HomeMy WebLinkAbout09/20/2011, C4 - UTILITY USERS TAX COMPLIANCE AND REVENUE PROTECTION PROGRAM council Mifi,D, 9-20-11
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CITY OF SAN LUIS OBISPO
FROM: Mary Bradley, Interim Director of Finance & Information Technology
Prepared By: Rachel Messner, Administrative Analyst
SUBJECT: UTILITY USERS TAX COMPLIANCE AND REVENUE PROTECTION
PROGRAM
RECOMMENDATION
Approve a contract with MuniServices, LLC ("MuniServices") and Donald H. Maynor, A
Professional Law Corporation ("Donald Maynor") to perform Utility Users Tax (UUT)
compliance and revenue protection services.
DISCUSSION
Overview
The City's UUT is imposed by City ordinance on gas, electric, telephone, water and cable
television utility providers with customers within the City. The tax generates approximately $4.7
million each year, used to fund a wide range of critical General Fund services. Because the UUT
represents such a significant revenue source, a comprehensive review of the City's UUT practices
is prudent to ensure that the City is realizing the full value of this tax base. To that end, staff has
explored options to conduct the review in a cost effective manner and proposes contracting with
MuniServices and Donald Maynor to provide the services outlined in the attached Agreement. In
addition to the broad based compliance program, important components of the program include
revenue protection and forecasting services.
Program Overview
The Agreement with MuniServices and Donald Maynor includes the following compliance and
revenue protection services:
• Compliance reviews of major utility providers
• Development and maintenance of City address database
• Identification of gaps in payments and/or calculation mistakes
• Ordinance reviews and recommendations based on new and proposed legislation
• Ordinance modernization
• Revenue forecasts based on industry trends
This Compliance Program will assist the City in identifying and correcting errors/omissions
causing revenue deficiencies, and thereby produce new or previously unrealized revenue. The
Program's tax preservation services will protect the City's existing UUT revenues from erosion
due to new legislation, new technologies, outdated ordinance language and inaccurate
information.
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UUT Compliance&Revenue Protection Program Page 2
MuniServices provides an array of UUT related services for more than one-third of the 150
California public agencies (and over 50% of the total UUT revenue) with UUT ordinances.
Therefore, there are economies of scale that can be realized by the City through working with
established experts in this area. Additionally, by offering these essential services through a
comprehensive Program, with widespread participation from other cities, there are the additional
benefits of: i) achieving lower individual costs for such joint activities; and, ii) pursuing joint
action in regards to issues common to the participating public agencies, including state and
federal legislation.
Ensuring the stability and diversity of the city's revenue sources, particularly in relation to UUT,
was identified in the work program for the Preservation of Essential Services and Fiscal Health
Major City Goal. The services provided through this contract will assist in accomplishing this
task in the work program.
FISCAL IMPACT
The City's annual fee for participating in this program is $19,900. Additionally, if the City
wishes to perform a compliance review with a focus on issues unique to San Luis Obispo, the
City will pay MuniServices twenty-five percent (25%) of the revenues which result from the
review, including interest and penalties. This includes any retroactive recovery and any additional
revenue received by the City for the first three years following the correction of the
error/omission.
Although the $19,900 fee is within the range for City Manager approval, it is necessary to obtain
Council approval of the contract because the fee may exceed this threshold if additional revenues
result from the review.
ALTERNATIVES
Do not approve the agreement. Given the importance of this revenue source to the City and the
current legal and legislative environment, this option is not recommended.
ATTACHMENTS
MuniServices Agreement
T:\Council Agenda Reports\Finance&IT CAR\Finance\201 I\UUT Compliance Contract.docx
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'AttachMGf1 ,-°
ASSOCIATED CONSULTING SERVICES FOR
UTILITY USERS TAX
COMPLIANCE AND REVENUE PROTECTION PROGRAM
This Agreement ("Agreement") is made as of September 20, 2011, between MuniServices,
LLC, a Delaware limited liability company, its subsidiaries and affiliates, with an office at 7335
N. Palm Bluffs Avenue, Fresno, California 93711 (hereinafter"MuniServices'l and the City of
San Luis Obispo, a municipal corporation of the State of California (hereinafter"City"),
This Agreement becomes effective on October 1, 2011, and continues in full force and effect for
a period of three-years (3), ending on October 1, 2014. The termination requirements are in
Section 6 below.
