HomeMy WebLinkAbout03146 - MUNICIPAL RESOURCE CONSULTANTS BUSINESS LICENSE SOFTWARE SYSTEM � - -
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Document V: A3,146 F (Group: FIN2,NCC -- ---- I f�C'IiN�B
Document
- I - Deserlptlen: Sales Tax.audR&Services(Dba M B 1 A). Financials
Approval Date: D902n992 F�[pire.6ate: 09N1N993 Clas'e[ICliYle: 11
V -` Owed: 0,00 ,
Company, rAuoypnl Resource Causal[ XPef; FINANCE paid: 0,00
Contact: Dear Mr.T.Austin " ph: (615)991-5220 Ext:
_ Address: 02107 W.Llndero Canyon Road,Surte 233 Sal: - , $0.00
.- Address?:
Cihr. Westlake Village St: CA Zip: 91361 Collntly:
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• Municipal Resource Consultant
Amend-Bus License System &
Revenue Enhancement Program
AGREEMENT #3146
AMENDED CONSULTANT SERVICES AGREban 06661, 11-15-95
THIS AGREEMENT is made at Palm Springs, California, as of 1995,
by and between the City of Palm Springs, a municipal corporation (hereafter referred to
as `City") and Municipal Resource Consultants (hereafter referred to as "Consultant'
or "MRC"), who agree as follows:
1. Services. Subject to the terms and conditions set forth in this Agreement,
Consultant shall provide to City the services described in Exhibits "A", "B" and
(the "Exhibits".) Consultant shall provide said services at the time, place, and in the
manner specified in the Exhibits. Consultant shall not be compensated for services
outside the scope of the Exhibits.
2. Payment. City shall pay Consultant for services rendered pursuant to this
Agreement at the times and in the manner set forth in the Exhibits. The payments
specified in the Exhibits shall be the only payments to be made to Consultant for
services rendered pursuant to this Agreement, unless the City approves additional
compensation for additional service. Consultant shall submit all billings for services
rendered pursuant to this Agreement to City in the manner specified in the Exhibits.
3. Facilities and Equipment. Consultant shall, at its sole cost and expense,
furnish all facilities and equipment which may be required for furnishing services
pursuant to this Agreement, with the exception of the computer equipment specified in
the Exhibits.
4. Exhibits. All Exhibits referred to herein are attached hereto and are by this
reference incorporated herein.
EXECUTED as of the day and year first above stated.
ATTEST: CITY OF PALM SPRINGS
C4- U
By:
y Clerk
Date:
MUNICIPAL RESOURCE CONSULTANTS
PARTN . JOHN T. AU IN, INC.
By:
John T. Austin
T(tte: President
Date: October 9, 1995
BY
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EXHIBIT A
-BUSINESS LICENSE INF0R11ATION SERVICE
Municipal Resource Consultants (MRC) proposes to provide to the City of Palm Springs
(City) a Business License Information Service (BLIS) that is comprised of two individual
services: 1) a business inventory management service; and 2) an optional business
' license administration service. The objectives, scope, procedures, system requirements,
custom specifications, software license, timing, support and compensation are set forth
as follows:
1. BACKGROUND
In 1954 the state legislature enacted Revenue and Taxation Code Section 19556 1
requiring most California cities to furnish the state Franchise Tax Board (FTB)
specific business tax information each year. In this regard, Government Code
Section 17561 2 provides for reimbursement to cities for certain costs incurred
from state-mandated local programs; also known as SB 90 reimbursement
The FTB utilizes the cities' business community data to monitor compliance with
the State Income Tax, and Bank and Corporation Tax. This program has proven
to be successful in allowing the FTB to increase state revenue, but it has become
apparent to the FTB that there is a strong correlation between the quality and
frequency of the data received and the amount of the revenue that could be
r raised for the State. Furtherinore, research has shown that cities throughout
i California experience changes in their business base at an average rate exceeding
200% per year - due to business openings, closings, expansions, consolidations,
relocation, mergers, acquisitions and other events. Given this situation, a valid
listing of a ciVs businesses typically does not exist
As a result, much of the data received by the FTB is not of the desired quality,
frequently in the wrong format, missing important data (e.g. SIC codes), not
standardized as to address and name, includes closed businesses not purged
from city files, missing many new businesses and it is received only once a year.
f Revenue and Taxation Code Section 19556 requires any California city which maintains or has access
to a computerized recordkeeping system, and which assesses a business tax, to annually furnish the
Franchise Tax Board specified business tax information on all businesses subject to the tax in the
preceding fiscal year. The Government Code further specifies that access to the business tax
information is to be kept confidential and shall be disclosed only to the FTS.
2 Government Code Section 17561 provides for the State Controller's Office to reimburse cities for
certain cost incurred for state-mandated local programs. City-incurred costs that are eligible for such
reimbursement include administrative, operational and related costs which are reasonably necessary to
implement and maintain an FTB compliance program. This includes Costs for staff, independent
consultants, automated and manual system modifications, data collection and reasonable allocation of
overhead expenses.
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MRC's BLIS business inventory management service creates and maintains a
comprehensive and valid inventory of current businesses operating within the
City's boundaries. The inventory is created by combining MRC's geobased data
integration technology, which extracts relevant business data from a large
variety of data sources (including the City's existing business license records),
and physical canvassing of the City which captures those firms that elude
electronic data sources. The combined data is corrected, standardized and
enhanced (e.g. business name, address, SIC code) and formatted according to
FTB requirements. Each month the data is updated and delivered to the FTB
and the City. The business inventory provided to the City is placed on a
1 personal computer designated by the City and is accessible through MRC's
1 proprietary compliance software.
The optional BLIS business license administration service provides the City with
MRC's proprietary business license administration software. This service greatly
increases the efficiency of the registration, renewal, billing, collection, data entry
1 and overall administration of a city's business license operation. It is adaptable
1 to existing business license forms, is compatible with all standard accounting
packages and can operate through most computer systems or platforms. BLIS is
eligible for State reimbursement
2. OBJECTIVES
MRC's BLIS is designed to assist the City achieve the following objectives:
❑ Build and Maintain an :Accurate Business Inventory
❑ Produce State-Mandated Business Tax Information that Qualifies for State
1 Reimbursement
1 ❑ Increase License Registration and Renewal Efficiency (optional service)
❑ Reduce Data Entry Errors, Processing Time"and Costs (optional service)
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3. SCOPE OF SERVICE
MRC shall provide the City with a Business License Information Service which
includes:
❑ Creation and maintenance of a comprehensive and valid inventory of the
City's businesses that is continuously updated
❑ Monthly progress reports to the City on the status of the business
- inventory which shall include the current business inventory
❑ Production of business inventory data on appropriate media and in
appropriate format provided to meet the mandate reporting deadline of
IMarch 31 each year
❑ License to use MRC's proprietary business inventory management
software
❑ License to use MRC's proprietary business license administration software
I ❑ Ongoing software upgrades, training and support
❑ Assistance with Franchise Tax Board (FTB) reporting and SB 90
? reimbursement claims
4. PROCEDURES
MRC responsibilities:
❑ Review the City's business license tax ordinance for enforceability,
coverage, billing and collection efficiency
❑ Review the City's business license forms for opportunities to simplify
taxpayer reporting, capture economic development data (number of
employees, building space, etc.) and FIB-mandated information, and
increase processing efficiency
❑ Secure from the City on electronic media a current listing of all businesses
registered with the City, and convert'the data to a BLIS-readable format
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❑ Develop and maintain it computerized inventory of businesses operating
in the City by:
o Physically canvassing every street and commercial/industrial
facility within the City's borders
o Preparing an aggregated list of business entities on electronic
I media; this list is derived from multiple private and public hard
copy and electronic sources, including specialized business listings
and directories, and the Citt's business tax and other confidential
irevenue payment files
o Cleaning and standardizing, in address-order, each entity's
business name, address, and payment file information to eliminate
redundancies
❑ Provide monthly data cleaning, standardization and multiple source
Iintegration using MR(C's proprietary software for compliance and
enforcement
❑ Install the BLIS software, provide ongoing software upgrades, training
and support
❑ Assist City and/or the City's consultant in preparing the claim for state
reimbursement by providing the substantiating documentation and
rationale to support the SB 90 claim and represent same with the FTB and
the State Controller's Office
City staff responsibilities:
❑ Establish a record for each registered business to include FEB-mandated
information;
❑ Each month provide b4RC with a current listing of all businesses
registered with the City on electronic media;
❑ Submit to the appropriate State agency an estimated claim for BLIS
reimbursement by the deadline for submitting estimated claims for
compliance with State mandates each year (November 30 of the fiscal year
in which the expense is incurred, or other deadline as may be established
by the State); and
❑ Submit to the appropriate State agency a claim for actual expenses
incurred for BLIS by the deadline for submitting claims for
reimbursement of State mandated local programs (November 30
following the fiscal year in which the expense is incurred, or other
deadline as may be established by the State).
