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Item # 29
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
July 19, 2022
TOPIC: Resolution Authorizing a Non -Financial Agreement with the California Franchise
Tax Board for exchange of Business License Tax Data
AGENDA TITLE:
Resolution Authorizing a Reciprocal Agreement with the California Franchise Tax Board
for the Exchange of Business License Tax Data
RECOMMENDED ACTION
1. Adopt a Resolution authorizing a reciprocal agreement with the California Franchise
Tax Board for the exchange of business license tax data.
2. Authorize the City Manager to execute a non -financial reciprocal agreement with the
California Franchise Tax Board for the exchange of business license tax data for a
term beginning July 19, 2022 through December 31, 2024, subject to non -substantive
changes approved by the City Manager and City Attorney.
DISCUSSION
The City of Santa Ana Municipal Code ("SAMC") Chapter 21, known as the Business
License Tax Code, is intended to provide a revenue for the general operation of the City
by the levy of a business license tax on all business transactions or activities carried on
or occurring within Santa Ana and is not intended for regulation.
The data exchange program with the California Franchise Tax Board ("FTB"), which
began because of the enactment of Senate Bill 1146 on September 26, 2008, enables
both Santa Ana and the FTB to share information and identify non -compliant businesses.
The City has been participating in the data exchange program since 2009, and has
conducted audits of business license data to ensure the City receives the revenue it is
legally entitled to collect.
The Agreement with the FTB is good for two years and seven months at a time, and it is
time to renew. Under the terms of the Agreement with the FTB, Santa Ana will be required
to send data to the FTB annually each June. The data required includes ownership name,
address information, Employer ID number, and business start date. The FTB will send
the City similar information from their database each year in December, as well as
information on taxpayers who file business related income tax returns. Under the terms
Adopt a Resolution Authorizing a BLT Data Exchange Agreement with the FTB
July 19, 2022
Page 2
of this Agreement, the data exchange will continue through December 2024. Neither the
FTB nor the City of Santa Ana would be reimbursed for the cost of providing data and
neither party will be charged for receiving data from the other agency. Should the City
wish to discontinue participating in the data exchange program, the Agreement may be
terminated with thirty days (30) written notice to the FTB.
Staff recommends the adoption of a Resolution authorizing a reciprocal agreement with
the California Franchise Tax Board for the continued exchange of business data.
ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.
FISCAL IMPACT
There is no fiscal impact associated with this Ordinance adoption.
EXHIBIT(S)
1. Resolution
2. FTB Agreement
Submitted By: Kathryn Downs, FMSA Executive Director
Approved By: Kristine Ridge, City Manager
EXHIBIT 1
RESOLUTION NO. 2022-XXX
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SANTA ANA AUTHORIZING A RECIPROCAL AGREEMENT
WITH THE CALIFORNIA FRANCHISE TAX BOARD FOR
THE EXCHANGE OF BUSINESS LICENSE TAX DATA
WHEREAS, Chapter 21 of the Santa Ana Municipal Code is known as the
Business License Tax Code of the City of Santa Ana ("City"), and Section 21-5 states: "It
shall be unlawful for any person, whether as principal or agent, clerk or employee, either
for himself or for any other person, or for body corporate, or as an officer of any
corporation to transact and carry on any business, trade, profession, calling or occupation
in the city without first having procured a license from the city to do so or without
complying with all applicable provisions of this Code."; and
WHEREAS, this data exchange program began as a result of the enactment of
Senate Bill 1146 on September 26, 2008, which authorized a city to enter into a reciprocal
agreement with the California Franchise Tax Board ("FTB") to exchange tax data to
enable both parties to identify any non -compliant businesses; and
WHEREAS, in June 2015, the City Council approved an agreement with the FTB
to exchange data related to Business Licensing, and the agreement with the FTB expired
on December 31, 2017; and
WHEREAS, the City desires to enter into such an agreement with FTB with a term
from July 19, 2022, or date of adoption of this resolution, through December 31, 2024.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa
Ana as follows:
Section 1. The City approves entering into a reciprocal agreement with FTB for
the exchange of business license tax data.
Section 2. The City appoints and authorizes the Finance Director and his/her
designee(s), and each of them, as agent(s) of the City to conduct all negotiations, execute
and submit documents, including, but not limited to, the standard agreement, applications,
amendments, memoranda of understanding, payment requests and so on, which may be
necessary for participation in and completion of the aforementioned reciprocal
agreement, including any extensions or amendments thereof, subject to prior approval as
to form by the City Attorney's Office.
Section 3. A signed copy of this resolution shall be transmitted to the FTB in
conjunction with the filing of an application.
Section 4. This Resolution shall take effect immediately upon its adoption by a
majority of the City Council.
Resolution No. 2022-XXX
Page 1 of 2
ADOPTED this day of , 2022.
