 $ 2,174.40 $ 90.60 24.00Data Carrier Fees (Sys Admin)
$ 2,408,152.48 2,606.00 $ 22,177.92 $ 924.08 24.00System Admin
$ 5,511,663.94 $ 50,759.76 Network Accounts
ENTERPRISE
New Solutions are new implementations or products.
Upgrades are major product releases that often contain significant changes and feature enhancements to the product.
Enhancements are new functionality, services or customizations.
ISF Vision
Maintenance, Support &
Updates
New Solutions, Upgrades &
Enhancements
Discretionary
Base Maintenance is the modification of a product after delivery to correct faults.
Support is user assistance with specific product problems, but not training and customization.
Updates, often referred to as service packs, are occasionally required to bring you necessary fixes or minor modifications to your software.
Maintenance, Support & Updates
New Solutions, Upgrades &
Enhancements
Discretionary
Base
ISF Goal
Maintenance, Support & Updates
New Solutions, Upgrades &
Enhancements
Discretionary
Base
↓ Maintenance & Support Costs
↑ Service Levels
↑ Allocation to High Value Discretionary Services
↑ Business Alignment