MuniServices agrees to provide the City with certain professional services in furtherance of a
comprehensive utility users tax compliance and revenue protection program (hereinafter
"Program"), with broad participation by California public agencies, that is designed to preserve,
protect, and enhance its utility users tax ("UUT")revenues.
1. PROGRAM OBJECTIVES
MuniServices will provide compliance reviewing, geocoding, information, and associated
services and skills, in conjunction with the legal and "protective" services of the City's outside
counsel, Donald H. Maynor, A Professional Law Corporation ("Law Firm"), to establish and
implement a Program that will allow the City and other participating California public agencies
to preserve, protect and enhance their UUT revenues through a combination of tax application
compliance, business detection, geocoding, exemption review, ordinance update, ordinance
modernization with election approval, legislative monitoring, technology update, and other
essential compliance and protective services. This Compliance Program will assist the City, and
other participating public agencies, in identifying and correcting errors/omissions causing
revenue deficiencies, and thereby produce new or previously unrealized revenue for such
participants. The Program's tax preservation services will protect the City's existing UUT
revenues from erosion due to new legislation, new technologies; outdated ordinance language
and inaccurate information. By offering these essential services through a comprehensive
Program, with widespread participation, there are the additional benefits of i) achieving lower
individual costs for such joint activities; and, ii) pursuing joint action in regards to issues
common to the participating public agencies, including state and federal legislation. Finally, for
public agencies with an ordinance requirement of an annual, independent third party compliance
review, this Program should satisfy that requirement.
2. ANNUAL FEE SERVICES
A. Compliance Review Services
The following compliance review services are included in the annual fee of$19,900.00:
1. UUT Tax Application Review: Compliance reviews of major utility providers, with a
focus on common client issues, to assure that the UUT is being properly applied to
taxable services and charges. The compliance review may include: i) review of
service provider's decisions regarding the taxability of various services and charges;
ii) allocation of values of bundled taxable and non-taxable items; iii) sampling of
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customer bills for correct geocoding, tax percentage, and tax application; and, iv)
other cost-effective compliance actions.
2. Geocode Information and Review: Develop and maintain a proprietary address range
database to assure accurate address range information regarding the City's boundaries.
Such databases will reflect the latest available LAFCO information regarding City
boundary changes due to annexations or other municipal reorganizations. Upon
request, MuniServices will verify whether a particular customer is properly geocoded
to the taxing jurisdiction,
3. UUT Business Detection Utilize detection tools to verify whether such companies
are doing business within the City, and then assist City's staff in pursuing
enforcement actions, as needed, including developing compliance correspondence
and enforcement procedures.
4. UUT Payment Calculations and Deviations: If the City provides MuniServices with
regular and accurate UUT payment history (i.e., copies of all UUT remittances),
MuniServices will identify to the City's staff possible gaps in payments, calculation
mistakes, and other payment errors. MuniServices will provide the City with an Excel
template for the City to record the payment data and send to MuniServices
electronically. Monthly, MuniServices will provide the City with a spreadsheet
reflecting the City's UUT payments and our analysis of the UUT payment data.
MuniServices will assist the City in developing compliance correspondence and
enforcement procedures to the Utility's for any errors detected in the compliance
process.
5. Exemption and Non-core/Direct Access Corrections are not included in the Annual
Fee: It is agreed any compliance activities by MuniServices that result in new
revenue due to exemption corrections or bringing into compliance non-core gas or
direct access electric customers shall be deemed "city specific" and shall not be
covered under the annual fee, but shall be subject to compensation as set forth in
Section 5 B below.
