HomeMy WebLinkAbout2006 CON MBIA MuniServices - Examine Sales Tax RecordsAGREEMENT
BY AND BETWEEN
THE CITY OF NATIONAL CITY AND
MBIA MUNISERVICES COMPANY
THIS AGREEMENT is entered into this 1st day of August, 2006, by and between the
CITY OF NATIONAL CITY, a municipal corporation (the "CITY"), and MBIA MuniServices
Company, a Delaware Corporation (the "CONTRACTOR").
RECITALS
WHEREAS, the CITY desires to employ a CONTRACTOR to serve as the CITY's
authorized representative to examine transactions and use tax (sales tax) records.
WHEREAS, the CITY has determined that the CONTRACTOR is a Consultant and is
qualified by experience and ability to perform the services desired by the CITY, and the
CONTRACTOR is willing to perform such services.
NOW, THEREFORE, THE PARTIES HERETO DO MUTUALLY AGREE AS
FOLLOWS:
1. ENGAGEMENT OF CONTRACTOR.
The CITY hereby agrees to engage the CONTRACTOR and the CONTRACTOR
hereby agrees to perform the services hereinafter set forth in accordance with all terms and
conditions contained herein.
The CONTRACTOR represents that all services required hereunder will be performed
directly by the CONTRACTOR, by CONTRACTOR'S consultants, or under direct supervision
of the CONTRACTOR.
2. SCOPE OF SERVICES.
The CONTRACTOR will perform services as set forth in the attached Exhibit "A".
The CONTRACTOR shall be responsible for all research and reviews related to the
work and shall not rely on personnel of the CITY for such services, except as authorized in
advance by the CITY. The CONTRACTOR shall appear at meetings cited in Exhibit "A" to
keep staff and City Council advised of the progress on the project.
Upon mutual agreement, the parties may, from time to time, reduce or increase the
Scope of Services to be performed by the CONTRACTOR under this Agreement. Upon doing
so, the CITY and the CONTRACTOR agree to meet in good faith and confer for the purpose
of negotiating a corresponding reduction or increase in the compensation associated with said
change in services, not to exceed a factor of TBD% from the base amount.
Revised October 2006
3. PROJECT COORDINATION AND SUPERVISION.
Chris Zapata hereby is designated as the Project Coordinator for the CITY and will
monitor the progress and execution of this Agreement. The CONTRACTOR shall assign a
single Project Director to provide supervision and have overall responsibility for the progress
and execution of this Agreement for the CONTRACTOR. Patricia Nunn hereby is designated
as the Project Director for the CONTRACTOR and CONTRACTOR will notify CITY of any
changes in who is designated as the Project Director prior to making any such change.
4. COMPENSATION AND PAYMENT.
The compensation for the CONTRACTOR shall be based on monthly billings covering
actual work performed. Billings shall include labor classifications, respective rates, hours
worked and also materials, if any. The total cost for all work described in Exhibit "A" shall not
exceed the schedule given in Exhibit "A" (the Base amount) without prior written authorization
from the Project Coordinator. Monthly invoices will be processed for payment and remitted
within thirty (30) days from receipt of invoice, provided that work is accomplished consistent
with Exhibit "A" as determined by the CITY. Any amounts which remain unpaid after thirty (30)
days shall accrue interest at the rate of one and one-half percent (1.5%) per month, or the
maximum amount permitted by law.
The CONTRACTOR shall maintain all books, documents, papers, employee time
sheets, accounting records, and other evidence pertaining to costs incurred and shall make
such materials available at its office at all reasonable times during the term of this Agreement
and for three (3) years from the date of final payment under this Agreement, for inspection by
the CITY and for furnishing of copies to the CITY, if requested.
5. LENGTH OF AGREEMENT.
Completion dates or time durations for specific portions of the Project are set forth in
Exhibit"A".
6. DISPOSITION AND OWNERSHIP OF DOCUMENTS.
The Memoranda, Reports, Maps, Drawings, Plans, Specifications and other documents
prepared by the CONTRACTOR for this Project and delivered to the CITY, whether paper or
electronic, shall become the property of the CITY for use with respect to this Project, and shall
be turned over to the CITY upon completion of the Project, or any phase thereof, as
contemplated by this Agreement.
Contemporaneously with the transfer of documents, the CONTRACTOR hereby
assigns to the CITY and CONTRACTOR thereby expressly waives and disclaims, any
copyright in, and the right to reproduce, all written material, drawings, plans, specifications or
other documents that are prepared under this agreement and delivered to the CITY, except
upon the CITY's prior authorization regarding reproduction, which authorization shall not be
unreasonably withheld. The CONTRACTOR shall, upon request of the CITY, execute any
further document(s) necessary to further effectuate this waiver and disclaimer.
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The CONTRACTOR agrees that the CITY may use, reuse, alter, reproduce, modify,
assign, transfer, or in any other way, medium or method utilize the CONTRACTOR's written
work product that is actually delivered to the CITY for the CITY's purposes, and the
CONTRACTOR expressly waives and disclaims any residual rights granted to it by Civil Code
Sections 980 through 989 relating to intellectual property and artistic works.
Any modification or reuse by the CITY of documents, drawings or specifications
prepared by the CONTRACTOR shall relieve the CONTRACTOR from liability under Section
14 but only with respect to the effect of the modification or reuse by the CITY, or for any
liability to the CITY should the documents be used by the CITY for some project other than
what was expressly agreed upon within the Scope of this project, unless otherwise mutually
agreed.
7. INDEPENDENT CONTRACTOR.
Both parties hereto in the performance of this Agreement will be acting in an
independent capacity and not as agents, employees, partners or joint venturers with one
another. Neither the CONTRACTOR nor the CONTRACTOR'S employees are employees of
the CITY and are not entitled to any of the rights, benefits, or privileges of the CITY's
employees, including but not limited to retirement, medical, unemployment, or workers'
compensation insurance.
This Agreement contemplates the personal services of the CONTRACTOR and the
CONTRACTOR's employees, and it is recognized by the parties that a substantial inducement
to the CITY for entering into this Agreement was, and is, the professional reputation and
competence of the CONTRACTOR and its employees. Neither this Agreement nor any
interest herein may be assigned by the CONTRACTOR without the prior written consent of the
CITY. Nothing herein contained is intended to prevent the CONTRACTOR from employing or
hiring as many employees, or subcontractors, as the CONTRACTOR may deem necessary for
the proper and efficient performance of this Agreement. All agreements by CONTRACTOR
with its subcontractor(s) shall require the subcontractor to adhere to the applicable terms of
this Agreement.
