HomeMy WebLinkAboutbocc.con.067.258/30/2021 CDD
Contract Information
Contract Number
Project Name
Contractor
Budget Line Item 10014100.531500
Procurement Method:
Type:
Contract Start Date
Contract End Date
Contract Type
Retainage
If this is a new contractor, please enter the New Vendor information into Munis for workflow approval.
Contact Information:
Department
County Representative Ann Driggers County Representative
Phone (970) 920-5225
Provide a brief description of the Contract or Change Order:
Contract Value Summary:
$ 31,000.00
$ -
$ -
$ 31,000.00
Finance
License agreement for AI assistant services.
Original Contract Amount
Previous Change Order/Amendment Amount
This Change order/Amendment amount
Contract Total
No
AI Assistant License Agreement
M3 Planning, Inc., dba Madison AI
$ 31,000.00
Additional Budget Line
Item(s)
(Please fully allocate New Contract Total)
$ -
$ -
$ -
$ 31,000.00
Sole Source
Services/Maintenance
4/1/2025
3/31/2026
New Contract
067.25
Pitkin County
Procurement Cover Sheet
Please complete the Contract Cover Sheet when the contract/task order is complete and fully executed.
Return all Contract Cover Sheets and Contracts/Change Orders/Amendments/Task Orders to Procurement
Rev 2023.12.15 CDD
1
PITKIN COUNTY
SOLE SOURCE PROCUREMENT
JUSTIFICATION REQUEST TO: County Manager DATE: May 5, 2025
FROM: Kara Silbernagel, Deputy County Manager Proposed Contractor: M3 Planning, Inc. dba Madison, AI Product/Service: AI Assistant License Agreement Estimated expenditure for the above Product/Service: $ 31,000.00
This form is required in documenting a Sole Source exception from an otherwise competitive bidding process
when sufficient competition does not exist, a single vendor represents a clear and best value to Pitkin County, or other factors are present that preclude other vendors from being able to provide the product(s), service(s), and/or construction. This purchase is clearly and legitimately limited to a Single or Sole Source. (Examples: original manufacturer, no regional distributor, standardization etc):
Explain:
As further described in Attachment A, Madison AI is the only vendor in the market who provides the
government-based AI Assistant services that the County requires.
Rev 2023.12.15 CDD
2
The undersigned requests that Pitkin County waive other procurement requirements and recognize this
transaction as a sole source exception to the Pitkin County Procurement Code. Department Representative Department Director
!#COUNTY REPRESENTATIVE#! Date !#SECTION LEADER#! Date
County Manager Reason for Denial:
________________________________________
!#COUNTY MANAGER SOLE#! Date
CFAO, Treasurer, and Public Trustee
May-06-2025
Ann Driggers
May-06-2025
Deputy County Manager
Kara
May-12-2025
County Manager
Jon Peacock
Knowledge Assistant
Licensing Agreement
As of March 15, 2025
AI knowledge assistants for government staff to
complete requests in minutes, not hours.
www.MadisonAI.com
Knowledge Assistant Licensing Agreement
As of March 15, 2025 I 527 Lander Street – Reno, NV 89509 I hello@madisonai.com I Page 1 of 5
This Licensing Agreement ("Agreement") is made and entered into as of March 15, 2025, by and
between Pitkin County, with its principal place of business at 530 East Main Street, Aspen, CO 81611
("Licensee"), and M3Planning, Inc. dba Madison AI, a corporation organized under the laws of Nevada,
with its principal place of business at 527 Lander Street, Reno, NV 89509 ("Licensor").
WHEREAS, Licensor has developed Madison AI, an AI Assistant for local government LLM for elected
officials and staff to access board decisions, agendas, and master codes in your library ("Madison AI");
and
WHEREAS, Licensee desires to license Madison AI from Licensor under the terms and conditions set
forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, the
parties hereto agree as follows:
1. LICENSE GRANT
1.1. License: Subject to the terms and conditions of this Agreement, Licensor hereby grants to
Licensee a non-exclusive, non-transferable license to use Madison AI during the Term (as
defined below) for the purpose of generating reports based on governmental data.
1.2. Ownership: All intellectual property rights in the Application, including but not limited to
software, content, text, images, graphics, video, audio, and other materials, are owned by
Madison AI.
2. TERM
2.1. Term: This Agreement shall commence on April 1, 2025, and shall continue for one (1) year,
unless terminated earlier in accordance with the provisions of this Agreement ("Term").
