Benicia City Council will consider awarding a contract Tuesday to Tyler Technologies for its Munis municipal financial enterprise resource planning (ERP) software, ending a lengthy and sometimes controversial effort to modernize the city’s computer system.

The decision also would substitute the Tyler contract for three other pacts that have been supporting financial modules that are incompatible with each other. Of those, Sunguard/Bi-Tech’s contract is for accounting and payroll, Harris’s contract is for utility building and Accela’s is for permitting and licensing.

The Munis lease and maintenance contract would cost about $173,000 annually, less than the $182,000 Benicia pays annually for its current three contracts. But costs could change if the city and the contractor either remove or enhance program modules, Finance Director Karin Schnaider wrote in a report to City Manager Brad Kilger.

At the eight-year point, the contract would be a $1.4 million agreement; at 15 years, it is expected to cost about $3 million.

Schnaider wrote that Benicia “is seeking a hosted environment,” letting the city lease the software from Tyler Technologies, based in Falmouth, Maine.

“In return, Tyler is responsible for maintenance and execution of software, purchasing and housing hardware (servers), storage and retrieval of all data, and carrying out regular updates for compliance with legal and financial reporting changes,” she wrote.

“Direct access via the Internet will allow ease of accessing and transferring information from remote facilities.”

Schnaider wrote Kilger that the contract is a “Service as an Agreement” (SaaS) type that reduces both hardware and energy costs as well as impacts to the city’s information technology staff.

Her report also addressed security, one of the concerns raised in the June Finance Committee meeting. “Indeed, Tyler utilizes some of the highest security measures available within its Munis Data Center, including advanced intrusion detection controls,” she wrote. “A third of Tyler’s Munis clients have selected the SaaS environment, including three California cities, Tracy, Richmond and Covina.”

The modernization process was initiated at least five years ago, when Benicia’s Finance Department, then led by Director Rob Sousa, sought upgrades to its existing system in hopes of reducing dependency on paperwork and hand-entering numbers.

Since Sousa’s retirement in 2011, the city has had four interim and permanent finance directors, and staff finally realized that a simple $66,000 ONESolution upgrade originally recommended by longtime vendor Sunguard/Bi-Tech wouldn’t work.

Attempts to make the software switch kept running into trouble. City Manager Brad Kilger and then-interim Finance Director Brenda Olwin realized by early 2014 that Bi-Tech’s ONESolution upgrade would remain incompatible unless the city also paid hundreds of thousands of dollars for a massive overhaul to its computer system.

The two decided the project should change direction, and that the Council should seek bids from competitors.

By then, matters had became so heated during Finance Committee meetings that Chairperson Lawrence Grossman, who had been asking for specific updates on the project, resigned from the panel at its Feb. 28, 2014, meeting, a month after Kilger and Olwin told the panel the city was changing direction and that costs had increased dramatically.

Since then, relationships between the advisory and city staff have become more cordial, and staff has provided the committee with regular updates on the project.

“The city is looking to convert general ledger (accounts payable, accounts receivable and payroll), utility billing and permitting applications into one comprehensive software,” Schnaider wrote in her report to Kilger. That’s because Benicia’s financial records are in three incompatible software applications and multiple supporting applications.

“The mere fact that the city hosts multiple applications in order to record and report financial information leads to inefficiencies,” she wrote.

In addition, it’s led to unnecessary duplication, such as maintaining two types of cashiering software for utility billing and for licensing and permitting, she wrote.

Those aren’t compatible with General Ledger, so the information must be entered again into a third system. Because the systems haven’t been updated regularly, city employees also have to modify data to make it comply with modern reporting requirements, Schnaider wrote.

Should the Council approve the contract with Tyler, city employees may find other areas in which duplication and inefficiencies may be eliminated, Schnaider wrote. Ultimately, removing that extra work would give employees time to undertake projects that have been delayed or not even started, she explained.

Schnaider wrote that during the development of the current two-year budget, employees asked the Council for a commitment of $800,000 for the replacement of the enterprise resource planning system, basing the number of similar ERP costs in other cities.

“The original appropriations were assumed to cover the purchase of the software as well as the implementation and conversion services provided by the vendor,” she wrote.

Since Benicia is leasing, rather than buying, the software, Schnaider recommended using the money for on-site training and conversion costs, project management, documentation, internal control auditing and testing and about $150,000 in equipment purchases.

Should the contract get Council approval Tuesday, the company would give employees a citywide demonstration July 16 and start the project Aug. 1.

Core financials would go “live” Oct. 1, Schnaider wrote, and would be followed by payroll and human resources Dec. 1. By spring 2016, utility billing would be incorporated, and modules for licensing, permitting and customer applications would be added by summer 2016.

The Council will meet in a closed session at 6 p.m. Tuesday to discuss legal matters. Its regular meeting will start at 7 p.m. in the Council Chamber of City Hall, 250 East L St.