8. CONTROL.
Neither the CITY nor its officers, agents or employees shall have any control over the
conduct of the CONTRACTOR or any of the CONTRACTOR's employees except as herein
set forth, and the CONTRACTOR expressly agrees not to represent that the CONTRACTOR
or the CONTRACTOR's agents, servants, or employees are in any manner agents, servants
or employees of the CITY, it being understood that the CONTRACTOR, its agents, servants,
and employees are as to the CITY wholly independent contractors and that the
CONTRACTOR's obligations to the CITY are solely such as are prescribed by this Agreement.
9. COMPLIANCE WITH APPLICABLE LAW.
The CONTRACTOR, in the performance of the services to be provided herein, shall
comply with all applicable State and Federal statutes and regulations, and all applicable
3 Revised October 2006
ordinances, rules and regulations of the City of National City, whether now in force or
subsequently enacted. The CONTRACTOR, and each of its subcontractors, shall obtain and
maintain a current City of National City business license prior to and during performance of
any work pursuant to this Agreement.
10. LICENSES, PERMITS, ETC.
The CONTRACTOR represents and covenants that it has all licenses, permits,
qualifications, and approvals of whatever nature that are legally required to practice its
profession. The CONTRACTOR represents and covenants that the CONTRACTOR shall, at
its sole cost and expense, keep in effect at all times during the term of this Agreement, any
license, permit, or approval which is legally required for the CONTRACTOR to practice its
profession.
11. STANDARD OF CARE.
A. The CONTRACTOR, in performing any services under this Agreement, shall
perform in a manner consistent with that level of care and skill ordinarily
exercised by members of the CONTRACTOR'S trade or profession currently
practicing under similar conditions and in similar locations. The CONTRACTOR
shall take reasonable precautions to protect the CONTRACTOR's employees
and members of the public from risk of harm arising out of the nature of the work
and/or the conditions of the work site.
B. Unless disclosed in writing prior to the date of this agreement, the
CONTRACTOR warrants to the CITY that it is not now, nor has it for the five (5)
years preceding, been debarred by a governmental agency or involved in
debarment, arbitration or litigation proceedings concerning the CONTRACTOR's
professional performance or the furnishing of materials or services relating
thereto.
12. NON-DISCRIMINATION PROVISIONS.
The CONTRACTOR shall not discriminate against any employee or applicant for
employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital
status, national origin, physical handicap, or medical condition. The CONTRACTOR will take
positive action to insure that applicants are employed without regard to their age, race, color,
ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or
medical condition. Such action shall include but not be limited to the following: employment,
upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination,
rates of pay or other forms of compensation, and selection for training, including apprentice-
ship. The CONTRACTOR agrees to post in conspicuous places available to employees and
applicants for employment any notices provided by the CITY setting forth the provisions of this
non-discrimination clause.
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13. CONFIDENTIAL INFORMATION.
The CITY may from time to time communicate to the CONTRACTOR certain
confidential information to enable the CONTRACTOR to effectively perform the services to be
provided herein. The CONTRACTOR shall treat all such information as confidential and shall
not disclose any part thereof without the prior written consent of the CITY. The
CONTRACTOR shall limit the use and circulation of such information, even within its own
organization, to the extent necessary to perform the services to be provided herein. The
foregoing obligation of this Section 13, however, shall not apply to any part of the information
that (i) has been disclosed in publicly available sources of information; (ii) is, through no fault
of the CONTRACTOR, hereafter disclosed in publicly available sources of information; (iii) is
already in the possession of the CONTRACTOR without any obligation of confidentiality; or (iv)
has been or is hereafter rightfully disclosed to the CONTRACTOR by a third party, but only to
the extent that the use or disclosure thereof has been or is rightfully authorized by that third
party.
The CONTRACTOR shall not disclose any reports, recommendations, conclusions or
other results of the services or the existence of the subject matter of this Agreement without
the prior written consent of the CITY. In its performance hereunder, the CONTRACTOR shall
comply with all legal obligations it may now or hereafter have respecting the information or
other property of any other person, firm or corporation.
Notwithstanding any other provision of this sectionl3, 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 Tatter's expense, in
any lawful effort to contest the validity of such subpoena or other legal process.
CONTRACTOR shall be liable to CITY for any damages caused by breach of this
condition, pursuant to the provisions of Section 14.
14. INDEMNIFICATION AND HOLD HARMLESS.
The CONTRACTOR agrees to defend, indemnify, and hold harmless the City of
National City, its officers and employees, against and from any and all liability, loss, damages
to property, injuries to, or death of any person or persons, and all claims, demands, suits,
actions, proceedings, reasonable attorneys' fees, and defense costs, of any kind or nature,
including workers' compensation claims, of or by anyone whomsoever, resulting from or
arising out of the CONTRACTOR's negligent performance of this Agreement.
15. WORKERS' COMPENSATION.
The CONTRACTOR shall comply with all of the provisions of the Workers'
Compensation Insurance and Safety Acts of the State of California and all similar state or
Federal acts or laws applicable; and shall indemnify, and hold harmless the CITY and its
officers, and employees from and against all claims, demands, payments, suits, actions,
proceedings and judgments of every nature and description, including reasonable attorney's
5 Revised October 2006
fees and defense costs presented, brought or recovered against the CITY or its officers,
employees, or volunteers, for or on account of any liability under any of said acts which may
be incurred by reason of any work to be performed by the CONTRACTOR under this
Agreement.
16. INSURANCE.
The CONTRACTOR, at its sole cost and expense, shall purchase and maintain, and
shall require its subcontractors, when applicable, to purchase and maintain throughout the
term of this agreement, the following insurance policies:
A. If checked, Professional Liability Insurance (errors and omissions) with minimum
limits of $1,000,000 per occurrence.
B. Automobile insurance covering all bodily injury and property damage incurred
during the performance of this Agreement, with a minimum coverage of
$1,000,000 combined single limit per accident. Such automobile insurance shall
include non -owned vehicles.