B. Revenue Protection Services
MuniServices will work cooperatively with Law Firm in providing the following revenue
protection services designed to protect the City's existing and future UUT revenues:
1. Ordinance Update and Legislative/Regulatory Review Services
a. Ordinance and Technology Update. Provide periodic reviews and
recommended updates to the UUT ordinance, administrative rulings to address
new issues that may arise because of deregulation, litigation, changes in laws or
regulations, the unbundling of traditional utility services, or the introduction of
new technologies to provide utility services. Such recommendations will clarify
or add procedural protections to the existing ordinance, and should not require a
Proposition 218 election approval. If a major modernization of the ordinance is
deemed necessary, with voter approval, we will assist the City with ordinance
language, staff reports, draft ballot language, and other technical assistance.
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. ttachment-
b. State and Federal Legislation. Monitor proposed state and federal legislation to
identify issues affecting the City's UUT revenues, and, if justified, make
recommendations to the City and its lobbyists.
c. Regulatory Agencies. Monitor proceedings at the various regulatory proceedings
(e.g., California Public Utilities Commission, Federal Commerce Commission,
and Federal Energy Regulatory Commission) that potentially impact the City's
UUT, and make appropriate recommendations to the City.
d. Information Services. Provide the City with periodic communications through
monthly conference calls, emails, and through workshops and seminars on such
subjects as tax application issues, new technologies; complying with.new utility
related legislation, and other timely subjects.
2. Statutory Compliance and Consulting Services
a. Publication of Ordinance Requirements. Prepare and maintain an accurate
copy of the City's UUT ordinance and its administrative rules and interpretations
on the uutinfo.org website, and otherwise assist the City in complying with Public
Utilities Code § 495.6.
b. Web-Based Data Links. Prepare and maintain on the uutinfo.org website (and
provide a link to the City's web page, if desired) the City's UUT ordinance and
administrative rules and rulings, e-mail inquiry feature, and model forms for
exemption applications, UUT remittances, information requests, and other tax
compliance documents.
c. Access to Information. Assist the City's staff in obtaining SB 278 lists, tax
compliance information, exemption lists of utility service providers, and in
determining the exempt status of utility customers pursuant to the exemption
provisions of the City's UUT ordinance.
d. Revenue Forecasts. Provide staff with revenue forecasts based on industry
trends,historical trends, and other relevant factors.
3. Assistance to City's Internal UUT Staff
a. Timely Response to Tax Application Inquiries.. Provide legal and technical
assistance to existing City staff and the City Attorney's office, and provide timely
analysis and draft responses to tax application inquiries from taxpayers or tax-
collecting entities.
b. Enforcement Assistance. Provide the City's staff and the City Attorney's office
with: i) legal advice on specific issues that arise in the enforcement of the tax
ordinance (e.g., nexus issues and questions from taxpayers or tax collectors); and,
ii) compliance correspondence and legal notices as required by ordinance and due
process..
c. Compliance Assistance. Assist the City's staff and the City Attorney's office in,
i) gaining access to tax-related information under existing legal authorities,
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ment
including the preparation of an administrative subpoena; ii) addressing legal
issues that arise in the course of a compliance review; iii) providing exemption
analysis; and, iv) reviewing and developing legal measures to improve existing or
proposed tax compliance programs.
C. MuniServices Does Not Provide Legal Services..
It is agreed and understood MuniServices will provide no legal services that may be
required under any of the PROGRAM activities described in this Agreement, but rather
Law Firm will provide such legal services by separate agreement with the City. It is also
acknowledged that in providing such legal services, Law Firm's client will be the City,
and not MuniServices.
3. CITY-SPECIFIC COMPLIANCE REVIEWS
A. Scope of City-Specific Compliance Reviews
At any time during the term of this Agreement, with the prior mutual consent of the City
and MuniServices, MuniServices may perform a City-specific compliance review of any
utility service provider regarding its UUT obligations, with a focus on_ City-specific
issues (e.g., revenue discrepancy apparently unique to the City or the geocoding of
customers in the City). See Section 5(B) below regarding compensation for City-specific
compliance reviews.
