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HomeMy WebLinkAbout01/21/1992, C-3 - PROPERTY TAX MANAGEMENT SERVICE�����Il��lll�lllll��l�llulll "� f MEETING DATE: In�►�� u c� o san �a� s o�� spo , COUNCIL AGENDA REPORT ITEM NUMBER: FROM: William C. Statler, Director of Financed -O� Prepared by: Linda Asprion, Revenue Manager SUBJECT PROPERTY TAX MANAGEMENT SERVICE CAO RECOMMENDATION Authorize the Mayor to sign an agreement with Hinderliter, de Llamas and Associates to provide property tax management services to the City at an annual cost of $10,000. REPORT -IN -BRIEF In today's economic environment, the City is re- evaluating all revenue sources in an attempt max e revenue potential. With property tax revenues comprising approximately 18% of the City's general fund revenues ($4.2 million annually), the importance of ensuring the accuracy of this particular revenue is essential. The purpose in hiring a consultant for property tax management services is to provide the City with assurance that we are receiving all property tax revenues to which we are entitled. Hinderliter de Llamas & Associates has developed a comprehensive program utilizing individuals knowledgeable in county property tax processing services and an extensive computer program which has the capability to verify property tax data and to extract other relevant information which can be used by staff for a variety of purposes. If the property tax management service detects processing errors there is the potential for revenue recovery which will effect not only the current years' revenue but also future property tax revenue for the City. Additionally, the information generated from this research will assist the City in its business tax enforcement efforts by identifying income properties. DISCUSSION Background Hinderliter, de Llamas and Associates is currently under contract with the City to provide quarterly sales tax information consisting of trending analyses and specific geographic sales tax data. During the past two years, this firm has been expanding their revenue management capabilities and has developed a cost effective method of tracking and auditing property tax allocations for cities.. This property tax management service is based on the fact that it is not practical for most cities to invest in the staff, training, and start -up costs to fully monitor parcel activity, property reassessment and tax levies that can negatively impact the property tax base from which the revenue to the cities is calculated. Summary of County Property Tax Processing Much of the law pertaining to taxation of property is prescribed in Article XIII of the state Constitution and in Article XIIIA which was adopted as Proposition 13 in 1978. All real and tangible personal property is generally subject to taxation in proportion to its value, with Proposition 13 limiting the tax on property to 1 percent of its taxable value. �������i�►►►�IIIIIpII�� lldlll city of San t. OBispo COUNCIL AGENDA REPORT Most real property taxes are "secured" which means they constitute a lien on real property owned by the taxpayer which could be sold to satisfy delinquent tax payments. Real property includes land, improvements, and possessory interests. Personal property of taxpayers who do not own real property in the county on which a lien can be placed, are not secured by real property and is considered to be "unsecured" property. Examples of unsecured personal property include machinery and equipment, and office furniture and tools. Public utilities are assessed by the State Board of Equalization with the assessment being reported as a "unitary" value to counties and are distributed to cities based upon each city's property tax share of the county total. Three county agencies are involved in the administration of the property tax function: ■ Assessor. The Assessor's primary responsibility is to determine annually the full taxable value of each property so that each property owner is assured of paying the proper amount for the support of local government. The assessed value for most property is the prior year's assessed value adjusted for inflation limited to a maximum of 2 percent. If there has been a change in ownership or the completion of new construction, the new assessed -value will be the market value of the property that changed ownership or of the new construction. ■ Auditor- ControIIer. The Auditor - Controller receives the assessment roll from the Assessor and performs the extensions of the rates on the property value to determine the amount of tax due and its distribution to the over ninety local agencies that receive property tax revenues.. ■ Tax Collector. The Tax Collector receives the tax rolls from the Auditor - Controller and prepares, distributes, and collects the tax bills. After the property tax payments are received by the county, the Auditor - Controller apportions to the city its share of the 1% general tax levy and any direct assessments. What are some of the Common County Property Tax Processing Errors? During the process of assessing, billing, collecting, and allocating the property taxes to the cities within the county it is possible