C, Comprehensive general liability insurance, with minimum limits of $1,000,000
combined single limit per occurrence, covering all bodily injury and property
damage arising out of its operation under this Agreement.
D. Workers' compensation insurance covering all of CONTRACTOR's employees.
E, The aforesaid policies, except for the professional liability and worker's
compensation policies, shall constitute primary insurance as to the CITY, its
officers, employees, and volunteers, so that any other policies held by the CITY
shall not contribute to any loss under said insurance. Said policies shall provide
for thirty (30) days prior written notice to the CITY of cancellation or material
change.
F, Said policies, except for the professional liability and worker's compensation
policies, shall name the CITY and its officers, agents and employees as
additional insureds.
G. If required insurance coverage is provided on a "claims made" rather than
"occurrence" form, the CONTRACTOR shall maintain such insurance coverage
for three years after expiration of the term (and any extensions) of this Agree-
ment.
H. Any aggregate insurance limits must apply solely to this Agreement.
I. Insurance shall be written with only California admitted companies which hold a
current policy holder's alphabetic and financial size category rating of not less
than A VIII according to the current Best's Key Rating Guide, or a company
equal financial stability that is approved by the City's Risk Manager.
6 Revised October 2006
J. This Agreement shall not take effect until certificate(s) or other sufficient proof
that these insurance provisions have been complied with, are filed with and
approved by the CITY's Risk Manager. If the CONTRACTOR does not keep all
of such insurance policies in full force and effect at all times during the terms of
this Agreement, the CITY may elect to treat the failure to maintain the requisite
insurance as a breach of this Agreement and terminate the Agreement as
provided herein.
17. LEGAL FEES.
If any party brings a suit or action against the other party arising from any breach of any
of the covenants or agreements or any inaccuracies in any of the representations and
warranties on the part of the other party arising out of this Agreement, then in that event, the
prevailing party in such action or dispute, whether by final judgment or out -of -court settlement,
shall be entitled to have and recover of and from the other party all costs and expenses of suit,
including attorneys' fees.
For purposes of determining who is to be considered the prevailing party, it is stipulated
that attorney's fees incurred in the prosecution or defense of the action or suit shall not be
considered in determining the amount of the judgment or award. Attomey's fees to the
prevailing party if other than the CITY shall, in addition, be limited to the amount of attorney's
fees incurred by the CITY in its prosecution or defense of the action, irrespective of the actual
amount of attorney's fees incurred by the prevailing party.
18. MEDIATION/ARBITRATION.
If a dispute arises out of or relates to this Agreement, or the breach thereof, the parties
agree first to try, in good faith, to settle the dispute by mediation in San Diego, Califomia, in
accordance with the Commercial Mediation Rules of the American Arbitration Association (the
"AAA") before resorting to arbitration. The costs of mediation shall be borne equally by the
parties. Any controversy or claim arising out of, or relating to, this Agreement, or breach
thereof, which is not resolved by mediation shall be settled by arbitration in San Diego,
California, in accordance with the Commercial Arbitration Rules of the AAA then existing. Any
award rendered shall be final and conclusive upon the parties, and a judgment thereon may
be entered in any court having jurisdiction over the subject matter of the controversy. The
expenses of the arbitration shall be bome equally by the parties to the arbitration, provided
that each party shall pay for and bear the costs of its own experts, evidence and attorneys'
fees, except that the arbitrator may assess such expenses or any part thereof against a
specified party as part of the arbitration award.
19. TERMINATION.
A. This Agreement may be terminated with or without cause by either party.
Termination without cause shall be effective only upon 60-day's written notice to
the party receiving the notice. During said 60-day period the CONTRACTOR
7 Revised October 2006
shall perform all services in accordance with this Agreement and CITY will
remain obligated to pay for those services in accordance with this Agreement.
B. 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 (10) days prior written notice of such failure to
pay), (b) a material breach by either party of this Agreement, (c)
misrepresentation by the CONTRACTOR in connection with the formation of this
Agreement or the performance of services. If an Event of Default occurs, the
non -breaching party shall notify the breaching party of the Event of Default and
provide the breaching party thirty (30) days 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 party fails to effect
cure within the time allowed, then the non -breaching party may, at its option,
terminate this Agreement effective immediately upon notice.
C. Termination with or without cause shall be effected by delivery of written Notice
of Termination by the terminating party to the receiving party as provided for
herein.
D, In the event of termination, all finished or unfinished Memoranda Reports, Maps,
Drawings, Plans, Specifications and other documents prepared by the
CONTRACTOR, whether paper or electronic, that would have been delivered to
the CITY had the contract not been terminated, shall immediately become the
property of and be delivered to the CITY, and the CONTRACTOR shall be
entitled to receive just and equitable compensation for any work satisfactorily
completed on such documents and other materials up to the effective date of the
Notice of Termination, not to exceed the amounts payable hereunder, and less
any damages caused the CITY by the CONTRACTOR's breach, if any.
Thereafter, ownership of said written material shall vest in the CITY all rights set
forth in Section 6.
E. The CITY further reserves the right to immediately terminate this Agreement
upon: (1) the filing of a petition in bankruptcy affecting the CONTRACTOR; (2) a
reorganization of the CONTRACTOR for the benefit of creditors; or (3) a
business reorganization.
20. NOTICES.
All notices or other communications required or permitted hereunder shall be in writing,
and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or
sent by registered or certified mail, postage prepaid, return receipt requested; or sent by
ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex,
telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally
delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by
overnight mail, the business day following its deposit in such overnight mail facility, (iii) if
mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address is
outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or
8 Revised October 2006
other like facility regularly maintained by the United States Postal Service, (iv) if given by
telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if
given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, direction or
other communication delivered or sent as specified above shall be directed to the following
persons:
To the CITY:
To the CONTRACTOR:
Chris Zapata
City Manager
City of National City
1243 National City Boulevard
National City, CA 91950-4301
MBIA MuniServices Company
7335 N Palm Bluffs Avenue
Fresno, CA 93711
Attn: Legal Department
legal@muniservices.com
Notice of change of address shall be given by written notice in the manner specified in
this Section. Rejection or other refusal to accept or the inability to deliver because of changed
address of which no notice was given shall be deemed to constitute receipt of the notice,
demand, request or communication sent. Any notice, request, demand, direction or other
communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty-
eight (48) hours by letter mailed or delivered as specified in this Section.
