HomeMy WebLinkAbout2012/03/13 Item 05CITY COUNCIL
AGENDA STATEMENT
~~ CITY OF
CHULAVISTA
MARCH 13, 2012, Item S
ITEM TITLE: RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA APPROVING AN AGREEMENT BETWEEN
THE STATE OF CALIFORNIA FRANCHISE TAX BOARD
AND THE CITY OF CHULA VISTA TO EXCHANGE TAX
DATA SPECIFIC TO CITY BUSINESS LICENSE
INFORMATION AS AUTHORIZED IN SECTION 19551.1 OF
THE CALIFORNIA REVENUE AND TAXATION CODE
SUBMITTED BY: DIRECTOR OF FIN E/ TREASURER j ;~
REVIEWED BY: CITY MANAGER
ASSISTANT CIT ANAGER
4/STHS VOTE: YES ~ NO
SUMMARY
In 2001, the California Legislature passed AB63 authorizing the California Franchise Tax
Boazd (FTB) to shaze information with cities regarding business tax filers within their
jurisdictions. Participation in the FTB's Business Tax Program requires entering into a
reciprocal agreement to exchange tax data with the FTB. Adoption of the resolution
approves the requisite agreement. There is no fee chazged to the City for participation in the
Business Tax Program.
ENVIRONMENTAL REVIEW
The Environmental Review Coordinator has reviewed the proposed activity for
compliance with the California Environmental Quality Act (CEQA) and has determined
that the activity is not a "Project" as defined under Section 15378(b)(4) of the State
CEQA Guidelines; therefore, pursuant to Section 15060(c)(3) of the State CEQA
Guidelines this activity is not subject to CEQA. Thus, no environmental review is
necessary.
RECOMMENDATION
That Council adopt the resolution.
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MARCH 13, 2012, Item `~
Page 2 of 3
BOARDS/COMMISSION RECOMMENDATION
Not applicable.
DISCUSSION
In 2001, the California Legislature passed AB63, which authorized the California
Franchise Tax Board (FTB) to share information with cities regazding business tax filers
within their jurisdictions. The FTB's City Business Tax Program is a data exchange
program which assists both cities and the State of California in identifying businesses and
taxpayers that may not be paying the proper amount of tax. Through this data exchange,
cities can find businesses within their jurisdictions that do not have current business
licenses. Conversely, the FTB can find businesses in cities that possess business licenses
but that fail to file a state income tax return.
Because the City of Chula Vista will provide reciprocal data to the State Franchise Tax
Board, there is no cost for participation in this program. Participation in the program
requires execution of a reciprocal agreement to exchange data (see Attachment 1). The
proposed agreement would have a term of June 1, 2012 through December 31, 2014.
If participation in the City Business Tax Program is approved, Chula Vista would first
transmit data to the FTB in June 2012. The first tax payer data would be received from the
FTB in December 2012. Collection efforts for the unlicensed businesses identified through
the program would commence in spring 2013. This collection effort will be consolidated
with a similar comparison of registered business licenses with the State Boazd of
Equalization's sellers permit data.
DECISION MAKER CONFLICT
Staff has reviewed the decision contemplated by this action and has determined that it is
not site specific and consequently the 500 foot rule found in California Code of
Regulations section 18704.2(a)(1) is not applicable to this decision.
CURRENT YEAR FISCAL IMPACT
If approved, collection efforts would commence in spring 2013, with initial revenue
impacts in fiscal year 2012-13. No impact is anticipated in the current fiscal year.
ONGOING FISCAL IMPACT
An initial review of FTB data identified approximately 15,000 taxpayers that have filed
documents with the state indicating that they are conducting business within Chula
Vista's jurisdiction. The City has approximately 10,000 in-city business licenses, leaving
approximately 5,000 businesses that may be conducting business within the City of Chula
Vista without a business license.
Businesses reporting to the State FTB as conducting business, but without a Chula Vista
business license are most likely to be small businesses with few employees. The annual
business license rate for these businesses would be either $25 (general business with
fewer than 5 employees) or $105 (professionals). The annual fiscal impact of licensing
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MARCH 13, 2012, Item S
Page 3 of 3
these 5,000 businesses could range from $125,000 to $525,000, depending upon the type
of business to be licensed.
