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Home My WebLink About25A - HDL COREN & CONE PROPERTY TAX AGREEMENTREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: DECEMBER 17, 2019 TITLE: AUTHORIZE FIRST AMENDMENT TO AGREEMENT WITH HDL COREN & CONE TO EXTEND AGREEMENT BY ONE YEAR FOR PROPERTY TAX REVENUE AUDITING AND CONSULTING SERVICES FOR AN AMOUNT NOT TO EXCEED $28,250 {STRATEGIC PLAN NO. 4, 2A} CLERK OF COUNCIL USE ONLY: APPROVED ❑ As Recommended ❑ As Amended ❑ Ordinance on 11' Reading ❑ Ordinance on 2nd Reading ❑ Implementing Resolution ❑ Set Public Hearing For_ CONTINUED TO /s/Kristine Ridge FILE NUMBER CITY MANAGER RECOMMENDED ACTION Authorize the City Manager to execute a First Amendment to Agreement with HdL Coren & Cone for Secured and Unsecured Property Tax Revenue Auditing and Consulting Services, to extend the current contract expiring December 31, 2019 for an additional one-year period beginning January 1, 2020 through December 31, 2020, for an amount not to exceed $28,250 ($23,250 contract services cost plus $5,000 contingency), subject to non -substantive changes approved by the City Manager and the City Attorney. DISCUSSION On February 11, 2016, a Request for Proposals (RFP No. 16-022) for Revenue Auditing, Recovery, Reporting, Analysis, and Legislative/State Agency Liaison and Implementation Monitoring services was released in connection with a variety of tax and revenue sources. Based on RFP proposals received, on October 18, 2016 the City Council awarded a contract to HdL Coren and Cone ("HdLCC") for Secured and Unsecured Property Tax Revenue Auditing and Consulting Services. The reports, analysis, and information derived from the HdLCC's Property Tax Auditing Programs are used for budget planning, revenue forecasting, trend analysis, economic development analysis, debt refinancing and other projects requiring Property Tax revenue statistics and to assist in analyzing the City's economic base. Annual Property Tax revenues of approximately $37.3 million represent approximately 12 percent of the City's total General Fund revenue. During the term of its contract with Santa Ana, HdLCC has been responsive to the City's needs, has offered excellent value, and has proven to be an appropriate selection for the services requested. Overall HdLCC has provided a flexible and cost-effective Property Tax Auditing Program. HdLCC also continues to provide Property Tax services for comparable California cities, including but not limited to: Long Beach, Orange, and Huntington Beach, among others. 25A-1 First Amendment to Agreement HdL Coren & Cone December 17, 2019 Page 2 As part of its City of Santa Ana Property Tax program HdLCC provides the following services: 1. Property Tax reporting services including, but not limited to: City Property Tax Roll Summary, top 40 net taxable change history, top 40 value change listing, median/average sales price of property sales, completed construction projects for tracking of reassessments. 2. Successor Agency services, such as, tax increment projections for each Project Area, cash flow estimates, and estimates of property tax revenues for the Project Area. 3. Property Tax analysis and identification of misallocations. 4. Property Tax web -based software application, which will enable staff to access the City's Property Tax data and be able to extract, analyze, and utilize the available data. 5. Assist in the development of a multi -year Property Tax revenue forecast model. 6. Legislative analysis regarding pertinent Property Tax legislation and regulations. 7. Ongoing consultation on all aspects of the auditing program. Staff Recommendation Continuing to engage HdLCC will enable the City to conduct audits that can recover additional revenue for the City, as well as ensure compliance with tax regulations, provide early indications of trends for the regional economy, and ensure revenues generated within city boundaries are properly allocated, assigned and remitted to the City of Santa Ana on a timely basis. In consideration of HdLCC's outstanding responsiveness to staff requests during their initial contract period (typically within 24 hours of request) and their level of service (analysis, full data and graphics), staff recommends a one-year extension of the HdLCC agreement via City Council approval of a First Amendment to Agreement