HomeMy WebLinkAbout5/16/2007 - STAFF REPORTS - 2.J. FvpLM S,
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City Council Staff Report
DATE: May 16, 2007 CONSENT CALENDAR
SUBJECT: AWARD CONTRACT to MBIA FOR SALES TAX AND PROPERTY TAX
AUDITING SERVICES
FROM: David H. Ready, City Manager
BY: Department of Finance and Treasury
SUMMARY
The City has had a contract with MBIA MuniServices Company for Sales Tax Auditing
Services for the past ten (10) years. The current agreement with MBIA has expired.
This action would approve a new contract with MBIA for a period of three (3) years. In
addition to sales tax auditing services, the new contract includes property tax revenues
as part of their scope of services. Total cost for both services for all three (3) years will
not exceed $175,000.
RECOMMENDATION:
1) Adopt Minute Order No. approving a three (3) year contract services
agreement with MBIA MuniServices Company for Sales Tax and Property Tax
Auditing Services in an amount not-to-exceed $175,000 for the full three (3) year
term.
2) Authorize the City Manager to execute the necessary documents.
STAFF ANALYSIS:
The collection of properly and sales taxes are major sources of revenue to the City of
Palm Springs. The non-standard and complex nature of both the State sales and
County property tax systems can lead to numerous administrative errors and omissions.
This, combined with general tax compliance problems, has resulted in underreporting of
tax revenues and other inconsistencies.
In order to determine whether the City is receiving all of the sales tax revenue it is
entitled to, the City has previously retained MBIA MuniServices Company to provide
sales tax analysis, auditing and reporting services. In addition to auditing the City's
sales tax revenues, MBIA provides a quarterly report that features a general analysis
regarding statewide trends that may affect the City's sales tax, pl V ec i an is .
of the City's sales tax composition, changes and performance. T i s ice
City Council Staff Report
May 16, 2007, Page 2
Contract with MBIA MuniServices Company
is capped at $5,967 a year ($17,900 over the 3-year contract term). In addition to their
base fee, MBIA charges a contingency fee of 25% of any recovered revenue. Over the
last three (3) years, MBIA has identified over $220,000 in unreported or misreported
sales tax. The current contract with MBIA for auditing and reporting of sales tax
revenues has expired.
MBIA is proposing a new three (3) year contract for auditing and reporting services. In
addition to sales tax revenues, staff is recommending that property tax revenues be
included as part of the audit services MBIA performs. Staff believes that it would be
prudent to audit property tax revenues due to the increased number of homes being
sold throughout the community which, in turn, results in new property valuations. The
total cost of this contract, which includes their base fee and an estimate on the
contingency fee, is limited to $175,000 over the three (3) year term_
Normally, professional services such as those being performed by MBIA should be
competed in order to make sure that the City is getting the best value for the services
being performed. Section 7.04.030 of the Municipal Code provides that the City Council
may authorize the acquisition of supplies, equipment or services without competition
when it is determined that an unusual or unique situations exists, in that due to
experience and expertise demonstrated in prior contracts with the City a particular
contractor is uniquely qualified for a particular task, that makes the application of all
requirements of competitive sealed bidding or competitive sealed proposals contrary to
the public interest. Since MBIA has been performing tax reporting and auditing services
to the City for the past ten (10) years, the Assistant City Manager — Administrative
Services and the Assistant Director of Finance have determined, pursuant to the
requirements of Section 7.04.030, that the prior contract performance and special
expertise of MBIA for sales tax auditing services is acceptable and will adequately
protect the public interest in that the total cost of the services to be provided will likely
be equal to or less than what could be obtained through an independent City
competitive process at this time.
FISCAL IMPACT:
This is a budgeted expense. Funds are available in account 001-1300-43200.
Craig Graves, Director of Finance oy . Butz[ istant City Manager
S
David H. Ready, City er
Attachment 1,15
1. Minute Order
MINUTE ORDER NO.
APPROVING A THREE (3) YEAR
CONTRACT SERVICES AGREEMENT
WITH MBIA MUNISERVICES COMPANY
FOR SALES TAX AND PROPERTY TAX
AUDITING SERVICES IN AN AMOUNT
NOT-TO-EXCEED $175,000 FOR THE
FULL THREE (3) YEAR TERM.
I, James Thompson, City Clerk of the City of Palm Springs, hereby certify that
this Minute Order approving a three (3) year contract services agreement with
MBIA MuniServices Company for sales tax and property tax auditing services in
an amount not-to-exceed $175,000 for the full three (3) year term, was adopted
by the City Council of the City of Palm Springs, California, in a meeting thereof
held on the 16th day of May 2007.
James Thompson, City Clerk
CONSULTANT SERVICES AGREEMENT
This Consultant Services Agreement (hereinafter "Agreement') is made as of July 1, 2006,
between MuniServices, LLC, a Delaware limited liability company with an office at 7335 N.
Palm Bluffs Ave, Fresno, CA 93711 (hereinafter "MuniServices"), and the City of Pahm Springs,
a municipal corporation of the State of California (hereinafter
1. SERVICES
Subject to the terms and conditions set forth herein, MuniServices shall provide to City those
services set forth in Addenda attached hereto in exchange for the fees set forth in the Addenda.
Upon mutual agreement, MuniServices and City may add services to be performed by
MuniServices for City under this Agreement by executing additional Addenda. Such additional
Addenda shall contain, at a minimum, a description of the services to be performed, the
anticipated compensation for such services, and any additional terms required to give effect to
the request for services (collectively "Services")_ Such additional Addenda shall be signed by
representatives of City and MuniServices having authority to so bind the parties. MuriServices
shall provide the Services in the manner specified in each applicable Addendum. MuniServices
shall not be required to perform, nor City be required to pay for, services not contained in an
applicable Addendum.
2. INDEPENDENT CONTRACTOR STATUS
MuniServices is an independent contractor, and not an employee of City, who will be engaged
in providing consulting services for City. Nothing in this Agreement shall be interpreted or
construed as creating or establishing the relationship of employer and employee between City
and MuniServices or between City and any employee or agent of Murdservices. Both parties
acknowledge that MuniServices is not an employee for state or federal tax purposes.
MuniServices shall retain the right to perform services for others during the term of this
Agreement. Nothing in this Agreement shall be construed as creating a partnership, joint
venture, or designating MuniServices as an agent of City. MuniServices shall have no authority
to bind, contract, or obligate City, financially or otherwise. City shall not have any right to
control the means by which MuniServices performs the Services including the facilities used,
the employees, contractors, or agents assigned by MuniServices. MuniServices shall be
responsible for any subcontracts entered into in the course of performance of the Services for
City and MuniServices shall be solely responsible for payment to the subcontractors.
