Amendment to Extend Non-Competitive Purchase Order Number 6047456 with Microsoft Canada Inc. for Microsoft Cloud Licenses and Windows Server 2008 Security Updates

The City of Toronto leverages the Province of Ontario's contractual agreement with Microsoft thereby achieving the best available pricing from Microsoft. There is a need to extend the Microsoft Purchase Order and a corresponding increase in the dollar amount to maintain the City of Toronto investment and continue receiving the best available pricing from Microsoft. In December 2016, City Council granted staff the authority to utilize the Province of Ontario Agreement for three years ending in December 2019. The agreement supports the implementation of two projects (Microsoft Office 365 Pilot Assessment and Segregation of the Accountability Officers using Microsoft cloud technology). The purpose of this report is to seek authority to amend Purchase Order Number 6047456 with Microsoft Canada to extend the term for a period of two years from January 1, 2020 to December 31, 2021. Authority is also sought for an additional $920,488 net of Harmonized Sales Tax. This increases the total contract value from $338,291 to $1,258,779 net of Harmonized Sales Tax. These funds are needed for the supply of Microsoft cloud technology tools for the City's cloud digital pilot projects. It is also needed to acquire Microsoft Windows on premise security technology under the Province's Microsoft Enterprise Agreement. Leveraging the Province of Ontario's Microsoft Master Business Agreement (#U8364444) provides the City with the best possible pricing for Microsoft Licenses. Pricing and the terms and conditions of the Province of Ontario's Enterprise Agreement are more favourable than the standard agreements. City Council approval is required in accordance with Municipal Code Chapter 195, Purchasing, where the current request exceeds the Chief Purchasing Officer's authority of the cumulative five-year commitment limit for each vendor under Article 7, Section 195-7.3(D) of the Purchasing By-law or exceeds the threshold of $500,000 net of Harmonized Sales Tax allowed under staff authority as per the Toronto Municipal Code Chapter 71, Financial Control, Section 71-11A.

increase the total amount of the agreement by $920,488 net of Harmonized Sales Tax ($936,689 net of Harmonized Sales Tax recoveries), revising the existing contract value from $338,291 net of Harmonized Sales Tax to $1,258,779 net of Harmonized Sales Tax ($1,280,934 net of Harmonized Sales Tax recoveries).