that various errors could occur such as: . ■ Parcel values and taxes being misallocated to incorrect tax rate areas or taxing agencies. ■ Parcels encoded to the wrong city resulting in the tax proceeds being misallocated. ■ Property transfers and new construction completions failing to be reassessed. ■ Unsecured values and taxes misallocated to mailing address tax rate areas instead of situs address tax rate areas. ���n��ibN►I�IIIIIIIIIP IIUIII city o� sanQis owpo Gii% COUNCIL AGENDA REPORT What Can the Property Tax Management Service Provide to the City? Although there is no indication that any of the potential errors listed above occur within this County, neither is there any verification that the property tax process operates error free. The scope of property tax services provided by Hinderliter de Llamas & Associates might best be described as property tax audits. Accordingly, the service conducts an independent third party review of the County's approach, methodology, policies and procedures in accomplishing the property tax process. The principal goal of the service is to provide assurance that the property tax process is providing the City with its entitlement of property tax revenues. If errors are detected there is the potential for the City to receive revenue recovery. Along with the potential for revenue recovery the Property Tax Management Service provides analytical services and data base development from the information reviewed. The additional data that is compiled and presented 'can be used in various departments throughout the City. The specifics on how both the revenue recovery and analytical services are performed is outlined below. Revenue Recovery Revenue Recovery consists of verification drat the City is receiving the correct amount of property tax revenue. With the number of potential errors, due not only from the volume of the workload but also from the complex processing, the likelihood of discovering additional property tax revenue for the City is probable. Depending on the type of error detected, the City may benefit from revenue recovery in perpetuity especially if the property tax allocation base is affected. The review of the source documentation would be conducted by: ■ Utilizing County Assessor tapes, real estate data from commercial sources, microfiche map research, and field audits to perform an analysis identifying and verifying parcels which are potentially misassigned within the various tax rate areas. ■ Reconciling the annual Auditor /Controller assessed valuation reports to assess values City-wide by both the taxing agency and the tax rate area. ■ Identifying parcels on the unsecured tax roll which would include an audit of value reductions, missing parcels, missing tax rate areas, or misallocation where the unsecured value for a parcel is being reported to a mailing address rather than to a City situs address. ■ Reviewing property transfers and building completion to verify that reassessment by the Assessor's office is performed within a reasonable timeframe. This includes an historic review covering the past two years. Notification of any errors to the proper government agency would be handled by the consultant. C'3_ ����i���� ►�Vlllllll�ll��u������ll city of San L S OBispo i COUNCIL AGENDA REPORT Analytical Services and Data Base Development While performing the scope of work required for revenue recovery the service provides for gathering various analytical information which is then used to develop a data base with reliable property and economic statistics to be used on an on -going basis. The specific types of information will be in four areas as detailed below. Economic Stability Program ■ Trend analysis of property transfers to assist staff in tracking turn -over patterns. Data will be provided by location, use type, sales price and with data pertinent to the transferred parcel. ■ Listings of multiple -owned parcels by both single owners and /or owner groupings with use type, tax rate area, assessed value and taxes levied. ■ Reports detailing the parcels remaining in the pre- Proposition 13 assessment pool, (parcels with no activity since 1978) with the annual percentage turn -over of the parcels in this pool. A by- produce of this analysis will be the development of a growing historical data base of the status of pre- Proposition 13 parcels. ■ Parcel listings developed by assessed value and by taxes levied for the largest tax payers and for property owners with the largest collective number of parcels for use in economic development planning. ■ Reports specific to parcel information such as building square footage by use type, year built, parcels with pools, parcels with mobile home designations and other characteristic data can be prepared. Financial Planning ■ Analysis and reconciliation of County Auditor Controller Assessed Valuation reports and Remittance advises to assist with financial tracking and validation of property values and tax receipts. ■ Computed value of the City's share of the 1 % General Tax Levy by tax rate area to verify short-falls in county reporting and assist with budget projections. ■ Listing of non -owner occupied