21. CONFLICT OF INTEREST AND POLITICAL REFORM ACT OBLIGATIONS.
During the term of this Agreement, the CONTRACTOR shall not perform services of
any kind for any person or entity whose interests conflict in any way with those of the City of
National City. The CONTRACTOR also agrees not to specify any product, treatment, process
or material for the project in which the CONTRACTOR has a material financial interest, either
direct or indirect, without first notifying the CITY of that fact. The CONTRACTOR shall at all
times comply with the terms of the Political Reform Act and the National City Conflict of
Interest Code. The CONTRACTOR shall immediately disqualify itself and shall not use its
official position to influence in any way any matter coming before the CITY in which the
CONTRACTOR has a financial interest as defined in Government Code Section 87103. The
CONTRACTOR represents that it has no knowledge of any financial interests that would
require it to disqualify itself from any matter on which it might perform services for the CITY.
❑ If checked, the CONTRACTOR shall comply with all of the reporting require-
ments of the Political Reform Act and the National City Conflict of Interest Code. Specifically,
the CONTRACTOR shall file a Statement of Economic Interests with the City Clerk of the City
of National City in a timely manner on forms which the CONTRACTOR shall obtain from the
City Clerk.
9 Revised October 2006
The CONTRACTOR shall be strictly liable to the CITY for all damages, costs or
expenses the CITY may suffer by virtue of any violation of this Paragraph 21 by the
CONTRACTOR.
22. MISCELLANEOUS PROVISIONS.
A. Computation of Time Periods. If any date or time period provided for in this
Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday,
then such date shall automatically be extended until 5:00 p.m. Pacific Time of
the next day which is not a Saturday, Sunday or federal, state or legal holiday.
B. Counterparts. This Agreement may be executed in multiple counterparts, each
of which shall be deemed an original, but all of which, together, shall constitute
but one and the same instrument.
C, Captions. Any captions to, or headings of, the sections or subsections of this
Agreement are solely for the convenience of the parties hereto, are not a part of
this Agreement, and shall not be used for the interpretation or determination of
the validity of this Agreement or any provision hereof.
D. No Obligations to Third Parties. Except as otherwise expressly provided herein,
the execution and delivery of this Agreement shall not be deemed to confer any
rights upon, or obligate any of the parties hereto, to any person or entity other
than the parties hereto.
E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are
hereby incorporated herein by this reference for all purposes.
F, Amendment to this Agreement. The terms of this Agreement may not be
modified or amended except by an instrument in writing executed by each of the
parties hereto.
G, Waiver. The waiver or failure to enforce any provision of this Agreement shall not
operate as a waiver of any future breach of any such provision or any other
provision hereof.
H. Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
Entire Agreement. This Agreement supersedes any prior agreements,
negotiations and communications, oral or written, and contains the entire
agreement between the parties as to the subject matter hereof. No subsequent
agreement, representation, or promise made by either party hereto, or by or to
an employee, officer, agent or representative of any party hereto shall be of any
effect unless it is in writing and executed by the party to be bound thereby.
10
Revised October 2006
J. Successors and Assigns. This Agreement shall be binding upon and shall inure
to the benefit of the successors and assigns of the parties hereto.
K. Construction. The parties acknowledge and agree that (i) each party is of equal
bargaining strength, (ii) each party has actively participated in the drafting,
preparation and negotiation of this Agreement, (iii) each such party has
consulted with or has had the opportunity to consult with its own, independent
counsel and such other professional advisors as such party has deemed
appropriate, relative to any and all matters contemplated under this Agreement,
(iv) each party and such party's counsel and advisors have reviewed this
Agreement, (v) each party has agreed to enter into this Agreement following
such review and the rendering of such advice, and (vi) any rule or construction to
the effect that ambiguities are to be resolved against the drafting party shall not
apply in the interpretation of this Agreement, or any portions hereof, or any
amendments hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
and year first above written.
CITY OF NATIONAL CITY
MBIA MUNISERVICES COMPANY
By: By:
Ron Morrison M'z el fiia
Mayor President
APPROVED AS TO FORM:
George H. Eiser, III
City Attorney
TG By:
n Cerutti
ief Financial Officer
APPROVED AS TO FORM:
5-ram."
Eric Myers
Corporate Counsel
11
Revised October 2006
LOCAL DISTRICT TAX AUDIT ADDENDUM
OBJECTIVES AND METHODS
Many California special taxing jurisdictions are not receiving the transactions and use tax revenue to
which they are entitled due to point of use and other types of taxpayer reporting errors. District taxes
are collected on a destination basis (where the tangible personal property will be used or is delivered
to) as opposed to Bradley -Burns tax, which is collected at the point of sale. When businesses fail to
properly report their transactions tax, it is distributed in error to other jurisdictions or not collected at
all. Almost all district tax error discoveries involve companies that are correctly collecting and
allocating the local Bradley -Burns tax. Accordingly, MMC initial and ongoing audit service will assist
in the detection and correction of taxpayer reporting errors and generate new transactions and use tax
revenue that would not otherwise have been realized by the City. MMC has vast experience in
auditing district tax. District taxes and local Bradley -Burns taxes do not necessarily result in
equivalent tax dollars for an equal measure of tax rate, because they have different rules of
application. MMC currently audits district tax for many transit authorities and jurisdictions such as:
Bay Area Rapid Transit District (BART), Lox Angeles Metropolitan Transit Authority (LAMTA), Orange
County Local Transportation Authority, San Diego County Regional Transportation Commission,
Santa Clara Valley Transportation Authority, City of Capitola, City of Davis, City of Richmond, Town of
Truckee, City of West Sacramento, and City of Woodland.
DISTRICT TAX DETECTION AND DOCUMENTATION
MMC shall represent the City of purposes of examining State Board of Equalization (SBE) records
pertaining to district tax to identify errors and omissions. MMC's procedures for detecting and
documenting misallocations are as follows:
❑ Meet with designated CITY official(s) to review service objectives and scope, MMC
work plan schedule, public relations and logistical matters.
❑ Procure a computer tape of district tax permit records from the State Board of
Equalization (SBE).