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5. SYSTEM REQUIREMENTS ///4
The BLIS software component requires the following hardware:
I o Any 486 based IBM or compatible PC with 4 DRIB RAM
o Hard disk with a minimum free space of 1 MB per 1,000 licenses
0 3.5" disk drive (1.44 MB)
0 SVGA or VGA monitor
lo Parallel (Centronics compatible) printer interface
o Any Centronics-compatible parallel printer
0 Modem (min. 14.4 baud rate 28.8 preferred) and dedicated
telephone line
Software required includes:
o MS or PC DOS version 5.0 or later
o Communications software for the modem (PC Anywhere
recommended)
- o Word processing software with mail merge capability, i.e.,
WordPerfect, Microsoft Word, etc. for optional business license
administration service
Should the City desire, MRC will assist in evaluating and procuring the necessary
hardware and/or software.
6. CUSTOM SPECIFICATIONS
The BLIS business license administration software can be customized to fit the City's
specific needs. The basic software includes the required state-mandated fields, state
tax report and standard revenue reports. Additional fields, reports and other
detailed specifications can be added on a pre-quoted time and materials basis.
7. SOFTWARE LICENSE, TIMING AND SUPPORT
BLIS includes the attached software license and maintenance agreement (see
Attachment A-1).
Within 45 Forking days of contract authorization and receipt of necessary
information, MRC shall:
❑ Install BLIS software on City hardware
❑ Provide staff with up to 16 hours of training with easy-to-use operating
manuals
MRC shall also provide ongoing software and documentation upgrades, data
updates, and up to 12 hours of annual support onsite or remotely by telephone
and/or modem on an as-needed basis.
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8. COMPENSATION
Pursuant to Government Code Section 17561, MRC's fees for BLIS are eligible for
reimbursement by the State. To make BLIS entirely self-funding for the City,
MRC's compensation is payable only after MRC has installed the BLIS soft ware
on City computer system, has trained Cih, personnel on the use of the software,
has produced the business license inventory in the appropriate format and on
appropriate media and delivered same to the FTB to meet the State reporting
mandate, and the City has been paid on its estimated claim for State
_ reimbursement for BLIS. MRC's fee for BLIS is due within ten days thereafter.
In the event that the State Controllef s office should make incremental payments
to the City for its SB 90 claim, the amount due MRC from each payment shall be
in proportion to the cost of BI.IS as it relates to the total amount of the CiVs
business license mandate claim. If the State does not fully reimburse the City for
BLIS, the amount not reimbursed is not due MRC until the State has reimbursed
it to the City.
The annual Business Inventory Management Service is provided for a fee of
$57,718, and the optional Business License Administration Service shall be provided
for a one-time fee of$15,000, and an annual maintenance fee of$2,000 starting in the
second year.
MRC shall assist the City and/or the Cih11s consultant in preparing the necessary
claim for state reimbursement by providing the substantiating documentation,
rationale, and cost breakdown to support the SB 90 claim and represent same
with the FTB and the State Controller's Office.
9. AUTHORIZATION
The City of Palm Springs hereby authorizes MRC to provide the following BLIS
service(s):
Business Inventory Management Service
Business License Administration Service (Optional) ❑ Authorized
❑ Not Authorized
EXECUTED as of this day
CITY OF PALM SPRINGS MUNICIPAL RESOURCE CONSULTANTS
PARTN • •JOHN T. A /TIN/Zc.
BY: By/
Title: Title: / President
Date: Date: October 9, 1995 0
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Attachment A-1
LICENSING AGREEMENT
for
BUSINESS LICENSE INFORMATION SERVICE (BLIS)
This Agreement is made at Palm Springs, California, as of 1995, by and
between the City of Palm Springs, a municipal corporation (hereafter referred to as
"City") and Municipal Resource Corisultants (hereafter referred to as "MRC"), who
{ agree as follows:
{ 1. License. Subject to the terms ,and conditions set forth in this Agreement, MRC
shall provide to the City a license to use MRC's software, database, and other
property (hereafter referred to as "Property") as further described in
Exhibit"A". MRC shall provide said Property at the time, place, and in the
_ manner specified in Exhibit "A". MRC shall not be compensated for property
outside the scope of Exhibit"A".
1 Restrictions. Said Property shall only be used by the City. The City shall not
sublet, duplicate, or modifZl said Property. Said Property may only be used for
the purposes described in Exhibit "A". Said Property shall be returned to MRC
at the time the license expires. 14RC may terminate the license, at its sole option,
if City violates any of the stated restrictions. The Property remains the sole and
exclusive property of MRC.
The license granted hereunder shall not imply ownership by City of said
Property, rights of City to sell said Property, or rights to use said Property for
the benefits of others. This License is transferable only with MRC's written
consent
3. Payment. City shall pay MRC for license rendered pursuant to this Agreement
at the times and in the manner set forth in Exhibit"A". The payments specified
in Exhibit "A" shall be the only payments to be made to MRC for license
rendered pursuant to this agreement, unless the City approves additional
compensation for additional property.' MRC shall submit all billings for license
rendered pursuant to this Agreement to City in the manner specified in
Exhibit"A".
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4. Attachments and Exhibits. All Attachments and Exhibits referred to herein are
appended hereto and are by this reference incorporated herein.
5. Proprietary Information. As used herein, the term "proprietary information'
means any information which relates to internal controls, computer, or data
processing programs; data that has been modified by MRC proprietary
techniques resulting in standardized, specifically correlated, or integrated
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information; electronic data processing applications, routines, subroutines,
techniques, or systems; or business affairs and methods of operation or
proposed methods of operation of MRC, except such information which is not
obtained through this Agreement or which is in the public domain at the time of
its disclosure to the other party. City shall hold in confidence using levels of
effort consistent with its own policies applicable to its confidential information
and shall not disclose to any other party any MRC proprietary information (as
such term is herein defined) which may be disclosed to City by MRC in
connection with this Agreement or otherwise learned or obtained by City in
connection with this Agreement,. The parties further agree not to take any other
action inconsistent with the confidential nature of MRC proprietary information.
The obligations imposed by this Paragraph shall survive any expiration or
termination of this Agreement.
6. Waiver. No waiver of any breach or failure or delay in exercising any right,
power, or remedy shall constitute a waiver of same or of any provision hereof
and no waiver shall be effective unless in writing and signed by an authorized
representative of the party against whom enforcement of such waiver is sought.
7. Severability. The provisions of this Agreement are severable, and the
unenforceability of any provision of this Agreement shall not affect the
enforceabilih, of this Agreement or any other provision hereof. In addition, in
the event that any provision of this Agreement is determined by a court to be
unenforceable as drafted, the parties acknowledge that it is their intention that
such provision be construed in a manner designed'to effectuate the purposes of
such provision to the fullest extent enforceable under applicable law.
8. Taxes. City shall be responsible for the payment of any applicable taxes in
connection with the Agreement, except for any tax based on MRC's net income.
9. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of California. Any controversy or claim
arising out of or relating to this Agreement, or the breach thereof, shall be settled
by arbitration in accordance with the Commercial Arbitration Rules of the
American Arbitration Association, and judgment upon the award rendered by
the Arbitrator(s) may be entered in any court having jurisdiction hereof.
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1 10. Remedies Cumulative. All remedies in this Agreement are cumulative and in
addition to and not in lieu of, any other remedies a party may have at law or in
equity.
11. Entire Agreement This Agreement and the Exhibits hereto, which is hereby
incorporated herein by reference, shall constitute the entire agreement between
City and MR(t with respect to its subject matter, shall supersede all prior
agreements and understandings, if any, between the parties respecting the
subject matter hereof and may be modified only by written agreement of the
parties.