B. MuniServices Responsibilities for City-Specific Activities
1. Work Plan Approval for City-Specific Activities. MuniServices will submit to the
City's staff a proposed Work Plan for review and approval that will serve as the basis
for City-specific compliance activities (e.g., telecommunications, gas, electric, or
CATV/video UUT review;, or payment deviation from a specific utility).
MuniServices will obtain the approval of the City staff before initiating a particular city
specific activity on the Work Plan
2. City pproval of Discovery Actions. For City-specific activities, MuniServices will
receive prior authorization from the City's staff to obtain and examine utility and
customer records (hard copy and data format) necessary to assure compliance with
the City's UUT ordinance through the use of administrative subpoenas, nondisclosure
agreements, and other procedures required by the utility service provider as a
condition of providing access to confidential customer information., .
3. MuniServices to Comply with Local Laws. In performing the compliance review
services described in this subsection, MuniServices agrees to abide by the provisions
of the City's UUT ordinance, any administrative rules the City may adopt relating to
such ordinance, and the confidentiality requirements of state law (Revenue and
Taxation Code Section 7284.6-.7). Throughout the above process, MuniServices
shall be available to meet with the City, utility service providers, or their customers to
review any MuniServices findings or recommendations arising out of its compliance
review activities for the City.
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Attachment
4. CITY'S RESPONSIBILITIES
To facilitate and maximize the effectiveness of the above compliance review activities, the
City shall diligently assist MuniServices by performing the following:
A. Necessary Information.
The City will provide MuniServices, on a timely basis, with information necessary to
conduct its compliance review activities including but not limited to: monthly UUT
payment histories, exemption lists, and SB 278 gas and electric lists (including names of
customers refusing to pay surcharges), and certified copies of the UUT ordinance and any
subsequent amendments.
B. Letter of Authorization.
The City will provide a letter of authorization identifying MuniServices as an authorized
agent of the City to perform utility user's tax compliance compliance reviews, to receive
and examine appropriate utility and customer records (hard copy and data. format)
necessary to assure UUT tax compliance, and to execute necessary nondisclosure
agreements approved by the City.
C. Legal Interpretations of Ordinance.
Upon request, the City will provide MuniServices with appropriate legal and
administrative interpretations of its UUT ordinance. It is agreed and understood that the
City will retain the exclusive authority and responsibility to administer, interpret, and
enforce its UUT ordinance; recognizing that the role of MuniServices and Law Firm is
limited to providing the City with technical assistance, without assuming or being
delegated the authority or responsibility of the City to administer, interpret, and enforce
its UUT ordinance.
5. COMPENSATION/TERM
A. Annual Fee
Total Annual Fee. The City's total annual fee for participating in the Program shall be
$19,900.
Allocation of Annual Fee. The total annual fee payment shall be allocated and paid
separately to Law Firm and MuniServices as follows: Law Firm: For the first year,
City will pay Law Firm its allocated fee of ten thousand dollars ($10,000), and for
each year thereafter, seven thousand five hundred dollars ($7,500). To MuniServices:
For the first year, City will pay MuniServices its allocated fee of nine thousand nine
hundred dollars ($9,900), and for each year therafter twelve thousand four hundred
dollars ($12,400). At any time, Law Fire and MuniServices may, by mutual
agreement, adjust their proportional share of said total annual fee, provided that such
parties shall receive prior approval of such adjustment from the City.
1. Ouarterly Payments of Fee. Said annual fee shall be paid in four equal quarterly
payments with due dates of: March 31, June 30, September 30, and December 31.
Invoices for services rendered shall be in arrears (invoiced for the immediately
preceding quarter). If the effective date of this Agreement is other than on an invoice
date, the City shall be invoiced /for the first quarterly payment on the immediately
following invoice date as set forth herein. City shall be invoiced and responsible for a
SLO- UUT 090611 5 C4-7
prorated portion of the preceding quarter based on the effective date of this
Agreement. Payment will be made to MuniServices within thirty (30) days of receipt
of MuniServices invoice therefore. Any amounts which remain unpaid after thirty
(30) days shall accrue interest at the rate of one and one-half percent (1.5%) per
month, or the maximum amount permitted by law. These quarterly payments are
nonrefundable.
