TRANSMITTAL IM'tE 09/30/16

Transcription

1 TO The City Council The City Attorney FHOM The Mayor TRANSMITTAL IM'tE 09/30/ COUMC'l FILE NO COUNCIL CI TFSICT rva Authority tor the Director of Finance to amend Contract No. C with the State of California Franchise Tax Board (FTB) to compensate the FTB with $10,000 for the one-time cost of modifying software during Fiscal Tear Approved as requested. pjhs City Adminiilfalive Officer report attached. (Ana Guerrero) mayors CAD 44 d

2 TO The Mayor TRANSMITTAL DATE COUNCIL FILE NO. FROM The City Administrative Officer COUNCIL DISTRICT Authority for the Director of Finance to amend Contract No. C with the State of California Franchise Tax Board (FTB) to compensate the FTB with $10,000 for the one-time cost of modifying software during Fiscal Year Transmitted for your consideration. See the City Administrative Officer report attached. / Miguel A. Santana 'City Administrative Officer MAS:ZMB: c CAO 649-d

3 Report From OFFICE OF THE CITY ADMINISTRATIVE OFFICER Analysis of Proposed Contract ($25,000 or Greater and Longer than Three Months) To: The Mayor Contracting Department/Bureau: Office of Finance C.D. No. CAO File No.: n/a Contact: Robert Lee Reference: Transmittal from the Office of Finance dated August 29, 2016 Purpose of Contract: Exchange of tax data for tax administration and discovery purposes Type of Contract: ( ) New contract ( x ) Amendment Contract Term Dates (3 Months or Less): May 15, 2015 through December 31, 2017 (The Amendment does not modify the contract term) Contract/Amendment Amount ($25,000 or Less): $10,000 (The Amendment does not modify the contract amount) Source of funds: Department 39, Fund 100, Account 3040 (Contractual Services) Name of Contractor: State of California Franchise Tax Board Address: P.O. Box 1468, Mailstop A18, Sacramento, CA Yes Council has approved the purpose Appropriated funds are available Charter Section 1022 findings completed Proposals have been requested Risk Management review completed 6. Standard Provisions for City Contracts included 7. Workforce that resides in the City: %N/A No N/A* 8. Contractor has complied with: Yes No a.equal Employmt. Oppty./Affirm. Action b.good Faith Effort Outreach c. Equal Benefits Ordinance d. Contractor Responsibility Ordinance e. Slavery Disclosure Ordinance f. Bidder Certification CEC Form 50 *N/A = not applicable ** Contracts over $100,000 N/A* COMMENTS The Office of Finance (Department) requests approval to amend Contract No. C (Contract) with the State of California Franchise Tax Board (FTB) to state that one-time programming to be performed by the FTB, originally scheduled to occur during , will occur during The amendment does not modify the contract amount of $10,000 or term of May 15, 2015 through December 31,2017. On April 1, 2015, the City Council authorized the Director of Finance to execute the Contract with the FTB. In accordance with the Contract and with California Revenue and Taxation Code Section , the Department and the FTB exchange tax data for tax administration and discovery purposes. The Department utilizes the FTB data to identify businesses that are operating in the City without a business tax registration certificate. The FTB data has assisted the Department in adding business accounts to the City s tax rolls and generating General Fund revenue. The City also provides the FTB with taxpayer data specific to City business tax information. There is no fee for either the FTB or the City for this exchange of data. Pursuant to the Contract, the FTB was to modify its existing software to incorporate ZIP Code +4 digit data for ZIP Codes partially located within the City s jurisdiction. These ZIP Codes are currently not lajanalyst CAO 661 Rev. 5/ c Assistant CAO uity Administrative Officer

4 CAO File No Page 2 part of FTB s data transmission. Due to extenuating circumstances, FTB was unable to reprogram its software prior to the end of The proposed amendment revises Exhibit B - Budget Detail and Payment Provisions to state that the FTB will perform the software modification during Furthermore, the amendment indicates that the City will pay the FTB a one-time fee of $10,000, in accordance with the Contract, upon completion of the modification of the FTB software. Funding is included in the Department s Contractual Services Account for this purpose. While the Contract does not include the Standard Provisions for City Contracts, it does incorporate equivalent language as the Department utilized the standard agreement format of the State of California Franchise Tax Board. Council approval of the proposed amendment is required because the Contract was approved by Council. RECOMMENDATION That the Council, subject to the approval of the Mayor, authorize the Director of Finance, or designee, to amend Contract No. C with the State of California Franchise Tax Board, subject to final review as to form and legality by the Office of the City Attorney. FISCAL IMPACT STATEMENT Funding is available in Department 39, Fund 100, Account 3040 (Contractual Services). This recommendation is in compliance with the City s Financial Policies in that there is no additional impact on the General Fund. Attachment

