Discussion and possible action to approve a budget amendment in the amount of $787,000 from the General Fund Contingency account to Information Technology to extend the existing Master Agreement with Oracle for the licensing of the PeopleSoft Enterprise Resource Planning system for three years.

In May 1998, Peoria entered into an agreement with Peoplesoft to purchase and license the Peoplesoft ERP system.  The agreement included a base annual operations budget of $88 million with the specification that no additional license fees would be required until the operating budget grew by more than $250 million, a total of $338 million.

In Fiscal Year 2023 the City operating budget of $372 million exceeded the $338 million threshold triggering the need for additional license fees.  The City has negotiated an agreement with Oracle, who acquired PeopleSoft, to extend the licensing agreement for three years and increase the approved operating budget amount to $440 million for a payment of $727,272.76 plus tax.  If the operating budget increases beyond the $440 million in the next three years the City will pay an additional license fee of $40,570 for every $8.8 million increment above $440 million.

The fiscal year 2024 budget includes funding for a new ERP system and the City has begun the process to acquire a new ERP.  Staff expects the new ERP system to be operational by the expiration of the Oracle agreement.

The staff recommends the approval of the budget amendment in the amount of $787,000 to extend the Master Agreement with Oracle.  This will allow for the continued use of the Peoplesoft ERP system for three years.

New funds are being requested; thus it requires a contingency transfer to the corresponding chartfield account in Finance of : 1000-0400-530021