The City Council approved renewals for Microsoft licenses and subscriptions on March 17, 2026, originally totaling $534,608. Following a thorough reconciliation of licensing requirements, staff identified an additional need for $39,737, bringing the revised total to $574,346. The Information Technology Internal Service Fund (Fund 68) has sufficient funding available for this adjustment, as included in the Fiscal Year 2025–26 Adopted Budget.

The approved licenses are crucial for maintaining essential City operations, including server infrastructure and cybersecurity protections, before the existing agreements expire on March 31, 2026.

During the reconciliation process, staff identified the need for additional Microsoft Defender for Endpoint licenses to support the current number of Microsoft 365 users, incurring an additional cost of $22,621. Furthermore, it was discovered that a portion of the required server licenses had not been licensed at full cost, necessitating a one-time true-up amounting to $17,116.

To prevent any disruption of critical systems and City operations, staff proceeded with the necessary adjustments ahead of the agreement’s expiration. The City Council will ratify the revised licensing costs in an upcoming meeting. Moving forward, staff say they will enhance coordination with the incoming IT vendor to ensure accurate licensing validation and alignment before future approvals.

This item is on the consent calendar of the Fullerton City Council meeting set for April 7, 2026.