Actual revenues to be generated by this compliance effort will vary depending upon the
number and type of unlicensed businesses identified. The revenues to be generated are
discretionary and support all General Fund functions.
ATTACHMENTS
Agreement between the City of Chula Vista and the California Franchise Tax
Board to Exchange Tax Data Specific to City Business License Information
Prepared by: Tiffany Allen, Treasury Manager, Finance Department
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THE ATTACHED AGREEMENT HAS BEEN REVIEWED
AND APPROVED AS TO FORM BY THE CITY
ATTORNEY'S OFFICE AND WILL BE
FORMALLY SIGNED UPON APPROVAL BY
THE CITY COUNCIL
~~len R. Googins
City Attorney
Dated: 3
STATE OF CALIFORNIA
STANDARD AGREEMENT NUIVIBER C1100157
BETWEEN
THE FRANCHISE TAX BOARD, AND
THE CITY OF CHULA VISTA
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STATE OF CALIFORNIA
STANDARD AGREEMENT
STD 213 (Rev 06/03)
ATTACHMENTI
AGREEMENT NUMBER
C1100157
REGISTRATION NUMBER
1. This Agreement is entered into between the State Agency and the Contractor named below:
STATE AGENCYS NAME
Franchise Tax Board
CONTRACTOR'S NAME
City of Chula Vista
2. The term of this
Agreement is: June 1, 2012 through December 31, 2014
3. The maximum amount $ 0.00
of this Agreement is: 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.
Exhibit A -Scope of Work 3 pages
Exhibit C* -General Terms and Conditions GTC610
Exhibit D -Special Terms and Conditions 3 pages
Exhibit E -City Record Layout Specifications 2 pages
Exhibit F - FTB Record Layout Specifications 1 page
Exhibit G -Confidentiality Statement 1 page
Items shown with an Asterisk (`), are hereby incorporated by reference and made part of this agreement as if attached hereto.
These documents can be viewed at www ols.dgs.ca.oov/Standard+Language/defaulthtm
IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto.
CONTRACTOR California Department of General
Services Use Only
CONTRACTOR'S NAME (if other than an individual, state whethera corporation, partnership, etc.)
City of Chula Vista
BY (Authorized Signature) DATE SIGNED(DO not type)
,~
PRINTED NAME AND TITLE OF PERSON SIGNING
ADDRESS
276 Fourth Avenue, Chula Vista, CA 91910
STATE OF CALIFORNIA
AGENCY NAME
Franchise Tax Board
BY (Authorized Signature) DATE SIGNED(DO not type)
PRINTED NAME AND TITLE OF PERSON SIGNING ®Exempt per: SCM 4.04.5.b.
Lisa Garrison, Chief Financial Officer
ADDRESS
P.O. Box 2086, Rancho Cordova, CA 95741-2086
5-5
City of Chula Vista
EXHIBIT A
SCOPE OF WORK
Agreement # C1100157
This Agreement is entered into by and between the Franchise Tax Board, herein referred to as
(FTB) and the City of Chula Vista, herein after referred to as the City.
Purpose:
This Agreement allows FTB and the City to enter into a reciprocal agreement to exchange tax
data specific to city business license information for tax administration and non-tax program
purposes. By entering into a reciprocal agreement, each party agrees to bear its own costs of
providing the data and each party is precluded from obtaining reimbursement.
Both parties will abide by the legal and confidentiality 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.
This Agreement does not include Federal Tax Information (FTI).
Legal Authority:
California Revenue and Taxation Code (R&TC) Section 19551.1 authorizes a reciprocal
agreement for the exchange of city business tax and income tax information between a city and
FTB. R&TC Section 19551.5 mandates cities to provide city business tax data to FTB upon
request.
City Responsibilities:
1. The City agrees that the information provided by FTB will be used exclusively to administer
the City's business tax program.
2. The City agrees to provide FTB with tax information pursuant to City Record Layout
Specifications, Exhibit E.
3. The City agrees to extract and provide City data to FTB annually in June for each tax year
that the Agreement is in place; June 2012, 2013, and 2014. If the Agreement is executed
after June 30, 2012, the City has 30 days after execution to provide FTB with the first year's
data.