Vicente Sarmiento
Mayor
APPROVED AS TO FORM:
Sonia R. Carvalho
City Attorney
l'
By:
Rya 0.Hcdge
Assistant City Attorney
/_ d2601
NOES:
Councilmembers
Councilmembers
ABSTAIN: Councilmembers
NOT PRESENT: Councilmembers
I, DAISY GOMEZ, Clerk of the Council, do hereby attest to and certify the attached
Resolution No. 2022 -XXX to be the original resolution adopted by the City Council of the
City of Santa Ana on , 2022.
Date:
Clerk of the Council
City of Santa Ana
Resolution No. 2022-XXX
Page 2 of 2
SCOID: 7730-0000000000000000000081093 EXHIBIT 2
STATE OF CALIFORNIA - DEPARTMENT OF GENERAL SERVICES
STANDARD AGREEMENT AGREEMENT NUMBER PURCHASING AUTHORITY NUMBER (if Applicable)
STD 213 (Rev. 04/2020) 000000000000000000081093
1. This Agreement is entered into between the Contracting Agency and the Contractor named below:
CONTRACTING AGENCY NAME
Franchise Tax Board
CONTRACTOR NAME
City of Santa Ana
2. The term of this Agreement is:
START DATE
July 19, 2022
THROUGH END DATE
December 31, 2024
3. The maximum amount of this Agreement is:
$0.00 (NON -FINANCIAL AGREEMENT)
4. The parties agree to comply with the terms and conditions of the following exhibits, which are by this reference made a part of the Agreement.
Exhibits
Title
Pages
Exhibit A
Scope of Work
3
Exhibit B
Budget Detail and Payment Provisions
1
Exhibit C *
General Terms and Conditions
GTC417
Exhibit D
Special Terms and Conditions
3
Exhibit E
City and County Record Format Specifications
2
Exhibit F
Franchise Tax Board Record Layout Specifications
1
Exhibit G
Confidentiality Statement
1
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These documents can be viewed athttps://www.dys.co.yov/OLS/Resources
IN WITNESS WHEREOF, THIS AGREEMENT HAS BEEN EXECUTED BYTHE PARTIES HERETO.
CONTRACTOR
CONTRACTOR NAME (if other than an individual, state whether a corporation, partnership, etc.)
City of Santa Ana
CONTRACTOR BUSINESS ADDRESS CITY STATE ZIP
20 Civic Center Plaza Santa Ana �CA 92701
PRINTED NAME OF PERSON SIGNING
CONTRACTOR AUTHORIZED SIGNATURE
DATE SIGNED
Page 1 of 2
SCOID: 7730-0000000000000000000081093
STATE OF CALIFORNIA - DEPARTMENT OF GENERAL SERVICES
STANDARD AGREEMENT AGREEMENT NUMBER PURCHASING AUTHORITY NUMBER (if Applicable)
STD 213 (Rev. 04/2020) 000000000000000000081093
STATE OF CALIFORNIA
CONTRACTING AGENCY NAME
Franchise Tax Board
CONTRACTING AGENCY ADDRESS
CITY
STATE
ZIP
P.O. Box 2086
Rancho Cordova
CA
95741
PRINTED NAME OF PERSON SIGNING
TITLE
Michael A. Banuelos
Procurement and Contracting Officer or Designee
CONTRACTING AGENCY AUTHORIZED SIGNATURE
DATE SIGNED
CALIFORNIA DEPARTMENT OF GENERAL SERVICES APPROVAL
EXEMPTION (If Applicable)
SCM Vol. 1, 4.04.A.2
Page 2of2
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement 81093
the date and year first above written.
ATTEST:
Daisy Gomez
Clerk of the Council
APPROVED AS TO FORM:
CITY ATTORNEY
Sonia R. Carvalho
Ryan O. Hodge
Assistant City Attorney
RECOMMENDED FOR APPROVAL:
Kathryn Downs (Jul 1, 202213:46 PDT)
Kathryn Downs, Executive Director
Finance and Management Services Agency
State of California
Franchise Tax Board
EXHIBIT A
SCOPE OF WORK
City of Santa Ana
Agreement 81093
This Agreement is entered into by and between the Franchise Tax Board, herein after referred to as
(FTB), and the City of Santa Ana, herein after referred to as the City.
Purpose:
This Agreement provides for the reciprocal exchange between FTB and the City tax data specific to
city business license information for tax administration purposes. By entering into a reciprocal
agreement, each party agrees to bear its own costs of providing the data, and the City is precluded
from obtaining reimbursement.
Both parties will abide by the legal and confidential provisions of this Agreement. Exhibits A, C, D, E,
F, and G, attached hereto and incorporated by reference herein, set forth additional terms to which
the parties agree to be bound.
No Federal Tax Information will be exchanged.
Legal Authority:
California Revenue and Taxation Code (R&TC) Section 19551.1 authorizes a reciprocal agreement
for the exchange of specified tax information between a City/County and FTB. RUC Section
19551.5 mandates cities/counties to provide city/county business licensing and tax information to
FTB upon request.
City Responsibilities:
1. The City agrees that the information provided by FTB will be used exclusively to administer the
City/County Business Tax Program.
2. The City agrees that information obtained under this Agreement will not be reproduced,
published, sold, or released in original or in any other form for any purpose; and will only be
accessed or used by City employees whose duties are to administer the City/County Business
Tax Program.