3. COMPENSATION
31 in consideration for the Services to be performed by MuniServices, City agrees to pay
MuniServices the rates set forth in each applicable Addendum.
3.2 MuniServices shall submit timely invoices for all services rendered in accordance with
each applicable Addendum. Payment will be made to MuniServices within thirty-days
(30) of receipt of MuniServices' invoice therefore. Any amounts which remain unpaid
after thirty-days (30) shall accrue interest at the rate of one and one-half percent (1.5%)
per month,or the maximum amount permitted by law.
3.3 MuniServices shall be responsible for all costs and expenses incident to the
performance of Services for City, including but not limited to, all costs of equipment
C5AI-032807i)1 1 .MuniServices City
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provided by MuniServices, all fees, fuzes, licenses, bonds or taxes required of or
imposed against MuniServices and all other of MuniServices' costs of doing business.
City shall not be responsible for expenses incurred by MuniServices in performing
Services for City, except as noted in an applicable Addendum, or such expenses that
receive prior written approval from City.
3.4 The total fee payable for the Services to be performed under this Agreement and any
outstanding amounts under the prior SUTA/STARS Agreement will be a not-to-exceed
amount of one-hundred and seventy-five thousand dollars ($175,000) (the "NTE"). If
Consultant determines that within 60 days the services provided under this Agreement
will result in invoices in excess of the NTE, Consultant shall notify City's Finance
Director. At Consultant's request, the parties shall negotiate an increase in the NTE. If
the parties reach agreement on Lhe increased NTE, City shall enter into an amendment
to this Agreement increasing the NTE. if Consultant has invoiced amounts that
cumulatively equal the NTE, Consultant has no obligation to continue to perform under
this Agreement. Notwithstanding Lhe foregoing, the fees paid after the termination of
this Addendum are not subject to the NTE.
4. CONFIDENTIALITY
4.1 During the term of this Agreement, each party may have access to certain confidential
information of the other including such parry's products, services, technical data, trade
secrets, inventions, processes, and constituent information. All such information shall
be deemed "Confidential Information' whether or not identified as such. Each party
shall use the Confidential Information of the other solely for performance of this
Agreement, and all Confidential Information shall remain the sole property of the
respective parties. With regard to Confidential Information, each party shall use the
same care as it uses to maintain the confidentiality of its own confidential information,
which shall be no less Lhan reasonable care, and shall not make disclosure of the
Confidential Information to any third party without the written consent of the
Disclosing Party, except to employees, consultants or agents Lo whom disclosure is
necessary to the performance of this Agreement and who are bound by a duty of
confidentiality. Information shall not be deemed confidential if it (a) is rightfully
known to the receiving party prior to receipt from the disclosing party as reasonably
evidenced by such party; (b) becomes known to the receiving party from a source other
than one who is under an obligation of confidentiality to the disclosing party; or (c)
becomes publicly known or otherwise ceases to be confidential other than by an
unauthorized act. At all times, in accordance with Graham-Leach Bliley and other
applicable State and Federal regulations, taxpayer information containing Personally
Identifiable Information, as defiled in applicable regulations, shall be held in the
strictest confidence by MuniServices.
4,2 If a subpoena or other legal process in any way concerning Confidential Information is
served upon a party to which Confidential Information has been disclosed
("Recipient"), the Recipient shall promptly notify the Disclosing Party and shall
cooperate with the Disclosing Party, at the latter's expense, in any lawful effort to
contest the validity of such subpoena or other legal process.
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4.3 The parties agree that a breach of the terms of Section 4.1 or 4.2 would result in
irreparable injury to the non-breaching party for which a remedy in damages would be
inadequate. The parties agree that in the event of such breach or threatened breach,the
non-breaching party shall be entitled to, in addition to any other remedies available at
law or in equity, seek an injunction to prevent the breach or threatened breach.
4.4 The obligation of confidentiality as set forth in Section 4.1 shall continue for a period of
three-years (3) from the date of disclosure of the information, provided, however, that
for any information which constitutes a Trade Secret(as defined by applicable law), the
obligation of confidentiality shall continue during the entire term of thus Agreement
and shall survive the termination of this Agreement indefinitely. This obligation of
confidentiality shall not extend to any information required to be disclosed pursuant to
the California Public Records Act, the United States Freedom Of Information Act, or
other public disclosure acts of the United States or a state or territory thereof.
5. TERM AND TERMINATION
5.1 Term, This Agreement shall be effective as of the date of the last signature hereto and
shall continue in full force and effect for a period of three-years (3). Thereafter, tlus
Agreement shall automatically renew for successive three-year (3) periods.
Notwithstanding thus section (5.1), if the term set forth in any Addendum attached to
this Agreement differs from the term of this Agreement, the term of the Addendum is
govemed by the language in the Addendum. If any Addendum attached to this
Agreement is silent about the term of the Addendum then the provisions of this section
(5.1) govern the term of the Addendum.
5.2 Termination of Agreement. Unless terminated as per section 5.4 below, this Agreement
may only be terminated upon the expiration of a three-year term. If either party desires
to terminate this Agreement upon the expiration of a three-year term, the terminating
party shall provide notice to the other party of its intent not to renew no less than sixty-
days (60)prior to the renewal date.
5.3 Termination of Addenda. Any Addendum attached to this Agreement may be
terminated as follows:
a. If the Addendum sets forth a method for terminating the Addendum, that
Addendum may only be terminated according to that method;or
b. If the Addendum is silent about the method for terminating the Addendum, that
Addendum may be terminated by either party at any time and for any reason or
no reason effective on no less than sixty-days (60) days notice; or
c. As per section 5.4 below.
5.4 Event of Default. Any of the following shall constitute an event of default ("Event of
Default") under this Agreement or any applicable Addendum: (a) City fails to pay any
amount when due hereunder (after ten-days (10) prior written notice of such failure to
pay), or (b) a material breach by either party of this Agreement or applicable
Addendum. If an Event of Default occurs, the non-breaching party shall notify the
breaching party of the EvenL of Default and provide the breaching party thirty-days (30)
to cure (except in the case of non-payment for which the cure period shall.be ten (10)
days) or such amount of time as is reasonable given the circumstances. If the breaching
CSAI-032807v1 3 MuniSendees City
party fails to effect cure within the time allowed, then the non-breaching party may, at
its option, terminate this Agreement or applicable Addendum effective immediately
upon notice.