4. The City agrees to submit the records to FTB using FTB's Secure Web Internet File Transfer
(SWIFT).
5. The City agrees to submit the records to FTB in ASCII fixed length format, .txt, per the City
Record Layout Specifications, Exhibit E.
5-6
City of Chula Vista
EXHIBIT A
SCOPE OF WORK (continued)
Agreement # C1100157
6. 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 forfeits its rights to FTB data for that year.
7. The City agrees that each City employee having access to FTB data shall sign a
Confidentiality Statement, Exhibit G. The signed statement is to be retained by the City and
produced to FTB upon request.
8. The City agrees to submit to FTB a completed Safeguard Review Questionnaire prior to
receiving FTB data. The Safeguard Review Questionnaire is valid for the duration of the
Agreement.
9. The City agrees to provide a copy of the resolution, order, motion, or ordinance of the local
governing body, authorizing the execution of the 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/federal agencies as
authorized by law.
2. FTB agrees to provide the City data extracted from the Taxpayer Information (TI) and
Business Entities Tax System (BETS). FTB will provide the City records for taxpayers within
the city's jurisdiction who indicate business income or deductions on their personal or
corporation income tax return pursuant to FTB Record Layout Specifications, Exhibit F.
3. FTB agrees to match the data provided by the City using the social security number or
federal employer identification number against FTB's data with a yes or no indicator on the
FTB Record Layout Specifications, Exhibit F. The first year's data match is at the discretion
of FTB and will be based on when the data is received and processed.
4. FTB agrees to provide the City an annual extract file in December 2012 for tax year 2011,
December 2013 for tax year 2012, and December 2014 for tax year 2013 via SWIFT.
5. FTB agrees to register the City for a SWIFT account, allowing for the secure electronic
transmission of data.
6. FTB agrees to provide the City a unique City Business Tax Number to be used for reporting
purposes only.
7. FTB agrees to allow the City to resubmit data within 30 days of notification, in the event data
is initially submitted with errors.
5-7
City of Chula Vista
EXHIBIT A
SCOPE OF WORK (continued)
Project Coordinators:
The project coordinators during the term of this Agreement will be:
Franchise Tax Board
Cathy McCollum
Data Resources and Services Unit
P.O. Box 1468, Mailstop A181
Sacramento, CA 95812-1468
Phone: (916) 845-4431
Fax: (916)843-5899
Agreement # C1100157
City of Chula Vista
Maria Kachadoorian
Director of Finance
276 Fourth Avenue
Chula Vista, CA 91910
Phone: (619) 691-5051 x4040
Return executed Agreement to:
Franchise Tax Board
Procurement & Asset Management Bureau
Attention: Tracey Mollow
P.O. Box 2086, Mailstop A-374
Rancho Cordova, CA 95741-2086
Phone: (916) 845-5193
Fax: (916) 843-0497
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City of Chula Vista
EXHIBIT D
SPECIAL TERMS AND CONDITIONS
Agreement # C1100157
STATEMENT OF CONFIDENTIALITY: The Franchise Tax Board has tax return
information and other confidential data in its custody. Unauthorized inspection or disclosure
of state return information or other confidential data is a misdemeanor (Sections 19542 and
19542.1 Revenue and Taxation Code).
The City and each of the City's employees who may have access to the confidential data of
FTB will be required to sign a Confidentiality Statement, Exhibit G, attesting to the fact that
he/she is aware of the confidential data and the penalties for unauthorized disclosure
thereof. The signed statement shall be retained by the City and furnished to FTB upon
request.
USE OF INFORMATION: The City and FTB agree that the information furnished or secured
pursuant to this Agreement shall be used solely for the purposes described in the Scope of
Work, Exhibit A. The information obtained by FTB shall be used for tax administration and
nontax programs that FTB administers and may be shared with other state/federal
agencies as authorized by law. The City and FTB further agree 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 identified in this Agreement or as authorized by
law.
3. DATA OWNERSHIP: The confidential tax information or sensitive information being
provided to the City under this Agreement remains the exclusive property of FTB.
Confidential tax and sensitive datalinformation are not open to the public and require
special precautions to protect from loss and unauthorized use, disclosure modification, or
destruction. The City shall have the right to use and process the disclosed information for
the purposes stated in the Scope of Work, Exhibit A, of this Agreement, which right shall be
revoked and terminated immediately upon completion of this Agreement.