2.2 Auto Renewal: This Agreement will automatically renew each year for an additional one (1)-
year term unless the Licensee provides written notice of its intent not to renew at least thirty
(30) days prior to the end of the then-current term.
2.3 Cost of Living Increase: Licenses will auto renew with a 5% cost of living increase each year.
2.4 AI Model Cost Escalation: Upon each annual renewal, the fees under this Agreement may be
subject to an increase. Any such increase shall be directly proportional to any price increases
imposed by Microsoft Azure for the software required to support Licensee's use of Madison.
The Licensor shall notify the Licensee of any increase in fees at least forty-five (45) days prior
to the renewal date. If Microsoft Azure does not increase its pricing, the fees will remain
unchanged for the subsequent renewal term.
3. FEES AND PAYMENT
3.1. Fee: Licensee agrees to pay Licensor a total fee ("Annual License Fee"), which includes data
deployment and annual access to Madison AI. All fees will be billed upon contract signing and
due net 30. See the Fee and Payment Schedule in Appendix 1.
Knowledge Assistant Licensing Agreement
As of March 15, 2025 I 527 Lander Street – Reno, NV 89509 I hello@madisonai.com I Page 2 of 5
3.2. Usage Tokens: The License Fee includes usage tokens with a limit of $250 per month or
$3,000 per year. Any usage beyond this limit will be tracked but not immediately billed and
will be subject to adjustment upon renewal as specified in Section 3.3. Tokens are priced at
cost by Microsoft ($0.005/1,000 input and $0.015/1,000 output) ) here. (Ex: Each search
costs ~ $0.0676 using GTP-4o Regional.)
3.3. Renewal Adjustment for Usage Fees: If the Licensee exceeds the monthly usage limit of
$250 or $3,000 for the 12-month period, the overage will not incur immediate additional
charges. Instead, the Licensor will track actual usage throughout the contract term. At the
time of annual renewal, the License Fee for the upcoming renewal will be adjusted ("trued
up") to reflect the Licensee’s level of usage over the previous term. This ensures that future
pricing aligns with actual consumption while avoiding unpredictable monthly overage
charges. Any increase in the License Fee due to the true-up will apply to the subsequent
renewal period and will be provided to the Licensee 30 days in advance of the renewal date.
3.4 Service Support: Service support beyond initial installation is available for issues and level
one customer service support. Additional support can be provided as a service add-on if
requested.
MADISON AI TERMS of SERVICE https://madisonai.com/terms-and-conditions/
4. DEPLOYMENT AND DATA INDEX UPDATING
4.1. Initial Deployment: Licensor will deploy the AI Knowledge Assistant in approximately (4)
weeks and it will include approximately five (5) years of data from existing agendas, minutes,
and staff reports.
4.2. Data Index Updates: Throughout the Term, Licensor shall update the data pile once monthly
to ensure the application has access to the most current governmental data to reference.
5. LICENSEE OBLIGATIONS AND RESTRICTIONS
5.1. Compliance with Laws: Licensee agrees to use Madison AI in compliance with all applicable
laws and regulations, including but not limited to all federal and Nevada state laws.
5.2. Restriction: Licensee shall not and shall not permit any third party to: (a) reverse engineer,
decompile, or disassemble Madison AI; (b) modify or create derivative works of Madison AI;
(c) sublicense, lease, rent, or distribute Madison AI to any third party; or (d) use Madison AI
for any purpose other than as expressly permitted under this Agreement.
6. SECURITY
6.1. Data Security: Madison AI is a Microsoft Azure Application that is compliant with Microsoft
Data Protection. Your prompts (inputs), completions (outputs), your embeddings, and your
training data:
• are NOT available to other customers.
• are NOT available to OpenAI.
• are NOT used to improve OpenAI models.
Knowledge Assistant Licensing Agreement
As of March 15, 2025 I 527 Lander Street – Reno, NV 89509 I hello@madisonai.com I Page 3 of 5
• are NOT used to improve any Microsoft or 3rd party products or services.
• are NOT used for automatically improving Azure OpenAI models for your use in your
resource (The models are stateless, unless you explicitly fine-tune models with your
training data).
The Azure OpenAI Service is fully controlled by Microsoft; Microsoft hosts the OpenAI
models in Microsoft’s Azure environment and the Service does NOT interact with any
services operated by OpenAI (e.g. ChatGPT, or the OpenAI API).