5.5 Effect of Tex mination. Notwithstanding non-renewal or termination of this Agreement
or any attached Addendum pursuant to Sections 5.1, 52, 5.3 or 5.4 above, City shall be
obligated to pay MuniServices for services performed through the effective date of
termination for which MuniServices has not been previously paid. In addition, because
the services performed by MuniServices prior to termination or non-renewal of f-ds
Agreement or attached Addendum may result in City's receipt of revenue after
termination which are subject to MuniServices' fee in accordance with each applicable
Addendum, City shall remain obligated after termination or non-renewal to provide to
MuniServices such information as is necessary for MuniServices to calculate the
compensation due as a result of this receipt of revenue by City and City shall remain
obligated to pay MuniServices' invoices therefore in accordance with the terms of Phis
Agreement.
6. EQUAL EMPLOYMENT OPPORTUNITY
During performance of this Agreement, MuniServices, for itself, its assignees and successors in
interest,agrees as follows:
6.1 Compliance With Regulations: MuniServices shall comply with Executive Order 11246,
"Equal Employment Opportunity" and labor regulations (41 C.P.R. Part 60), hereinafter
referred to as the "Regulations."
6.2 Nondiscrimination: MuniServices, with regard to any work performed pursuant to this
Agreement, shall not discriminate on the ground of race, color, religion, sex, national
origin, or veteran status in the selection and retention of employees, subcontractors, the
procurements of materials or leases of equipment.
6.3 Solicitation for Subcontractor, Including Procurements of Materials and Equipment: In
all solicitations either by competitive bidding or negotiations made by MuniServices for
work to be performed under any subcontract, including procurements of materials or
equipment, such potential subcontractor or supplier shall be notified by MuniServices of
MuniServices' obligation under this Agreement and the Regulations relative to
nondiscrimination on the ground of race, color, religion, sex, national origin, or veteran
status.
6.4 Information and Reports: MuniServices shall provide all information and reports
required by the Regulations, or orders and instructions issued pursuant thereto,and will
permit access to its books, records, accounts, other sources of information and its
facilities as may be determined by City to be pertinent to ascertain compliance with such
Regulations, orders and instructions. Where any information required of MuniServices
is in the exclusive possession of another who fails or refuses to furnish this information,
MuniServices shall so certify to City and shall set forth what efforts it has made to obtain
the information.
6.5 Incorporation of Provisions: MuniServices shall include the provisions of paragrlphs _
6.1 through 6.4 in every subcontract issued pursuant to this Agreement. MuniServices
shall take such action with respect to any Regulations, order or instructions issued
CSAl-032807v1 4 MuniServices CihJ
pursuant thereto. MuniServices shall take such action with respect to any subcontract or
procurement as City may direct as a means of enforcing such provisions, including
sanctions for noncompliance; provided, however, that in the event MuniServices
becomes involved in, or is threatened with, litigation with a subcontractor or supplier as
a result of such direction, MuniServices may request City to enter such litigation to
protect the interests of City.
7. WARRANTIES, REPRESENTATIONS AND INDEMNIFICATION
7.1 By MuniServices. MuniServices represents that all Services shall be performed by
persons with the skills and abilities necessary and consistent with the standards of
professionalism prevalent in the industry. The Services and deliverables shall be
provided free and clear of the proprietary claims of third parties. All Services shall be
provided in accordance with applicable state and federal regulations, including,
without limitation, the Fair Credit reporting Act, the Fair Debt Collection Practices Act,
and applicable state regulations.
Subsection 7.1 is the full and complete warranty statement of MuniServices
under this Agreement.
7.2 By CITY. City represents that the information provided to MuniServices in the
performance of Services by MuniServices hereunder shall be provided free and clear of
the claims of third parties. City represents that City has the right to provide said
information to MuniServices and that said information shall not be obscene,
defamatory, or otherwise expose MuniServices to liability to third parties. City
represents that it shall use reasonable and diligent efforts in the collection of moneys
identified by MuniServices. City represents that in the event City elects not to proceed
with diligent efforts in collection, that City shall remain liable to MuniServices in
accordance with applicable Addendum as if City had proceeded with diligent efforts in
collection.
7.3 Indemnification. The parties hereto agree to defend, indemnify, and hold harmless the
other, its directors, officers, employees and affiliates, from any a-ad all claims, suits,
demands, losses, damages, liabilities, costs and expenses, including reasonable
attorney's fees (collectively "Losses') arising from or related to a claim of injury to
person or property or death arising from or caused by the negligent acts or omissions
of employees, agents, or representatives of the indemnifying party which acts or
omissions arise from the indennfying party's performance (or non-performance)
under this Agreement. City shall defend, indemnify, and hold MuniServices harmless
from any Losses arising from or related to a claim that information provided by City to
MuniServices contains any false, misleading, or defamatory information regarding a
third party. MuniServices shall defend, indemnify, and hold City harmless from any
claim that MuniServices negligently or intentionally falsified any information provided
to City pursuant to this Agreement.
7.1 LIMITATION OF LIABILITY. To the maximum extent permitted by law, in no event
shall MuniServices, its employees, contractors or agents be liable for any indirect,
incidental, special, punitive or consequential damages,lost data or cost of procurement
CSAI-032807vl 5 Muni5ernices Cityr
of substitute goods or services arising from or related to the services whether for,
among other things, breach of warranty or any obligation arising therefrom, and
whether liability is asserted in contract or tort (including but not limited to negligence
and strict product liability) whether or not MuniServices has been advised of the
possibility of any such loss or damage. MuniServices" liability hereunder shall in no
event exceed an amount equal to the fees paid by city for the affected service to which
the claim pertains. The foregoing sets forth City's exclusive remedy for claims arising
from or out of this Agreement. The provisions of this section allocate the risks between
MuniServices and City and MuniServices' pricing reflects the allocation of risk and
limitation of liability specified herein.
S. GENERAL PROVISIONS
81 Personnel. At any time, City may request removal or replacement of personnel
assigned by MuniServices and MuniServices shall promptly replace such personnel.
The time for any deliverables required or any increase in costs shall be adjusted to
reflect any adverse impact resulting from the change in personnel.
8.2 Gratuities, Gifts, Conflict of Interest. MuniServices shall, at all times, comply with any
City policies regarding gifts, gratuities, or conflicts of interest. At no time shall
MuniServices, an employee, agent, director, or contractor offer or accept any gift or
gratuity from a third party who may be subject to findings resulting from Services,to or
from any City official, employee, contractor, or agent, or from any other party where
such gift or gratuity could be construed as a conflict of interest. MuniServices, its
officers, directors, employees, agents, and contractors shall avoid all conflicts of
interest, financial or otherwise, or the appearance thereof, in the performance of finis
Agreement or the applicable Services.