B. Compensation for City-Specific Compliance review Services
1. With the exception noted in subsection (2) below, with respect to a City-specific
compliance review referred to in Section 3(A) above and Section 2(A)(5) above,
MuniServices shall be entitled to contingent fee compensation where MuniServices'
compliance review activities result in the City receiving additional revenues from
such City-specific compliance review activity. Accordingly, the City shall pay
MuniServices twenty-five percent (25%) of the additional revenues, including interest
and penalties, that has resulted from its City-specific compliance review activities.
MuniServices will seek to recover, or assist the City in.recovering, all revenue due the
City from prior periods, if any, and MuniServices will receive 25% of any retroactive
recovery. Said 25% also applies to the additional revenue received by the City for
the first three years following the correction of the error/omission. As used in this
subsection, the term "additional revenues" includes the value of any other services,
credits, property of every kind or nature, or other consideration received by the City
in lieu of monetary payment.
2. Notwithstanding subsections (1 and 2) above, nothing herein shall prohibit the parties
from entering into a written agreement on compensation for CITY-specific
compliance review services on any other separately negotiated basis.
3. In the event that any legal services from Law Firm are required in connection with a
City-specific compliance review, as described above and on Exhibit C, the cost of
such services to the City shall be paid by MuniServices, and MuniServices shall
disclose to the City the financial arrangement between MuniServices and Law Firm
regarding the payment of such costs. For all other City-specific compliance reviews,
Law Firm shall receive compensation under B.I. above in accordance with the
allocation rule of 5.A.2. above.
C. City's Obligations
Regarding the City-specific compliance review activities of MuniServices in Sections 3
and 5(B) above, the City agrees to:
1. Invoice the responsible party for tax deficiencies (plus interest and penalties if
applicable) identified and confirmed by MuniServices within thirty (30) days
following receipt of MuniServices detection report or correspondence;
2. Provide MuniServices with a copy of any settlement agreement with a taxpayer/tax
collector within ten (10) days of entering into such agreement; and,
3. Notify MuniServices within ten (10) days following receipt by the City of payments
(cash, installment, or other compensation directly benefiting the City) of such tax
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deficiencies, whether invoiced or not. Upon receipt of such notice, MuniServices will
promptly invoice the City. MuniServices compensation is due and payable within
thirty (30) days of the City's "receipt of MuniServices invoice. Any amounts which
remain unpaid after thirty (30) days shall accrue interest at the rate of one and one-
Half percent (1.5%)per month, or the maximum amount permitted by law.
D. MuniServices Expenses
MuniServices shall absorb all expenses incurred by MuniServices in providing its
services as described herein. These expenses include items such as employee salaries and
benefits, insurance, airfare, auto rentals, meals, lodging, Federal Express, mail, telephone,
copying, directories, on-line resources, and other overhead and miscellaneous expenses.
6. TERMINATION OF AGREEMENT
A. Either the City or MuniServices may terminate this Agreement, by thirty (30) days prior
written notice as provided in this Section.
B. If the City terminates this Agreement at any time within twelve (12) months following
the effective date of this Agreement, and Law Firm has prepared an ordinance update for
the City (whether or not the City adopts the recommended update), the City shall
nevertheless pay MuniServices four (4) quarterly payments from the commencement of
the Agreement to compensate MuniServices for services rendered. MuniServices shall
also be entitled to additional compensation as described in Section 6(C).
C. Upon termination by either party of the Agreement as provided herein, MuniServices
shall be entitled to retain any fees it may have received from the City pursuant to Sections
5(A) and 6(B) of this Agreement. In addition, MuniServices,shall be entitled to payment
according to the terms of Section 5(B) for all additional revenues, including interest and
penalties, resulting from MuniServices compliance review activities. Within thirty (30)
days following termination, MuniServices shall provide the City with a list of detections
of non-compliance resulting from the compliance review activities of MuniServices. The
City shall, in good faith, diligently seek to: i) correct such detections of non-compliance
made by MuniServices prior to the date of termination; and, ii) collect the additional
revenues that are due the City and MuniServices for past periods and for the twelve
quarters going forward following the correction, even though the date of actual correction
may occur after the termination date. MuniServices shall assist the City in this
correction/collection effort, if so requested by the City. MuniServices right to
compensation for City-Specific compliance review activities under Section 5(B) shall
survive termination of this Agreement for any reason.
