55B - RESO DEPT OF TAX AGMT MEASURE X

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Resolutions Authorizing Execution of Certain Documents Required by CDTFA for Implementation of Voter Approved Transactions and Use Tax and Approval of Second Amendment to MuniServices Agreement January 15, 2019 Page 3 a. Allows CDTFA to collect and remit the Sales Tax to the City effective April 1, 2019. (4) Resolution authorizing the examination of transactions (sales) and use tax records by City employees (designed by position title) and by the City's contracted tax reporting, analysis and recovery services consultant (Exhibit 4). a. This resolution authorizes access by designated City employees to confidential sales and use tax information and/or transactions and use tax information for review of accuracy of local tax allocation to the City and for other "specific governmental functions"; i.e., (a) revenue tracking and economic development, (b) forecasting and budget related functions, and (c) comparative audit of local jurisdiction taxes.) Designations are made by position title and may be altered by formal written request by the Executive Director of Finance and Management Services Agency. Likewise, in concert with an expansion of additional "specific governmental functions", additional employee positions may be formally requested. This resolution also authorizes access by the City's contracted tax reporting, analysis and recovery services consultant.) The City currently contracts with MuniServices, LLC ("MuniServices") for sales and use tax recovery, reporting, and analysis. As part of these services MuniServices provides both a web - based software application (STARS) to help track and analyze sales and use taxes as well as a web -based geographic revenue information application (GRIA) to aggregate for analysis a variety of general fund revenues along with reported sales and use tax data, geographically. Appropriation Adjustment To maintain the efficacy of these services as they relate to the City's new Sales Tax authorized by Measure X, a Second Amendment to MuniServices' contract is required to fully authorize those services in connection with the new tax (Exhibit 5). Also, as the collection of November 6, 2018 voter approved transactions and use taxes cannot commence under state law sooner than April 1, 2019, the City will be in receipt of the increase Sales Tax revenues as follows: Sales Tax Reporting Period Receipted by the Citv • April 2019 Advance June 2019 • May 2019 Advance July 2019 • June 2019 True -Up August 2019 The City's Sales Tax Consultant, MuniServices has provided a preliminary estimate of Sales Tax to be received for the period April 1, 2019 through June 30, 2019 (FY 2018-19, 4w Quarter) estimated to be $15,000,000. The amount is based on various factors and is solely a "best guess estimate" at this time. Staff will be monitoring the revenue source and will provide the Council an update if any revisions are necessary. Local jurisdictions failing to submit all requested resolutions and agreements to the CDTFA by February 1, 2019, risk delay in the implementation of their newly enacted transactions and use taxes which could result in CDFTA not imposing transaction and use taxes otherwise collectible beginning April 1, 2019. Thus, delaying Cities would forfeit those expected quarterly revenues resulting in no transactions and use tax monies accruable for the current fiscal year (FY 2018-19). 55B-3