8.3 Dispute Resolution. Any dispute relating to this Agreement shall be submitted for
binding arbitration under the Commercial Arbitration Rules of the American
Arbitration Association and judgment on any award entered therein may be entered in
any court of competent jurisdiction The arbitrator's decision shall be final and binding
on the parties. Such arbitration shall be held in the State of California. In all cases, the
prevailing party to such dispute shall be entitled to recover costs and expenses,
including reasonable attorney's fees, as the arbitrator deems appropriate.
SA Ownersh p of Work Product MuniServices shall retain all right, title, and interest in
and to the processes, procedures, models, inventions, software, ideas, know-how, and
any and all other patentable or copyrightable material used, developed, or reduced to
practice in the performance of this Agreement. Upon payment therefore, City shall be
granted all right, title, and interest in and to the reports, charts, graphs, and other
deliverables produced by MuniServices in the performance of this Agreement.
8.5 Assignment. Neither Party may assign this Agreement or any of its nights or
obligations hereunder without the prior written consent of the other Party, which
consent shall not be unreasonably withheld. Any assignment without Such prior
written consent shall be void. Notwithstanding the foregoing, the Parties hereto may
assign all or part of this Agreement immediately, without the prior written consent of
the non-assigning Party (a) to any successor in interest to the assigning Party who
expressly assumes responsibility for the assigning Party's obligations hereunder; or (b)
CSA1-032807vl 6 MuniServices City �
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if necessary to satisfy the rules, regulations and/or orders of any federal or state
governmental agency or body. Any violation of the provisions of this Section shall
render this Agreement voidable at the option of the non-assigning Party.
8.6 Insurance.
a. Public Liability. During the term of this Agreement, MuniServices shall maintain in
full force and effect a policy of public liability insurance with minimum coverage's in
accordance with the requirements provided by City to MuniServices. MuniServices
shall cause City, its officials and employees to be named on all liability policies
described above as insured as respects activities undertaken pursuant to the parties'
respective obligations pursuant to this Agreement.
b. Workers' Compensation. During the term of this Agreement, MuniServices shall
fully comply with the terms of the law of California concerning workers'
compensation. Said compliance shall include, but not be limited to, maintaining in
full force and effect one or more policies of insurance insuring against any liability
MuniServices may have for workers' compensation.
8.7 Severability. In the event that any portion of this Agreement is held to be
unenforceable, the unenforceable portion shall be construed as nearly as possible to
reflect the original intent of the parties and the remainder of the provisions shall remain
in full force and effect.
8.8 Waiver. Either Party's failure to insist upon strict performance of any provision of this
Agreement shall not be construed as a waiver of that or any other of its rights
hereunder at any later date or time.
8.9 Force Majeure. Neither party shall be liable for failing to perform its obligations
hereunder (other than payment obligations) where delayed or hindered by war, riots,
embargoes, strikes or acts of its vendors or suppliers, accidents, acts of God, or any
other event beyond its reasonable control.
8.10 Notices. All notices,including notices of address changes,provided hereunder shall be
deemed received on the third day after mailing if sent by mail,or immediately if sent
by facsimile. Notices shall be sent to the following:
If to MuniServices: If to City:
MuniServices, LLC City of Palm Springs
7335 N. Palm Bluffs Ave. 3200 E. Talnquitz Canyon Way
Fresno,CA 93711 P.O. Box 2743
Attn: Legal Department Palm Springs, CA 92262-2743
Email: legal@munibervices.com Attn:Finance Director
8.11 Copies. This Agreement May Be Executed In Separate Counterparts Including
Facsimile Copies, Each Of Which Shall Be Deemed An Original, And All Of Which
Shall Be Deemed One And The Same Instrument And Legally Binding Upon The
Parties.
8.12 Entire Agreement. This Agreement, including the Addenda attached hereto and made
part hereof, constitutes the entire Agreement between MuniServices and City, with
respect to the Services provided. This Agreement supersedes and replaces any and all
CSAl-032807v1 7 Muni5arvices City
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prior agreements, of whatever kind or nature, with respect to the Services provided
hereunder and with respect to any Addendum to be added hereto at a later date. Any
prior agreements, discussions, or representations not expressly set forth herein are of
no force or effect.
8.13 No Oral Modification. No modification of this Agreement shall be effective unless set
forth in writing and executed with the same formality as this Agreement. No waiver of
the requirements of this Section shall be effective unless in writing and signed by the
CEO for MuniServices.
8.14 Construction. This Agreement shall be construed in accordance with the laws of the
State of California without regard to its conflict of laws principals.
8,15 Headings. The section headings herein are for convenience and reference purposes
only and shall not serve as a basis for construction or interpretation.
8.16 Order of Precedence. In the event of any conflict between the terms of this Agreement
and the terms of any Addenda, the Lerms of this Agreement shall prevail_ No
additional terms, PO Terms and Conditions, or oral or written representations of any
kind shall be of any force and effect unless in writing and executed with the same
formality as this Agreement.
8.17 Partial Payment. No receipt by MuniServices of an amount less than City's full amount
due will be deemed to be other than payment "on account", nor will any endorsement
or statement on any check or any accompanying letter effect or evidence an accord and
satisfaction. MuniServices may accept such check or partial payment without prejudice
to MuniServices' right to recover the balance or pursue any right of Muniservices.
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CSAI-032807vl 8 MuniServices CzbJ
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The Parties are signing this Agreement as stated in the introductory clause.
MuniServices, TIC City of Palm Springs
a municipal corporation
By: By:
Marc Herman
Tide: President and CEO Title:
ATTEST:
By:
Kevin Cerutti City Clerk
Title: Chief Financial Officer
APPROVED AS TO FORM: APl'RO D AS PO
Eric Myers,General Counsel ity Attorney
CSAl-032807vl 9 Muniseivices city ��
PROPERTY TAX ADDENDUM
MuniServices, LLC ("MuniServices") shall provide to the City of Palm Springs
MuniServices's Property Tax Compliance Services which consists of Audit and Recovery
Services.
OBJECTIVES AND METIJODS
MuniServices' property tax audit assists City in recovering all of the revenue to which it is
entitled from its Property Tax. Administrative errors and omissions combined with general
compliance problems are inevitable given the non-standard, complex nature of state and local
property taxes. Error rates rise with respect to property tax applicability, rates, exceptions,
exemptions,quirks and other inconsistencies.
Because there are time limitations on the City's ability to recover misallocated revenue, prompt
correction of these errors and omissions is essential to maximizing revenue potential.