MADISON AI PRIVACY POLICY https://madisonai.com/privacy-policy/
7. TERMINATION
7.1. Termination for Convenience: Either party may terminate this Agreement for any reason
upon thirty (30) days' prior written notice to the other party.
7.2. Termination for Breach: Either party may terminate this Agreement immediately upon
written notice if the other party breaches any material term or condition of this Agreement
and fails to cure such breach within thirty (30) days after receiving written notice thereof.
7.3. Effect of Termination: Upon termination of this Agreement, Licensee shall cease all use of
Madison AI. The License Fee will be prorated on a monthly basis, net of the initial setup fee
and token usage to date. Termination shall not relieve Licensee of its obligation to pay any
fees accrued or payable to Licensor prior to the effective date of termination. Madison AI will
delete all data related to the Licensee, to include chat history and backups.
8. WARRANTY DISCLAIMER
8.1. Madison AI and all content is provided to Licensee strictly on an “as is” basis; and all
conditions, representations, and warranties, whether express, implied, statutory, or
otherwise, including, without limitation, any implied warranty of merchantability, fitness for a
particular purpose, or non-infringement of third party rights, or any warranties arising out of
course of dealing or usage of trade; are hereby disclaimed to the maximum extent permitted
by applicable law by Madison AI and its licensors.
9. LIMITATION OF LIABILITY
9.1. Limitation: Licensor's liability for damages hereunder shall in no event exceed the amount of
fees paid by licensee to licensor under this agreement. Licensor agrees to indemnify, hold
harmless and defend Licensee and the employees, officers and agents of Licensee from any
liabilities, damages, losses, claims, actions or proceedings, including, without limitation,
reasonable attorneys' fees and costs, to the extent that such liabilities, damages, losses,
claims, actions or proceedings are caused by the negligence, errors, omissions, recklessness
or intentional misconduct of Licensor or the employees or agents of the Licensor (1) in the
performance of the agreement, or (2) which are, or are not, based upon or arising out of the
professional services of Licensor, to the full extent allowed by law.
Knowledge Assistant Licensing Agreement
As of March 15, 2025 I 527 Lander Street – Reno, NV 89509 I hello@madisonai.com I Page 4 of 5
10. GENERAL
10.1. Governing Law and Dispute Resolution: This Agreement shall be governed by and
construed in accordance with the laws of the State of Nevada, without regard to its conflict
of law principles. By using Madison AI (Software), you agree that any disputes, claims, or
controversies arising out of or relating to the use of the Software, including but not limited
to performance, data use, or service-related issues (collectively referred to as "Disputes"),
will be resolved exclusively through mediation as the initial step in the dispute resolution
process, in accordance with the laws of the State of Nevada.
10.2. Entire Agreement: This Agreement constitutes the entire agreement between the parties
with respect to the subject matter hereof and supersedes all prior or contemporaneous
understandings or agreements, written or oral, regarding such subject matter.
10.3. Amendments: No amendment or modification of this Agreement shall be binding unless in
writing and signed by both parties.
10.4. Waiver: No waiver of any term or condition of this Agreement shall be deemed a continuing
waiver or a waiver of any other term or condition.
10.5. Severability: If any provision of this Agreement is held to be invalid or unenforceable, the
remaining provisions shall continue in full force and effect.
10.6. Assignment: Licensee may not assign or transfer its rights or obligations under this
Agreement without the prior written consent of Licensor.
IN WITNESS WHEREOF, the parties have executed this Licensing Agreement as of the Effective Date.
M3 Planning, Inc. dba Madison, AI
By: ___________________________
Name: __Erica Olsen___________
Title: __CEO/Co-Founder______
Date: ____03/15/25___________
Pitkin County
By: __________________________
Name: _______________________
Title: ________________________
Date: ________________________
Kara
Deputy County Manager
May-06-2025
Knowledge Assistant Licensing Agreement
As of March 15, 2025 I 527 Lander Street – Reno, NV 89509 I hello@madisonai.com I Page 5 of 5
Appendix 1 – Fee and Payment Schedule
SETUP FEE & DEPLOYMENT (for each Knowledge Assistant) - $10,000 WAIVED via DOLA
Partnership
• Custom LLM setup and configuration including prompt fine-tuning.
• Data processing and metadata extraction.
