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Finance and Management Services <br />www.santa-ana.org/finance <br />Item # 29 <br />City of Santa Ana <br />20 Civic Center Plaza, Santa Ana, CA 92701 <br />Staff Report <br />July 19, 2022 <br />TOPIC: Resolution Authorizing a Non -Financial Agreement with the California Franchise <br />Tax Board for exchange of Business License Tax Data <br />AGENDA TITLE: <br />Resolution Authorizing a Reciprocal Agreement with the California Franchise Tax Board <br />for the Exchange of Business License Tax Data <br />RECOMMENDED ACTION <br />1. Adopt a Resolution authorizing a reciprocal agreement with the California Franchise <br />Tax Board for the exchange of business license tax data. <br />2. Authorize the City Manager to execute a non -financial reciprocal agreement with the <br />California Franchise Tax Board for the exchange of business license tax data for a <br />term beginning July 19, 2022 through December 31, 2024, subject to non -substantive <br />changes approved by the City Manager and City Attorney. <br />DISCUSSION <br />The City of Santa Ana Municipal Code ("SAMC") Chapter 21, known as the Business <br />License Tax Code, is intended to provide a revenue for the general operation of the City <br />by the levy of a business license tax on all business transactions or activities carried on <br />or occurring within Santa Ana and is not intended for regulation. <br />The data exchange program with the California Franchise Tax Board ("FTB"), which <br />began because of the enactment of Senate Bill 1146 on September 26, 2008, enables <br />both Santa Ana and the FTB to share information and identify non -compliant businesses. <br />The City has been participating in the data exchange program since 2009, and has <br />conducted audits of business license data to ensure the City receives the revenue it is <br />legally entitled to collect. <br />The Agreement with the FTB is good for two years and seven months at a time, and it is <br />time to renew. Under the terms of the Agreement with the FTB, Santa Ana will be required <br />to send data to the FTB annually each June. The data required includes ownership name, <br />address information, Employer ID number, and business start date. The FTB will send <br />the City similar information from their database each year in December, as well as <br />information on taxpayers who file business related income tax returns. Under the terms <br />