EXECUTED as of the day and year first above stated.
CITY OF PALM SPRINGS
By:
Title:
Date:
MUNICIPAL RESOURCE CONTSULTANTS
PARTNE • JOHN T. AUSTIN, INC.
By:
John T. Austin
Title: President
Date: October 9, 1995
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EXHIBIT B
REVENUE ENHANCEMENT AUDIT PROGRAM
Municipal Resource Consultants (MRC) presently provides to the City of Palm Springs
(City) a Revenue Enhancement Audit Program (REAP) to assist the City in realizing all
of the revenue to which it is entitled from sales/use tax, and agrees to amend the scope
to include documentary transfer tax, franchise fees, property tax (including RDA tax
increment) and transient occupancy tax. The purpose, scope, procedures, timing,
reports and compensation are set forth as follows:
1. BACKGROUND
Many California cities are not realizing all of the revenue to which they are
entitled from existing tax sources due to administrative errors and omissions by
businesses and third-party intermediaries (such as the state, counties, and utility
companies) responsible for collecting the revenue and remitting it to the cities.
Administrative errors and omissions are inevitable given the non-standard,
complex nature of state and local taxes with regard to applicability, rates,
exceptions, exemptions, quirks and inconsistencies. Rapidly changing
technology, deregulation, hurnan fallibility, fragmented responsibilities and
employee turnover further compound the problem.
Because there are time limitations on a government agencv's ability to recover
revenue to which it has been deprived, it behooves the City to have revenue
enhancement audits conducted as thoroughly and rapidly as possible.
2. PURPOSE & SCOPE
The purpose of MRC's revenue enhancement audits is to assist the City in
recovering all of the revenue to which it is entitled from the following sources:
❑ Documentary Transfer Tax
❑ Franchise Fees
❑ Property Tax (including RDA tax increment)
❑ Transient Occupancy Tax
MRC's Revenue Enhancement Audit Program results in the detection,
documentation and correction of errors and omissions causing deficiencies and
thereby produces new revenue that would not otherwise have been realized by
the City.
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3. PROCEDURES
In providing the revenue enhancement audit service, MRC shall:
❑ Meet «-ith City's designated staff to review service objectives, scope,
workplan schedule, public relations and logistical matters; MRC will also
establish an appropriate liaison with the City's coordinator and logical
checkpoints for reviewing progress
_ Note: With the exception of this initial meeting, MRC's revenue
enhancement audit service requires minimal time and effort on the part of
City staff .
❑ Reviev,, applicable provisions of the Civs municipal code and ordinances
adopted by the City
❑ Represent the City for purposes of examining records pertaining to the
revenue sources listed above (see Section 2) to identify and confirm any
;1 errors/omissions that are resulting in deficient payment to the City
❑ 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)
❑ Prepare and forward to the appropriate parties "date of knowledge'
requests for corrective action and revenue recovery
❑ Meet with designated City official(s) as necessary to review our findings
and recommendations
❑ Provide additional assistance as necessary to support the City in
recovering and preventing tax deficiencies
MRC's detailed procedures for auditing each revenue source shall be provided
on request
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4. TIMING & REPORTS
MRC shall commence the revenue enhancement audits within 10 working days
of authorization with the objective of delivering the initial audit reports within
90 to 120 working days after receiving the necessary data. Thereafter, MRC shall
provide the City with audit progress reports to include, but not be limited to, the
following:
Cl Status of work in progress, including copies of reports provided to
taxpayers/intermediaries addressing each reporting error/omission
individually, including where applicable the business name, address,
telephone number, account identification number, individuals contacted,
date(s) of contact, nature of business, reason(s) for error/omission and
recommended corrective procedure
❑ Actual revenue produced for the City by MRC's service on a quarterly
and cumulative basis
❑ Projected revenue forthcoming to the City as a result of MRC's audit
service, specified according to source, timing and one-time versus
ongoing
❑ Alphabetical listing of all errors/omissions detected for the City by MRC
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.)
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5. COMPENSATION S EXPENSES
To make MRC's service self-funding for the City and its Redevelopment Agency
(Agency), MRC's compensation for providing the Revenue Enhancement Audit
Program (REAP) shall be entirely predicated and contingent upon the audit(s)
producing new revenue that would not otherwise have been realized by the
City/Agency.
Under this arrangement, the City/Agency agree(s) to pay MRC an amount equal
to 25% of the deficiency recoveries from eligible prior periods (plus associated
charges for penalties and interest). Said recoveries include amounts recovered,
refunded, credited, or any other consideration received by the City/Agency in
lieu or as a result of the audit findings. When MRC's audits result in the
detection and correction of errors/omissions that the City/Agency and l.IRC
mutually agree will produce ongoing (rather than one-time) benefits, MRC's
compensation shall be 25/6 of the incremental revenue realized by the
City/Agency during the first twelve consecutive quarters following correction.
In this regard, the City/Agency agree(s) to:
o Invoice the responsible party for tax deficiencies (plus associated charges
for penalties and interest) identified and confirmed by MRC within 30
days following receipt of MRC's report; and
o Notify MRC within 10 days following receipt by the City/Agency of
payments (cash payments, installment payments, or other compensation
directly benefiting the City/Agency) resulting from MRC's audit service.
Upon being notified of receipt of payment(s), NIRC will then invoice the
City/Agency. Earned compensation is due and payable upon receipt of
invoices.
All expenses incurred by MRC in providing the revenue enhancement audits
and information services are absorbed by MRC. These expenses include items
such as employee salaries and benefits, insurance, airfare, auto rentals, meals,
lodging, keypunching, computer processing, clerical meetings, telephone, mail,
etc.) photocopying, overhead and miscellaneous out-of-pockets for consumable
supplies and research materials such as maps, directories, etc.
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5.1 MRC AUDIT EFFICIENCY CREDITS
Efficiencies are realized by MRC from common tasks accomplished and data
developed in providing multiple revenue audit services and GRIP. In this
regard, MRC proposes to offer to the City, in the form of Audit Efficiency
Credits, an opportunity to reduce the compensation paid MRC as follows:
First Tier Audit Efficiency Credits - the City can qualify for First Tier
Audit Efficiency Credits if, in addition to BLIS, the City elects to utilize
MRC's REAP and GRIP services. This will provide a credit of $23,000,
` which may be used to reduce MRC earned compensation from REAP
and/or GRIP services for the period described below each year
commencing July 1, 1996.
Second Tier Efficiency Credits - the City can qualify for Second Tier
Audit Efficiency Credits if, in addition to BLIS, the City elects to utilize
MRC's REAP service (but not GRIP). 'This will provide a credit of$14,000,
which may be used to reduce MRC earned compensation from the REAP
service for the period described below each year commencing July 1,
1996.
In addition, to qualify for Audit Efficiency Credits, the City must
❑ Authorize MRC to proceed with the appropriate services for the Tier of Audit
Efficiency Credits sought;
❑ Submit to the appropriate State agency an estimated claim for BLIS
reimbursement by the deadline for submitting estimated claims for
compliance with State mandates each year (November 30 of the fiscal year in
which the expense is incurred, or other deadline as may be established by the
State); and
Cl Submit to the appropriate State agency a claim for actual expenses incurred
for BLIS by the deadline for submitting claims for reimbursement of State
mandated local programs (]November 30 following the fiscal year in which
the expense is incurred, or other deadline as may be established by the State).
Audit Efficiency Credits are granted July 1 of each year and are applied to MRC
billings between that July 1 and the following June 30 to reduce the amount due
MRC as earned compensation for providing REAP and/or GF-T services. Audit
Efficiency Credits may not be carried over beyond June 30 of any year.
As stated above, MRC's revenue audit and information services are being
3 provided as a package. Should the City elect to terminate any of the services
t provided by MRC, or should there be a fundamental change in the funding or
administration of any of the revenue sources subject to MRC services, or should
the State cease to mandate and/or fund the city business license reporting
program, the Compensation and Audit Efficiency Credits sections of the package
agreement would be subject to modification by mutual agreement of the City
and MRC.