3. The City agrees to provide FTB with tax information pursuant to Format Specifications, Exhibit E,
which shall include, but not be limited to, the following:
• Business or owner's name
• Business or residence address
• Federal Employer Identification Number (FEIN) or Social Security Number (SSN)
• Ownership type
• North American Industry Classification Code or Standard Industry Classification Code
• Business start and cessation dates
• City Business Tax Number, to be assigned to the City by FTB
Page 1 of 17
State of California
Franchise Tax Board
City of Santa Ana
Agreement 81093
4. The City agrees to extract and provide city data to FTB annually between April and July for each
tax year that the Agreement is in place. If the Agreement is executed after July 31, 2022, the City
will have 30 days after execution to provide FTB with the first year's data.
5. The City agrees to submit the records to FTB electronically using FTB's Secure Web Internet File
Transfer (SWIFT) system.
6. The City agrees to submit the records to FTB in ASCII fixed -length format, .txt, per the Format
Specifications, Exhibit E.
7. The City agrees to resubmit data in the event data is initially submitted with errors. The
resubmission of data must be within 30 days of notification. If data is not submitted accurately
and timely, the City will forfeit its rights to FTB data for that year.
8. The City agrees that each City employee having access to FTB data shall sign a City/County
Business Tax Program Confidentiality Statement, FTB 712 (Exhibit G). The signed statement is
to be retained by the City and produced to FTB upon request.
9. The City agrees to submit to FTB a completed Security Questionnaire prior to receiving any FTB
data. The Security Questionnaire is valid for the duration of the Agreement.
10. The City agrees to provide a copy of the current resolution, order, or minutes reflecting passage
of a motion, or ordinance of the local governing body authorizing the execution of this specific
Agreement.
FTB Responsibilities:
1. FTB agrees that information provided by the City will be used for tax administration and non -tax
programs that FTB administers and may be shared with other state or federal agencies as
authorized by law.
2. FTB agrees that information obtained under this Agreement will not be reproduced, published,
sold, or released in original or in any other form for any purpose, except as provided in
paragraph 1 or otherwise authorized by law.
3. FTB agrees to provide the City with data extracted from the Taxpayer Information (TI) system
and Business Entities Tax System (BETS). FTB will provide the City with records for taxpayers
within the City's jurisdiction who indicate a business on their personal or business entity income
tax return. The Record Layout, Exhibit F, FTB 909A shall include:
• Taxpayer name
• Taxpayer address
• Taxpayer SSN or FEIN
• Principal Business Activity code
4. FTB agrees to match the data provided by the City using the SSN or FEIN against FTB's data
with a "Yes" or "No" indicator on the Record Layout, Exhibit F, FTB 909A. The first year's data
match is at the discretion of FTB based on when the data is received from the City and
processed.
Page 2 of 17
State of California City of Santa Ana
Franchise Tax Board Agreement 81093
5. FTB agrees to provide the City with an annual data extract in December 2022 for tax year 2021,
in December 2023 for tax year 2022, and in December 2024 for tax year 2023 via SWIFT.
6. FTB agrees to register the City for a SWIFT account allowing for the secure electronic
transmission of data.
7. FTB agrees to provide the City with a unique City Business Tax Number to be used for reporting
purposes only.
8. FTB agrees to allow the City to resubmit data within 30 days of notification, in the event data is
initially submitted with errors.
Project Coordinators:
The project coordinators during the term of this Agreement will be:
Franchise Tax Board
Chelsea Van Zant
City/County Business Tax Program Manager
Data Oversight Program
P.O. Box 1468, Mailstop A181
Sacramento, CA 95812-1468
Phone: (916) 845-6304
Email: FTBCCBT(o)ftb.ca.aov
Return executed agreement to:
Franchise Tax Board
Richard O'Neal
Business Acquisitions Unit
P.O. Box 2086, Mailstop A-374
Rancho Cordova, CA 95741-2086
Phone: (916) 845-5597
Fax: (916) 364-2688
Email: Richard. Oneal(@ftb.ca.aov
City of Santa Ana
Alejandra Gutierrez
Senior Management Analyst
20 Civic Center Plaza
Santa Ana, CA 92701
Phone: (714) 647-5497
Email: agutierrez(@santa-ana.org
Page 3 of 17
State of California
Franchise Tax Board
EXHIBIT B
BUDGET DETAIL AND PAYMENT PROVISIONS
This data exchange is provided at no cost.
City of Santa Ana
Agreement 81093
Page 4 of 12
General Terms and Conditions (GTC 04/2017)
EXHIBIT C
APPROVAL: This Agreement is of no force or effect until signed by both parties
and approved by the Department of General Services, if required. Contractor
may not commence performance until such approval has been obtained.
2. AMENDMENT: No amendment or variation of the terms of this Agreement shall be
valid unless made in writing, signed by the parties and approved as required. No
oral understanding or Agreement not incorporated in the Agreement is binding on
any of the parties.