The following steps are taken in conducting MuniServices' Property Tax Audit:
o Contact City's designated staff to review service objectives, scope, workplan
schedule, public relations and logistical matters. MuniServices will also establish
an appropriate liaison with the City's coordinator and logical checkpoints for
progress reviews-
0 Represent the City for purposes of examining records pertaining to property tax
to identify and confirm any errors/omissions that are resulting in deficient
payment of tax revenues to the City-
0 For each error/omission identified and confirmed, prepare documentation to
substantiate and facilitate recovery of revenue due from prior periods plus
applicable interest and penalties (collectively"Misallocation").
o Meet with designated City official(s) as necessary to review our findings and
recommendations.
o Prepare and forward to the appropriate parties requests for corrective action and
revenue recovery for Misallocations. The date that the appropriate parties
receive and acknowledge these requests is the "Date of Knowledge
0 Provide additional assistance as necessary to support the City in recovering and
preventing tax allocation errors/omissions.
From the Date of Knowledge, the County Assessor's office will review the identified
Misallocations, and for those Misallocations for which a correction is required, an Assessor's
Roll Correction ("ARC") will be processed by the County correcting those Misallocations,
typically triggering a reallocation. The Roll Year in which the assessments first appear
corrected is the Date of Correction. Corrected assessments result in proper allocations in
subsequent Roll Years ("Corrected Allocations-).
Pr1t-02t507i4 21 MuniSe"zces City
Specifically,MuniServices shall:
0 Establish a comprehensive inventory of every parcel located within the City and
within the RDA project(s), including the database elements needed to facilitate a
comparison analysis with County secured and unsecured taxable values.
o Conduct an audit of the City local secured and unsecured valuations,on a parcel-
by-parcel basis to determine tax rate area ("TRA") miscoding errors and
omissions.
TIMING AND REPORTING
MuniServices shall commence the Property Tax Compliance Services within 10 working days of
authorization (unless instructed otherwise by the City) with the objective of delivering the
initial audit reports witlun 90 to 120 working days. Thereafter, MuniServices shall provide the
City with audit progress reports to include,but not be limited to,the following:
o Actual revenue produced for the City by MuniServices' service on an annual and
cumulative basis.
o Projected revenue forthcoming to the City as a result of MuniServices' audit
service, specified according to source, timing and one-time payment versus
ongoing.
0 Listing of all errors/omissions detected for the City including, for each, the
account number, correction status,payment amount received by the City, period
to which payment is related and payment type (e.g. reallocation, deficiency
assessment, etc-
)-0 Status of the work including copies of reports provided by the County
addressing each reporting error/omission individually, the Incorrect Parcel
Number, Correct Parcel Number, Assessee, Correct TRA assignment, Business
ID,Address,Secured and Unsecured Valuation,Exemptions,Net Total Valuation
of misallocated assessments.
COMPENSATION
MuniServiccs performs this work for a 25% contingency fee. This fee applies to all reallocations
for the fiscal year during which the Date of Correction falls and all eligible prior period
revenues corrected. The fee also applies to Corrected Allocations for three (3) subsequent Poll
Years from the Date of Correction. The total fee payable for the Services to be performed under
this Addendum will be a not-ko-exceed amount of thirty thousand dollars ($30,000) (the
"NTE"), Tf Consultant determines that within 60 days the services provided under this
Addendum will result in invoices in excess of the NTE, Consultant shall notify City's Finance
Director. At Consultant's request, the parties shall negotiate an increase in the NTE. If the
parties reach an agreement on the increased NTE, City shall enter into an amendment to this
Agreement increasing the NTE. If Consultant has invoiced amounts that cumulatively equal
the NTE, Consultant has no obligation to continue to perform under this Agreement.
Notwithstanding the foregoing, the Corrected Allocations for three (3) subsequent Roll Years
from the Date of Correction are not subject to the NTF.
PTX7-021507v1 22 MuniServices City
ADDITIONAL CONSULTING
City may request that MuniServices provide additional consulting services at any time during
the term of the Agreement to which this Addendum is attached. if MuniServices and City agree
on the scope of the additional consulting services requested, then MuniServices shall provide
the additional consulting on a Time and Materials basis. Depending on the personnel assigned
to perform the work, MuniServices' standard hourly rates range from $75 per hour to $300 per
hour.
These additional consulting services will be invoiced no less frequently than monthly based on
actual time and expenses incurred.
All reimbursable expenses shall receive prior approval from the City and shall be reimbursed at
cost to MuniServices.
CITY OBLIGATIONS
MuniServices shall invoice City for the above fee on no less frequently than a quarterly basis,
based on recoveries actually received by City. Because MuniServices' Tax Compliance Service
may result in collection of deficiencies after termination of the Agreement, City's obligation to
collect fees and notify MuniServices, and MuniServices' right to continue to receive payment,
shall survive termination of t1ds Addendum or the Agreement for any reason.
PTXI-021507v1 23 Muni5emices City
h l�l•�_�r
Each party is signing this Addendum on the date set forth in the introductory clause of the
Consultant Services Agreement to which this Addendum is attached.
MuniServices, LLC City of Palm Springs
A Municipal Corporation
BY: By:
Marc Herman
Title: President and CEO Title:
ATTEST:
By:
Kevin Cerutti City Clerk
Title: Chief Financial Officer
APPROVED AS TO FORM: APPROVED AS TO FFOO�RM/1:
,lJni� �I/�✓
Eric Myers,General Counsel ty Attorney
PTX1-021507v1 24 MuniServices Cihj
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SALESIUSE TAX ANALYSIS &REPORTING SERVICE(STARS)ADDENDUM
OBJECTIVES AND METHODS
MuniServices' STARS Digest provides a summary that features a general analysis regarding
statewide trends that may affect the City's sales tax plus a specific analysis of the City's sales tax
composition, changes and performance. Report graphically illustrates the data and analysis
presented in the Summary. Each MuniServices STARS Digest includes the Quarterly
Management Summary, The MuniServices STARS Digest also includes specialized reports that
provide analysis of the City's sales tax economic base and performance for the latest complete
quarter and benchmark year.
TIMING&REPORTS
MuniServices shall:
❑ Provide the City with quarterly updated STARS Digests.
❑ Install the STARS Query System on a City designated PC
❑ Update quarterly the City's sales tax registration and allocation data from the
State Board of Equalization (SBE) from MuniServices' proprietary STARS
Query System on ISM compatible PCs with Microsoft Access export capacity.
(note:STARS is provided in encrypted formats)
❑ Train authorized City staff in the use of the STARS Query System.
QUARTERLY STARS DIGEST
MuniServices will provide the City with quarterly updated bound STARS Digests including
accounts from which the City receives sales tax revenue. The primary reports included in the
STARS Digest are:
❑ Allocation Summary- Reconciles SBE advances, cleanup payments and pool
allocations with budget projections to assist the City with revenue forecasting
and receipt monitoring.
❑ Cash Analysis - Quarterly aberrations due to SBE audits, fund transfers, and
other causes are also identified and analyzed for budget planning and
revenue forecasting purposes.