parcels for use in improving the City Business Tax revenue collection for residential rental units and commercial rental space. ■ Assessment Appeals Board Tracking services including a 10 year historical summary of appeals, with a 5 year listing of pending appeals which will enable City staff to review parcels under appeal and to intercede during the appeals process prior . to final disposition which could impact future tax revenues. ■ Assistance with and verification of non - residential new construction data for use in preparation of Proposition 4 and 111 State Appropriation Limit calculations. �����►►i�illlllllip�' �l�lll city of San JS OBISpo Mii% COUNCIL AGENDA REPORT Planning and Building ■ Tracking of parcel reassessments which are due as a result of the completion of new construction and a review of building department information will be performed to ensure a more timely posting of building changes. ■ Listings of non -owner occupied parcels prepared by use type, tax rate area, assessed value, and taxes levies for planning information. ■ Where data is available and reliable, parcel listings will be developed with building and planning data including various comparative analyses incorporating lot size square footage, building area, and land /improvement /total assessed valuation comparisons will be provided. Report specific information designated by the City will be solicited in the development of these reports. Executive Summaries Summary information including comprehensive listings of secured property tax data including, top tax payer summary, top assessed value summary, parcel characteristic information, multiple owner listings, parcel listings by use type, absentee owners by use type, and unsecured parcel owner information will also be available. Why Can't This Service be Performed by Staff? This type of service relies on expertise and knowledge of property tax operations as well as sophisticated automation techniques. Accordingly, this can be done much more cost efficiently by a private company specializing in this service. What Have Other Cities Experienced Using This Service? Ten cities participated in the first year (1990 -91) the property tax management service was offered by Hinderliter de Llamas and Associates. Errors were found in both the secured and unsecured tax rolls for all ten cities ranging from misassignment of tax rate areas and assessor parcel numbers to misallocation of taxes to mailing addresses rather than situs. The recovered revenues for the ten cities ranged from $3,000 for a small residential community to slightly over $1.6 million for an industrial community. The first year's recoveries including retroactive adjustments ranged from 0.4% to 5.5% of the cities total property tax revenues. The average recovery was 1.6 %. Applying these percentages to the City's 1990 -91 property tax revenue of $4,197,700 demonstrates a potential revenue recovery of between $16,800 and $230,900. The potential revenue recovery for the City if the average of 1.6% was met would be $67,200. ���H�►�N►IVIIIIIIIIImN °�1�111 city of san k � oBispo = ONG@ COUNCIL AGENDA REPORT FISCAL IMPACT Based upon the first year's data of revenue recovery from the property tax management service, the City could realistically expect to receive between $17,000 and $100,000 in additional property tax revenue. The annual cost for the service is based on the number of City parcels, which equates to $10,000 for the City. Additionally, the consultant will receive 25% of the first year's revenue recovered in the initial audit. As such, it is feasible for the revenue recovery from the property tax management service to pay for the cost of the service. How Will the City Fund the Property Tax Management Service? The 1991 -93 Financial Plan provided funding for an Economic Stability Program, with $96,000 allocated in the 1991 -92 Budget. Based on the kind of information that this service will provide us regarding our economic base, it is recommended that it be funded from the Economic Stability Program. To date $3,000 of the budgeted $96,000 has been encumbered. If the proposed service is approved, $79,000 will remain available to fund other projects. ALTERNATIVE ■ Do not approve the Property Tax Management Service. By not proceeding with the property tax management service, the City will not be assured that it is receiving the correct amount of property tax revenue. Not ensuring the accuracy in processing the property tax revenues impacts not only the current year's revenue but also the revenues in future years. SUMMARY In today's economic environment, the City is evaluating all revenue sources in an attempt to maximize revenue potential. With property tax revenues comprising approximately 18% of the City's total general fund revenues, the importance of ensuring the accuracy of this particular revenue is essential. By hiring Hinderliter de Llamas and Associates to perform the property tax management service, the City can be assured that it is receiving all the property tax revenue to which it is entitled as well as gain a better understanding of the factors that affect one of our most important revenue