• Up to 2 custom developed reports/outputs.
• Rollout & Training – 2-3 team training sessions, to be recorded for future use.
MADISON AI MODELS
All modules include 1) Unlimited staff use, 2) Auto-indexing weekly, AI Tokens for search and
OpenAI with a limit of $250 per month or $3,000 per year.
Selected Knowledge Assistants Cost
✅ Agency-Wide Policy & Governance $25,000/Annual
$10,000 setup fee
Elected Officials $10,000/Annual
No setup fee
Planning & Zoning $10,000/Annual per dept
$5,000 setup fee
✅ Transcription with Attribution Process (2017-2024
meeting minutes) $5,000/One Time
Total Annual Licensing Fee $25,000
Total One-Time Fees $5,000
Total Amount Due $30,000
Madison AI – Sole Source Provider
527 Lander Street – Reno, NV 89509 I hello@madisonai.com I Page 1 of 2
November 14, 2024
To Whom It May Concern:
This letter is to certify that M3 Planning, Inc., dba Madison AI is the sole provider of Madison AI, a proprietary
large language model (LLM) uniquely tailored for local government needs. Madison AI is custom-built exclusively
for local governments, leveraging advanced AI and machine learning to support critical functions such as policy
research, staff report generation, and decision-making based on secure and customized data.
Madison AI is distinct in the marketplace due to the following attributes:
1.Custom-Built for Local Governments: Madison AI is the only LLM specifically designed to meet the
challenges of local governments, offering functionalities such as error-checked and fully cited outputs
based on internal agency documents. No other solution on the market provides this level of customization
specifically for governmental operations.
2.Individualized on Agency Data: Unlike generic AI tools like Microsoft Co-Pilot and GPT models that may
draw from open web data or third-party sources, Madison AI exclusively uses each agency’s own data,
ensuring outputs that are reliable, accurate, and directly applicable to government operations.
3.Collaborative Model Enhancement: Madison AI employs a unique cross-client learning approach, where
improvements made for one government entity are shared across all clients, enhancing the tool’s overall
effectiveness. This structure ensures that all users benefit from best practices and collective learning
across the local government landscape.
4.Seamless Integration with Microsoft Ecosystem: Madison AI integrates into Microsoft platforms like
SharePoint and Teams, allowing unlimited data access, unrestricted file size, and support for a broad range
of file types without data limitations. This integration provides local governments with a seamless, secure,
and scalable solution tailored to their existing technological environments.
5.Public-Private Partnership: Madison AI was developed in partnership with Washoe County, Nevada,
making it uniquely aligned with government operations. This co-development model ensures that the
platform is consistently refined to meet real-world, government-specific needs.
6.Market Leader: Madison AI stands as the leader in the sector, offering unmatched customization, security,
and innovation tailored to the public sector.
In summary, there is no comparable product or service on the market that delivers the same combination of
tailored government-specific functions, collaborative learning, and Microsoft ecosystem integration as Madison AI.
M3 Planning, Inc. dba Madison AI is the sole source and provider of Madison AI, and no alternative solution exists
that could meet the specific requirements and benefits Madison AI offers.
Should you require additional information or have any questions regarding this sole source certification, please feel
free to contact us.
Sincerely,
Erica Olsen
CEO/Co-Founder
M3 Planning, Inc. dba Madison AI
Attachment A
Madison AI – Sole Source Provider
527 Lander Street – Reno, NV 89509 I hello@madisonai.com I Page 2 of 2
Comparison: Madison AI vs. Co -Pilot and Custom GPT
Feature Madison AI Co-Pilot (Microsoft) Custom GPT (OpenAI)
Data Privacy Only accesses and uses client
data, no open web access
Uses a mix of personal and
open web data
Can access both open web
and specific datasets
Customization
Tailored to local government
needs, using government-
specific documents and data
Generalized for broader
enterprise use
Can be customized but
typically not specialized
Integration
Fully integrated into
Microsoft Teams and
SharePoint
Integrated into Microsoft
products like Word
Limited integration; requires
manual configuration
Error Checking & Citations
Results are error -checked
and fully cited from master
documents
Limited error checking,
focuses on user input
Provides general outputs
without formal error checks
Knowledge Sharing Across
Clients
Learns from the experiences
and datasets of all
government clients
Individual use only Case-by-case customization,
no cross-client learning
File Count Limitations Unlimited file access within
your SharePoint environment
10,000 files per customer in
Co-Pilot
Typically supports up to
2,000 files per dataset
File Size Limitations
No size limitations within the
SharePoint and Azure
environments
Up to 32 MB per file Maximum of 512 MB per file
for processing
File Type Limitations
Supports any file type within
Microsoft ecosystem (e.g.,
Word, Excel, PDFs, etc.)