3. ASSIGNMENT: This Agreement is not assignable by the Contractor, either in
whole or in part, without the consent of the State in the form of a formal written
amendment.
4. AUDIT: Contractor agrees that the awarding department, the Department of General
Services, the Bureau of State Audits, or their designated representative shall have
the right to review and to copy any records and supporting documentation pertaining
to the performance of this Agreement. Contractor agrees to maintain such records for
possible audit for a minimum of three (3) years after final payment, unless a longer
period of records retention is stipulated. Contractor agrees to allow the auditor(s)
access to such records during normal business hours and to allow interviews of any
employees who might reasonably have information related to such records. Further,
Contractor agrees to include a similar right of the State to audit records and interview
staff in any subcontract related to performance of this Agreement. (Gov. Code
§8546.7, Pub. Contract Code §10115 et seq., CCR Title 2, Section 1896).
5. INDEMNIFICATION: Contractor agrees to indemnify, defend and save harmless the
State, its officers, agents and employees from any and all claims and losses accruing
or resulting to any and all contractors, subcontractors, suppliers, laborers, and any
other person, firm or corporation furnishing or supplying work services, materials, or
supplies in connection with the performance of this Agreement, and from any and all
claims and losses accruing or resulting to any person, firm or corporation who may be
injured or damaged by Contractor in the performance of this Agreement.
6. DISPUTES: Contractor shall continue with the responsibilities under this
Agreement during any dispute.
7. TERMINATION FOR CAUSE: The State may terminate this Agreement and be
relieved of any payments should the Contractor fail to perform the requirements of
this Agreement at the time and in the manner herein provided. In the event of such
termination the State may proceed with the work in any manner deemed proper by
the State. All costs to the State shall be deducted from any sum due the Contractor
under this Agreement and the balance, if any, shall be paid to the Contractor upon
demand.
Page 5 of 17
8. INDEPENDENT CONTRACTOR: Contractor, and the agents and employees of
Contractor, in the performance of this Agreement, shall act in an independent
capacity and not as officers or employees or agents of the State.
9. RECYCLING CERTIFICATION: The Contractor shall certify in writing under penalty
of perjury, the minimum, if not exact, percentage of post -consumer material as
defined in the Public Contract Code Section 12200, in products, materials, goods, or
supplies offered or sold to the State regardless of whether the product meets the
requirements of Public Contract Code Section 12209. With respect to printer or
duplication cartridges that comply with the requirements of Section 12156(e), the
certification required by this subdivision shall specify that the cartridges so comply
(Pub. Contract Code §12205).
10. NON-DISCRIMINATION CLAUSE: During the performance of this Agreement,
Contractor and its subcontractors shall not deny the contract's benefits to any person
on the basis of race, religious creed, color, national origin, ancestry, physical
disability, mental disability, medical condition, genetic information, marital status, sex,
gender, gender identity, gender expression, age, sexual orientation, or military and
veteran status, nor shall they discriminate unlawfully against any employee or
applicant for employment because of race, religious creed, color, national origin,
ancestry, physical disability, mental disability, medical condition, genetic information,
marital status, sex, gender, gender identity, gender expression, age, sexual
orientation, or military and veteran status. Contractor shall insure that the evaluation
and treatment of employees and applicants for employment are free of such
discrimination. Contractor and subcontractors shall comply with the provisions of the
Fair Employment and Housing Act (Gov. Code §12900 et seq.), the regulations
promulgated thereunder (Cal. Code Regs., tit. 2, §11000 et seq.), the provisions of
Article 9.5, Chapter 1, Part 1, Division 3, Title 2 of the Government Code (Gov. Code
§§11135-11139.5), and the regulations or standards adopted by the awarding state
agency to implement such article. Contractor shall permit access by representatives
of the Department of Fair Employment and Housing and the awarding state agency
upon reasonable notice at any time during the normal business hours, but in no case
less than 24 hours' notice, to such of its books, records, accounts, and all other
sources of information and its facilities as said Department or Agency shall require to
ascertain compliance with this clause. Contractor and its subcontractors shall give
written notice of their obligations under this clause to labor organizations with which
they have a collective bargaining or other agreement. (See Cal. Code Regs., tit. 2,
§11105.)
Contractor shall include the nondiscrimination and compliance provisions of this
clause in all subcontracts to perform work under the Agreement.
11. CERTIFICATION CLAUSES: The CONTRACTOR CERTIFICATION CLAUSES
contained in the document CCC 04/2017 are hereby incorporated by reference
and made a part of this Agreement by this reference as if attached hereto.
12. TIMELINESS: Time is of the essence in this Agreement.
Page 6 of 17
13. COMPENSATION: The consideration to be paid Contractor, as provided herein,
shall be in compensation for all of Contractor's expenses incurred in the
performance hereof, including travel, per diem, and taxes, unless otherwise
expressly so provided.
14. GOVERNING LAW: This contract is governed by and shall be interpreted in
accordance with the laws of the State of California.
