HomeMy WebLinkAboutStaff Report 3.E 12/21/2009CITY OF PETALUMA~ CALIFORNIA
. AGENDA. ~~LL ®ecember 21, 2009
Agenda Tt1~e A Resolution of the ~Ci~ty Council of the 'City of Petaluma M'eetin~ Date:
Authorizing. Examination of Sales and Use Tax Records by Applied December 21, 2009
Development Economics.
1Vleetin~ Time: 7:00 PM
Cate~Ory: ^ Presentation ^.Appointments ~ Consent ^ Public Hearing ^ Unfinished Business ^ New Business
Department: Director:. Contact Person: Phone Number:
City Manager John C. Brown John C. Brown 707-778-4345
Total Cost of Proposal orP'roject: n/a Name of Fund:
Account Number:
Amount Budgeted: 54.00-54100-54.110-17001
Current Account Balance: $145,000
.Recommendation: It is recommended that. the City Council take the :following action:
Adopt the attached resolution Authorizing'Examination of Sales and Use Tax Records by Applied Development
Economics.
1. ^ First reading of Ordinance approved unanimously, or with unanimous vote to allow posting prior to second reading
2. ^ First reading of Ordinance approved without unanimous vote: Ordinance has been published/posted prior to second
reading; .see .Attachment '
3. ^ Other action requiringspecial notice:, Notice has been given, see Attachment
Summa Statement: The City may, by resolution, pursuant to Revenue and Taxation Code Section 7056,
designate any officer, employee or any other person to examine all of the sales and use tax records of the Board
pertaining to sales and use'taxes collected for the City.
On November 23, 2009 the City Council awarded a bid to Applied Development Economics (ADE) to prepare an
economic development strategy and implementation plan, and authorized the City Manager to execute a contract
with the firrn. 'Section 1.6 of the project Scope of Work provides for a'Retail Market Analysis, and anticipates
that the, City will provide. ADE sales tax audit reports that document the sales tax collections by retail category
for each of'the retail districts within Petaluma.
ADE has requested that the City provide ~t with sales tax data needed to assist in the completion of the Retail
Market Analysis. ADE''s primary purpose -for .requesting the data is to identify mis-categorized data or duplicate
amount_s_. ADE- wi-ll rilai-retain the conf dentiality of all sales tax records it examines, none of its publically
released reports -will contain any conf dential: data, nor will it share confidential data with any unauthorized
persons:
To allow ADE to examine this information, it is recommended that the City Council adopt the attached
resolution, which provides that authorization.
Attachments to Agenda Packet Item:
1. Correspondence of November 30, 2009 from Applied Developrnenf Economics
2. Resolution
Reviewed bFinance Director: Reviewed by City Attorney: A " rov d. `'• .Maria er:
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Date: /Z` ~'~ Date: Date: .f
Rev. # ~ alb/ Date Last Revised: _ Filer
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CITY Off' PETAI,UIVIA, CALIFORNIA
DECEMBER 21, 2~~9
AGENDA 12EPORT
FOR
- A RESOLUTION OF`THE CITY COUNCIL OF`TBE"CITY OF PETAMULA
AUTIIORIZIN.G EXAIVLINATION OF SALES AND USE TAX .RECORDS BY APPLIED
DEVELOPMENT ECONOMICS
1. RECOmMENDAT[oN: I:t.is recommended that the City Council adopt the attached
resolution designating Applied Development. Economics as an authorized representative
to examine sales and use tax records.
2. BACKGROUND::; Pursuantao California Revenue and Taxation Code, the City of
Petaluma adopted a sales arid. use tax ordinance which is administered and collected by
the, State. Board of Equalization: 'The City may; by resolution; pursuant to Revenue and
Taxation Code. Section 7056; designate any officer, employee or any other person to
examine all ~of the sales and use tax records of the Board pertaining to sales and use taxes
collected for the City.
Qn November 23, 20.09 the City `Council awarded a bid to Applied Development
Economics (ADE) .to prepare; an .economic development strategy and implementation
plan, and authorized the City Managerto execute a contractwith the firm. Section 1.6 of
the project Scope' of Work provides "for,a. Retail Market Analysis to determine: how well
the existing base of local businesses is seruirig..the market demand. of the community;
where household spending occurs within a variety.of retail spending categories and
product groupings; and how much :retail spending Petaluma attracts from.. outside of "the
community. 'The scope of work anticipates that the: City: will provide ADE sales tax audit
reports Ghat document the .sales' tax collections by retail category' for each of the retai'1
districts within Petaluma.
3, Disc-ussioN; ADE has requested that,the City provide it.with sales tax data :needed to
assrst~in the completion of the Retail Mar-ket Analysis. (Attachment 1). As .indicated `n
the request, ADE. s primary purpose forrequesting the data is to identify ms-categori-zed
data or duplicate amounts. Pursuant to statute;. ADE will maintain the confidentiality of
.:all sales tax records, it examines: None of its publically released reports will contain any
.confidential data about individual businesses, nor will it share. confidential data with any
unauthorized ;persons.
In order to allow ADE to examine this information,. it is recommended that the City
Council ..adopt. fhe attached resolution, which provides that authorization.
4. FrscaL IMPACT: There is no cost.associated with the recommended action. The ability
to utilize-what would otherwise be confidential sales tax data will provde'for a more
thorough sales tax analysis on ADE's part,. and at less cost than would be incurred if the
firm had to try to assemble, this data from other sources.