sources. REVISED DATE I3Y:I&IT^ 63 AGREEMENT FOR PROPERTY TAX AUDIT AND INFORMATION SERVICES This Agreement is made and entered into as of the day of , 1992 by and between the CITY OF SAN LUIS OBISPO, a municipal corporation hereinafter called CITY, and HINDER=I;E DE LLAMAS ,AND ASSOCIATES a California Corporation hereinafter called CONTRACTOR. RECITALS WHEREAS, property tax revenues can be verified and potentially increased through a system of continuous monitoring, identification, and reconciliation to county records; MM WHEREAS, an effective program of property tax management will assist the city in fiscal, economic, and community development planning; and WHEREAS, City desires the property tax data based reports and data analysis required to effectively manage the city's property tax base and identify and recover revenues misallocated within the city, or to other jurisdictions; and WHEREAS, Contractor has the programs, equipment, data and personnel required to deliver the property tax services referenced herein; NOW, THEREFORE, City and Contractor, for the consideration hereinafter described, mutually agree as follows: 1 COKSTO: q • Dew Action ❑ FYI cou m ❑ CDDDUL CAO ❑ EN. DR CAO 0 M CHU L� A77C WgEY ❑ FW DIR CLE.KIM11G. ❑ POLICE Ci ❑ MCMT. TEAL.•! ❑ P.EC DUL MDR 0 C READ FILL Fit Y.ra SERVICES The Contractor shall perform the following services: A. to Property tax and economic analysis 1. Annually after the lien date roll becomes available, Contractor shall establish a special data base which will include, for each parcel within the city boundaries, the assessed values for the secured and unsecured property tax rolls. The major property owners and property tax payers listings shall be provided on an annual basis. Tracldng and trend analysis of property transfers, use type comparisons, pre Prop 13 assessment parcels, new construction activity, multiple owned parcels, absentee owner parcels and other information will be provided to assist staff in fiscal, economic and community development planning. 2. Each year, after the lien date roll is available, Contractor shall up -date reports identifying property transfers. Additional reports using the data bases will be prepared to identify errors, analyze city tax rate areas and taxing agencies and provide comparative information. Printouts, graphs and comparative data will be provided on a quarterly basis. 3. Contractor shall provide a reconciliation of assessed values (secured and unsecured lien date valuations) to county records which will be used to project annual property tax figures for forecasting. PRI-1 Orb Analysis and Identification of Misallocation Errors the city's use in revenue 1. Contractor shall conduct an analysis to identify and verify, parcels which 6 C are misassigned by Tax Rate Area and will provide the correct TRA designation to the proper county agency. Typical errors include parcels assigned to incorrect tax rate areas within the city or an adjacent city, and tax rate areas allocated to wrong taxing agencies. 2. Contractor shall reconcile the annual auditor - controller assessed valuations report to the assessor's lien date rolls and identify discrepancies. 3. A review of parcels on the unsecured roll will be performed to identify inconsistencies such as value reductions, values being reported to a mailing address rather than the situs address, and errors involving tax rate areas. 4. Property transfers and new construction completions will be tracked to determine whether reassessment is performed within a reasonable time frame. The city will be notified of parcels which have failed to be reassessed. 5. Contractor shall utilize city building department data, including building permits with assessor parcel numbers and project completion dates, to identify non - residential parcels with new construction activity and shall provide reports for use in the city's preparation of Prop 4 and 111 State Appropriation Limit calculations. 3 C. On Going Consultation ` During the term of the contract, Contractor will serve as the city's resource staff on questions relating to property tax and assist in estimating property tax revenues. D. Optional Services The following services are available on a time and materials basis: Analyses based on geo areas designated by the city to include assessed valuations and square footage computations for use in community development planning Generation of specialized reports which would require additional programming or the purchase of additional data not necessary to carry out services outlined in Sections A and B. Any research with county agencies for which Contractor does not have a current database CONSIDERATION A. Contractor shall establish the property tax and analysis data bases and shall provide quarterly updates, as outlined under SERVICES - Sections A -C above, for an annual fee of $10,000.00 billed after the delivery of reports. B. Contractor shall be paid 25% of misallocated revenue recovered in the initial year's audit. Contractor's shall separate and support said reallocation and provide City with an itemized quarterly invoice showing all formula calculations and amounts due as a result of