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' 6. BACKSTOP AUDIT PROGRAMS
' MRC's revenue enhancement and information services described in this and the
following exhibit are to be provided on a self-funding basis without creating an
expenditure impact on the City's budget
Accordingly, if the City has an additional ("backstop") revenue enhancement
audit program (staffed by internal or external personnel), it is understood and
agreed that those personnel must detect and document in writing (on behalf of
tthe City) to the taxpayer and/or responsible intermediary (e.g., state, utility
company, etc.) each individual error/omission at least one full calendar quarter
prior to MRC doing so. Otherwise, MRC shall be entitled to receive
compensation for detecting and documenting any such error/omission which
has resulted in deficient payment to the City. For this purpose, the City and
MRC shall provide copies to each other of notices submitted to taxpayers and/or
intermediaries (state agencies, county, utility service providers, etc.).
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Municipal Resource Consultants
(MRC) - Sales Tax Audit &
Information Services
AGREEMENT #3146
M05076, 9-2-92
CONTRACT SERVICES AGREEMENT FOR
SALES TAX AUDIT & INFORMATION SERVICES
THIS CONTRACT SERVICES AGREEMENT (herein "Agreement") , is made
and entered into this 2nd day of September, 1992 by and between the
CITY OF PALM SPRINGS, a municipal corporation, (herein "City") and
Municipal Resource Consultants (MRC) (herein "Contractor") . The
parties hereto agree as follows:
1. 0 SERVICES OF CONTRACTOR
1. 1 Scope of Services. In compliance with all terms and
conditions of this Agreement, the Contractor shall provide those
services specified in the "Scope of Services" attached hereto as
Exhibit "A" and incorporated herein by this reference, which
services may be referred to herein as the "services" or "work"
hereunder. As a material inducement to the City entering into this
Agreement, Contractor represents and warrants that Contractor is a
provider of first class work and services and Contractor is
experienced in performing the work and services contemplated herein
and, in light of such status and experience, Contractor covenants
that it shall follow the highest professional standards in
performing the work and services required hereunder and that all
materials will be of good quality, fit for the purpose intended.
1. 2 Contractor's Proposal. The Scope of Services shall
include the Contractor's proposal or bid which shall be
incorporated herein by this reference as though fully set forth
herein. In the event of any inconsistency between the terms of
such proposal and this Agreement, the terms of this Agreement shall
govern.
1. 3 Compliance with Law. All services rendered
hereunder shall be provided in accordance with all ordinances,
resolutions, statutes, rules, and regulations of the City and any
Federal, State or local governmental agency having jurisdiction in
effect at the time service is rendered.
1. 4 Licenses, Permits, Fees and Assessments. Contractor
shall obtain at its sole cost and expense such licenses, permits
and approvals as may be required by law for the performance of the
services required by this Agreement. Contractor shall have the
sole obligation to pay for any fees, assessments and taxes, plus
applicable penalties and interest, which may be imposed by law and
arise from or are necessary for the Contractor's performance of the
services required by this Agreement, and shall indemnify, defend
and hold harmless City against any such fees, assessments, taxes
penalties or interest levied, assessed or imposed against City
hereunder.
1. 5 Familiarity with Work. By executing this Contract,
Contractor warrants that Contractor (a) has thoroughly investigated
and considered the scope of services to be performed, (b) has
carefully considered how the services should be performed, and (c)
fully understands the facilities, difficulties and restrictions
attending performance of the services under this Agreement. If the
services involve work upon any site, Contractor warrants that
Contractor has or will investigate the site and is or will be fully
acquainted with the conditions there existing, prior to
commencement of services hereunder. Should the Contractor discover
any latent or unknown conditions, which will materially affect the
performance of the services hereunder, Contractor shall immediately
inform the City of such fact and shall not proceed except at
Contractor's risk until written instructions are received from the
Contract Officer.
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1. 6 Care of Work. The Contractor shall adopt reasonable
methods during the life of the Agreement to furnish continuous
protection to the work, and the equipment, materials, papers,
documents, plans, studies; and/or other components thereof to
prevent losses or damages, and shall be responsible for all such
damages, to persons or property, until acceptance of the work by
City, except such losses or damages as may be caused by City's own
negligence.
1. 7 Further Responsibilities of Parties. Both parties
agree to use reasonable care and diligence to perform their
respective obligations under this Agreement. Both parties agree to
act in good faith to execute all instruments, prepare all documents
and take all actions as may be reasonably necessary to carry out
the purposes of this Agreement. Unless hereafter specified,
neither party shall be responsible for the service of the other.
1. 8 Additional Services. City shall have the right at
any time during the performance of the services, without
invalidating this Agreement, to order extra work beyond that
specified in the Scope of Services or make changes by altering,
adding to or deducting from said work. No such extra work may be
undertaken unless a written order is first given by the Contract
Officer to the Contractor, incorporating therein any adjustment in
(i) the Contract Sum, and/or (ii) the time to perform this
Agreement, which said adjustments are subject to the written
approval of the Contractor. Any increase in compensation of five
percent (5%) or less of the Contract Sum, or in the time to perform
of one hundred eighty (180) days or less may be approved by the
Contract Officer. Any greater increases, taken either separately
or cumulatively must be approved by the City Council. It is
expressly understood by Contractor that the provisions of this
Section shall not apply to services specifically set forth in the
Scope of Services or reasonably contemplated therein. Contractor
hereby acknowledges that it accepts the risk that the services to
be provided pursuant to the Scope of Services may be more costly or
time consuming than Contractor anticipates and that Contractor
shall not be entitled to additional compensation therefore.
1. 9 Special Requirements. Additional terms and
conditions of this Agreement, if any, which are made a part hereof
are set forth in the "Special Requirements" attached hereto as
Exhibit "B" and incorporated herein by this reference. In the
event of a conflict between the provisions of Exhibit "B" and any
other provisions of this Agreement, the provisions of Exhibit "B"
shall govern.
2 . 0 COMPENSATION
2 . 1 Contract Sum. For the services rendered pursuant to
this Agreement, the Contractor shall be compensated in accordance
with the "Schedule of Compensation" attached hereto as Exhibit "C"
and incorporated herein by this reference, but not exceeding the
maximum contract amount of NOT APPLICABLE
($ - ) (herein "Contract Sum") , except as provided in
Section 1. 8 . The method of compensation may include: (i) a lump
sum payment upon completion, (ii) payment in accordance with the
percentage of completion of the services, (iii) payment for time
and materials based upon the Contractor's rates as specified in the
Schedule of Compensation, but not exceeding the Contract Sum or
(iv) such other methods as may be specified in the Schedule of
Compensation. Compensation may include reimbursement for actual
and necessary expenditures for reproduction costs, telephone
expense, transportation expense approved by the Contract Officer in
advance, and no other expenses and only if specified in the
Schedule of Compensation. The Contract Sum shall include the
attendance of Contractor at all project meetings reasonably deemed
necessary by the City; Contractor shall not be entitled to any
additional compensation for attending said meetings.
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2 . 2 Method of ]Payment. Unless some other method of
payment is specified in the Schedule of Compensation, in any month
in which Contractor wishes to receive payment, no later than the
first (1st) working day of such month, Contractor shall submit to
the City in the form approved by the City's Director of Finance, an
invoice for services rendered prior to the date of the invoice.
Except as provided in Section 7 . 3 , City shall pay Contractor for
all expenses stated thereon which are approved by City pursuant to
this Agreement no later than the last working day of the month.
3 . 0 PERFORMANCE SCHEDULE
3 . 1 Time of Essence. Time is of the essence in the
performance of this Agreement.
3 . 2 Schedule of Performance. Contractor shall commence
the services pursuant to this Agreement upon receipt of a written
notice to proceed and shall perform all services within the time
period(s) established in the "Schedule of Performance" attached
hereto as Exhibit "D" , if any, and incorporated herein by this
reference. When requested by the Contractor, extensions to the
time period(s) specified in the Schedule of Performance may be
approved in writing by the Contract Officer but not exceeding one
hundred eighty (180) days cumulatively.
3 . 3 Force Maieure. The time period(s) specified in the
Schedule of Performance for performance of the services rendered
pursuant to this Agreement shall be extended because of any delays
due to unforeseeable causes beyond the control and without the
fault or negligence of the Contractor, including, but not
restricted to, acts of God or of the public enemy, unusually severe
weather, fires, earthquakes, floods, epidemics, quarantine
restrictions, riots, strikes, freight embargoes, wars, litigation,
and/or acts of any governmental agency, including the City, if the
Contractor shall within ten (10) days of the commencement of such
delay notify the Contract Officer in writing of the causes of the
delay. The Contract Officer shall ascertain the facts and the
extent of delay, and extend the time for performing the services
for the period of the enforced delay when and if in the judgment of
the Contract Officer such delay is justified. The Contract
Officer's determination shall be final and conclusive upon the
parties to this Agreement. In no event shall Contractor be
entitled to recover damages against the City for any delay in the
performance of this Agreement, however caused, Contractor's sole
remedy being extension of the Agreement pursuant to this Section.