extending HdLCC's contract with the City from January 1, 2020 to December 31, 2020. Staff plans to release an RFP during 2020 to ensure the City continues to receive competitive service and pricing. STRATEGIC PLAN ALIGNMENT Approval of this item allows the City to meet Goal #4 - City Financial Stability, Objective #2 (Maintain a stable, efficient and transparent financial environment), Strategy A (Adopt a budget that is in alignment with the five-year financial forecast and strategic plan). FISCAL IMPACT Funds in the amount of $28,250, which are comprised of the $23,250 amount for the one-year extension of the current agreement, combined with a $5,000 contingency, are available in the General Fund Property Tax account (01102002-50011). Payments made to HdLCC will be recognized when the fees related to HdLCC's auditing and reporting activities are incurred. The payments within the 2019-2020 and 2020-2021 fiscal years will be available as follows: 25A-2 First Amendment to Agreement HdL Coren & Cone December 17, 2019 Page 3 Fiscal Year Amount FY 2019-20 Property Tax Auditing Services (January 2020-June 2020) $11,625 FY 2019-20 Property Tax Services - Contingency (January 2020-June 2020) $ 2,500 FY 2020-21 Property Tax Auditing Services (July 2020-December 2020) $11,625 FY 2020-21 Property Tax Services - Contingency (July 2020-December 2020) $ 2,500 Exhibit: 1. First Amendment to Agreement WH:AG APPROVED AS TO FUNDS AND ACCOUNTS: Kathryn Downs, CPA Executive Director Finance and Management Services Agency 25A-3 FIRST AMENDMENT TO CONSULTANT SERVICES AGREEMENT This First Amendment to Consultant Services Agreement ("First Amendment to Agreement") is made as of the 17th day of December, 2019 by and between HdL Caren & Cone, a California Corporation ("CONSULTANT") and the City of Santa Ana, a charter city and municipal corporation organized and existing under the Constitution and laws of the State of California (hereinafter "CITY"). CITY and CONSULTANT shall hereinafter collectively be referred to as "the PARTIES", RECITALS A. The PARTIES to Consultant Agreement (A-2016-296) wish to amend said Agreement, dated October 16, 2016, by which CONSULTANT having special skill and knowledge in the field of property tax auditing and consulting agreed to perform such services for CITY with respect to secured and unsecured property taxes with provisos for other related optional services. B. The PARTIES to this First Amendment to Agreement wish to extend the length of said Agreement to include calendar year 2020 (Section 3. "TERM"), and to correspondingly increase reimbursement by $28,250 ($23,250 for base fixed fee services, plus $5,000 for optional contingent services) [Section 2. "COMPENSATION"] payable under said Agreement to coincide with the effect of the term and compensation amendments made. NOW THEREFORE, in consideration of the mutual and respective promises, and subject to the terms and conditions hereinafter set forth, the PARTIES agree to amend Section 2. "COMPENSATION" and Section 3. "TERM" as follows: 1. Section 2. COMPENSATION a. CITY agrees to pay, and CONSULTANT agrees to accept as total payment for its base fixed fee service, the rates and charges set out in Section 4-6 "CONSIDERATION", subsection 4-6.1 Base Fixed Fee Services. b. CONSULTANT shall provide the base services described in section 4-2.0 above, for a fixed annual fee of $ 23,250 (invoiced quarterly). c. CONSULTANT agrees to provide other optional services described in sections 4-3.0 and 4-4.0 at the request of CITY in an amount not to exceed $5,000. 2. Section 3. TERM The Term of this Agreement shall be effective from January 1, 2017 and shall terminate on December 31, 2020, unless amended by the PARTIES for a longer term or terminated earlier in accordance with Section 13, below. // #15085v2 (Signatures on followingpage) 25A-4 IN WITNESS WHEREOF, the parties hereto have executed this First Amendment to Agreement the date and year first above written. ATTEST: Daisy Gomez Clerk of the Council APPROVED AS TO FORM: Sonia R. Carvalho City Attorney By: Lisa Storck Assistant City Attorney FOR APPROVAL: Kathryn Downs, CPA Executive Director Finance & Management Services Agency 915085v2 CITY OF SANTA ANA Kristine Ridge City Manager CONSULTANT HdL Coren & Cone e' Name: Nichole Cone Title: Vice President Tax ID# 95-4398586 25A-5 25A-6