revenue recovery or reallocation. City shall pay audit fees after Contractor's submittal of evidence that corrections have been made by the appropriate agency. Payment to Contractor shall be made after Qty receives its first remittance advice during the fiscal year for which the correction applies. C. Fees charged for optional work or specialized work for cities as outlined above in SERVICES - Section D shall be billed on a time and materials basis at a rate of $75.00 per hour or as negotiated by both parties under a separate agreement. D. Above sums shall constitute full reimbursement to Contractor for all direct and indirect expenses incurred by Contractor in performing analyses and audits including the salaries of Contractor's employees, and travel expenses connected with contacting appropriate county department representatives. 5 J CITY MATERIALS AND SUPPORT City agrees to provide the following information: Current city map and zoning map A copy of reports received by the city annually from the Auditor - Controller's office detailing Assessed Values (Secured, Unsecured and Utilities), as well as Unitary Values for reconciliation analysis. Parcel listing and maps of City parcel annexations since the prior lien date roll. A listing of completed new construction projects with mapbook, page and parcel numbers for proper identification and tracldng for two years prior to the date of this contract. If the data does not include the APN information, Contractor will research this information at an additional cost. A listing of City levied assessment districts and direct assessments. TERMINATION This Agreement may be terminated by either party giving 30 days written notice to the other of such termination and specifying the effective date thereof. Upon the presentation of such notice, Contractor may continue to work through the date of termination. Upon termination as provided herein, Contractor shall be paid the value of all tax analysis and reporting work performed less payments previously made by City. In ascertaining the value of the work performed up to the date of termination, consideration shall be given to amounts due for any unpaid invoices, and to parcels 6 identified by Contractor which may result in increased or reallocated revenues after the termination of this Agreement. After City receives said tax payments, Contractor shall be paid the for percentage work as previously authorized and satisfactorily performed at the times provided in the preceding section entitled "Consideration ". All documents, data, surveys and reports prepared by Contractor pursuant to this Agreement shall be considered the property of the City and upon payment for services performed by contractor, such documents and other identified materials shall be delivered to City by Contractor. INDEPENDENT CONTRACTOR Contractor shall perform the services hereunder as an independent contractor and shall furnish such services in its own manner and method, and under no circumstances or conditions shall any agent, servant, or employee of Contractor be considered as an employee of City. NON - ASSIGNMENT This Agreement is not assignable either in whole or in part by Contractor without the written consent of City. ATTORNEY'S FEES In the event a legal action is commenced to enforce any of the provisions of this Agreement, the prevailing party shall be entitled to recover its costs and reasonable attorney's fees. 7 GOVERNING LAW The laws of the State of California shall govern the rights, obligations, duties and liabilities of the parties to this Agreement and shall also govern the interpretation of this agreement. INDEMNIFICATION Contractor hereby agrees to, and shall hold City, its elective and appointive boards, officers, agents and employees, harmless from any liability for damage or claims for damage for personal injury, including death, as well as from claims for breach of confidentiality or property damage which may arise from Contractor's willful or negligent acts, errors or omissions or those of its employees or agents. Contractor agrees to and shall defend City and its elective and appointive boards, officers, agents and employees from any suits or actions at law or in equity for damages caused, or alleged to have been caused, by reason of any of the aforesaid willful or negligent acts, errors or omissions. NOTICE All notices required by this Agreement shall be given to City and Contractor in writing, by personal delivery or first class mail postage prepaid, addressed as follows: City: CITY OF SAN LUIS OBISPO 990 Palm Street San Luis Obispo, CA 93403 Contractor: IHNDERLITER, DE LLAMAS & ASSOCIATES 2220 E. Alosta Avenue, Suite 205 Glendora, California 91740 E :3 I 0 INSURANCE Contractor shall provide insurance as specified in Exhibit A. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the date first above written by their respective officers duly authorized in that behalf. CITY OF SAN LUIS OBISPO CONTRACTOR: Mayor Eyft�w City Clerk City Admini uanve cer 0 9 ER, DE LLAMA4 & ASSOCIATES Corporation/ AGREEMENT FOR PROPERTY TAX AUDIT AND INFORMATION SERVICES This Agreement is made and entered into as of the day of . 