3 .4 Term. Unless earlier terminated in accordance with
Section 7. 8 of this Agreement, this Agreement shall continue in
full force and effect until completion of the services but not
exceeding one (1) year from the date hereof, except as otherwise
provided in the Schedule of Performance.
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4 . 0 COORDINATION OF WORK
4 . 1 Representative of Contractor. The following
principals of Contractor are hereby designated as being the
principals and representatives of Contractor authorized to act in
its behalf with respect to the work specified herein and make all
decisions in connection therewith:
Project Liaison - John O'sullivan
Project Co-Directors- John Austin
Allen Charkow
It is expressly understood that the experience, knowledge,
capability and reputation. of the foregoing principals were a
substantial inducement for City to enter into this Agreement.
Therefore, the foregoing principals shall be responsible during the
term of this Agreement for directing all activities of Contractor
and devoting sufficient time to personally supervise the services
hereunder. For purposes of this Agreement, the foregoing
principals may not be replaced nor may their responsibilities be
substantially reduced by Contractor without the express written
approval of City.
4 . 2 Contract Officer. The Contract Officer shall be
such person as may be designated by the City Manager of City. It
shall be the Contractor's responsibility to assure that the
Contract officer is kept informed of the progress of the
performance of the services and the Contractor shall refer any
decisions which must be made by City to the Contract Officer.
Unless otherwise specified herein, any approval of City required
hereunder shall mean the approval of the Contract Officer. The
Contract Officer shall have authority to sign all documents on
behalf of the City required hereunder to carry out the terms of
this Agreement.
4 . 3 Prohibition Against Subcontracting or Assignment.
The experience, knowledge, capability and reputation of Contractor,
its principals and employees were a substantial inducement for the
City to enter into this Agreement. Therefore, Contractor shall not
contract with any other entity to perform in whole or in part the
services required hereunder without the express written approval of
the City. In addition, neither this Agreement nor any interest
herein may be transferred, assigned, conveyed, hypothecated or
encumbered voluntarily or by operation of law, whether for the
benefit of creditors or otherwise, without the prior written
approval of City. Transfers restricted hereunder shall include the
transfer to any person or group of persons acting in concert of
more than twenty five percent (250) of the present ownership and/or
control of Contractor, taking all transfers into account on a
cumulative basis. In the event of any such unapproved transfer,
including any bankruptcy proceeding, this Agreement shall be void.
No approved transfer shall release the Contractor or any surety of
Contractor of any liability hereunder without the express consent
of City.
4 . 4 Independent Contractor. Neither the City nor any of
its employees shall have any control over the manner, mode or means
by which Contractor, its agents or employees, perform the services
required herein, except as otherwise set forth herein. City shall
have no voice in the selection, discharge, supervision or control
of Contractor's employees, servants, representatives or agents, or
in fixing their number, compensation or hours of service.
Contractor shall perform all services required herein as an
independent contractor of city and shall remain at all times as to
City a wholly independent contractor with only such obligations as
are consistent with that role. Contractor shall not at any time or
in any manner represent that it or any of its agents or employees
are agents or employees of City. City shall not in any way or for
any purpose become or be deemed to be a partner of Contractor in
its business or otherwise or a joint venturer or a member of any
joint enterprise with Contractor.
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5. 0 INSURANCE, INDEMNIFICATION AND BONDS
5. 1 Insurance. The Contractor shall procure and
maintain, at its sole cost and expense, in a form and content
satisfactory to City, during the entire term of this Agreement
including any extension thereof, the following policies of
insurance:
(a) Comprehensive General Liability Insurance. A policy
of comprehensive general liability insurance written on a per
occurrence basis. If the Contract Sum is $25, 000. 00 or less, the
policy of insurance shall be written in an amount not less than
either (i) a combined single limit of $500, 000. 00 or (ii) bodily
injury limits of $250, 000. 00 per person, $500, 000. 00 per occurrence
and $500, 000. 00 products and completed operations and property
damage limits of $100, 000. CIO per occurrence and $100, 000. 00 in the
aggregate. If the Contract Sum is greater than $25, 000. 00 but less /
than or equal to $100, 000. 00, the policy of insurance shall be in
an amount not less than either (i) a combined single limit of
$1, 000, 000 . 00 for bodily injury, death and property damage or (ii)
bodily injury limits of $500, 000. 00 per person, $1, 000, 000. 00 per
occurrence and $1, 000, 000. 00 products and completed operations and
property damage limits of $500, 000. 00 per occurrence and
$500, 000. 00 in the aggregate. If the Contract Sum is greater than
$100, COO. 00, the policy of insurance shall be in an amount not less
than $5, 000, 000. 00 combined single limit.
(b) Worker's Compensation Insurance. A policy of
worker's compensation insurance in such amount as will fully comply
with the laws of the State of California and which shall indemnify, /
insure and provide legal defense for both the Contractor and the
City against any loss, claim or damage arising from any injuries or
occupational diseases occurring to any worker employed by or any
persons retained by the Contractor in the course of carrying out
the work or services contemplated in this Agreement.
(c) Automotive Insurance. A policy of comprehensive
automobile liability insurance written on a per occurrence basis in
an amount not less than either (i) bodily injury liability limits
of $250, 000. 00 per person and $500, 000. 00 per occurrence and
property damage liability limits of $100, 000. 00 per occurrence and
$250, 000. 00 in the aggregate or (ii) combined single limit
liability of $500, 000. 00. Said policy shall include coverage for
owned, non-owned, leased and hired cars.
(d) Additional Insurance. Policies of such other
insurance, including professional liability insurance, as may be
required in the Special Requirements.
All of the above policies of insurance shall be primary
insurance and shall name the City, its officers, employees and
agents as additional insureds. The insurer shall waive all rights
of subrogation and contribution it may have against the City, its
officers, employees and agents and their respective insurers. All
of said policies of insurance shall provide that said insurance may
not be amended or cancelled without providing thirty (30) days
prior written notice by registered mail to the City. In the event
any of said policies of insurance are cancelled, the Contractor
shall, prior to the cancellation date, submit new evidence of
insurance in conformance with this Section 5. 1 to the Contract
Officer. No work or services under this Agreement shall commence
until the Contractor has provided the City with Certificates of
Insurance or appropriate insurance binders evidencing the above
insurance coverages and said Certificates of Insurance or binders
are approved by the City.
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The Contractor agrees that the provisions of this Section 5. 1
shall not be construed as limiting in any way the extent to which
the Contractor may be held responsible for the payment of damages
to any persons or property resulting from the Contractor's
activities or the activities of any person or persons for which the
Contractor is otherwise responsible.
In the event the Contractor subcontracts any portion of the
work in compliance with Section 4 . 3 of this Agreement, the contract
between the Contractor and such subcontractor shall require the
contractor to maintain the same policies of insurance that the
C tractor is required to maintain pursuant to this Section 5. 1.
