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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL MEETING DATE: <br />JUNE 19, 2018 <br />TITLE: <br />AUTHORIZE FIRST AMENDED AGREEMENT <br />FOR SALES AND USE TAX REVENUE <br />AUDITING AND CONSULTING SERVICES <br />WITH MUNISERVICES, LLC <br />{STRATEGIC PLAN NO. 4,2) <br />r' <br />P <br />CIT ANAGER <br />RECOMMENDED ACTION <br />CLERK OF COUNCIL USE ONLY: <br />❑ As Recommended <br />❑ As Amended <br />❑ Ordinance on 1St Reading <br />❑ Ordinance on 2nd Reading <br />❑ Implementing Resolution <br />❑ Set Public Hearing For <br />CONTINUED TO <br />FILE NUMBER <br />Authorize the City Manager and Clerk of the Council to execute a First Amended Agreement <br />("Amended Agreement") with MuniServices, LLC ("Mun!Services") for Sales and Use Tax Revenue <br />Auditing and Consulting Services for a period of two and one-half (2Yz) years. Amended Agreement <br />to become effective July 1, 2018 through December 31, 2020 for a stated amount not to exceed <br />$12,000 annually (prorated to $6,000 for the final six month period) covering the web based Sales <br />Tax Analysis Reporting System (STARS) and Geographic Revenue Information Application system <br />(GRIA) reporting systems, inclusive of an annual CPI adjustment not less than two percent (2%) or <br />greater than four percent (4%), annually; plus 15% of recovered sales tax of revenues over the life of <br />the Amended Agreement, with a contingency of up to $100,000 to cover other consulting services <br />subject to non -substantive changes approved by the City Manager and the City Attorney. <br />BACKGROUND <br />The Sales and Use Tax represents approximately 18.4% of the City's total General Fund revenue. <br />Sales tax is levied upon the retailers who sell tangible property in the State of California. The sales <br />tax is measured by gross receipts from retail sales. For the City of Santa Ana the effective sales tax <br />rate is 7.75%. The distribution of the sales tax rate is as follows: State of California (6.00% <br />Combined), County of Orange (0.25%), Measure M (0.50%), and City of Santa Ana (1.0%). A Use <br />Tax complements the sales tax and is imposed on the storage, use, or other consumption of tangible <br />personal property purchased from any out-of-state retailer. The Use tax is measured by the sales <br />price of the property and the rate is the same for both the Sales Tax and the Use Tax. <br />DISCUSSION <br />Currently, MuniServices provides the City with Sales & Use Tax revenue auditing and consulting <br />services and the STARS and GRIA software applications; however, the current agreement will lapse <br />at the end of this fiscal year. In February 2016, a Request for Proposals (RFP No. 16-022) was issued <br />25F-1 <br />