7. OTHER GENERAL PROVISIONS
In addition to the above provisions, the parties also agree to be bound by the general
provisions as set forth in Attachment "A" of this Agreement, which are by this reference
incorporated herein. In the event of disagreement between the specific provisions of this
Agreement and the general provisions, the specific provisions of this Agreement shall
prevail.
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�- ,-,,dachment
MuniServices, LLC City of San Luis Obispo
A Municipal Corporation
By: By:
Marc Herman Jan Marx
President Mayor
By:
Doug Jensen ATTEST:
Senior Vice President Client Services
APPROVED AS TO F
J. Christine Dietrick
City Attorney
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Attachment.
ATTACHMENT"A"
GENERAL PROVISIONS
1. Independent Contractor. At all times during the term of this Contract,MuniServices shall be an Independent
Contractor and shall not be an employee of the City. The City shall not have the right to control the means by which
MuniServices accomplishes services rendered pursuant to this Agreement.
2. Liabili . The City shall not be called upon to assume any liability for direct payment of any salaries,wages,or
other compensation to any of MuniServices personnel or subcontractors performing services hereunder for the City,
or any liability other than provided for in this Agreement. The City shall not be liable for compensation or
indemnity to any MuniServices employee or subcontractor for injury or sickness arising out of his/her employment,
or for any negligent actions of MuniServices or its employees. All persons employed in the performance of such
services and functions shall be employees of MuniServices,and as such shall not,for any purposes,be considered
employees of the City and therefore shall have no right to any City benefits,civil service,or other City employment
status.
3. Insurance.
A. Public Liability. During the term of this Agreement,MuniServices shall maintain in full force and effect a
policy of public liability insurance with minimum coverages as follows: $1,000,000 for injury to one person in
any one occurrence and$1,000,000 in the aggregate;and$50,000.00 for property damage. MuniServices shall
cause the City;its officials and employees to be named as insureds on all liability policies described above with
respect to: (1)activities performed for the City by or on behalf of the named insured,(2)products and
completed operations of the named insured,and(3)premises owned,leased or used by the named insured.
B. Worker's Compensation. During the term of this Agreement,MuniServices shall fully comply with the
terms of the law of the City concerning worker's compensation. Said compliance shall include,but not be
limited to,maintaining in full force and effect one or more policies of insurance insuring against any liability
MuniServices may have for worker's compensation.
4. MuniServices Not Agent Except as the City may specify in writing,MuniServices shall have no authority,express
or implied,to act on behalf of the City in any capacity whatsoever as an agent. MuniServices shall have no
authority,express or implied,pursuant to this Agreement to bind the City to any obligation whatsoever.
5. Assignment Prohibited No party to this Agreement may assign any right or obligation pursuant to this Agreement.
Any attempt of purported assignment of any right or obligation pursuant to this Agreement shall be void and of no
effect. Notwithstanding the foregoing,the parties hereto may assign all or part of this Agreement immediately,
without the prior written consent of the non-assigning party(a)to any successor in interest to the assigning
parry who expressly assumes responsibility for the assigning party's obligations hereunder;or(b)if necessary
to satisfy the rules,regulations and/or orders of any federal or state governmental agency or body. .
6. Nondiscrimination. MuniServices shall not discriminate,in any way,against any person on the basis of race,sex,
color,religion,sexual orientation,disability,ethnicity,or national origin,in connection with or related to the
performance of this Agreement.
7. Reports.Charts or Other Products. All reports,charts and other products produced by MuniServices and delivered
to the City are the property of the City.
S. City Representative. The City Manager or his/her designee is the representative of the City and will administer this
Agreement for the City.