15. ANTITRUST CLAIMS: The Contractor by signing this agreement hereby certifies
that if these services or goods are obtained by means of a competitive bid, the
Contractor shall comply with the requirements of the Government Codes Sections
set out below.
a. The Government Code Chapter on Antitrust claims contains the following
definitions:
1) "Public purchase" means a purchase by means of competitive bids of
goods, services, or materials by the State or any of its political subdivisions
or public agencies on whose behalf the Attorney General may bring an
action pursuant to subdivision (c) of Section 16750 of the Business and
Professions Code.
2) "Public purchasing body" means the State or the subdivision or
agency making a public purchase. Government Code Section 4550.
b. In submitting a bid to a public purchasing body, the bidder offers and
agrees that if the bid is accepted, it will assign to the purchasing body all
rights, title, and interest in and to all causes of action it may have under
Section 4 of the Clayton Act (15 U.S.C. Sec. 15) or under the Cartwright
Act (Chapter 2 (commencing with Section 16700) of Part 2 of Division 7 of
the Business and Professions Code), arising from purchases of goods,
materials, or services by the bidder for sale to the purchasing body
pursuant to the bid. Such assignment shall be made and become effective
at the time the purchasing body tenders final payment to the bidder.
Government Code Section 4552.
C. If an awarding body or public purchasing body receives, either through
judgment or settlement, a monetary recovery for a cause of action assigned
under this chapter, the assignor shall be entitled to receive reimbursement
for actual legal costs incurred and may, upon demand, recover from the
public body any portion of the recovery, including treble damages,
attributable to overcharges that were paid by the assignor but were not paid
by the public body as part of the bid price, less the expenses incurred in
obtaining that portion of the recovery. Government Code Section 4553.
d. Upon demand in writing by the assignor, the assignee shall, within one year
from such demand, reassign the cause of action assigned under this part if
the assignor has been or may have been injured by the violation of law for
which the cause of action arose and (a) the assignee has not been injured
thereby, or (b) the assignee declines to file a court action for the cause of
action. See Government Code Section 4554.
Page 7 of 17
16. CHILD SUPPORT COMPLIANCE ACT: For any Agreement in excess of
$100,000, the contractor acknowledges in accordance with Public Contract Code
7110, that:
a. The contractor recognizes the importance of child and family support
obligations and shall fully comply with all applicable state and federal laws
relating to child and family support enforcement, including, but not limited
to, disclosure of information and compliance with earnings assignment
orders, as provided in Chapter 8 (commencing with section 5200) of Part 5
of Division 9 of the Family Code; and
b. The contractor, to the best of its knowledge is fully complying with the
earnings assignment orders of all employees and is providing the names
of all new employees to the New Hire Registry maintained by the
California Employment Development Department.
17. UNENFORCEABLE PROVISION: In the event that any provision of this Agreement
is unenforceable or held to be unenforceable, then the parties agree that all other
provisions of this Agreement have force and effect and shall not be affected
thereby.
18. PRIORITY HIRING CONSIDERATIONS: If this Contract includes services in excess
of $200,000, the Contractor shall give priority consideration in filling vacancies in
positions funded by the Contract to qualified recipients of aid under Welfare and
Institutions Code Section 11200 in accordance with Pub. Contract Code §10353.
19. SMALL BUSINESS PARTICIPATION AND DVBE PARTICIPATION
REPORTING REQUIREMENTS:
a. If for this Contract Contractor made a commitment to achieve small
business participation, then Contractor must within 60 days of receiving
final payment under this Contract (or within such other time period as may
be specified elsewhere in this Contract) report to the awarding department
the actual percentage of small business participation that was achieved.
(Govt. Code § 14841.)
b. If for this Contract Contractor made a commitment to achieve disabled
veteran business enterprise (DVBE) participation, then Contractor must
within 60 days of receiving final payment under this Contract (or within
such other time period as may be specified elsewhere in this Contract)
certify in a report to the awarding department: (1) the total amount the
prime Contractor received under the Contract; (2) the name and address of
the DVBE(s) that participated in the performance of the Contract; (3) the
amount each DVBE received from the prime Contractor; (4) that all
payments under the Contract have been made to the DVBE; and (5) the
actual percentage of DVBE participation that was achieved. A person or
entity that knowingly provides false information shall be subject to a civil
penalty for each violation. (Mil. & Vets. Code § 999.5(d); Govt. Code §
14841.)
Page 8 of 17
20. LOSS LEADER: If this contract involves the furnishing of equipment, materials, or
supplies then the following statement is incorporated: It is unlawful for any person
engaged in business within this state to sell or use any article or product as a "loss
leader" as defined in Section 17030 of the Business and Professions Code. (PCC
10344(e).)
Page 9 of 17
State of California
Franchise Tax Board
EXHIBIT D
SPECIAL TERMS AND CONDITIONS
City of Santa Ana
Agreement 81093
DATA OWNERSHIP: The confidential tax information or sensitive information being provided
under this Agreement remains the exclusive property of the providing party.