1991 by and between the CITY OF SAN LUIS OBISPO, a municipal corporation hereinafter called CITY, and HINDERLITER, DE LLAMAS AND ASSOCIATES a California Corporation hereinafter called CONTRACTOR. RECITALS WHEREAS, property tax revenues can be verified and potentially increased through a system of continuous monitoring, identification, and reconciliation to county records; and WHEREAS, an effective program of property tax management will assist the city in fiscal, economic, and community development planning; and WHEREAS, City desires the property tax data based reports and data analysis required to effectively manage the city's property tax base and identify and recover revenues misallocated within the city, or to other jurisdictions; and WHEREAS, Contractor has the programs, equipment, data and personnel required to deliver the property tax services referenced herein; . NOW, THEREFORE, City and Contractor, for the consideration hereinafter described, mutually agree as follows: 1 X3.7 SERVICES The Contractor shall perform the following services: A. Property tax and economic analysis 1. Annually after the lien date roll becomes available, Contractor shall establish a special data base which will include, for each parcel within the city boundaries, the assessed values for the secured and unsecured property tax rolls. The major property owners and property tax payers listings shall be provided on an annual basis. Tracking and trend analysis of property transfers, use type comparisons, pre Prop 13 assessment parcels, new construction activity, multiple owned parcels, absentee owner parcels and other information will be provided to assist staff in fiscal, economic and community development planning. 2. Each year, after the lien date roll is available, Contractor shall up -date reports identifying property transfers. Additional reports using the data bases will be prepared to identify errors, analyze city tax rate areas and taxing agencies and provide comparative information. Printouts, graphs and comparative data will be provided on a quarterly basis. 3. Contractor shall provide a reconciliation of assessed values (secured and unsecured lien date valuations) to county records which will be used to project annual property tax figures for the city's use in revenue forecasting. 4.. Contractor shall provide the base year values by tax rate area for all redevelopment project areas, and verify that all redevelopment parcels are correctly assigned to tax rate areas and taxing agencies. Tax increment 2 eu_49 projections based on net assessed values after factoring for base year values and exemptions will be furnished. B. Analysis and Identification of Misallocation Errors 1. Contractor shall conduct an analysis to identify and verify, parcels which are misassigned by Tax Rate Area and will provide the correct TRA designation to the proper county agency. Typical errors include parcels assigned to incorrect tax rate areas within the city or an adjacent city, tax rate areas allocated to wrong taxing agencies, and parcels missing from redevelopment project areas. 2. Contractor shall reconcile the annual auditor - controller assessed valuations report to the assessor's lien date rolls and identify discrepancies. 3. A review of parcels on the unsecured roll will be performed to identify inconsistencies such as value reductions, values being reported to a mailing address rather than the situs address, and errors involving tax rate areas. 4. Property transfers and new construction completions will be tracked to determine whether reassessment is performed within a reasonable time frame. The city will be notified of parcels which have failed to be reassessed. 5. Contractor shall utilize city building department data, including building permits with assessor parcel numbers and project completion dates, to identify non - residential parcels with new construction activity and shall provide reports for use in the city's preparation of Prop 4 and 111 State Appropriation Limit calculations. 3 4,3.9 C. On Going Consultation During the term of the contract, Contractor will serve as the city's resource staff on questions relating to property tax and assist in estimating property tax revenues. D. Optional Services The following services are available on a time and materials basis: Analyses based on geo areas designated by the city to include assessed valuations and square footage computations for use in community development planning Generation of specialized reports which would require additional programming or the purchase of additional data not necessary to carry out services outlined in Sections A and B. Any research with county agencies for which Contractor does not have a current database CONSIDERATION A. Contractor shall establish the property tax and analysis data bases and shall provide quarterly updates, as outlined under SERVICES - Sections A -C above, for an annual fee of $10,000.00 billed after the delivery of reports. B. Contractor shall be paid 25% of misallocated revenue recovered in the initial year's audit. Contractor's shall separate and support said reallocation and provide City with an itemized quarterly