5. 2 Indemnification. Contractor agrees to indemnify the
i y is officers, agents and employees against, and will hold and
a them and each of them harmless from, any and all actions,
suits, claims, damages to persons or property, losses, costs,
penalties, obligations, errors, omissions or liabilities, (herein
"claims or liabilities") that may be asserted or claimed by any
person, firm or entity arising out of or in connection with the
negligent performance of the work, operations or activities of
Contractor, its agents, employees, subcontractors, or invitees,
provided for herein, or arising from the negligent acts or
omissions of Contractor hereunder, or arising from Contractor's
negligent performance of or failure to perform any term, provision
covenant or condition of this Agreement, whether—or—not—there—is
-c-erncurr-ent--passive--o-r active—negligence---on the--par-t-of-the--City,--
its—o-f-fieer-s,agents—or—emp3-eyees but excluding such claims or
liabilities arising from the sole negligence or willful misconduct
of the City, its officers, agents or employees, who are directly
responsible to the City, and in connection therewith:
(a) Contractor will defend any action or actions filed
in connection with any of ;said claims or liabilities and will pay
all costs and expenses, including legal costs and attorneys' fees
incurred in connection therewith;
(b) Contractor will promptly pay any judgment rendered
against the City, its officers, agents or employees for any such
claims or liabilities arising out of or in connection with the
negligent performance of or failure to perform such work,
operations or activities of Contractor hereunder; and Contractor
agrees to save and hold the City, its officers, agents, and
employees harmless therefrom;
(c) In the event the City, its officers, agents or
employees is made a party to any action or proceeding filed or
prosecuted against Contractor for such damages or other claims
arising out of or in connection with the negligent performance of
or failure to perform the work, operation or activities of
Contractor hereunder, Contractor agrees to pay to the City, its
officers, agents or employees, any and all costs and expenses
incurred by the City, its officers, agents or employees in such
action or proceeding, including but not limited to, legal costs and
attorneys' fees.
5. 3 Performance Bond. Concurrently with execution of
this Agreement, Contractor shall deliver to City a performance bond
in the sum of the amount of this Agreement, in the form provided by
the City Clerk, which secures the faithful performance of this
r Agreement, unless such requirement is waived by the Contract
Officer. The bond shall contain the original notarized signature
of an authorized officer of the surety and affixed thereto shall be
a certified and current copy of his power of attorney. The bond
shall be unconditional and remain in force during the entire term
of the Agreement and shall be null and void only if the Contractor
promptly and faithfully performs all terms and conditions of this
Agreement.
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5. 4 Sufficiency of Insurer or Surety. Insurance or
bonds required by this Acreement shall be satisfactory only if
issued by companies qualified to do business in California, rated
"A" or better in the most recent edition of Best Rating Guide, The
Key Rating Guide or in the Federal Register, and only if they are
of a financial category Class VII or better, unless such
requirements are waived by the Risk Manager of the City due to
unique circumstances. In the event the Risk Manager of City ("Risk
Manager") determines that the work or services to be performed
under this Agreement creates an increased or decreased risk of loss
to the City, the Contractor agrees that the minimum limits of the
insurance policies and the performance bond required by this
Section 5 may be changed accordingly upon receipt of written notice
from the Risk Manager; provided that the Contractor shall have the
right to appeal a determination of increased coverage by the Risk
Manager to the City Council of City within 10 days of receipt of
notice from the Risk Manager.
6. 0 RECORDS AND REPORTS
6. 1 Reports. Contractor shall periodically prepare and
submit to the Contract Officer such reports concerning the
performance of the services required by this Agreement as the
Contract Officer shall require. Contractor hereby acknowledges
that the City is greatly concerned about the cost of work and
services to be performed pursuant to this Agreement. For this
reason, Contractor agrees that if Contractor becomes aware of any
facts, circumstances, techniques, or events that may or will
materially increase or decrease the cost of the work or services
contemplated herein or, if Contractor is providing design services,
the cost of the project being designed, Contractor shall promptly
notify the Contract Officer of said fact, circumstance, technique
or event and the estimated increased or decreased cost related
thereto and, if Contractor is providing design services, the
estimated increased or decreased cost estimate for the project
being designed.
6. 2 Records. Contractor shall keep, and require
subcontractors to keep, such books and records as shall be
necessary to perform the services required by this Agreement and
enable the Contract Officer to evaluate the performance of such
services. The Contract Officer shall have full and free access to
such books and records at all times during normal business hours of
City, including the right to inspect, copy, audit and make records
and transcripts from such records. Such records shall be
maintained for a period of three (3) years following completion of
the services hereunder, and the City shall have access to such
records in the event any audit is required.
6 . 3 Ownership of Documents. All drawings,
specifications, reports, records, documents and other materials
prepared by Contractor, its employees, subcontractors and agents in
the performance of this Agreement shall be the property of City and
shall be delivered to City upon request of the Contract Officer or
upon the termination of this Agreement, and Contractor shall have
no claim for further employment or additional compensation as a
result of the exercise by City of its full rights of ownership of
the documents and materials hereunder. Any use of such completed
documents for other projects and/or use of uncompleted documents
without specific written authorization by the Contractor will be at
the City's sole risk and without liability to Contractor, and the
City shall indemnify the Contractor for all damages resulting
therefrom. Contractor may retain copies of such documents for its
own use. Contractor shall have an unrestricted right to use the
concepts embodied therein. All subcontractors shall provide for
assignment to City of any documents or materials prepared by them,
and in the event Contractor fails to secure such assignment,
Contractor shall indemnify City for all damages resulting
therefrom.
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6.4 Release of Documents. The drawings, specifications,
reports, records, documents and other materials prepared by
Contractor in the performance of services under this Agreement
shall not be released publicly without the prior written approval
of the Contract Officer.
7 . 0 ENFORCEMENT OF AGREEMENT
7 . 1 California Law. This Agreement shall be construed
and interpreted both as to validity and to performance of the
parties in accordance with the laws of the State of California.
Legal actions concerning any dispute, claim or matter arising out
of or in relation to this Agreement shall be instituted in the
Superior Court of the County of Riverside, State of California, or
any other appropriate court in such county, and Contractor
covenants and agrees to submit to the personal jurisdiction of such
court in the event of such action.
7 . 2 Disputes. In the event of any dispute arising under
this Agreement, the injured party shall notify the injuring party
in writing of its contentions by submitting a claim therefor. The
injured party shall continue performing its obligations hereunder
so long as the injuring party commences to cure such default within
ten (10) days of service of such notice and completes the cure of
such default within forty-five (45) days after service of the
notice, or such longer period as may be permitted by the injured
party; provided that if the default is an immediate danger to the
health, safety and general welfare, such immediate action may be
necessary. Compliance with the provisions of this Section shall be
a condition precedent to termination of this Agreement for cause
and to any legal action, and such compliance shall not be a waiver
of any party's right to take legal action in the event that the
dispute is not cured, provided that nothing herein shall limit
City's or the Contractor's right to terminate this Agreement
without cause pursuant to :>ection 7. 8 .
7 . 3 Retention of Funds. Contractor hereby authorizes
City to deduct from any amount payable to Contractor (whether or
not arising out of this Agreement) (i) any amounts the payment of
which may be in dispute hereunder or which are necessary to
compensate City for any losses, costs, liabilities, or damages
suffered by City, and (ii) all amounts for which City may be liable
to third parties, by reason of Contractor's acts or omissions in
performing or failing to perform Contractor's obligation under this
Agreement. In the event that any claim is made by a third party,
the amount or validity of which is disputed by Contractor, or any
indebtedness shall exist which shall appear to be the basis for a
claim of lien, City may withhold from any payment due, without
liability for interest because of such withholding, an amount
sufficient to cover such claim. The failure of City to exercise
such right to deduct or to withhold shall not, however, affect the
obligations of the Contractor to insure, indemnify, and protect
City as elsewhere provided herein.
7 . 4 Waiver. No delay or omission in the exercise of any
right or remedy by a nondefaulting party on any default shall
impair such right or remedy or be construed as a waiver. A party's
consent to or approval of any act by the other party requiring the
party's consent or approval shall not be deemed to waive or render
unnecessary the other party's consent to or approval of any
subsequent act. Any waiver by either party of any default must be
in writing and shall not: be a waiver of any other default
concerning the same or any other provision of this Agreement.
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7 . 5 Rights and Remedies are Cumulative. Except with
respect to rights and remedies expressly declared to be exclusive
in this Agreement, the rights and remedies of the parties are
cumulative and the exercise by either party of one or more of such
rights or remedies shall not preclude the exercise by it, at the
same or different times, of any other rights or remedies for the
same default or any other default by the other party.
7. 6 Legal Action. In addition to any other rights or
remedies, either party may take legal action, in law or in equity,
to cure, correct or remedy any default, to recover damages for any
default, to compel specific performance of this Agreement, to
obtain declaratory or injunctive relief, or to obtain any other
remedy consistent with the purposes of this Agreement.
7.7 Liquidated Damages. Since the determination of
actual damages for any delay in performance of this Agreement would
be extremely difficult or :impractical to determine in the event of
a breach of this Agreement, the Contractor and its sureties shall
be liable for and shall pay to the City the sum of NOT APPLICABLE
($ •— ) as liquidated damages for each working day of delay
in the performance of any :service required hereunder, as specified
in the Schedule of Performance (Exhibit "D") . The City may
withhold from any monies payable on account of services performed
by the Contractor any accrued liquidated damages.
