Title
Microsoft Enterprise Agreement Software Licensing Renewal Change Order for Copilot
History
On September 15, 2025, the Village Board approved a three (3) year Microsoft Enterprise Agreement purchased through Dell Enterprise for an annual cost of $281,785.64 per year. The final quote came in at $281,564.50. As part of our ongoing digital transformation efforts, we are preparing to implement Microsoft Copilot to enhance productivity, streamline workflows, and improve decision-making across departments. Initial feedback from pilot users has been positive, and we anticipate broader adoption in the coming months. The original approval included ten (10) Copilot licenses. We are seeking board approval to increase the discretionary spending authority for Microsoft Copilot licenses for $18,000 up to the annual budgeted amount of $300,000 for all Microsoft services, to support a phased rollout across the organization.
Below is a breakdown of Copilot costs.
Each user license for Copilot costs $30 per month or $360 per year.
Copilot studio allows for the creation of customized AI agents to complete specific business tasks. Copilot studio authorizing license is $2,400 per year per author.
Depending on the type of result, Copilot has messaging costs. Messaging costs $200 per month for 25,000 messages per month. each additional message is $.01 per message.
Scalable Rollout
Copilot adoption will occur in stages. Pre-approving a $18,000 spend limit allows us to scale licensing efficiently without requiring repeated board approvals for each incremental purchase.
Operational Agility
The ability to procure licenses on demand ensures we can respond quickly to user needs, pilot outcomes, and evolving priorities without administrative delays.
Efficiency in Execution
Avoiding the need for repeated board approvals reduces administrative overhead and enables the IT department to maintain momentum in deploying this strategic tool.
Financial Impact
The 2025 Microsoft budget is for $315,000. As the cost for the three year contract came in significantly less than the budgeted amount, subsequent years budgets for Microsoft products is $300,000 per year.
Recommended Action/Motion
I move to approve and authorize the execution of change Order #2 and Addendum A to the current contract dated June 20, 2025, with Dell Technologies using Omnia Partners contract C000001019611 to increase the total annual spend up to the budgeted amount of $300,000 per year for 3 years for Copilot and Copilot Studio licenses to enable the rollout of Artificial Intelligence at the Village of Orland Park;
AND
Authorize the Village Manager to execute all related contracts and change orders, subject to Village attorney review.