9. Indemnity and Hold Harmless. MuniServices shall indemnify and hold harmless the City,its officers,employees,
and agents,from and against all actions,damages,claims,or losses,which are in the nature of personal injury,
physical property damage,or intentional torts,and which allegedly arise out of or are caused by MuniServices
negligent or intentional conduct in the performance of MuniServices work under this Agreement.
10.. Waiver of Breach. No waiver of the breach of any of the covenants,agreements,restrictions or conditions of this
Agreement by any party hereto shall be construed to be a waiver of any succeeding breach of the same or other
covenants,agreements,restrictions or conditions of this Agreement. No delay or omission of any party hereto in
exercising any right,power or remedy herein provided in the event of default shall be construed as a waiver thereof,
or acquiescence therein,nor shall the acceptance of any payments made in a manner or at a time other than as herein
provided be construed as a waiver of or variation in any of the terms of this Agreement.
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achipent
11. Interest Unless the City requests in writing additional information regarding the billing or otherwise disagrees with
the billing,the City shall pay MuniServices within thirty(30)days of receipt of MuniServices billing,or from the
date of agreement on the billing in the event of a written request Any payment received after such time period shall
accrue monthly interest of one and one-half percent(1.5%).
12. Whole and Entire AThis Agreement,and any attachments hereto,contains the whole and entire
agreement of the parties hereto and correctly sets forth the rights,duties and obligations of each to the others as of its
date with regard to the provision of utility users tax services described herein. This Agreement and any
attachments hereto shall supersede any and all prior agreements entered into by the parties relating to the
provision of utility users tax compliance services by MuniServices,or its predecessor Municipal Resource
Consultants(MRC).
13. City's Determination Final. Whenever the City Council or a City Officer is empowered under State or local
ordinance to make a determination as to whether or nota tax assessed against a taxpayer is due,for purposes of this
Agreement that determination shall be final and binding on the parties hereto. However,a City Officer's
determination to waive a tax assessment shall not relieve the City of its obligation to pay MuniServices therefore.
14. Confidentiality. MuniServices agrees that it shall keep all information it receives concerning City taxpayers
confidential and shall use it solely for tax compliance purposes. Services performed by MuniServices prior to
termination may result in the City's receipt of revenue after termination. This receipt of revenue entitles
MuniServices to payment from the City even after expiration of contract or termination. The City agrees to
provide to MuniServices after expiration or termination of this Agreement such confidential payment
information as is necessary to enable MuniServices to calculate the compensation due to MuniServices as a
result of said receipt of revenue and MuniServices shall maintain the confidentiality of this information.
Therefore,MuniServices shall be deemed a contractor under Revenue and Taxation Code Section 7284.6-.7
after expiration of contract or receipt of notice of termination from the City for the sole and limited purpose of
enabling MuniServices to have access to said information to calculate compensation,
15. Notices. Any notice to be given from one party to the other pursuant to this Agreement shall be deposited with the
United States Postal Service postage prepaid and addressed as follows:
To City: City of San Luis Obispo
990 Palm Street
San Luis Obispo,CA 93401
Attn: Finance Director
To Contractor: MuniServices,LLC
7335 North Palm Bluffs Avenue
Fresno,CA 93711
Attn: Legal Department
Nothing in this Paragraph shall be construed to prevent the giving of notice by personal service.
16. Dispute Resolution. Any dispute relating to this Agreement shall be submitted for binding arbitration under the
Commercial Arbitration Rules of the American Arbitration Association and judgment on any award entered
therein may be entered in any court of competent jurisdiction. The arbitrator's decision shall be final and
binding on the parties: Such arbitration.shall be held in the State of California. In all cases,the prevailing parry
to such dispute shall be entitled to recover costs and expenses,including reasonable attorney's fees,as the
arbitrator deems appropriate.
17. Partial Payment. No receipt by MuniServices of an amount less than City's full amount due will be deemed to
be other than payment"on account",nor will any endorsement or statement on any check or any accompanying
letter effect or evidence an accord and satisfaction. MuniServices may accept such check or partial payment
without prejudice to MuniServices right to recover the balance or pursue any right of MuniServices.
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