❑ Top 100 Five-Year - Historical performance of the top 100 accounts
comparing current benchmark year ranking and sales tax produced with that
of prior years.
❑ Top 100 Detail - Sales tax performance of the City's top 100 sales tax
accounts is shown in order of sales tax produced with the results for the most
recent five quarters prominently displayed. The proportion of City sales tax
produced is also shown by each account
STARS-037.807vl 17 Mumservices Ciiij
❑ Economic Category Performance - An analysis of the changes that occurred
by economic category and segment with the specific businesses responsible
for the significant changes delineated.
❑ Significant Change Analysis - A report reflecting magnitude of change,
indicating which key businesses grew or declined, measured in absolute
dollars and percentages.
❑ Business Code Classification -This report shows the various business codes
assigned by the SBE and the accounts assigned those codes in order of sales
tax produced. Five quarters of sales tax data are shown for each significant
account.
❑ Historical Economic Composition - Data are summarized by economic
category and segment by quarters and benchmark years. Percentage of total
sales tax generated by each category and segment is also shown to indicate
trends in sales tax composition as well as performance-
0 Geo-Area Reports - Tracks sales tax performance within designated areas of
the City (e.g., key shopping centers, business parks, and downtown
/business districts,). Charts and printed reports are included for each geo-
area.
❑ Cross-Reference Reports - These reports allow the user to look up any
account shown in the STARS Digest by name,address or account number.
STARS QUERY SYSTEM
MuniServices shall install the STARS Query System (a software program) on a
City designated, IBM-compatible PC. Each quarter, MuiuServices shall provide the City with
updated information from SBE on CD-ROM. The data shall be provided in an encrypted format
allowing the City to export sales tax information from the Query System in an Access-
compatible format.
❑ The Query System enables City staff to analyze the contribution of sales/use
tax revenue from each taxpayer in the City on an individual, grouped or
sorted-order basis by business name, business type, permit number, size
ranking, street address, development, shopping center or other geographic
area. Reports may be generated by any year (i.e., calendar, fiscal,
benchmark) or for any particular quarter for all periods stored in the
historical database.
The initial STARS Digest and Sales Tax Query System shall be delivered and installed within 45
working days following receipt of a hilly executed contract, confidentiality resolution and the
SBE sales tax registration and payment data. Subsequent quarterly Query System updates and
STARS reports will be delivered to the City within 30 days following receipt of the quarterly
distribution reports from the SBE.
STARS-0328070 18 MuuiSeruices City
COMPENSATION
The STARS Digest and Query System are available for an mutual fixed fee of$5,200 per year,
paid 51,300 quarterly through December 31, 2006. For 2007 the annual fixed fee is $5,408, paid
$1,352 quarterly through December 31, 2007. The Annual Fee thereafter is adjusted at the
beginning of each calendar year by the percentage change in the Consumer Price Index -West
Urban (CPI-WU) as reported by the Bureau of Labor Statistics. The adjustments are based on
the CPI-WU from the last month of the prior calendar year. Each Annual Fee adjustment shall
not be less than four percent(4%) or greater than ten percent(10%).
Total fee payable for the services to be performed under this Addendum will be a not-to-exceed
amount of $17,900 (the "NTE"). If Consultant determines that within 60 days the services
provided under this Addendum will result in invoices in excess of the NTE, Consultant shall
notify City's Finance Director. At Consultant's request, the parties shall negotiate an increase in
the NTE. If the parties reach agreement on the increased NTE, City shall enter into an
amendment to this Agreement increasing the NTE. If Consultant has invoiced amounts that
cumulatively equal the NTE, Consultant has no obligation to continue to perform under this
Agreement.
LICENSE AGRF.EMI3NT
The STARS Query System is licensed software provided by MuniServices. The terms and
conditions of the STARS Query System License Agreement are provided to City upon
installation. By installing and using the STARS Query System, City agrees to be bound by the
terms of the License Agrecment.
STAR5-032807v1 19 MImiServices Cihj
Each party is signing this Addendum on the date seL forth in the introductory clause of the
Consultant Services Agreement to which this Addendum is attached.
MuniServices,LLC City of Palm Springs
a municipal corporation
By: By:
Marc Herman
Title: President and CEO Title:
ATTEST:
By:
Kevin Cerutti City Clerk
Title: Chief Financial Officer
APPROVED AS TO FORM: APPROVED AS WFO
'
Z 'Ll
Eric Myers, General Counsel I Attomey
STARS-032807i11 20 MuniseTvices City
SALES AND USE TAX AUDIT (SUTA) ADDENDUM
OBJECTIVES ANO METHOI)S
MuniServices's Sales and Use Tax Audit Service is designed to maximize the City's income -
Enid minimize the cost of lost revenue - by detecting and documenting misallocation of Local
District Tax (also knows as Transactions & Use Tax), Bradley-Burns sales tax and local use tax
activity within the statute of limitations on recoverability.
In performing the sales and use tax audit program MuniServices shall:
Q Identify and correct the sales/use tax reporting errors of businesses that, based on the
nexus of their activities, are not properly registered with the City.
❑ Identify and correct the reporting of businesses that are improperly reporting tax to state
and county pools (i.e. classifying sales tax as use tax) and thereby depriving the City of
sales tax revenue.
❑ Detect, document and correct sales/use tax reporting errors/omissions and thereby
generate new,previously unrealized revenue for the City.
❑ Ensure through comprehensive audit measures that the revenue information used for
ongoing economic analysis includes all sales/usc tax generators.
❑ Assist the City with strategies to preserve and even enhance sales and use tax revenue
generated by existing businesses within the City.
MuniServices's proposed sales/use tax allocation audit services for the City includes five
distinct types of audits:
0 Taxable Nexus Field audits
❑ Permitization audits
Q Deficiency assessment audits
❑ Accounts payable audits
0 Quarterly Distribution Report audits
TAXABLE NEXUS FIELD AUDITS
MuniServices's initial and periodic taxable nexus field audits include a physical canvassing and
evaluation of sales/use tax generating businesses located in the City. In the absence of this
undertaking, significant misallocation will remain undetected. MuniServices's field audits
focus on those businesses located in the City from which the City has not been receiving
sales/use tax revenue. The result is new or'found' revenue for the City.
PERMITIZATION AUDITS
Wholesalers, contractors, processors, manufacturers and other non-retail businesses will
frequently not have a sales tax permit properly registered to the City in which they are located
SUTAI-032807vl 10 MieniServires City
because their business operations do not include a point-of-sale qualifying activity. However,
these companies will often generate local sales/use tax from the State Board of Equalization
(SBE) audit deficiency assessments, occasional sales (i.e., mergers and acquisitions), and self-
accrual of use tax on purchases. MuniServices's field audits facilitate the identification and
correction of improperly registered permits for companies having point-of-sale operations in
the City.