• Clean-up, standardize and computerize data from City's quarterly transaction tax
distribution reports provided by SBE for previous quarters, current quarter and each
future quarter service is provided.
❑ Develop a target list of potential point-of-sale/delivery/use taxpayer reporting errors of
transactions and use tax generating businesses located in the City's jurisdiction.
These businesses are to be analyzed based on proprietary guidelines established by
MMC, formulated through expert knowledge of corporate mergers and acquisitions,
transactions versus use tax, businesses marking organization and methods,
commercial/industrial transactions and use tax reporting practices, and other conditions
contributing to reporting errors.
❑ Clean, standardize and integrate, in address -order, each entity's business name,
address and payment file information, to eliminate redundancies, using MMC's
proprietary software.
Cl Contact personnel in sales, operations and/ or tax accounting at each target business
to determine whether a destination based reporting error exists. (Note: this is
accomplished with the highest regard to discretion and professional conduct. MMC's
allocation audits are predicated on a non -controversial, constructive public relations
MBIA MuniScrvices Company 1
Local District Tax Audit Addendum
EXHIBIT A
approach which emphasizes the importance of each business to the City and the
mutual benefits of correcting reporting errors.)
O 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 contracted, date(s) of contract, nature of business,
reason(s) for error, and estimated district tax revenue which should be forthcoming to
the City.
O MMC may also provide suggested language for letters to be sent to the taxpayers and/
or SBE from the City (or from MMC 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 dates of knowledge.
❑ Receive and process registration control record information monthly.
O Receive and process transaction tax distribution reports quarterly.
0 Coordinate with the taxpayer and SBE to make the necessary corrections and collect
eligible back quarters amounts.
O Monitor and analyze the quarterly distribution reports with an audit focus on the
following:
1. Accounts with previously reported destination based 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 transaction, sales and
use 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 Tess revenue that it is entitled to.
3. Those accounts receiving deficiency assessments to ensure that the City receives
its local allocation.
DISTRICT TAX CORRECTION OF MISALLOCATIONS/UNDERRPORTING
For each misallocated or underreporting account detected, MMC will coordinate with the taxpayer
and/ or SBE to make the necessary corrections plus retroactive adjustments for transactions and use
tax amounts improperly distributed or uncollected in prior quarters. This task is simply stated, but
enormously complex and time-consuming. The following is a discussion of the complexity of
administering the program:
When MMC detects taxpayer -reporting errors, together with the reasons therefore, less than half of
MMC's audit work id accomplished. Most of MMC's audit work is devoted to facilitating corrective
action. This is largely due to the preponderance, of reporting errors by out-of-state headquartered
distributors, contractors, processors, manufacturers and lessors engaged in business -to -business
sales in California In terms of dollars, these companies account for more that 90% of misallocations.
For these companies, there is considerable confusion due to the complexities posed by California's
transactions and use tax regulations. The reporting problems are further compounded when the
regulations are applied to multiple California locations, with each having a product/customer mix of
business -to -business sales, while some of the transactions are subject to transactions tax, and others
are subject to use tax and some are exempt
:v1BIA MuniServtces Company 2 Local District Tax Audit Addendum
COROLLARY CONSULTING
Upon mutual agreement between MMC and the CITY as to the scope of services to be provided,
MMC shall provide to CITY such additional consulting services as CITY may request. Consulting
services otherwise included in the Addendum will not be subject to MMC's fees for Corollary
Consulting as set forth below.
DISTRICT TAX DETECTION TIMING CONSIDERATIONS
For each misallocated account detected, MMC will coordinate with the business and SBE to make the
necessary corrections plus retroactive adjustments for eligible amounts of district tax improperly
distributed in prior quarters. MMC coordinates and communicates between typically four parties;
sales/operations personnel at the taxpayer's local operation, tax personnel at the company's
corporate headquarters, and SBE personnel and the in-state/out-of-state district offices. Correction of
the account is considered to have been made once the taxpayer is properly allocating the payments
on identified taxpayer accounts to the City in the period in which the payment was made.
As needed, MMC 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.
TIMING
MMC shall commence auditing the district tax and within 10 working days of receipt of a fully executed
contract and Confidentiality Resolution designating MMC as the authorized City Consultant to
examine district tax records.
CONFIDENTIALITY PROVISIONS
MMC is authorized by this Agreement to examine district tax, sales tax and use tax records of the
State Board of Equalization provided to City pursuant to contract under the Bradley -Burns Uniform
Sales and Use Tax Law and California Revenue & Taxation Code applicable to transactions and use
taxes.
MMC 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.
MMC is prohibited from performing consulting services for a retailer during the term of this Agreement.
MMC 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 MMC'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.
s.., ,.luntServices Company 3 Local District Tax Aud:t Addendum
DISTRICT TAX COST PROPOSAL
COST PROPOSALS
MMC's compensation for the City District Tax Audit Services is a 25% contingency fee. This fee
applies to six quarters after the Date of Correction and all eligible prior quarters back to and including
all corrected quarters prior to the Date of Knowledge quarter.
The Date of Knowledge is the quarter during which MMC notifies the SBE of the existence of a
misallocation. 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, MMC's compensation shall only include
the quarters in which the misallocation actually occurred.
In most cases where MMC identifies District Tax errors, the business is already reporting the local
Bradley -Burns allocations correctly. Therefore, when MMC provides the Sales and Use Tax Audit
(SUTA) service for the City's Bradley -Burns revenues and the City's District Tax revenues, MMC will
not charge for both revenue sources but only the Bradley -Burns portion of the correction contained in
the SUTA agreement.
COROLLARY CONSULTING
For any agreed scope of services to be performed by MMC for CITY as Corollary Consulting as
provided for herein, MMC shall be compensated on a Time and Material basis. MMC's standard
hourly rates are as follows:
Principal - $175/hour
Director - $150/hour
Manager - $125/hour
Senior Analyst - $100/hour
Analyst - $75/hour
Administrative Support - $50/hour
All reimbursable expenses shall receive prior approval from the CITY and shall be reimbursed at cost
to MMC.
