HomeMy WebLinkAboutCA State Board Equalization3. b
Agenda Item No:
Meeting Date: December 2, 2013
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Prepared by: Lisa Goldfien, Asst.. City Attorney City Manager ApprovaI;1q//"J--&
SUBJECT: CONSIDERATION OF A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF SAN RAFAEL APPROVING AND AUTHORIZING THE MAYOR TO
EXECUTE AGREEMENTS WITH THE STATE BOARD OF EQUALIZATION
FOR IMPLEMENTATION OF THE CITY'S TRANSACTIONS AND USE TAX.
RECOMMENDATION:
Staff recommends that the City Council adopt the Resolution approving and authorizing the
Mayor to execute the two agreements with the State Board of Equalization in order to implement
the City's transactions and use tax (Measure E).
BACKGROUND:
The County Registrar has certified the results of the November 5, 2013 election, showing that
Measure E, the new 0.75% transactions and use tax adopted by the City Council in Ordinance
No. 1913, passed with a majority vote of the City electors voting at the election. The new
transactions and use tax will go into effect on April 1, 2014. Under the State Revenue and
Taxation Code, prior to the operative date of the Ordinance the City is required to contract with
the State Board of Equalization ("BOE") to perform all the functions incident to the
administration and operation of the Ordinance.
The BOE has provided the City with two forms of agreement containing the provisions required
by law. In addition to a contract providing for BOE administration of the transactions and use
tax (the "Administration Agreement"), there is a second agreement covering the activities
required of the BOE in its preparation to administer the transaction and use tax (the
"Preparatory Agreement"). The BOE is authorized to assess a separate fee for these activities,
which include computer programming for data processing, developing and adopting regulations,
developing procedures, updated publications, notifications to taxpayers and other direct and
indirect costs as permitted under Government Code section 11256. Under the terms of the
agreement, the costs to be assessed are the actual cost to BOE, and, in no event shall BOE's
costs exceed $175,000.00.
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Implementation of the City's new transactions and use tax requires that the City execute the
Administration and Preparatory Agreements with the State Board of Equalization. The City will
comply with the BOE requirement if the Council adopts the Resolution approving and
authorizing the Mayor to execute these agreements. Any delay in the approval of these
agreements may delay the implementation and collection of the new tax.
FISCAL IMPACT:
The State Board of Equalization will charge its actual costs for the preparation to administer the
tax (not to exceed $175,000.00) and will charge an on-going administration fee calculated
based upon the gross tax revenue collected. These costs will be deducted from the gross ta.N-
revenue and the net tax revenue will be dispersed to the City.
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1. Adopt the Resolution.
T. Decline to adopt the Resolution. Staff recommends against this action as it will conflict
with the mandates of Measure E and the procedures of the BOE.
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ATTACHMENTS:
! RESOLUTION OF THE CITY COUNCIL OF THE CITY OF 1 RAFAEL
AUTHORIZING MAYOR AGREEMENTS
STATE BOARD EQUALIZATION ' IMPLEMENTATION
OF ! LOCAL TRANSACTIONS 1 1
WHEREAS, on August 5, 2013 the City Council approved Ordinance No.#amending th
City's Municipal Code and providing for a local transactions and use tax; and i
WHEREAS, Ordinance No. 1913 was submitted to the voters as Measure E on the ballot for
the general municipal election on November S, 2013, and was approved by a majority of the voters
voting at that election; and
WHEREAS, the State Board of Equalization (Board) administers and collects the transactions
and use taxes for all applicable jurisdictions within the state, and
WHEREAS, the Board will be responsible to administer and collect the transactions and use
tax for the City; and
WHEREAS, the Board requires that the City enter into a "Preparatory Agreement" and an
"Administration Agreement" prior to implementation of said taxes, and
WHEREAS, the Board requires that the City Council authorize the agreements;
NOW, THEREFORE BE IT RESOLVED by the City Council of the City of San Rafael that
the "Preparatory Agreement" attached as Exhibit A and the ".Administration Agreement' attached as
Exhibit B are hereby approved and the Mayor is hereby authorized to execute each agreement.
L ESTHER C. BEIRNE, City Clerk of the City of San Rafael, hereby certify that the
foregoing / duly # regularly introduced I adopted +/ I regular meeting of
AYES: COUNCILMEMBERS: Bushey Lang, Colin, Connolly, McCullough & Mayor Phillips
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ESTHER C. BEIRNE, City Clerk