invoice showing all formula calculations and amounts due as a result of revenue recovery or reallocation. City shall pay audit fees after Contractor's submittal of evidence that corrections have been made by the appropriate agency. Payment to Contractor shall be made after City receives its first remittance advice during the fiscal year for which the correction applies. C. Fees charged for optional work or specialized work for cities as outlined above in SERVICES - Section D shall be billed on a time and materials basis at a rate of $75.00 per hour or as negotiated by both parties under a separate agreement. D. Above sums shall constitute full reimbursement to Contractor for all direct and indirect expenses incurred by Contractor in performing analyses and audits including the salaries of Contractor's employees, and travel expenses connected with contacting appropriate county department representatives. 5 e- -3 -11 CITY MATERIALS AND SUPPORT City agrees to provide the following information: Current city map and zoning map A copy of reports received by the city annually from the Auditor - Controller's office detailing Assessed Values (Secured, Unsecured and Utilities), as well as Unitary Values for reconciliation analysis. Parcel listing and maps of City parcel annexations since the prior lien date roll. A listing of completed new construction projects with mapbook, page and parcel numbers for proper identification and tracking for two years prior to the date of this contract. If the data does not include the APN information, Contractor will research this information at an additional cost. A listing of City levied assessment districts and direct assessments. TERMINATION This Agreement may be terminated by either party giving 30 days written notice to the other of such termination and specifying the effective date thereof. Upon the presentation of such notice, Contractor may continue to work through the date of termination. Upon termination as provided herein, Contractor shall be paid the value of all tax analysis and reporting work performed less payments previously made by City. In ascertaining the value of the work performed up to the date of termination, consideration shall be given to amounts due for any unpaid invoices, and to parcels identified by Contractor which may result in increased or reallocated revenues after the termination of this Agreement. After City receives said tax payments, Contractor shall be paid the for percentage work as previously authorized and satisfactorily performed at the times provided in the preceding section entitled "Consideration ". All documents, data, surveys and reports prepared by Contractor pursuant to this Agreement shall be considered the property of the City and upon payment for services performed by contractor, such documents and other identified materials shall be delivered to City by Contractor. INDEPENDENT CONTRACTOR Contractor shall perform the services hereunder as an independent contractor and shall furnish such services in its own manner and method, and under no circumstances or conditions shall any agent, servant, or employee of Contractor be considered as an employee of City. NON - ASSIGNMENT This Agreement is not assignable either in whole or in part by Contractor without the written consent of City. ATTORNEY'S FEES In the event a legal action is commenced to enforce any of the provisions of this Agreement, the prevailing party shall be entitled to recover its costs and reasonable attorney's fees. GOVERNING LAW The laws of the State of California shall govern the rights, obligations, duties and liabilities of the parties to this Agreement and shall also govern the interpretation of this agreement. INDEMNIFICATION Contractor hereby agrees to, and shall hold City, its elective and appointive boards, officers, agents and employee's, harmless from any liability for damage or claims for damage for personal injury, including death, as well as from claims for breach of confidentiality or property damage which may arise from Contractor's willful or negligent acts, errors or omissions or those of its employees or agents._ Contractor agrees to and shall defend City and its elective and appointive boards, officers, agents and employees from any suits or actions at law or in equity for damages caused, or alleged to have been caused, by reason of any of the aforesaid willful or negligent acts, errors or omissions. NOTICE All notices required by this Agreement shall be given to City and Contractor in writing, by personal delivery or fast class mail postage prepaid, addressed as follows: City: CITY OF SAN LUIS OBISPO 900 Palm Street San Luis Obispo, CA 93403 Contractor. HINDERLITER, DE LLAMAS & ASSOCIATES 2220 E. Alosta Avenue, Suite 205 Glendora, California 91740 8 zl&4 INSURANCE Contractor shall provide insurance as specified in Exhibit A. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the date first above written by their respective officers duly authorized in that behalf. CTTY OF SAN LUIS OBISPO CONTRACTOR: Mayor ATTEST: City Clerk City Administrative Officer City Attorney HINDERLITER, DE LLAMAS & ASSOCIATES California Corporation 9 d 3 —116