4. EMPLOYEE ACCESS TO INFORMATION: Both FTB and the City 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 information to perform their official
duties in connection with the uses of the information authorized by this Agreement. Both
parties recognize their responsibilities to protect the confidentiality of this information as
provided by law and ensures such information is disclosed only to those individuals and of
such purpose, as authorized by the respective laws.
5. PROTECTING CONFIDENTIAL INFORMATION: Both FTB and the City in recognizing the
confidentiality of the information being exchanged, agree to take all appropriate precautions
to protect the confidential information obtained pursuant to this Agreement from
unauthorized disclosure. Both FTB and the City will conduct oversight of its users with
access to the confidential information provided under this Agreement.
5-9
City of Chula Vista
EXHIBIT D
SPECIAL TERMS AND CONDITIONS (continued)
Agreement # C1100157
6. INFORMATION SECURITY: Information security is defined as the preservation of the
confidentiality, integrity, availability, authenticity, and utility of information. A secure
environment is required to protect the confidential information obtained from FTB pursuant
to this Agreement. The City will store information so that it is physically secure from
unauthorized access. The records received by the City will be securely maintained and
accessible only by employees of the city business license program who are committed to
protect the data from unauthorized access, use, and disclosure.
INCIDENT REPORTING: All unauthorized or suspected unauthorized access; use and/or
disclosure (incidents) of FTB data shall be reported to FTB's City Business Tax Program
Area, (916) 845-6304 or by email: LocalGovtLiaison(a~ftb.ca.gov ,immediately upon
discovery of the incident. The incident report shall contain the following: date, time,
employee name, description of the incident or circumstances, and means of discovery.
Upon discovery of any such incident, FTB will make the appropriate notification to affected
California resident(s) pursuant to the requirements of Civil Code Section 1798.29.
8. DESTRUCTION OF RECORDS: All records received by the City from FTB and any
database(s) created, copies made, or files attributed to the records received will be
destroyed within three years of receipt. 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. FTB will destroy City data in accordance with the Department's
data retention policies.
9. SAFEGUARD REVIEW QUESTIONNAIRE AND ON-SITE SAFEGUARD REVIEW: Prior to
sending data to the City, FTB requires the City to submit a Safeguard Review
Questionnaire certifying the protection and confidentiality of FTB data. The FTB retains the
right to conduct an on-site safeguard review of the City. The City will be provided a
minimum of seven (7) days' notice prior to an on-site safeguard review being conducted by
the FTB Disclosure Office. The on-site safeguard review will examine the adequacy of
information security controls established by the City in compliance with the confidentiality
requirements pursuant to this Agreement. The City will take appropriate disciplinary actions
against any user determined to have violated security or confidentiality requirements.
10. DISPUTE RESOLUTION: In the event of a dispute, the City shall file a "Notice of Dispute'
with the Chief Financial Officer of the Franchise Tax Board within ten (10) days of discovery
of the problem. Within ten (10) days, the Chief Financial Officer orhis/her designee shall
meet with the City and the FTB contact for purposes of resolving the dispute. The decision
of the Chief Financial Officer shall be final. The City retains the right to immediately
terminate this Agreement following the decision of the Chief Financial Officer.
11. INDEMNIFICATION: Both parties agree to indemnify, defend, and save harmless each
other, its officers, agents, and employees from any and all claims and losses accruing or
resulting from any breach of confidentiality by either party and/or its employees.
5-10
City of Chula Vista
EXHIBIT D
Agreement # C1100157
SPECIAL TERMS AND CONDITIONS (continued)
12. LIMITED WARRANTY: Either party does not warrant or represent the accuracy or content
of the material available through this Agreement, and 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 days' (30) prior written notice. This Agreement may be terminated by either
party in the event of any breach of the terms of this Agreement. Both parties agree that in
the event of a breach to the terms of this Agreement, it shall destroy all records and any
databases created, copies made, or files attributed to the records received. 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, upon destruction.