Confidential tax information and other confidential information are not open to the public and
require special precautions to protect from loss and unauthorized access, inspection,
acquisition, use, disclosure, modification, or destruction. The City (or County) shall have the
right to use and process the disclosed information for the purposes stated in the Scope of
Work of Exhibit A of this Agreement, which right shall be revoked and terminated
immediately upon termination of this Agreement.
2. STATEMENT OF CONFIDENTIALITY: The Franchise Tax Board has taxpayer tax returns
and other confidential information and data in its custody. Unauthorized inspection or
disclosure of state returns or other confidential information or data is a misdemeanor
(Revenue and Taxation Code Sections 19542, 19542.1, Unauthorized inspection or
disclosure of federal returns and other confidential federal return information or data is a
misdemeanor or a felony (Internal Revenue Code Sections 7213A(a)(2) and (b), and
7213(a)(2), respectively).
Upon the approval of this agreement and prior to any access to the confidential or sensitive
data of the FTB, each City (or County) employee who may have access to the confidential
data of FTB will be required to sign a City/County Business Tax Program Confidentiality
Statement, FTB 712 (Exhibit G), attesting to the fact that he/she is aware of the
confidentiality of the data and the penalties for unauthorized disclosure thereof under
applicable state and federal law. The signed statement(s) shall be retained by the City (or
County) and furnished to FTB upon request.
3. USE OF INFORMATION: The City (or County) agrees that the information furnished or
secured pursuant to this Agreement shall be used solely for the purposes described in the
Scope of Work of Exhibit A. The City (or County) further agrees that information obtained
under this Agreement will not be reproduced, published, sold or released in original or in any
other form for any purpose other than as identified in the Scope of Work of Exhibit A.
4. EMPLOYEE ACCESS TO INFORMATION: Both FTB and the City (or County) receiving data
agree that the information obtained will be kept in the strictest confidence and shall make
information available to its own employees only on a "need to know" basis. The "need
to know" standard is met by authorized employees who need the information to perform their
official duties in connection with the uses of the information authorized by this Agreement.
Each party receiving data recognize(s) its responsibility to protect the confidentiality of the
information in its custody as provided by law and ensure that such information is disclosed
only to those individuals and for such purposes as authorized by law and this Agreement.
5. PROTECTING CONFIDENTIAL INFORMATION/ INCIDENT REPORTING: Both FTB and
the City (or County) receiving data, recognize the confidentiality of the information to be
exchanged, pursuant to this agreement from unauthorized access, use, or disclosure. Each
party receiving data will conduct oversight of its users with access to the confidential
information provided under this agreement and will immediately notify the FTB's Information
Security Audit Unit(SecurityAuditMail(a-)-ftb.ca.gov) of any unauthorized or suspected
unauthorized accesses, uses and/or disclosures (incidents). For purposes of this section,
immediately is defined as within 24 hours of the discovery of the breach. The notification
Page 10 of 17
State of California City of Santa Ana
Franchise Tax Board Agreement 81093
must describe the incident in detail and identify responsible personnel (name, title, and
contact information). The City (or County) with an incident will comply with the incident
reporting requirements in accordance with R&TC Section 19542.1, Civil Code Section
1798.29, SAM Chapter 5300, and SAM Sections 8643 and 20080, and State Information
Management Manual 54340-A and 5340-C to facilitate the required reporting to the
taxpayers or state oversight agencies.
6. INFORMATION SECURITY: Information security is defined as the preservation of the
confidentiality, integrity, and availability of information. A secure environment is required to
protect the confidential information obtained from FTB pursuant to this agreement. The City
(or County) receiving data will store information so that it is physically secure from
unauthorized access. The records received by the City (or County) will be securely
maintained and accessible only by employees of the City (or County) business license or
tax programs who are committed to protect the data from unauthorized access, use, or
disclosure. All FTB electronic data must be encrypted when in transit using FIPS 140-2
approved encryption technology and be password protected and secure at all times when in
storage. Confidential information obtained from the FTB must be secured in accordance with
the SAM Chapters 5100 and 5300 (Information Security), and National Institute of Standards
and Technology (NIST) Special Publication 800-53 (moderate); and additional security
requirements provided by FTB.
7. CLOUD COMPUTING ENVIRONMENT: A City (or County) receiving FTB's confidential data
must submit a completed FTB Cloud Security Questionnaire before using a Cloud
Computing Environment. The questionnaire will be reviewed for approval by FTB's Chief
Security Officer, or his/her designee. A Cloud Computing Environment cannot be used to
receive, transmit, store or process FTB's confidential data without prior written approval from
FTB's Chief Security Officer or his/her designee.
8. DESTRUCTION OF RECORDS: All records received by the City (or County) from FTB
under this Agreement, and any database(s) created, copies made, or files attributed to the
records received, will be returned or destroyed within three years of receipt or upon
termination of the agreement due to a breach of its terms, whichever occurs earlier. The
records shall be destructed in a manner to be deemed unusable or unreadable, and to the
extent that an individual record can no longer be reasonably ascertained. The City (or
County) will notify FTB City/County Business Tax program manager annually in writing at
FTB CCBT(a�FTB.CA.GOV that proper destruction methods have been applied. FTB will
destroy city/county data in accordance with the department's data retention policies.