7 . 8 Termination Prior to Expiration Of Term. This
Section shall govern any germination of this Agreement except as
specifically provided in the following Section for termination for
cause. The City reserves the right to terminate this Agreement at
any time, with or without cause, upon thirty (30) days' written
notice to Contractor, except that where termination is due to the
fault of the Contractor, the period of notice may be such shorter
time as may be determined by the Contract officer. In addition,
the Contractor reserves the right to terminate this Agreement at
any time upon, with or without cause, upon sixty (60) days' written
notice to City, except that where termination is due to the fault
of the City, the period of notice may be such shorter time as the
Contractor may determine. Upon receipt of any notice of
termination, Contractor shall immediately cease all services
hereunder except such as may be specifically approved by the
Contract Officer. Contractor shall be entitled to compensation for
all services rendered prior to the effective date of the notice of
termination and for any services authorized by the Contract officer
thereafter in accordance with the Schedule of Compensation or such
as may be approved by the Contract Officer, except as provided in
Section 7. 3 . In the event of termination without cause pursuant to
this Section, the terminating party need not provide
non-terminating party with the opportunity to cure pursuant to
Section 7 . 2 .
7 . 9 Termination for Default of Contractor. If
termination is due to the failure of the Contractor to fulfill its
obligations under this Agreement, City may, after compliance with
the provisions of Section 7. 2, take over the work and prosecute the
same to completion by contract or otherwise, and the Contractor
shall be liable to the extent that the total cost for completion of
the services required hereunder exceeds the compensation herein
stipulated (provided that the City shall use reasonable efforts to
mitigate such damages) , and City may withhold any payments to the
Contractor for the purpose of setoff or partial payment of the
amounts owed the City as previously stated.
9
• i
7 . 10 Attorneys' Fees. If either party to this Agreement
is required to initiate or defend or made a party to any action or
proceeding in any way connected with this Agreement, the prevailing
party in such action or proceeding, in addition to any other relief
which may be granted, whether legal or equitable, shall be entitled
to reasonable attorney's fees. Attorney's fees shall include
attorney's fees on any appeal, and in addition a party entitled to
attorney's fees shall be entitled to all other reasonable costs for
investigating such action, taking depositions and discovery and all
other necessary costs the court allows which are incurred in such
litigation. All such fees shall be deemed to have accrued on
commencement of such action and shall be enforceable whether or not
such action is prosecuted to judgment.
8 . 0 CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION
8 . 1 Non-liability of City Officers and Employees. No
officer or employee of the City shall be personally liable to the
Contractor, or any successor in interest, in the event of any
default or breach by the City or for any amount which may become
due to the Contractor or to its successor, or for breach of any
obligation of the terms of this Agreement.
8 . 2 Conflict of Interest. No officer or employee of the
City shall have any financial interest, direct or indirect, in this
Agreement nor shall any such officer or employee participate in any
decision relating to the Agreement which effects his financial
interest or the financial interest of any corporation, partnership
or association in which he is, directly or indirectly, interested,
in violation of any State statute or regulation. The Contractor
warrants that it has not paid or given and will not pay or give any
third party any money or other consideration for obtaining this
Agreement.
8 . 3 Covenant Against Discrimination. Contractor
covenants that, by and for itself, its heirs, executors, assigns,
and all persons claiming under or through them, that there shall be
no discrimination against or segregation of, any person or group of
persons on account of race, color, creed, religion, sex, marital
status, national origin, or ancestry in the performance of this
Agreement. Contractor shall take affirmative action to insure that
applicants are employed and that employees are treated during
employment without regard to their race, color, creed, religion,
sex, marital status, national origin, or ancestry.
9 . 0 MISCELLANEOUS PROVISIONS
9 . 1 Notice. Any notice, demand, request, document,
consent, approval, or communication either party desires or is
required to give to the other party or any other person shall be in
writing and either served personally or sent by prepaid,
first-class mail, in the case of the City, to the City Manager and
to the attention of the Contract Officer, CITY OF PALM SPRINGS,
P.O. Box 2743 , Palm Springs, California 92263 , and in the case of
the Contractor, to the person at the address designated on the
execution page of this Agreement. Either party may change its
address by notifying the other party of the change of address in
writing. Notice shall be deemed communicated at the time
personally delivered or in seventy-two (72) hours from the time of
mailing if mailed as provided in this Section.
9. 2 Interpretation. The terms of this Agreement shall
be construed in accordance with the meaning of the language used
and shall not be construed for or against either party by reason of
the authorship of this Agreement or any other rule of construction
which might otherwise apply.
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9 . 3 Integration; Amendment. It is understood that there
are no oral agreements between the parties hereto affecting this
Agreement and this Agreement supersedes and cancels any and all
previous negotiations, arrangements, agreements and understandings,
if any, between the parties, and none shall be used to interpret
this Agreement. This Agreement may be amended at any time by the
mutual consent of the parties by an instrument in writing.
9.4 Severability. In the event that any one or more of
the phrases, sentences, clauses, paragraphs, or sections contained
in this Agreement shall be declared invalid or unenforceable by a
valid judgment or decree of a court of competent jurisdiction, such
invalidity or unenforceability shall not affect any of the
remaining phrases, sentences, clauses, paragraphs, or sections of
this Agreement which are hereby declared as severable and shall be
interpreted to carry out the intent of the parties hereunder unless
the invalid provision is so material that its invalidity deprives
either party of the basic benefit of their bargain or renders this
Agreement meaningless.
9 . 5 Corporate Authority. The persons executing this
Agreement on behalf of the parties hereto warrant that (i) such
party is duly organized and existing, (ii) they are duly authorized
to execute and deliver this Agreement on behalf of said party,
(iii) by so executing this Agreement, such party is formally bound
to the provisions of this Agreement, and (iv) the entering into
this Agreement does not violate any provision of any other
Agreement to which said party is bound.
IN WITNESS WHEREOF, the parties have executed and entered into
this Agreement as of the date first written above.
ATTEST: CITY OF PA
a muni al corporate n
By \ a _ By:
�Cit'y Clerk City M ger
APPROVED AS TO FORM:
RUTAN & TUCKER
MUNICIPAL RESOURCE CONSULTANTS
David A� PARTNER : JOHN T. AUSTIN, INC. and
City Attorney PARTNER: ALLEN W. CHARKOW, INC .
CONTRACTOR:
By: ter✓ �
N e• Austin
itle. Partner
By:�
Name: Allen W. Charkow
Title: Partner
Address:
{�t��^��..�r"!"(7^y rn .' �TM1'i�.` h.�3�ub.w�..':F•4gfl�.��.
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Exhibit A
CONSULTANT SERVICES
Municipal Resource Consultants (MRC) shall provide sales tax
audit and information services to the City of Palm Springs
(City) . The objectives, scope, procedures, timing, compensation
and qualifi.cationS are not forth as follows:
_I 1. SnI E'J ., A1l,acn'PION_LUDJ'i'5
Many California cities are not receiving the sales/use tax
revenue to which they are entitled due to point of-sale and
other types of taxpayer reporting errors (for discussion of
misallocation causes, see enclosed MRC Insights newsletter) .
When businesses fail. to properly report their. California
saLe,,/use tax, the local allocation is distributed in error
to pool accounts or other jurisdictions.
Accordingly, the purpose of MRC's initial and ongoing
allocation audit service is to detect and correct taxpayer
reporting errors and thereby generate new sales/use tax
revenue which would not otherwise have been realized by the
City of. Palm Springs. Unlike most tax audits, MRC's
allocation audit service produces new revenue without
causing any additional tax liability for business.
As discussed under Section TV, MRC's audit staff in
organized into highly focused areas of specialization
related to either the detection or correction or
misallocations. In this regard, the audit service scope
7 includes, but is not limited to, MRC performing the
following procedures and tasks:
1 A. DETECTION OF MISALLOCATIONS
J 1. Procure a computer tape of sales/use tax permit
records from the State Board of Equalization
(SBE) .
2. Establish master file from tape data provided in
7 previous task.