Att-aehent 1
APPLIED
DEVELOP(VIENT
ECONOiVVICS
November 30, 2U09
Mr. )ohn G. Brown
Cii} Manager '
City of Petaluma .
11 Laglish Street
Petaluma, C1~ )4952
sear' 1~r. BroAVn
As use discussed at qut Noverber 23id meeting, ice are=.regtesting access to the City of Petaluma's
sales .t<ix audit reports foe p~itp;ores of completing a retail air il~sis as patt of fhc I/cononiic
Development Strategy for the City. We would use the sales. tax audi for purposes of calculating the
potential for new rer<iil• development within Petaluma. Our. analysis needs to begin with as solid an
understanding of the existing.. retail husinesses as possible. The sales tax data is the best source of
data for this analysis. C~thet sources that can be consulC_ed foz this type'of uialysis are far less
reliable, and an}'°deficicncies~in the-reliability of the sales data will. hinder the ocecall validity of the
economic development plan and precess.
.~Ehas used:?vIBIr1 data for a_naui~lier of other stc'idies,.and is firriily-aware of the con£dentiality
requirements associated cviih the use of this data. lindei•a1o circuinstanceswill any of our publicly
releaed reports contain any'conhdenti~l data about-individual uusinesses of dsta drat can be
baclcwards extrapolated to yield' confidential informatign. In addition,:nr~ confidential data will be
shared with anvpersons or organizations outside our firm.
We are requesting access ti> the data f~r;a11 retail Uusinesses in Petaluma.. This'is primarily so that
our analvstti can identify mis-categorized data or dupLcate.accounts. "['his. type"of examination
allows us ~to accurately deternunc the actual number of valid businesses, and identify what can and.
cannot be reported. '
The data that we are requestingaccess'to is dae sales tax summary report fox all Board of
Equalization categories for- a one-year period. axle only reed a report for one quarter hecause
I~IBIA's audit reports are typically formatted to include the previous four quarters.
Please contact me if you have any other questions about our xequest~ Tlaanlc you for your assistance.
Sincerely., -
~- ~?
z.-+..
Drug $ccnsson, MCI'
1>xesidcnt
100 Pringle Avenue, Suite560 • WalnurCceek, CA 94196 • Te197_5934.8712 • 1^ax 925.934.2402
21:50 12iver Plaza Drive, Suite 168 • Sacramento, CA 95833 •'rel 916'.932.1562 • Fax 916.923.1625
W lV ~i~. ad f; LI ~ a.. c OITl
A RESOLIJTIbN OF THE CITY CO~JNCIL OF THE CITY OF PETAMULA
Al<JTHORIZING EXAMINATION OF SALES AND USE TAX RECORDS BY APPLIED
DEVE><.OPMENT ECONOMICS.
WHEREAS, to California Revenue and Taxation Code .Section 7200, et, seq., the City of
Petaluma has adopted a sales and use tax ordinance. which imposes a .tax and provides a measure
therefore that can be~ administered and collected'by the State Board of Equalization along the
same and existing statutory and administrafive procedures followed by the State Board of
Equali~~zation in administering and collecting the California State Sales and Use Tax; and
WHEREAS, in 1956, pursuant to ordinance No. 444 N,C.S ,.the City of Petaluma entered
into a:contract with the State Board of Equalization to perform all functions incident to the
adrrrini'stration and collection of local'sales:and-use taxes; and
W>FIEREAS, pursuant to California Revenue and Taxation Code Section 7056, the City
of Petaluma may, by resolution, designate any .officer„ employee: or any other person to examine
all of the sales and use tax records of the -Board pertaining ao sales and use taxes collected for the
City; and
WHEREAS, the City Council of the. City of Petaluma deems it desirable and necessary
for authorized representatives of the City to examine confidential -sales and use tax records of the
State Board of Equalization pertaining; to sales and use taxes- collected by the Board for the City;
and
'WHEREAS, Section 7056 of the. California Revenue and Taxation Code further sets
forth ;certain requirements and conditions for the disclosure of Board- records, and establishes
criminal{penalties for the unlawfi'1 disclosure of information contained in, or der--ivied from',. the
sales~arid ise tax records. of the Board; and
W>FIEREAS, the City of Petaluma has entered into an agreement with Applied
Development Economies to conduct, among other analyses, an examination of sales and use
taxes collected for the. City.
NOW, THEREFORE, TIIE CITY COUNGhL OF THE CITY OF PETALIIMA
HEREBY RESOLVES AS FOLLOWS:
,Section. 1. That the City Manager or Finance Director,, or other officer or employee of the City
designated by the .City Manager in writing to the State Board of Equalization (hereafter referred to as
Board), is hereby appointed to represent the City with authority to examine sales and use tax
records of the .Board pertaining to sales and use taxes collected for the City by the Board
pursuant to the contract between the City. and the Board. The information obtained by
examination of Board .records shall be used only for purposes related to the collection of City
sales and use taxes by the .Board pursuant to that contract.
Section 2. 'That Applied Development Economies is hereby designated to examine the sales and
use tax records of the Board pertaining to sales and use taxes collected for the City by the Board.
The person or entitydesignated by this section meets all of "the following conditions:
a) has an existing contract with the City to examine those sales and use tax records;
b) is required by that contract ao disclose information. contained in, or derived from,
those .sales and -use tax. records only to the officer or employee authorized under
Section 1 of this resolution to examine the. information.
c) is prohibited. by that :contract from performing consulting services for a retailer
during the term of that contract; and
d) is prohibited by that contract from retaining the information contained in, or
derived from those sales .and use tax records; after that contract has expired.
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