5 CLAIRE BARTELS DIRECTOR of FINANCE CITY TREASURER CITY OF LOS ANGELES CALIFORNIA o.^-yy-7-tg. TllIlT f A" *vt' OFFICE OF FINANCE 200 N. SPRING ST. ROOM CITY HALL LOS ANGELES, CA (844] August 29, 2016 ERIC GARCETTI MAYOR t/> f?s -o it * 4. ro V 2SC f The Honorable Eric Garcetti Mayor, City of Los Angeles 200 N. Spring St., Room 303 Los Angeles, CA Re: APPROVAL TO EECUTE FIRST AMENDMENT TO CONTRACT WITH THE CALIFORNIA FRANCHISE TA BOARD -n & r~' 3so * ' ca : A -o zr Q irr ^O * : J C"1 r*3 CP SUMMARY In accordance with Executive Directive No. 3, the Office of Finance (Finance) requests approval to execute the attached proposed Amendment No. 1 to Contract C with the California Franchise Tax Board (FTB). The purpose of the amendment is to allow programming that was scheduled to be performed during Fiscal Year 2016 to be performed during Fiscal Year This contract was executed in 2015 and is a reciprocal exchange of tax data from the FTB specific to City business tax information for tax administration purposes. The Office of Finance utilizes the FTB information to identify businesses who are not registered to pay business tax for tax discovery purposes which generates millions of dollars of revenue for the City annually. KEY CONTRACT PROVISIONS This amendment is being requested because in order to effectuate the agreed exchange of information, the City agreed to compensate FTB $10,000 for one-time programming costs to be completed during Fiscal Year However, due to extenuating circumstances, FTB was unable to undertake the required programming prior to the end of Fiscal Year 2016, and will be performed during Fiscal Year FISCAL IMPACT Funds for the one-time programming costs have been budgeted in the Office of Finance Account 3040, Contractual Services. Funds to pay for this amendment are provided for under the current fiscal year s budget; therefore, no additional funding is required. RECOMMENDATIONS The Office of Finance respectfully requests: AN EQUAL OPPORTUNITY-AFFIRMATIVE ACTION EMPLOYER

6 The Honorable Eric Garcetti, Mayor August 29, 2016 Page 2 1) 2) The Mayor submit Amendment No. 1 to Contract C to the City Council for its review and consideration; and The City Council authorize the Director of Finance to execute Amendment No. 1 to Contract No. C , subject to final review as to form and legality by the Office of the City Attorney. If you require any further information regarding this request, please contact Robert Lee, Chief Tax Compliance Officer II, at (213) or Robert.Lee@lacity.org. Respectfully. Claire Bartels Director of Finance/City Treasurer Attachment cc: Ana Guerrero, Mayor s Chief of Staff (w/o attachments) Matt Szabo, Deputy Mayor of Budget and Innovation (w/o attachments) Zara Bukirin, Office of the City Administrative Officer

7 FIRST AMENDMENT TO CONTRACT No. C BETWEEN THE CITY OF LOS ANGELES AND CALIFORNIA FRANCHISE TA BOARD This First Amendment to Contract No. C (California State Agreement Number C ) between the City of Los Angeles (hereinafter "City") and the California Franchise Tax Board (hereinafter "FTB") is entered into with reference to the following: WHEREAS, on May 19, 2015 the parties entered into City Contract No. C (California State Agreement Number Cl400034) wherein City and FTB agreed to a reciprocal exchange of tax data specific to City business tax information for tax administration purposes; and WHEREAS, in order to effectuate the agreed exchange of information, City agreed to compensate FTB for one-time programming cost to be completed during Fiscal Year 2016; and WHEREAS, due to extenuating circumstances FTB was unable to undertake the required programming prior to the end of Fiscal Year 2016; and WHEREAS, the Office of Finance utilizes the FTB information to identify businesses who are not registered to pay business tax for tax discovery purposes which generates millions of dollars of revenue for the City annually; and WHEREAS, the City and the FTB now agree to amend the Contract to state that the one-time programming to be performed by the FTB will be performed during Fiscal Year NOW THEREFORE, the parties hereby covenant and agree as follows: ARTICLE I - AMENDMENT TO THE CONTRACT Exhibit B - Budget Detail and Payment Provisions - of the Contract is hereby amended in its entirety to read as: PAYMENT: The City agrees to pay FTB a one-time programming cost of $10,000for Fiscal Year 2017 associated with the modification of the existing FTB matching software to incorporate the Zip Code +4 for the Zip Codes partially within Los Angeles City jurisdiction as listed in Exhibit I once the Zip Code +4 file is provided by the City to FTB. Upon completion of modification of the FTB matching software to incorporate the Zip Code +4 data into the bi-annual extract files, the FTB will invoice the City for the one-time programming cost accordingly. INVOICING: FTB shall render an invoice in triplicate to: City of Los Angeles Office of Finance 200 N. Spring Street, Room 220 Los Angeles, CA Upon receipt of the Agreement executed by the FTB and an accompanying invoice, the City agrees to remit payment of the amount shown on the invoice within 30 days. Page 1 of 3

8 ARTICLE II - GENERAL PROVISIONS Except as amended by this FIRST AMENDMENT, all other provisions of Contract No. C (California State Agreement Number C ) shall remain in full force and effect. SIGNATURE PAGE FOLLOWS Page 2 of 3

9 IN'WITNESS THEREOF, the parties hereto have caused this instrument to be signed by their respective duly authorized officers: Approved Corporate Signature Methods (please sign in blue ink): a) Two signatures: one by Chairman of Board of Directors, President or Vice President; and one by Secretary, Assistant Secretary, Chief Financial Officer or Assistant Treasurer. OR b) One signature by Corporate designated individual together with properly attested resolution of Board of Directors authorizing person to sign on the company behalf. City Of Los Angeles California Franchise Tax Board CLAIRE BARTELS Director of Finance / City Treasurer Name: Title: Signature Printed / Typed Printed / Typed Name: Title: Signature Printed / Typed Printed / Typed APPROVED AS TO FORM: MICHAEL N. FEUER City Attorney ATTEST: HOLLY L. WOLCOTT City Clerk Deputy City Attorney Deputy City Clerk Page 3 of 3 CA FTB 2016 Contract Amend No