REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
June 27, 2023
FROM
SHANNON D. DICUS, Sheriff/Coroner/Public Administrator
SUBJECT
Title
Agreement with IRIS Tech, Inc. for Intelligence Request and Information System Software
End
RECOMMENDATION(S)
Recommendation
Approve Software License and Services Agreement with IRIS Tech, Inc., and incorporated Microsoft Customer Agreement and Microsoft Online Subscription Agreement, including non-standard terms, for the provision of Intelligence Request and Information System software services, in a total amount not to exceed $59,000, for a one-year period, with the option to extend the contract by four additional one-year periods, effective on the date that the Sheriff/Coroner/Public Administrator commences use of the software.
(Presenter: Ernie Perez, Deputy Chief, 387-3760)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Improve County Government Operations.
Operate in a Fiscally-Responsible and Business-Like Manner.
Provide for the Safety, Health and Social Service Needs of County Residents.
FINANCIAL IMPACT
Approval of this item will not result in the use of additional Discretionary General Funding (Net County Cost). The cost of software services in the amount of $59,000 will be funded within the Sheriff/Coroner/Public Administrator’s (Department) existing 2022-23 budget allocation (4430001000). Sufficient appropriation for subsequent purchases will be included in future recommended budgets, if necessary.
BACKGROUND INFORMATION
The Department’s Criminal Intelligence Division Division) is a designated unit of law enforcement trained to respond to intelligence requests from the Department’s various internal divisions and stations, as well as from other local, state, and federal law enforcement agencies. The Division’s current method of receiving and responding to intelligence requests is outdated and unable to provide analytics and reporting documentation as needed by the Division.
IRIS Tech, Inc.’s (IRIS Tech) web-based Intelligence Request & Information System (IRIS) software platform is a workload management tool that streamlines the communication and dissemination process related to intelligence requests. IRIS stores digital information in a secure manner, provides readily accessible data analytics, and enables a collaborative work environment for intelligence and information sharing only accessible by authorized agencies.
IRIS Tech’s standard Software License and Services Agreement (SLSA), that also incorporates Microsoft Corporation’s (Microsoft) Customer Agreement and Online Subscription Agreement, includes terms that differ from the standard County contract. The non-standard terms include the following:
1. Microsoft’s Customer Agreement requires mutual indemnification between the County and Microsoft against any third-party claims, and each party must pay the amount of any resulting adverse final judgment or approved settlement, but only if the defending party is promptly notified in writing of the claim and has the right to control the defense and any settlement of it.
• The County standard contract requires the contractor to indemnify the County in accordance with County Policy 11-07.
• Potential Impact: The County may have immunities that may not apply to a private entity, so the County’s risk exposure is broader.
2. Microsoft’s Customer Agreement limits Microsoft’s liability to direct damages finally awarded, at various amounts, for perpetual licenses, subscriptions, professional services, free offers and distributable code, exclusions, exceptions, and applicability.
• The County standard contract does not permit the contractor to limit its liability in the performance of a contract.
• Potential Impact: The Department could potentially not recover all damages incurred during the SLSA period; however, the Department believes utilization of the software services provided through IRIS outweighs any potential risk.
3. Microsoft’s Online Services Agreement limits the aggregate liability of each party for all claims under the Agreement to direct damages up to the amount paid for the online service during the 12 months before the cause of action arose; provided, that in no event will a party’s aggregate liability for any online service exceed the amount paid for that service during the subscription period.
• The County standard contract does not permit the contractor to limit its liability in the performance of a contract.
• Potential Impact: The Department could potentially not recover all damages incurred during the SLSA period.
4. If the County is liable for any payments directly to Microsoft, the Customer Agreement requires Net 30 payment terms with applicable interest of 2%, or the highest amount allowed by law, whichever is less, applied to invoices late more than 15 calendar days past due.
• County standard payment terms are Net 60 with no interest or late payment penalties.
• Potential Impact: Failing to pay an invoice within 30 days of the invoice date may result in the Department being assessed interest at the applicable rates stated.
5. The Microsoft Customer Agreement is effective until terminated by a party without cause with 60 days written notice, with cause with 30 days written notice, suspension due to material breach of the SLSA, or termination by Microsoft to comply with laws.
• The County standard contract term is five years. Indefinite contract terms are not permitted.
• Potential Impact: There is no end term to the Customer Agreement and the County is indefinitely bound by the terms and conditions of the SLSA until either party terminates the SLSA with required notice.
6. Either party may assign Microsoft’s Customer Agreement to an affiliate with prior notification, but not approval, of the other party.
• County policy requires that the County approve any assignment of a contract.
• Potential Impact: The Contractor may assign the Agreement to another entity the Department is unfamiliar with without the Department’s approval.
7. Governing law of the Microsoft Customer Agreement is the State of Washington and federal laws of the United States.
• The County standard contract requires California governing law.
• Potential Impact: The Customer Agreement will be interpreted under Washington law. Any questions, issues, or claims arising under the SLSA will require the County to hire outside counsel competent to advise on and practice Washington law, which may result in fees that exceed the total SLSA amount.
8. Microsoft’s Customer Agreement and Online Subscription Agreement do not require Microsoft to meet the County’s insurance standards as required pursuant to County Policy 11-07.
• County policy requires contractors to carry appropriate insurance limits and under conditions determined by the County’s Risk Management Department as set forth in the County standard contract.
• Potential Impact: The County has no assurance that Microsoft will be financially responsible for claims that may arise from the County’s use of the software, which could result in expenses to the County that exceed the total SLSA amount.
While these are notable exceptions to the County’s standard contract language, the Department recommends approval of the SLSA, including non-standard terms, for the provision of IRIS software to allow for the secure and timely dissemination of intelligence requests. County Counsel and Risk Management have reviewed and provided input on the proposed agreement with IRIS Tech.
PROCUREMENT
IRIS Tech, as the owner and developer of the IRIS software, holds intellectual and other proprietary rights for maintenance and software updates. No other division of IRIS Tech, nor any other company may resell or distribute IRIS. There are no other known similar software programs that deliver IRIS' capabilities. The terms in the SLSA, including non-standard terms, may be used to accompany future purchase orders to IRIS Tech as necessary. The Purchasing Department concurs that a non-competitive justification exists with IRIS Tech as the owner and developer of IRIS Software is line with County Policy 11-04.
County Policy 11-05 requires departments to obtain Board of Supervisors’ approval for the procurement of goods and services with non-standard terms and conditions.
REVIEW BY OTHERS
This item has been reviewed by County Counsel (Richard D. Luczak, Deputy County Counsel, 387-5455) on June 1, 2023; Purchasing (Michael Candelaria, Lead Buyer, 387-0321) on June 2, 2023; Risk Management (Victor Tordesillas, Director, 396-8621) on May 31, 2023; Finance (Erika Rodarte, Administrative Analyst, 387-4919) on June 9, 2023; and County Finance and Administration (Robert Saldana, Deputy Executive Officer, 387-5423) on June 11, 2023.