9. DISPUTE RESOLUTION: In the event of a dispute, the City (or County) shall file a "Notice of
Dispute" with the Chief Financial Officer of the FTB within ten (10) days of discovery of the
problem. Within ten (10) days, the Chief Financial Officer or his/her designee shall meet with
the City (or County) for purposes of resolving the dispute. The decision of the Chief
Financial Officer shall be final.
10. SURVIVAL OF OBLIGATION TO PROTECT DATA: Each party's obligation to protect the
data and information received from the other party shall survive the expiration or termination
of this Agreement. In the event a party continues to provide any data or information to the
other party after the expiration or termination of this Agreement, the receiving party agrees
to continue to protect all such data and information received in accordance with the
provisions of this Exhibit D, and all applicable state and federal laws.
Page 11 of 17
State of California
Franchise Tax Board
City of Santa Ana
Agreement 81093
11. ONSITE SAFEGUARD REVIEW: FTB retains the right to conduct on -site safeguard reviews
of the City (or County) use of FTB information and security controls established. The
safeguard reviews may include, but are not limited to an examination of the adequacy of
information security controls, "need to know," and use justifications established by the City
(or County) to ensure compliance with the terms and conditions of this agreement. FTB will
provide a minimum of seven (7) days' notice of a safeguard review being conducted by FTB
staff. The City (or County) will take appropriate disciplinary actions against any user
determined to have violated security or confidentiality requirements.
12. LIMITED WARRANTY: Neither party represents or warrants the accuracy or content of the
material available through this Agreement, nor each expressly disclaims any express or
implied warranty, including any implied warranty of fitness for a specific purpose.
13. CANCELLATION: Either party may terminate this Agreement, in writing for any reason, upon
thirty (30) days' prior written notice. This Agreement may be terminated immediately by either
party in the event of any breach of the terms of this Agreement.
14. NO THIRD PARTY LIABILITY: Nothing contained in or related to this agreement shall
create any contractual relationship between either of the Parties and any other party, except
between FTB and the City (or County); and no other party shall relieve the City (or County)
or FTB of its responsibilities and obligations hereunder. Each of the parties agrees to be
fully responsible for the acts and omissions of its third party contractors and agents, and of
persons either directly or indirectly employed by the party. Neither of the parties shall have
any obligation to pay, or to see to the payment of, any monies to any party or persons either
directly or indirectly employed by the other.
Page 12 of 17
State of California City of Santa Ana
Franchise Tax Board Agreement 81093
EXHIBIT E
CITY AND COUNTY RECORD FORMAT SPECIFICATIONS (FTB 9091
Data Element Name Start End Field Usage Description
Pos. Pos. Size
SOCIAL SECURITY NUMBER
(SSN)
FEDERAL EMPLOYER
ID NUMBER (FEIN)
1
9 9
10
18 9
19
19 1
OWNER'S LAST NAME
20
34
15
OWNER'S FIRST NAME
35
45
11
OWNER'S MIDDLE INITIAL
46
46
1
BUSINESS NAME
47
86
40
BUSINESS ADDRESS
NUMBER AND STREET
CITY
STATE
ZIP CODE
BUSINESS START DATE
87 126 40
127
166
40
167
168
2
169
177
9
178 185 8
AN
Must be present unless FEIN is
provided. Fill unused field with
zeros.
AN
Must be present unless SSN is
provided. Fill unused field with
zeros.
AN
Must be present:
S = Sole Proprietorship
P = Partnership
C = Corporation
T = Trust
L = Limited Liability Company
AN
Must be present if Ownership Type
in position 19 = S.
AN
Must be present if Ownership Type
in position 19 = S.
AN
May be left blank.
AN
Enter if business is operating under
a fictitious name (Doing Business
As (DBA)).
AN
Address of the business location or
the residence of the owner if sole
proprietorship.
A
Must be present.
A
Enter standard state abbreviation.
AN
Enter the five- or nine -digit ZIP
Code assigned by the U.S. Postal
Service. If only the first five -digits
are known, left -justify information
and fill the unused fields with zeros.
N
Enter the eight -digit date
(MMDDYYYY). Zero fill if not
known.
Page 13 of 17
State of California
Franchise Tax Board
BUSINESS CEASE DATE
City of Santa Ana
Agreement 81093
186 193 8 N Enter the eight -digit date
(MMDDYYYY) if out of business.
Zero fill if unknown or still in
business.
Data Element Name
Start
End
Field Usage
Description
Pos.
Pos.
Size
CITY BUSINESS TAX
194
196
3 N
Enter three -digit number assigned
NUMBER
by FTB.
NORTH AMERICAN
197
202
6 N
Enter the two- to six -digit NAICS
INDUSTRYCLASSIFICATION
code. Left justify. (example 99 will
SYSTEM (NAICS)
be 9900). Fill unused fields with
zeros.