Limited to Microsoft formats
(Word, Excel)
Primarily text -based inputs
like .txt, .docx, .json
Certificate Of Completion
Envelope Id: 2C084B9D-DA4C-483F-95FC-0882F644F2BC Status: Completed
Subject: Madison AI | Pitkin County Contract 067.25 for Review and Signature
Source Envelope:
Document Pages: 11 Signatures: 4 Envelope Originator:
Certificate Pages: 2 Initials: 1 Pitkin County Procurement
AutoNav: Enabled
EnvelopeId Stamping: Disabled
Time Zone: (UTC-07:00) Mountain Time (US & Canada)
530 East Main Street
Suite 203
Aspen, CO 81611
Procurement@PitkinCounty.com
IP Address: 10.103.81.9
Record Tracking
Status: Original
5/5/2025 12:42:19 PM
Holder: Pitkin County Procurement
Procurement@PitkinCounty.com
Location: DocuSign
Signer Events Signature Timestamp
Connie Baker
connie.baker@pitkincounty.com
Budget Director
Pitkin County
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Using IP Address: 216.147.126.217
Sent: 5/5/2025 12:49:24 PM
Viewed: 5/6/2025 10:14:14 AM
Signed: 5/6/2025 10:14:41 AM
Electronic Record and Signature Disclosure:
Not Offered via Docusign
Ann Driggers
ann.driggers@pitkincounty.com
CFAO, Treasurer, and Public Trustee
Pitkin County
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Using IP Address: 69.170.199.137
Sent: 5/6/2025 10:14:44 AM
Viewed: 5/6/2025 10:20:59 AM
Signed: 5/6/2025 10:21:30 AM
Electronic Record and Signature Disclosure:
Not Offered via Docusign
Kara
kara.silbernagel@pitkincounty.com
Deputy County Manager
Pitkin County Colorado
Security Level: Email, Account Authentication
(None)
Signature Adoption: Drawn on Device
Using IP Address: 65.38.144.66
Sent: 5/6/2025 10:21:32 AM
Viewed: 5/6/2025 12:34:32 PM
Signed: 5/6/2025 12:34:48 PM
Electronic Record and Signature Disclosure:
Not Offered via Docusign
Jon Peacock
Jon.Peacock@PitkinCounty.com
County Manager
Pitkin County
Security Level: Email, Account Authentication
(None)
Signature Adoption: Drawn on Device
Using IP Address: 65.38.144.66
Sent: 5/6/2025 12:34:50 PM
Viewed: 5/12/2025 10:13:29 AM
Signed: 5/12/2025 10:13:39 AM
Electronic Record and Signature Disclosure:
Not Offered via Docusign
In Person Signer Events Signature Timestamp
Editor Delivery Events Status Timestamp
Agent Delivery Events Status Timestamp
Intermediary Delivery Events Status Timestamp
Certified Delivery Events Status Timestamp
Carbon Copy Events Status Timestamp
Pitkin County Procurement
procurement@pitkincounty.com
Procurement Specialist
Pitkin County
Security Level: Email, Account Authentication
(None)
Sent: 5/12/2025 10:13:41 AM
Resent: 5/12/2025 10:13:45 AM
Electronic Record and Signature Disclosure:
Not Offered via Docusign
Accounts Payable
AP@pitkincounty.com
Accounts Payable
Pitkin County
Security Level: Email, Account Authentication
(None)
Sent: 5/12/2025 10:13:41 AM
Viewed: 5/12/2025 10:24:17 AM
Electronic Record and Signature Disclosure:
Not Offered via Docusign
Witness Events Signature Timestamp
Notary Events Signature Timestamp
Envelope Summary Events Status Timestamps
Envelope Sent Hashed/Encrypted 5/5/2025 12:49:24 PM
Certified Delivered Security Checked 5/12/2025 10:13:29 AM
Signing Complete Security Checked 5/12/2025 10:13:39 AM
Completed Security Checked 5/12/2025 10:13:41 AM
Payment Events Status Timestamps