14. NO THIRD PARTY LIABILITY: Nothing contained in this Agreement or otherwise shall
create any contractual relation between either party and any other party, and no party shall
relieve the City or FTB of its responsibilities and obligations hereunder. Both parties agree
to be fully responsible for the acts and omissions of its third parties and of persons either
directly or indirectly employed by any of them as it is for the acts and omissions of persons
directly employed by the City or FTB. Both parties shall have no obligation to pay or to see
the payment of any monies to any party or persons either directly or indirectly employed by
the City or FTB.
15. EARLY TERMINATION CLAUSE: In the event that Revenue & Taxation Code 19551.1 and
19551.5 are not amended before the sunset date of December 31, 2013, this Agreement
will be terminated effective that date.
5-11
City of Chula Vista
EXHIBIT E
CITY RECORD LAYOUT SPECIFICATIONS
Agreement # C1100157
Data Element Name Start End Field Usage Description
Pos. Pas. Size
SOCIAL SECURITY NUMBER 1 9 9 AN Must be present unless FEIN is
(SSN) provided. Fill unused field with
blanks.
FEDERAL EMPLOYER 10 18 9 AN Must be present unless SSN is
ID NUMBER (FEIN) provided. Fill unused field with
blanks.
OWNERSHIP TYPE 19 19 1 AN Must be present:
S =Sole Proprietorship
P =Partnership
C =Corporation
T =Trust
L =Limited Liability Company
OWNER'S LAST NAME 20 34 15 AN Must be present if Ownership Type
in position 19 = S.
OWNER'S FIRST NAME 35 45 11 AN Must be present if Ownership Type
in position 19 = S.
OWNER'S MIDDLE INITIAL 46 46 1 AN May be left blank.
BUSINESS NAME 47 86 40 AN Enter if business is operating under
a fictitious name (Doing Business
As (DBA)).
BUSINESS ADDRESS 87 126 40 AN Address of the business location or
NUMBER AND STREET the residence of the owner if sole
proprietorship.
CITY 127 166 40 A Must be present.
STATE 167 168 2 A Enter standard state abbreviation.
ZIP CODE 169 177 9 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
blanks.
BUSINESS START DATE 178 185 8 N Enter the eight-digit date
(MMDDYYYY). Zero fll if not
known.
BUSINESS CEASE DATE 186 193 8 N Enter the eight-digit date
(MMDDYYYY) if out of
business. Zero fll if not known or
still in business.
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City of Chula Vista
Agreement # C1100157
Data Element Name Start End Field Usage Description
Pos. Pos. Size
CITY BUSINESS TAX 194 196 3 N Enter three-digit number assigned
NUMBER byFTB.
NORTH AMERICAN 197 202 6 N Enter the six-digit NAICS code. Fill
INDUSTRY CLASSIFICATION unused fields with zeros.
SYSTEM (NAICS)
STANDARD INDUSTRIAL 203 206 4 N Enter the 2-4 digit SIC code. Left
CLASSIFICATION (SIC) justify (example 99 will be 9900).
Fill unused fields with zeros.
TOTAL RECORD LENGTH 206
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City of Chula Vista Agreement # C1100157
EXHIBIT F
FRANCHISE TAX BOARD RECORD LAYOUT SPECIFICATIONS
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 fled with a joint return.
SPOUSE LAST NAME 17 72 For "P" records filed with a joint return.
SPOUSE FIRST NAME 11 89
SPOUSE MIDDLE INITIAL 1 100
PBA CODE 6 101
ADDRESS NUMBER 10 107
PRE-DIRECTIONAL DIRECTOR 2 117
STREET NAME 28 119
STREET SUFFIX 4 147
POST-DIRECTIONAL INDICATOR 2 151
STREET SUFFIX 2 4 153
APARTMENT/SUITE NUMBER 10 157
CITY 13 167
STATE 2 180
ZIP CODE 5 182
ZIP CODE SUFFIX 4 187
CBT MATCH 1 191
Far "P" records filed with a joint return.
For "P" records filed with a joint return.
Principal business activity code.
Postal Service term (i.e., N, S, E, W, NE,
NW, SE, SW).
e.g., ST, WAY, HWY, BLVD, etc.
Postal Service term (i.e., N, S, E, W, NE,
NW, SE, SW).
e.g., APT, UNIT, FL, etc.
Standard state abbreviation.