DEFICIENCY ASSESSMENT AUDI1 S
When the California SBE audits taxpayers for sales/use tax compliance, it is not uncommon for
the taxpayer to receive a substantial deficiency assessment due to underpayments and/or
under-collections. In many cases, the local allocation portion of the deficiency assessment is
distributed in error to the State pool, county pools, or other jurisdictions. Accordingly,
MuniServices has developed proprietary criteria and techniques to detect and correct SBE
deficiency assessment misallocation and thus expand the benefits produced by MuniServices's
allocation audit service.
ACCOUNTS PAYABLE AUDITS
When California taxpayers purchase tangible personal property for which title passes out-of-
state, the transactions are subject to use tax (rather than sales tax) which is collected by the
vendor who in turn remits it to the SBE, with the local allocation typically distributed statewide
or countywide through the pools.
Under certain conditions, the seller may allocate the local tax by sites or the City may elect to
self-accrue the use tax and remit it directly to the SBE,in which case the local portion will come
back to the City in the same manner as sales tax.
MuniServices's accounts payable audit will include a review of the City's purchases to identify
opportunities for the City to capture the 1% local allocation on purchases subject to use tax and
the local district tax where applicable. In this regard, MuniServices will prepare the
documentation to facilitate the election, including assistance in preparing and filing the tax
returns.
QUARTERLY DIS fRIBUTION REPORT AUDITS
Every three months, the City and MuniServices receive a Quarterly Distribution Report(QDR)
from the SBE with the local allocation amount reflected by permit number.
MuniServices's QDR audits detect and correct taxpayer-reporting errors and thereby generate
new, previously unrealized sales/use tax revenue for the City. MuniServices's QDR audits
focus on those accounts where MuniServices observes a substantial decline in the sales/use tax
revenue allocation for a particular business entity in a given quarter. In most cases, accounts
showing zero balances have either relocated or simply reported late, in which case the
payments will not be reflected until the next quarter's QDR. Therefore, six months must lapse
before the QDRs indicate whether a zero balance account can be attributed to a late payment or
a misallocation.
Cities and counties may only recover misallocated Bradley-Burns sales tax revenue for three
quarters prior to the SBE being notified of the reporting error and misallocated District tax
revenues for between three quarters and three years. Therefore QDR audits must be conducted
SUTA1-032307v1 II MuniSdrvices City
in a timely manner in order to preserve the opportunity for the City to recover misallocated
revenue. MuniServices shall conduct the QDR audit each and every quarter to minimize the
potential of los L revenue to the City.
SUTA DETECTION AND DOCUMENTATION
MuniServices shall represent the City for purposes of examining SBE records pertaining to sales
and use Lax to identify errors and omissions. MuniServices's procedures for detecting and
documenting misallocation are as follows:
❑ review applicable provisions of the City's municipal code and ordinance adopted by
the City to determine applicability.
❑ Procure a computer tape of sales/use tax permit records from the SBE.
❑ Analyze sales tax distribution reports provided by the SBE for five or more of the
most recent consecutive quarters.
❑ Clean-up, standardize and computerize data from City's quarterly sales tax
distribution reports provided by SSE for previous quarters,current quarter and each
future quarter service is provided.
❑ Prepare an aggregated list of business entities on electronic media;this list is derived
from multiple private and public sources (hard copy and electronic), including
specialized business listings and directories, the City's sales and use tax payment
files, and an electronic copy of the City's Business License Tax registry, updated no
less than twice per year.
❑ Clean, standardize and integrate, in address-order, each entity's business name,
address and payment File information, to eliminate redundancies, using
MuniServices's proprietary software.
❑ Physically canvas commercial/industrial area within the City's borders.
❑ Develop a target list of potential point of sale/use reporting errors/omissions based
on:
1) An electronic comparison of MuniServices's comprehensive inventory against the
SBFs quarterly distributions for the City, and
2) An analysis of each potentially misalhocated account based on proprietary
guidelines established by MuniServices.
❑ Meet with designated City official(s) to review service objectives and scope,
MuniServices workplan schedule,public relations and logistical matters.
❑ Contact persomlel in sales, operations and/or tax accounting at each target business
to determine whether a point-of-sale/use reporting error exists. (Note: this is
accomplished with the highest regard to discretion and professional conduct.
MuniServices's allocation audits are predicated on a non-controversial, constructive
public relations approach which emphasizes the importance of each business to the
City and the mutual benefits of correcting reporting errors.)
SUTAI-032807vl 12 MuniServices City
❑ Provide to the City and SBE reports addressing each taxpayer reporting error
individually, including the business name, address, telephone number, California
sales tax permit number,individuals contacted,date(s) of contact,nature of business,
reason(s) for error, recommended corrective procedure and, if available, estimated
sales/use tax revenue which should be forthcoming to the City.
❑ MuniServices may also provide suggested language for letters to be sent to the
taxpayers and/or SBE from the City (or from MuniServices on behalf of the City)
urging cooperation in promptly correcting the distribution error.
❑ Respond to negative findings by SBE with timely reconfirmation documentation in
order to preserve the City's original dales of knowledge.
❑ Receive and process registration control record information monthly.
0 Receive and process sales tax dish ibution reports quarterly.
❑ Coordinate with the taxpayer and SBE to make the necessary corrections and collect
eligible back quarters amounts.
0 Monitor and analyze the quarterly distribution reports with an audit focus on the
following:
1) Accounts with previously reported point-of-sale/use distribution errors to
ensure that the corrections are made for current quarters and all eligible back
quarters.
2) Major accounts comprising 90% or more of the City's total sales tax revenue to
identify any irregularities or unusual deviations from the normal pattern (e.g.
negative fund transfers, significant decreases, unusual increases,etc.) and ensure
that the City is not receiving less revenue than it is entitled to.
3) Those accounts receiving deficiency assessments to ensure that the City receives
its local allocation
❑ Identify opportunities for the City to recover local allocation on purchase
transactions subject to use tax. MuniServices will prepare the necessary
documentation to facilitate recovery, including assistance in preparing and filing the
returns.
SUTA D ETEC1ION TIMING CONSIDERATIONS
For each misallocated account detected, MunuServices will coordinate with the business and
SBE to make the necessary corrections plus retroactive adjustments for eligible amounts of
sales/use tax improperly distributed in prior quarters. MuniServices coordinates and
communicates between typically four parties;sales/operations personnel at the taxpayer's local
operation, tax personnel at the company's corpora Le headquarters, and SSE personnel and the
in-state/out-of-state district offices. Correction of the account is considered to have been made
once the payments on identified taxpayer accounts are being properly allocated by the taxpayer
to the City in the period in which the payment was made.