3 . Clean-up, :standardize and computerize data from
City's sales tax distribution reports provided by
J SBE for eight (8) previous quarters, current
quarter and each future quarter service is
provided. ,
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4 . Develop a target list of potential point-of-
sale/use taxpayer reporting errors based on a
J physical canvassing and evaluation or sales/ur.(I
tax generating businesses located in the City of
Palm Springs. These businesses are to be analyzed
based on proprietary guidelines established by
MRC, formulated through expert knowledge of
corporate mergers and acquisitions, sales tax
J versus use tax, business marketing organization
J and methods, commercial/industrial sales/use tax
reporting practices, and other conditions
contributing to reporting errors.
5. Meet with designated City official(s) to review
service objectives and scope, MRC workpl.an
schedule, public relations and logistical. mattrr:;.
MRC will, also establish an appropriate liaison
with the City's coordinator and define logical
1 checkpoints .for reviewing the project's progress.
Note: with the exception of this initial meetinq,
t MRC's service requires no time or efrort. on Alie
J part of.' City staff.
6. Contact personnel in sales, operations and/or tax
accounting at each target business to determine
whether a poihtµ&f-salejuse reporting error
exists.
1 Note: this is adoompltshed with the higher.t
regard to discretion and professional conduct, as
evidenced by tl;e fact that MRC's allocation audits
have inv..rlved more than 400, 000 direct contacts
with taxpayer businesses without a single
complaint from a taxpayer, client or the State
Board of Equalization. our allocation audits are
predicated on a noncontroversial, constructive,
public relations approach which emphasizes the
importance of each business to the City and the
mutual benefits of correcting reporting errors.
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7. Provide to the city and State Board of Equalization, reports addressing each taxpayer
reporting error individually, including the
business name, address, telephone number,
California sales tax permit number, individuals
1 contacted, date(s) of contact, ngture of business,
reason(s) for error, recommended corrective
procedure and, if available, estimated sales/use
1 tax revenue which should be forthcoming to the.
City of Palm Springs.
1 8 . Respond to negative findings by SBF, with timely
reconfirmation documentation in order to preserve
the City's original dates of knowledge.
1 9. Receive and process sales/use tax quarterly
distribution reports provided to City by Si3I;.
1 10. Monitor and analyze the quarterly distribution
f reports with audit focus on the following:
a. Those accounts with previously detected
reporting errors to ensure that the
corrections are made for current quarters
Plus retroactive adjustments for eligible
amounts improperly distributed in prior
quarters.
b. Those accounts representing 90% of. the City's I'
total sales/use tax xevenue . to identify and
investigate significant aberrations (e.g. , I
negative fund transfers, declines, deficiency
assessments, etc. ) -
C. Those accounts having a use tax designation
to ascertain why the tax is being classified
as use .tax rather than sales tax.
d. Those accounts receiving deficiency
assessments to ensure that the City receives
its local allocation.
11. Review the city's purchases to identify
opportunities for the City to recover the local
allocation on transactions subject to use tax.
7 MRC will also prepare the necessary documentation
to facilitate recovery, including assistance in
preparing and filing the returns.
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IkJ E. QUARTERLY PROGRESS REPORTS
On a quarterly basis, MRC is to provide the City with
audit progress reports to include, but not be limited
Ito, the following:
1. Status of audit work in progress, including:
11 a. Copies of reports provided to the SBE
f '•! addressing each point-of-sale taxpayer
reporting error individually, including the
I business name, address, telephone number,
Il.1 California sales tax permit number,
individuals contacted, date(s) of contact,
nature of business, reason for error and
recommended corrective procedure.
b. Copies of misallocation reconfirmation
y� documentation, in response to negative
findings by the SBE, in order to preserve
original dates of knowledge.
I !, 2 . Actual sales/use tax produced for the City by
MRC's audit service on a quarterly and cumulative
basis.
� i 3 . Projected sales%ye tax rejrenue forthcoming to the
City as a result of MRC's allocation audits,
delineated. according to source, timing and one-
time versus ongoing.
4 . Alphabetical listing of all misallocated accounts
detected for the City by MRC including, for each,
the permit number, correction status, payment
amount received by the City, quarter to which
payment is :related and payment source (e.g. , fund
I transfer, deficiency assessment, etc. ) .
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III a�-AS
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rI E. QUARTERLY PROGRESS REPORTS
JOn a quarterly basis, MRC is to provide the City with
audit progress reports to include, but not be limited
to, the following:'
1. Status of audit work in progress, including:
a. Copies of reports provided to the SBE
I ' addressing each point-of-sale taxpayer
reporting error individually, including the
business name, address, telephone number,
i� California sales tax permit number,
J individuals contacted, date(s) of contact,
nature of business, reason for error and
recommended corrective procedure.
b. Copies of misallocation reconfirmation
sl documentation, in response to negai:ivu
J findings by the SBE, in order to preserve
original dates of knowledge.
II, 2. Actual sales/use tax produced for the City by
MRC's audit service on a quarterly and cumulative
basis.
3 . Projected sales%y5e tax revenue forthcoming to the
City as a result of MRC's allocation audits,
delineated. eiccording to source, timing and one-
time versus ongoing.
4 . Alphabetical listing of all misallocated accounts
detected for the City by MRC including, for each,
the permit number, correction status, payment
amount received by the City, quarter to which
payment is related and payment source (e.g. , fund
transfer, deficiency assessment, etc. ) .
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r� EXHIBIT C-
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III. COME'ENSATION
� 1 In order to make MRC's services self-funding for the City,
MRC's compensation for providing the audit and information
t� services shall be entirely predicated and' contingent upon
MRC's audits producing new sales/use tax revenue that would
not otherwise have been received by the City, further
described as follows:
A. ALLOCATION AUDIT SERVICE
Ir ) MRC's compensation for providing the allocation
audit service is 25% of the new sales/use tax
revenue received by the City as a result of MRC
l detecting and correcting the related point-of-
sale/use distribution error. Said 25% applies to
each correction for fund transfers (i.e. ,
retroactive adjustments for eligible amounts
improperly distributed in prior quarters) and the
first six consecutive reporting quarters following
completion of the audit by MRC and confirmation of
corrections by the State Board of Equalization.
I
I Sales/use tax audit invoices are submitted
quarterly after the City has received the revenue
y from the correction and quarterly distribution
report verifying it. Each invoice is to include
the business name, permit number, local allocation
jl amount received by the City and amount due MRC.
' Invoices are: due and payable upon receipt.
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EXHIBIT C-
� e
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fIII. COME'ENSATION
� ! In order to make MRC's services self-funding for the City,
MRC's compensation for providing the audit and information
services shall be entirely predicated and' contingent upon
!� MRC's audits producing new sales/use tax revenue that would
not otherwise have been received by the City, further
described as follows:
aI A. ALLOCATION AUDIT SERVICE
MRC's compensation for providing the allocation
audit service is 25% of the new sales/use tax
revenue received by the City as a result of MRC
detecting and correcting the related point-of-
sale/use distribution error. Said 25% applies to
each correction for fund transfers (i.e. ,
retroactive adjustments for eligible amounts
improperly distributed in prior quarters) and the
first six consecutive reporting quarters following
completion of the audit by MRC and confirmation of
corrections by the State Board of Equalization.
i
Sales/use tax audit invoices are submitted
quarterly after the City has received the revenue
} from the correction and quarterly distribution
report verifying it. Each invoice is to include
` the business; name, permit number, local allocation
]� amount received by the City and amount due MRC.
' Invoices are: due and payable upon receipt.
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EXHIBIT D'
Schedule of Performance
D. TIMING
MRC shall commence preparing the Sales Tax Inquiry
System and STARS reports within 10 working days
following receipt of the following:
o Contract approval and resolution designating MRC
as the authorized City consultant to examine sales
and use tax records (see Exhibit C) ; and
o State Board of Equalization quarterly distribution
reports for most recent nine (9) consecutive
quarters.
The initial Sales Tax Inquiry System shall be delivered
and installed on IBM compatible PCs designated by City,
together with the STARS reports, within 45 working days
following receipt of the above. The quarterly updated
Inquiry System and STARS reports will be delivered to
the City within 30 working days following receipt of
the quarterly distribution reports.
MRC will provide consulting services to the City in
conjunction with delivery of the Inquiry System and
STARS reports .following completion of the enhancement
audits.
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