The five-digit ZIP Code assigned by the U.S.
Postal Service.
Provided if known.
"N" - No match per CBT data. "Y" -Yes:
CBT matched to state tax return fled.
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City of Chufa Vista
EXHIBIT G
CONFIDENTIALITY STATEMENT
State of California
Agreement # C1100157
Franchise Tax Board
Confidential tax return information 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 return information is in the
public's interest, the state's interest, and the city's interest.
A city employee is required to protect all information received from the Franchise Tax
Board.
A city employee is required to protect confidential information by:
• Accessing or modifying information only for the purpose of performing official duties.
• Never accessing or inspecting information for curiosity or personal reasons.
Never showing or discussing confidential information to or with anyone who does not
have the need to know.
• Placing confidential information only in approved locations.
• Never removing confidential information from your work site without authorization.
Unauthorized inspection, access, use, or disclosure of confidential tax return information
is a crime under state laws, including but not limited to Sections 19542 and 19552 of the
California Revenue and Taxation Code and Section 502 of the Penal Code. Unauthorized
access, inspection, use, or disclosure may result in either or both of the following:
• State criminal action
• State and/or taxpayer civil action
You are reminded that these rules are designed to protect everyone's right to privacy, including
your own.
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 maybe punishable as a crime and may result in disciplinary and/or civil
action being taken against me.
Name
5-15
GTC 610
EXHIBIT C
GENERAL TERMS AND CONDITIONS
1. 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.
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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 unlawfully discriminate, harass, or allow
harassment against any employee or applicant for employment because of sex, race,
color, ancestry, religious creed, national origin, physical disability (including HIV and
AIDS), mental disability, medical condition (e.g., cancer), age (over 40), marital status,
and denial of family care leave. Contractor and subcontractors shall insure that the
evaluation and treatment of their employees and applicants for employment are free
from such discrimination and harassment. Contractor and subcontractors shall comply
with the provisions of the Fair Employment and Housing Act (Gov. Code §12990 (a-f) et
seq.) and the applicable regulations promulgated thereunder (California Code of
Regulations, Title 2, Section 7285 et seq.). The applicable regulations of the Fair
Employment and Housing Commission implementing Government Code Section 12990
(a-f), set forth in Chapter 5 of Division 4 of Title 2 of the California Code of Regulations,
are incorporated into this Agreement by reference and made a part hereof as if set forth
in full. 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.
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 307 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.
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.
5-17
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.
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
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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.)
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).)
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CCC-307
CERTIFICATION
I, the official named below, CERTIFY UNDER PENALTY OF PERJURY that I am
duly authorized to legally bind the prospective Contractor to the clause(s) listed
below. This certification is made under the laws of the State of California.
ContractorBidder Firm Name (Printed)
City of Chula Vista Federal ID Number
By (Authorized Signature)
Printed Name and Title of Person Signing
Date Executed ~ Executed in the County of
CONTRACTOR CERTIFICATION CLAUSES
1. STATEMENT OF COMPLIANCE: Contractor has, unless exempted, complied
with the nondiscrimination program requirements. (Gov. Code §12990 (a-f) and
CCR, Title 2, Section 8103) (Not applicable to public entities.)
2. DRUG-FREE WORKPLACE REQUIREMENTS: Contractor will comply with
the requirements of the Drug-Free Workplace Act of 1990 and will provide a
drug-free workplace by taking the following actions:
a. Publish a statement notifying employees that unlawful manufacture,
distribution, dispensation, possession or use of a controlled substance is
prohibited and specifying actions to be taken against employees for violations.
b. Establish aDrug-Free Awareness Program to inform employees about:
1) the dangers of drug abuse in the workplace;
2) the person's or organization's policy of maintaining adrug-free workplace;
3) any available counseling, rehabilitation and employee assistance programs;
and,
4) penalties that may be imposed upon employees for drug abuse violations.
c. Every employee who works on the proposed Agreement will:
1) receive a copy of the company's drug-free workplace policy statement; and,
2) agree to abide by the terms of the company's statement as a condition of
employment on the Agreement.
Failure to comply with these requirements may result in suspension of payments
under the Agreement or termination of the Agreement or both and Contractor
may be ineligible for award of any future State agreements if the department
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determines that any of the following has occurred: the Contractor has made false
certification, or violated the certification by failing to carry out the requirements as
noted above. (Gov. Code §8350 et seq.)