SUTAI-032807v1 13 MuniSaroices City
As needed, MuniServices will represent the City before state officials, boards,commissions and
committees for the purpose of correcting sales tax distribution errors that have deprived the
City of revenue to which it is entitled.
TINTING
MuniServices shall commence auditing the sales/use tax and preparing the sales tax Query
System on July 1, 2006. The Confidentiality Resolution designating MuniServices as the
authorized City Consultant to examine sales and use tax records was previously signed by the
City Council.
CONr•I V ENTIALITY PROVISIONS
MuniServices is authorized by this Agreement to examine district tax, sales tax and use tax
records of the SBE provided to City pursuant to contract under the Bradley-Burns Uniform
Sales and Use Tax Law and California Revenue iir f axation Code applicable to transactions and
use taxes.
MuniServices is required to disclose information contained in, or derived from, those sales and
use tax records only to an officer or employee of the City who is authorized by resolution to
examine the information.
MuniServices is prohibited from performing consulting services for a retailer during the term of
this Agreement.
MuniServices is prohibited from retaining the information contained in, or derived from, those
sales and use tax records, after this Agreement has expired.
This Agreement, and MuniServices's and CITY's obligations with respect to confidentiality of
taxpayer data pursuant to the Bradley Burns Revenue and Taxation Code, shall continue until
final payment for all services rendered hereunder.
SUTA COMPENSATION
MuniServices's compensation for the Sales and Use Tax Audit Service is a 25% contingency fee.
This fee applies to revenue received for six quarters beginning with the quarter in which the
Date of Correction falls and all eligible prior quarters back to and including the three quarters
prior to the Date of Knowledge quarter for Bradley-Bums sales tax revenues and all eligible
prior quarters back to and including all corrected quarters prior to the Date of Knowledge
quarter for district tax revenues. As used herein, the Date of Knowledge is the quarter during
which MuniServices notifies the SBE of the existence of a misallocation. As used herein, the
Date of Correction refers to the quarter in which the taxpayer has correctly reported the local
tax and the SBE distributes the local tax properly to City based on the taxpayer's reporting.. For
QDR Misallocations detected and corrected, MuniServices's compensation shall only include
the quarters in which the misallocation actually occurred.
The total fee payable for the Services to be performed under this Addendum will be a not-to-
exceed amount of eighty-five thousand dollars ($85,000) (the "NTE"). If Consultant determines
that within 60 days the services provided under tius Addendum will result in invoices in excess
of the NTE, Consultant shall notify City's finance Director. At Consultant's request,the parties
SUTAI-032807v1 14 MuniServices City
shall negotiate an increase in the NTE. If the parties reach agreement on the increased NTE,
City shall enter into an amendment to this Agreement increasing the NTE. If Consultant has
invoiced amounts that cumulatively equal the NTE, Consultant has no obligation to continue to
perform under this Agreement. Notwithstanding the foregoing, the fees paid after the
termination of this Addendum are not subject to the NTE.
Consultant and City entered into a prior SUTA Agreement, on July 7 2004 (the "Prior
Contract"). The Prior Contract ended on June 30,2006.
Notwithstanding any other provisions of this Addendum, or the Agreement to which it is
attached, all accounts with a Date of Knowledge on or before June 30, 2006, are compensated
under the terms of the Prior Contract and are not subject to the NTH in this Agreement.
Accounts with a Date of Knowledge on or after July 1, 2006, are compensated Imder this
Addendum.
ADDITIONAL CONSULTING
City may request that MuniServices provide additional consulting services at any time during
term of the Agreement to which this addendum is attached. If MuniServices and City agree on
the scope of the additional consulting services requested, Olen MulServices shall provide the
additional consulting services on a Time and Materials basis. Depending on the personnel
assigned to perform the work, MuniServices's standard hourly rates range from$75 per hour to
$300 per hour.
These additional consulting services will be invoiced no less frequently than monthly based on
actual time and expenses incurred.
CITY RESPONSIBILITIES
MuniServices's services performed hereunder may result in corrections of misallocations after
cessation of services by MurdServices for City. Therefore, City agrees that with regards to
misallocations identified to the SSE whose Date of Knowledge occurred during MuniServices's
performance of services for City, that City's obligation to pay MuniServices in accordance with
the above compensation language shall survive expiration or termination of this Agreement for
any reason.
In the event that City identifies, documents, and notifies the SBL of a reporting error or
misallocation as those terms are used herein, City agrees to notify MuniServices of City's
discovery no later than ten (10) days after the Date of Knowledge. If City fails to so notify
MuniServices and MuniServices later detects, documents, and reports the misallocation or
reporting error to the SBE, or if MuniServices has established a Date of Knowledge with the SBE
prior to notification to the Board by City, then MuniServices shall be entitled to compensation
for the affected account in accordance with this Addendum.
SUTk1-032307vl 15 MuniSeruices Cihj
Z.
C,r
COMPLETION OF SERVICES
Notwithstanding any other provision of this Agreement, because Consultant's services
performed hereunder result in corrections of misallocation and other revenue after cessation of
services by Consultant for City, City agrees that with regards to misallocation identified to the
SSE whose Date of Knowledge occurred during Consultant's performance of services for City
or for other revenue resulting from Consultant's actions taken during the term of this
Agreement, that City's obligation to pay Consultant in accordance with the compensation
language of this Agreement shall survive expiration or termination of this Agreement for any
reason. Additionally,notwithstanding any other provision of this Agreement,if this Agreement
is terminated or expires, Consultant shall continue to pursue corrections of accounts identified
during the term of this Agreement that have not been corrected by the SBE as of the effective
date of termination or expiration. The period after termination during which Consultant is
pursuing correction of accounts identified before termination is referred to as the "completion
period." City shall compensate Consultant in accordance with the compensation language of
this Agreement for corrected misallocations that result from Consultant's efforts during the
completion period. City will also take all necessary steps to allow Consultant to continue to
receive the required information from the SSE during this completion period.
Each party is signing this Addendum on the date set forth in the introductory clause of the
Consultant Services Agreement to which this Addendum is attached.
MuniServices, LLC City of Palm Springs
a municipal corporation
By: By:
Marc Ferman
Title: President and CEO Title:
ATTEST:
By
Kevin Cerutti City Clerk
Title: Chief Financial Officer
APPROVTD AS TO FORM: APPROVED AS TO RM:
Z"
Z -
Eric Myers,General Counsel IVAtto ey
SUT71Y-032807vl 16 1vumServices City