CITY RESPONSIBILITES
MMC's services performed hereunder may result in corrections of misallocations after cessation of
services by MMC for City. Therefore, City agrees that with regards to misallocations identified to the
SBE whose Date of Knowledge occurred during MMC's performance of services for City, that City's
obligation to pay MMC 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 SBE of a reporting error or misallocation
as those terms are used herein, City agrees to notify MMC of City's discovery no later that ten (10)
days after the Date of Knowledge. If City fails to so notify MMC and MMC later detects, documents,
and reports the misallocation or reporting error to the SBE, or if MMC has established a Date of
Knowledge with the SBE prior to notification to the Board by City, then MMC shall be entitled to
compensation for the affected account in accordance with this Addendum.
\1RIi1 MunServices Company 4 Locni District Tax Audu Addendum
0
c
RESOLUTION NO. 2006 - 157
RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF NATIONAL CITY
DESIGNATING MBIA MUNISERVICES COMPANY
AS THE AUTHORIZED CITY REPRESENTATIVE TO EXAMINE
TRANSACTIONS AND USE TAX (SALES TAX) RECORDS
WHEREAS, pursuant to California Revenue and Taxation Code Section 7200, et.
seq., the City of National City has adopted a transactions and use tax (sales tax) ordinance
which imposes a tax and provides a measure therefore that can be administered and collected
by the State Board of Equalization along the same and existing statutory and administrative
procedures followed by the State Board of Equalization in administering and collecting the
Califomia State Sales and Use Taxes; and
WHEREAS, the City of National City has entered into an agreement for sales tax
audit and information services with the firm of MBIA MuniServices Company, to designate MBIA
MuniServices Company as the authorized Consultant to examine such sales tax records
maintained by the Board on behalf of the City of National City; and
WHEREAS, all legal prerequisites prior to the adoption of this Resolution have
occurred.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
National City as follows:
1. In all respects as set forth above, the City Council of the City of National City
hereby certifies to the State Board of Equalization that MBIA MuniServices
Company is the designated representative of the City of National City to examine
all of the transactions and use tax records of the Board pertaining to transactions
and use taxes collected by the Board on behalf of the City of National City.
2. Pursuant to California Revenue and Taxation Section 7056(b), the City Council of
the City of National City certifies that MBIA MuniServices Company (hereinafter
referred to as "Consultant") meets all of the following conditions:
a. Consultant is required by that contract to disclose information contained
in, or derived from, those sales tax records only to an officer or employee
of the City who is authorized by resolution to examine the information;
b. Consultant is prohibited by the contract from performing consulting
services for a retailer during the term of the contract; and
c. Consultant is prohibited from retaining the information contained in, or
derived from, those sales tax records after the contract has expired.
--- Signature Page to Follow --
Resolution No. 2006 - 157
August 1, 2006
Page 2
PASSED and ADOPTED this 1st day of August, 2006.
Nick'nzunza,
ATTEST:
/')/
Michael Dalla, C09 Clerk
APPROVED AS TO FORM:
/T z
George H. Eiser, III
City Attorney
Passed and adopted by the Council of the City of National City, California, on August
1, 2006, by the following vote, to -wit:
Ayes: Councilmembers: Morrison, Natividad, Parra, Zarate.
Nays: None.
Absent: Inzunza.
Abstain: None.
AUTHENTICATED BY:
NICK INZUNZA
Mayor of the City of National City, California
N
City 1 erk of the City c National City, California
By:
Deputy
I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of
RESOLUTION NO. 2006-157 of the City of National City, California, passed and
adopted by the Council of said City on August 1, 2006.
City Clerk of the City of National City, California
By
Deputy
City of National City, California
COUNCIL AGENDA STATEMENT
MEETING DATE5 August 1, 2006 AGENDA ITEM NO.
9
ITEM TITLE RESOLUTION OF THE CITY COUNCIL OF THE CITY OF NATIONAL CITY
AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT DESIGNATING
MBIA, MUMSERV!CES COMPANY AS THE AUTHORIZED CITY REPRESENTATIVE TO
EXAMINE TRANSACTIONS AND USE TAX (SALES TAX) RECORDS
PREPARED BY Lin Wurbs
Asst. City Manager
EXPLANATION 336-4240 jo
DEPARTMENT
City Manager
Califomia Sales and Use Tax regulations arc extremely complex and there is often confusion on the
part of the business community due to these complexities. MBIA/MuniServices Company (MMC) has
expertise and experience in discovering, identifying and recovering misallocated and misreported
revenue for California cities and counties for the past 25 years. MMC is committed to assisting
National City in realizing all of the District Sales and Use Tax revenue to which it is entitled. MMC
shall represent the City for purpose of examining State Board of Equalization (SBE) records pertaining
to the District Tax to identify errors and omissions. For each misallocated or under reported account
detected, MMC will coordinate with the taxpayer and/or SHE to make the necessary corrections plus
retroactive adjustments where necessary.
Environmental Review ✓ N/A
Financial Statement
There is no additional charge for monitoring and providing reports on the new tax.
Account No.
STAFF RECOMMENDATION
Adopt Resolution
BOARD / COMMISSION RECOMMENDATION
N/A
ATTACHMENTS ( Listed Below) Resolution No.
Resolution
i,
A-200 (9/80)
June 26, 2006
Mr. Chris Zapata
City Manager
National City
1243 National City Blvd.
National City, CA 91950
Dear Mr. Zapata,
MBIA/MuniServices Company (MMC) has expertise and experience in discovering,
identifying and recovering misallocated and misreported revenue for California cities and
counties for the past 25 years. MMC is the only known organization providing these
audit and information services to special districts restoring revenue that is critical to their
economies.
MMC is particularly proud of its long standing relationship with other cities throughout
California. Given the opportunity, MMC can assist National City in realizing all of the
District Sales and Use Tax revenue to which it is entitled.
MMC's unique ability to identify and correct the complex errors associated with District
Sales and Use Fax reporting is provided on a self funded basis. Only MMC has the
extensive resources and specialized expertise needed to meet and exceed the
requirements of this challenging job. MMC is confident that National City will see why
MMC is the preferred contractor for other major California cities Saks and Use Tax
Audit Services. As evidenced by the following results, it is clear to see the value of
MMC'S services.
MMC is currently working with 20 city, county and transportation districts in auditing
and tracking their revenue from District Sales and Use Taxes. To date MMC has
recovered $ 12,417,706 in misallocated and misreported revenue for these entities.