3. NATIONAL LABOR RELATIONS BOARD CERTIFICATION: Contractor
certifies that no more than one (1) final unappealable finding of contempt of court
by a Federal court has been issued against Contractor within the immediately
preceding two-year period because of Contractor's failure to comply with an order
of a Federal court, which orders Contractor to comply with an order of the
National Labor Relations Board. (Pub. Contract Code §10296) (Not applicable to
public entities.)
4. CONTRACTS FOR LEGAL SERVICES $50 000 OR MORE- PRO BONG
REQUIREMENT: Contractor hereby certifies that contractor will comply with the
requirements of Section 6072 of the Business and Professions Code, effective
January 1, 2003.
Contractor agrees to make a good faith effort to provide a minimum number of
hours of pro bono legal services during each year of the contract equal to the
lessor of 30 multiplied by the number of full time attorneys in the firm's offices in
the State, with the number of hours prorated on an actual day basis for any
contract period of less than a full year or 10% of its contract with the State.
Failure to make a good faith effort may be cause for non-renewal of a state
contract for legal services, and may be taken into account when determining the
award of future contracts with the State for legal services.
5. EXPATRIATE CORPORATIONS: Contractor hereby declares that it is not an
expatriate corporation or subsidiary of an expatriate corporation within the
meaning of Public Contract Code Section 10286 and 10286.1, and is eligible to
contract with the State of California.
6. SWEATFREE CODE OF CONDUCT
a. All Contractors contracting for the procurement or laundering of apparel,
garments or corresponding accessories, or the procurement of equipment,
materials, or supplies, other than procurement related to a public works contract,
declare under penalty of perjury that no apparel, garments or corresponding
accessories, equipment, materials, or supplies furnished to the state pursuant to
the contract have been laundered or produced in whole or in part by sweatshop
labor, forced labor, convict labor, indentured labor under penal sanction, abusive
forms of child labor or exploitation of children in sweatshop labor, or with the
benefit of sweatshop labor, forced labor, convict labor, indentured labor under
penal sanction, abusive forms of child labor or exploitation of children in
sweatshop labor. The contractor further declares under penalty of perjury that
they adhere to the Sweatfree Code of Conduct as set forth on the California
Department of Industrial Relations website located at www.dir.ca.aov, and Public
Contract Code Section 6108.
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b. The contractor agrees to cooperate fully in providing reasonable access to the
contractor's records, documents, agents or employees, or premises if reasonably
required by authorized officials of the contracting agency, the Department of
Industrial Relations, or the Department of Justice to determine the contractor's
compliance with the requirements under paragraph (a).
7. DOMESTIC PARTNERS: For contracts over $100,000 executed or amended
after January 1, 2007, the contractor certifies that contractor is in compliance with
Public Contract Code section 10295.3.
DOING BUSINESS WITH THE STATE OF CALIFORNIA
The following laws apply to persons or entities doing business with the State of
California.
1. CONFLICT OF INTEREST: Contractor needs to be aware of the following
provisions regarding current or farmer state employees. If Contractor has any
questions on the status of any person rendering services or involved with the
Agreement, the awarding agency must be contacted immediately for clarification.
Current State Employees (Pub. Contract Code §10410):
1). No officer or employee shall engage in any employment, activity or enterprise
from which the officer or employee receives compensation or has a financial
interest and which is sponsored or funded by any state agency, unless the
employment, activity or enterprise is required as a condition of regular state
employment.
2). No officer or employee shall contract on his or her own behalf as an
independent contractor with any state agency to provide goods or services.
Former State Employees (Pub. Contract Code §10411):
1). For the two-year period from the date he or she left state employment, no
former state officer or employee may enter into a contract in which he or she
engaged in any of the negotiations, transactions, planning, arrangements or any
part of the decision-making process relevant to the contract while employed in
any capacity by any state agency.
2). For the twelve-month period from the date he or she left state employment, no
former state officer or employee may enter into a contract with any state agency
if he or she was employed by that state agency in apolicy-making position in the
same general subject area as the proposed contract within the 12-month period
prior to his or her leaving state service.