STANDARD INDUSTRIAL 203 206 4
CLASSIFICATION (SIC)
TOTAL RECORD LENGTH 206
N Enter the 2-4 digit SIC code. Left
justify (example 99 will be 9900).
Fill unused fields with zeros.
Page 14 of 17
State of California
Franchise Tax Board
City of Santa Ana
Agreement 81093
EXHIBIT F
FRANCHISE TAX BOARD RECORD LAYOUT SPECIFICATIONS (FTB 909A)
Field Name
Length
Start
Description
Pos.
ENTITY TYPE
1
1
"P" — personal income tax record;
"B" — business entity tax record.
SSN or FEIN
9
2
For "P" records, primary taxpayer's social
security number; For "B" records, federal
employer identification number.
LAST NAME
40
11
For "P" records, the primary taxpayer's last
name; For "B" records, business name.
FIRST NAME
11
51
For "P" records ONLY.
MIDDLE INITIAL
1
62
For "P" records ONLY.
SPOUSE SSN
9
63
For "P" records filed with a joint return.
SPOUSE LAST NAME
17
72
For "P" records filed with a joint return.
SPOUSE FIRST NAME
11
89
For "P" records filed with a joint return.
SPOUSE MIDDLE INITIAL
1
100
For "P" records filed with a joint return.
PBA CODE
6
101
Principal Business Activity code.
ADDRESS NUMBER
10
107
PRE -DIRECTIONAL DIRECTOR
2
117
Postal Service term (i.e., N, S, E, W, NE,
NW, SE, SW).
STREET NAME
28
119
STREET SUFFIX
4
147
e.g., ST, WAY, HWY, BLVD, etc.
POST -DIRECTIONAL INDICATOR
2
151
Postal Service term (i.e., N, S, E, W, NE,
NW, SE, SW).
STREET SUFFIX 2
4
153
APARTMENT/SUITE NUMBER
10
157
e.g., APT, UNIT, FL, etc.
CITY
13
167
STATE
2
180
Standard state abbreviation.
Page 15 of 17
State of California City of Santa Ana
Franchise Tax Board Agreement 81093
ZIP CODE 5 182 The five -digit ZIP Code assigned by the U.S.
Postal Service.
ZIP CODE SUFFIX 4 187 Provided if known.
CBT MATCH 1 191 "N" — No match per CBT data.
"Y" — Yes: CBT matched to state tax return
filed.
Page 16 of 17
EXHIBIT G
CONFIDENTIALITY STATEMENT (FTB 712)
State of California
City/County Business Tax Program Confidentiality Statement
Franchise Tax Board
Confidential tax data is protected from disclosure by law, regulation, and policy. Information security is
strictly enforced; violators may be subject to disciplinary, civil, and/or criminal action. Protecting
confidential tax data is in the best interest of the city, county, and state.
As a city/county employee, you are required to protect all information received from the
Franchise Tax Board (FTB). To protect confidential tax data, you must:
• Access or modify tax data solely to perform official duties.
• Never access or inspect tax data for curiosity or personal reasons.
• Never show or discuss confidential tax data with anyone who does not have a need to
know.
• Never remove confidential tax data from your worksite without authorization.
• Place confidential tax data in approved locations only.
Unauthorized inspection, access, use, or disclosure of confidential tax data is a crime under state laws
including, but not limited to, California Revenue and Taxation Code Sections 19542 and 19552 and
Penal Code Section 502. Unauthorized access, inspection, use, or disclosure may result in either or
both of the following:
• State criminal action.
• Taxpayer civil action.
I certify that I have read the confidentiality statement printed above. I further certify and
understand that unauthorized access, inspection, use, or disclosure of confidential information
may be punishable as a crime and may result in disciplinary and/or civil action against me.
Name (print)
Signature
Dat
Each city/county employee accessing FTB data must retain a signed copy of this form and provide it to
FTB upon request.
FTB 712 (REV 06-2016)
Page 17 of 17
Exhibit 2—State of California —Dept of GS_FTB
Standard Agreement with Exhibits_7-1-22
Final Audit Report 2022-07-01
Created: 2022-07-01
By: Kristin Andrade (kandrade@santa-ana.org)
Status: Signed
Transaction ID: CBJCHBCAABAA1Co-tQekQVT8usThmrkDfnf8HsUhE7Cq
"Exhibit 2_State of California —Dept of GS_FTB Standard Agreem
ent with Exhibits_7-1-22" History
Document created by Kristin Andrade (kandrade@santa-ana.org)
2022-07-01 - 8:42:35 PM GMT- IP address: 98.153.69.210
Document emailed to Kathryn Downs (kdowns@santa-ana.org) for signature
2022-07-01 - 8:42:54 PM GMT
Email viewed by Kathryn Downs (kdowns@santa-ana.org)
2022-07-01 - 8:46:12 PM GMT- IP address: 184.181.115.13
='a Document e-signed by Kathryn Downs (kdowns@santa-ana.org)
Signature Date: 2022-07-01 - 8:46:24 PM GMT - Time Source: server- IP address: 184.181.115.13
Agreement completed.
2022-07-01 - 8:46:24 PM GMT
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