I know I speak for all of MMC when I express MMC's sincere desire to partner with
National City. MMC has the confidence that our project team, our techniques and our
systems offered to National City will result in superior service and the opportunity to
realize additional revenue for the City'.
Sincerely.
Patricia Nunn
Client Services
MBIA MuniServiccs Company
LOCAL DISTRICT TAX AUDIT ADDENDUM
OBJECTIVES AND METHODS
Many California special taxing jurisdictions are not receiving the transactions and use tax revenue to
which they are entitled due to point of use and other types of taxpayer reporting errors. District taxes
are collected on a destination basis (where the tangible personal property will be used or is delivered
to) as opposed to Bradley -Burns tax, which is collected at the point of sale. When businesses fail to
properly report their transactions tax, it is distributed in error to other jurisdictions or not collected at
all. Almost all district tax error discoveries involve companies that are correctly collecting and
allocating the local Bradley -Burns tax. Accordingly, MMC initial and ongoing audit service will assist
in the detection and correction of taxpayer reporting errors and generate new transactions and use tax
revenue that would not otherwise have been realized by the City. MMC has vast experience in
auditing district tax. District taxes and local Bradley -Burns taxes do not necessarily result in
equivalent tax dollars for an equal measure of tax rate, because they have different rules of
application. MMC currently audits district tax for many transit authorities and jurisdictions such as:
Bay Area Rapid Transit District (BART), Lox Angeles Metropolitan Transit Authority (LAMTA), Orange
County Local Transportation Authority, San Diego County Regional Transportation Commission,
Santa Clara Valley Transportation Authority, City of Capitola, City of Davis, City of Richmond, Town of
Truckee, City of West Sacramento, and City of Woodland.
DISTRICT TAX DETECTION AND DOCUMENTATION
MMC shall represent the City of purposes of examining State Board of Equalization (SBE) records
pertaining to district tax to identify errors and omissions. MMC's procedures for detecting and
documenting misallocations are as follows:
❑ Meet with designated CITY official(s) to review service objectives and scope, MMC
work plan schedule, public relations and logistical matters.
❑ Procure a computer tape of district tax permit records from the State Board of
Equalization (SBE).
❑ Clean-up, standardize and computerize data from City's quarterly transaction tax
distribution reports provided by SBE for previous quarters, current quarter and each
future quarter service is provided.
❑ Develop a target list of potential point-of-sale/delivery/use taxpayer reporting errors of
transactions and use tax generating businesses located in the City's jurisdiction.
These businesses are to be analyzed based on proprietary guidelines established by
MMC, formulated through expert knowledge of corporate mergers and acquisitions,
transactions versus use tax, businesses marking organization and methods,
commercial/industrial transactions and use tax reporting practices, and other conditions
contributing to reporting errors.
❑ Clean, standardize and integrate, in address -order, each entity's business name,
address and payment file information, to eliminate redundancies, using MMC's
proprietary software.
❑ Contact personnel in sales, operations and/ or tax accounting at each target business
to determine whether a destination based reporting error exists. (Note: this is
accomplished with the highest regard to discretion and professional conduct. MMC's
allocation audits are predicated on a non -controversial, constructive public relations
\1RL\ NtuniSere•tces Company 1 Local District Tax .Audit Addendum
approach which emphasizes the importance of each business to the City and the
mutual benefits of correcting reporting errors )
❑ 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 contracted, date(s) of contract, nature of business,
reason(s) for error, and estimated district tax revenue which should be forthcoming to
the City.
❑ MMC may also provide suggested language for letters to be sent to the taxpayers and/
or SBE from the City (or from MMC 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 dates of knowledge.
❑ Receive and process registration control record information monthly.
❑ Receive and process transaction tax distribution reports quarterly.
❑ Coordinate with the taxpayer and SBE to make the necessary corrections and collect
eligible back quarters amounts.
❑ Monitor and analyze the quarterly distribution reports with an audit focus on the
following:
1. Accounts with previously reported destination based 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 transaction, sales and
use 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 that it is entitled to.
3. Those accounts receiving deficiency assessments to ensure that the City receives
its local allocation.
DISTRICT TAX CORRECTION OF MISALLOCATIONS/UNDERRPORTING
For each misallocated or underreporting account detected, MMC will coordinate with the taxpayer
and/ or SBE to make the necessary corrections plus retroactive adjustments for transactions and use
tax amounts improperly distributed or uncollected in prior quarters. This task is simply stated, but
enormously complex and time-consuming. The following is a discussion of the complexity of
administering the program:
When MMC detects taxpayer -reporting errors, together with the reasons therefore, less than half of
MMC's audit work id accomplished. Most of MMC's audit work is devoted to facilitating corrective
action. This is largely due to the preponderance, of reporting errors by out-of-state headquartered
distributors, contractors, processors, manufacturers and lessors engaged in business -to -business
sales in California. In terms of dollars, these companies account for more that 90% of misallocations.
For these companies, there is considerable confusion due to the complexities posed by California's
transactions and use tax regulations. The reporting problems are further compounded when the
regulations are applied to multiple California locations, with each having a product/customer mix of
business -to -business sales, while some of the transactions are subject to transactions tax, and others
are subject to use tax and some are exempt.
NMI:\ MuntScry ices Company 2 Local District Tax Audit .Addendum
COROLLARY CONSULTING
Upon mutual agreement between MMC and the CITY as to the scope of services to be provided,
MMC shall provide to CITY such additional consulting services as CITY may request. Consulting
services otherwise included in the Addendum will not be subject to MMC's fees for Corollary
Consulting as set forth below.
DISTRICT TAX DETECTION TIMING CONSIDERATIONS
For each misallocated account detected, MMC will coordinate with the business and SBE to make the
necessary corrections plus retroactive adjustments for eligible amounts of district tax improperly
distributed in prior quarters. MMC coordinates and communicates between typically four parties;
sales/operations personnel at the taxpayer's local operation, tax personnel at the company's
corporate headquarters, and SBE personnel and the in-state/out-of-state district offices. Correction of
the account is considered to have been made once the taxpayer is properly allocating the payments
on identified taxpayer accounts to the City in the period in which the payment was made.
As needed, MMC 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.
TIMING
MMC shall commence auditing the district tax and within 10 working days of receipt of a fully executed
contract and Confidentiality Resolution designating MMC as the authorized City Consultant to
examine district tax records.