If Contractor violates any provisions of above paragraphs, such action by
Contractor shall render this Agreement void. (Pub. Contract Code §10420)
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Members of boards and commissions are exempt from this section if they do not
receive payment other than payment of each meeting of the board or
commission, payment for preparatory time and payment for per diem. (Pub.
Contract Code §10430 (e))
2. LABOR CODE/WORKERS' COMPENSATION: Contractor needs to be aware
of the provisions which require every employer to be insured against liability for
Worker's Compensation or to undertake self-insurance in accordance with the
provisions, and Contractor affirms to comply with such provisions before
commencing the performance of the work of this Agreement. (Labor Code
Section 3700)
3. AMERICANS WITH DISABILITIES ACT: Contractor assures the State that it
complies with the Americans with Disabilities Act (ADA) of 1990, which prohibits
discrimination on the basis of disability, as well as all applicable regulations and
guidelines issued pursuant to the ADA. (42 U.S.C. 12101 et seq.)
4. CONTRACTOR NAME CHANGE: An amendment is required to change the
Contractor's name as listed on this Agreement. Upon receipt of legal
documentation of the name change the State will process the amendment.
Payment of invoices presented with a new name cannot be paid prior to approval
of said amendment.
5. CORPORATE QUALIFICATIONS TO DO BUSINESS IN CALIFORNIA
a. When agreements are to be performed in the state by corporations, the
contracting agencies will be verifying that the contractor is currently qualified to
do business in California in order to ensure that all obligations due to the state
are fulfilled.
b. "Doing business" is defined in R&TC Section 23101 as actively engaging in
any transaction for the purpose of financial or pecuniary gain or profit. Although
there are some statutory exceptions to taxation, rarely will a corporate contractor
performing within the state not be subject to the franchise tax.
c. Both domestic and foreign corporations (those incorporated outside of
California) must be in good standing in order to be qualified to do business in
California. Agencies will determine whether a corporation is in good standing by
calling the Office of the Secretary of State.
6. RESOLUTION: A county, city, district, or other local public body must provide
the State with a copy of a resolution, order, motion, or ordinance of the local
governing body which by law has authority to enter into an agreement,
authorizing execution of the agreement.
7. AIR OR WATER POLLUTION VIOLATION: Under the State laws, the
Contractor shall notb_e~ (1) in violation of any order or resolution not subject to
review promulgatead by the State Air Resources Board or an air pollution control
district; (2) subject to cease and desist order not subject to review issued
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pursuant to Section 13301 of the Water Code for violation of waste discharge
requirements or discharge prohibitions; or (3) finally determined to be in violation
of provisions of federal law relating to air or water pollution.
8. PAYEE DATA RECORD FORM STD. 204: This form must be completed by all
contractors that are not another state agency or other governmental entity.
S:WDMIN\HOMEPAGE\CCC\CCC-307.doc
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RESOLUTION NO.
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA APPROVING AN AGREEMENT BETWEEN
THE STATE OF CALIFORNIA FRANCHISE TAX BOARD
AND THE CITY OF CHULA VISTA TO EXCHANGE TAX
DATA SPECIFIC TO CITY BUSINESS LICENSE
INFORMATION AS AUTHORIZED IN SECTION 19551.1 OF
THE CALIFORNIA REVENUE AND TAXATION CODE, AND
AUTHORIZING AND DIRECTING THE MAYOR TO
EXECUTE SAID AGREEMENT
WHEREAS, Section 19551.1 of the California Revenue and Taxation code authorizes the
exchange of tax data; and
WHEREAS, the City of Chula Vista desires to participate in the exchange of data with
the California Franchise Tax Board, as authorized in Section 19551.1 of the Califomia Revenue
and Taxation Code; and
WHEREAS, a condition of participation in the program is the execution of a reciprocal
agreement to exchange information.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula
Vista does hereby approve the reciprocal agreement with the California Franchise Tax Board to
exchange tax data specific to City Business License information.
BE IT FURTHER RESOLVED that the Mayor of the City of Chula Vista is hereby
authorized and directed to execute said agreement in the form presented for and on behalf of the
City of Chula Vista
Presented by
Maria Kachadoorian
Finance Director/Treasurer
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