City anticipates savings in leasing data storage system
The Grand Junction City Council expects to save more than $1 million by leasing a data storage system.
The council voted to authorize City Manager Greg Caton to enter into a four-year lease with no interest.
The city purchased a network storage system in 2013. But new technological advances offered the city a chance to replace the system with a more cost-effective alternative.
Hyper converged infrastructure (HCI) merges servers, high-performance flash storage and networking into a single appliance called a node. Nodes can be grouped to provide large and efficient storage and server capabilities. The resulting solution is less expensive to build and maintain as well as easier to manage.
The old storage system was not scheduled for replacement until 2019, but maintenance costs have increased to $250,000 a year. In researching ways to reduce maintenance costs, city staff discovered a way to obtain discounted pricing along with a four-year, zero-interest lease that would replace the network and seven related servers and include full maintenance coverage for an annual payment of about $203,000. The equipment can be purchased for $1 at the end of the lease period.
The lease payment will be paid using operating funds approved in the information technology 2017 budget for the network maintenance agreement. Additional savings will be realized by not having to purchase four replacement servers and associated licensing increases.
Operating cost savings for 2017 are expected to total $300,000. In addition, the lease arrangement will free up $800,000 in funds accrued for the replacement of the network and related servers. The combined savings and accrual fund return in 2017 should be $1.1 million.