CONFIDENTIALITY PROVISIONS
MMC is authorized by this Agreement to examine district tax, sales tax and use tax records of the
State Board of Equalization provided to City pursuant to contract under the Bradley -Burns Uniform
Sales and Use Tax Law and California Revenue & Taxation Code applicable to transactions and use
taxes.
MMC 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.
MMC is prohibited from performing consulting services for a retailer during the term of this Agreement.
MMC 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 MMC'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.
11BIA J1uniScrvi e Company 3 Local District Tas ?audit .\ddendunt
DISTRICT TAX COST PROPOSAL
COST PROPOSALS
MMC's compensation for the City District Tax Audit Services is a 25% contingency fee. This fee
applies to six quarters after the Date of Correction and all eligible prior quarters back to and including
all corrected quarters prior to the Date of Knowledge quarter.
The Date of Knowledge is the quarter during which MMC notifies the SBE of the existence of a
misallocation. 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, MMC's compensation shall only include
the quarters in which the misallocation actually occurred.
In most cases where MMC identifies District Tax errors, the business is already reporting the local
Bradley -Burns allocations correctly. Therefore, when MMC provides the Sales and Use Tax Audit
(SUTA) service for the City's Bradley -Burns revenues and the City's District Tax revenues, MMC will
not charge for both revenue sources but only the Bradley -Burns portion of the correction contained in
the SUTA agreement.
COROLLARY CONSULTING
For any agreed scope of services to be performed by MMC for CITY as Corollary Consulting as
provided for herein, MMC shall be compensated on a Time and Material basis. MMC's standard
hourly rates are as follows:
Principal - $175/hour
Director - $150/hour
Manager - $125/hour
Senior Analyst - $100/hour
Analyst - $75/hour
Administrative Support - $50/hour
All reimbursable expenses shall receive prior approval from the CITY and shall be reimbursed at cost
to MMC.
CITY RESPONSIBILITES
MMC's services performed hereunder may result in corrections of misallocations after cessation of
services by MMC for City. Therefore, City agrees that with regards to misallocations identified to the
SBE whose Date of Knowledge occurred during MMC's performance of services for City, that City's
obligation to pay MMC 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 SBE of a reporting error or misallocation
as those terms are used herein, City agrees to notify MMC of City's discovery no later that ten (10)
days after the Date of Knowledge. If City fails to so notify MMC and MMC later detects, documents,
and reports the misallocation or reporting error to the SBE, or if MMC has established a Date of
Knowledge with the SBE prior to notification to the Board by City, then MMC shall be entitled to
compensation for the affected account in accordance with this Addendum.
MBIA MuniServices Company 4 Local District TlX .Audit Addcndum
EXECUTED as of the day and year last stated below.
MBIA MuniServices Company/MMC CITY OF CITY
A Municipal Corporation
By: By:
Marc Herman
Title: President Title:
Date: Date:
By:
Kevin Cerutti
Title: Chief Financial Officer
Date:
ATTEST:
CITY CLERK
APPROVED AS TO FORM: APPROVED AS TO FORM:
Eric Myers, Corporate Counsel CITY ATTORNEY
MBIA MIuniServiccs Company 5 Local District Tax Audit Addendum
RESOLUTION NO. 2006 —
RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF NATIONAL CITY AUTHORIZING THE MAYOR TO
EXECUTE AN AGREEMENT DESIGNATING MBIA MUNISERVICES COMPANY
AS THE AUTHORIZED CITY REPRESENTATIVE
TO EXAMINE TRANSACTIONS AND USE TAX (SALES TAX) RECORDS
WHEREAS, pursuant to California Revenue and Taxation Code Section 7200, et.
seq., the City of National City has adopted a transactions and use tax (sales tax) ordinance
which imposes a tax and provides a measure therefore that can be administered and collected
by the State Board of Equalization along the same and existing statutory and administrative
procedures followed by the State Board of Equalization in administering and collecting the
California State Sales and Use Taxes; and
WHEREAS, the City of National City desires to enter into an agreement for
transactions and use tax audit and information services with the firm of MBIA MuniServices
Company, to designate MBIA MuniServices Company as the authorized Consultant to examine
such transaction and use tax records maintained by the Board on behalf of the City of National
City; and
WHEREAS, all legal prerequisites prior to the adoption of this Resolution have
occurred.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
National City as follows:
1. In all respects as set forth above, the City Council of the City of National City
hereby certifies to the State Board of Equalization that MBIA MuniServices
Company shall be the designated representative of the City of National City to
examine all of the transactions and use tax records of the Board pertaining to
transactions and use taxes collected by the Board on behalf of the City of
National City.
2. Pursuant to California Revenue and Taxation Section 7056(b), the City Council of
the City of National City certifies that MBIA MuniServices Company (hereinafter
referred to as "Consultant") meets all of the following conditions:
a. Consultant is required by that contract to disclose information contained
in, or derived from, those sales tax records only to an officer or employee
of the City who is authorized by resolution to examine the information;
b. Consultant is prohibited by the contract from performing consulting
services for a retailer during the term of the contract; and
c. Consultant is prohibited from retaining the information contained in, or
derived from, those sales tax records after the contract has expired.
--- Signature Page to Follow ---
Resolution No. 2006 —
August 1, 2006
Page 2
PASSED and ADOPTED this 1st day of August, 2006.
Nick Inzunza, Mayor
ATTEST:
Michael Dalla, City Clerk
APPROVED AS TO FORM:
George H. Eiser, III
City Attomey
City of National City
Office of the City Clerk
1243 National City Boulevard, National City, CA 91950-4397
Michael R. Della, CMC - City Clerk
(619) 336-4228 Fax: (619) 336-4229
February 20, 2007
Ms. Patricia A. Dunn
Contracts Administrator
MBIA MuniServices Company
7335 N. Palm Bluffs Avenue
Fresno, CA 93711
Dear Ms. Dunn,
On August 1, 2006, Resolution No. 2006-157 was
the City Council of National City, designating MBIA
to examine Sales Tax Records.
We are enclosing for your records a certified copy
and a fully executed copy of the agreement.
Sincerely,
h 4
Michael R. Ualla, CMC
City Clerk
Enclosure
cc: City Manager
passed and adopted by
MuniServices Company
of the above Resolution
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