HomeMy WebLinkAboutResolution No. 13-7406 RESOLUTION NO. 13 -7406
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DOWNEY,
CALIFORNIA, AUTHORIZING TO ENTER INTO AN AGREEMENT BETWEEN
THE STATE OF CALIFORNIA FRANCHISE TAX BOARD AND THE CITY OF
DOWNEY TO EXCHANGE BUSINESS LICENSE TAX INFORMATION
WHEREAS, the City Council of the City of Downey ( "CITY ") has determined that there is
a need to enter into a non - financial agreement with the Franchise Tax Board (FTB); and,
WHEREAS, the City's participation in the reciprocal business tax information exchange
will benefit both the City and the State in detecting the unlicensed businesses in the City; and,
WHEREAS, the parties will exchange the information via a Secure Web Internet File
Transfer method; and,
WHEREAS, the City receiving taxpayer data will provide adequate safeguards to protect
their confidentiality and will use the information exclusively to administer the City's business
license program.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF DOWNEY DOES
HEREBY RESOLVES AS FOLLOWS:
SECTION 1. That the City Council approves the Agreement between the FTB and the
City of Downey for the exchange of business license information, attached hereto as Exhibit A.
SECTION 2. The City Council authorizes the City Manager to execute the Agreement
on the City's behalf and submit such documents as may be required in order to implement the
Agreement.
SECTION 3. The Mayor is hereby authorized to affix his signature on this Resolution
signifying its adoption by the City Council of the City of Downey, and the City Clerk is directed to
attest thereto.
SECTION 4. The City Clerk shall certify to the adoption of this Resolution.
APPROVED AND ADOPTED on this 23rd day of April, 1 13.
--°"
MARIO A. GUE - A, Mayor
ATTEST:
- ONG'
ADRIA M. J W E EZ, CMC
City Clerk
RESOLUTION NO. 13 -7409
PAGE 2
HEREBY CERTIFY that the foregoing Resolution was adopted by the City Council of
the City of Downey at a regular meeting thereof held on the 23 day of April 2013, by the
following vote, to wit:
AYES: Council Members: Brossmer, Marquez, Saab, Vasquez, Mayor Guerra
NOES: Council Members: None
ABSTAIN: Council Members: None •
ABSENT: Council Members: None
1 1 fb
Ab"' IA M. JIM NE , CMC
City Clerk
STATE OF CALIFORNIA
STANDARD AGREEMENT
STD 213 (Rev 06/03)
, AGREEMENT NUMBER
C1200111
REGISTRATION NUMBER
1. This Agreement is entered into between the State Agency and the Contractor named below:
STATE AGENCY'S NAME
Franchise Tax Board
CONTRACTOR'S NAME
City of Downey
2. The term of this
Agreement is: June 1, 2013 through December 31, 2015
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.gov /Standard +Language /default.htm
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 whether a corporation, partnership, etc.)
City of Down
BY (Authorized ure DATE SIGNED(Do not type)
A K -e-4.4, - , fe ,,,t.?-... C Y I ? 9/
1 , °
PRINTED), WIE TITLE OF " , e SIGNING
fr iii/g) e Cia- PI 9 Ve d
ADDRESS
11111 Brookshire Blvd., Downey, CA 90241
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 1 - 4.04.A.2.5.
Lisa Garrison, Chief Financial Officer
..... ADDRESS
P.O. Box 2086, Rancho Cordova, CA 95741 -2086
City of Downey Agreement # C1200111
EXHIBIT A
SCOPE OF WORK
This Agreement is entered into by and between the Franchise Tax Board, herein referred to as (FTB) and
the City of Downey, 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 purposes. By entering into a reciprocal
agreement, each party agrees to bear its own costs of providing the data and the City is precluded from
obtaining reimbursement.
Both parties will abide by the legal and confidential 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. No Federal Tax Information will be exchanged.
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 that information obtained under this Agreement will not be reproduced, published,
sold, or released in original or in any other form for any purpose; and only accessed by City
employees.
3. The City agrees to provide FTB with tax information pursuant to Exhibit E, Format Specifications,
which shall include but is not limited to the following:
• Business or owner's name.
• Business or residence address.
• Federal employer identification number or social security number.
• North American Industry Classification Code or Standard Industry Classification Code.
4. 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 2013, 2014, and 2015. If the Agreement is executed after June 30, 2013,
the City has 30 days after execution to provide FTB with the first year's data.
5. The City agrees to submit the records electronically to FTB using FTB's Secure Web Internet File
Transfer (SWIFT) system.
6. The City agrees to submit the records to FTB in ASCII fixed length format, .txt, per the Format
Specifications, Exhibit E.
City of Downey Agreement # C1200111
EXHIBIT A
SCOPE OF WORK (continued)
7. 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 its rights to FTB data for that year. y
8. The City agrees that each City employee having access to FTB data shall sign a FTB 712,
Confidentiality Statement (Exhibit G). The signed statement is to be retained by the City and
produced to FTB upon request.
9. 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.
10. The City agrees to provide a copy of the resolution, order, motion, or ordinance of the local overnin g
body, authorizing the execution of the Agreement.
g
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 that information obtained under this Agreement will not be reproduced, published, sold,
or released in original or in any other form for any purpose.
3. 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 a business on their personal or corporation income tax return. The Record
Layout, Exhibit F (FTB 909A) shall include, but is not limited to:
• Taxpayer name
• Taxpayer address
• Taxpayer social security number or federal employer identification number
• Principal Business Activity code
4. 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 Record Layout,
Exhibit F (FTB 909A). The first year's data match is at the discretion of FTB and will be based on
when the data is received and processed.
5. FTB agrees to provide the City an annual extraction in December 2013 for tax year 2012, December
2014 for tax year 2013, and December 2015 for tax year 2014 via SWIFT.
6. FTB agrees to register the City for a SWIFT account, allowing for the secure electronic transmission
of data.
City of Downey Agreement # C1200111
EXHIBIT A
SCOPE OF WORK (continued)
7. FTB agrees to provide the City a unique City Business Tax Number to be used for reporting purposes
only.
8. FTB agrees to allow the City to resubmit data within 30 days of notification, in the event data is
initially submitted with errors.
Project Coordinators:
The project coordinators during the term of this Agreement will be:
Franchise Tax Board City of Downey
Cathy McCollum Anil Gandhy
Data Resources and Services Unit Acting Director of Finance
P.O. Box 1468, Mailstop A181 11111 Brookshire Blvd.
Sacramento, CA 95812 -1468 Downey, CA 90241
Phone: (916) 845 -4431 Phone: (562) 904 -7265
Fax: (916) 843 -5899 Email: agandhy @downeyca.orq
Email: LocalGovtLaison
Return executed agreement to:
Franchise Tax Board
Tracey Mollow
Business Acquisitions Unit
P.O. Box 2086, Mailstop A -374
Rancho Cordova, CA 95741 -2086
Phone: (916) 845 -5193
Fax: (916) 845 -3599
City of Downey Agreement # C1200111
EXHIBIT D
SPECIAL TERMS AND CONDITIONS
1. DATA OWNERSHIP: The classified confidential tax information being provided to the City under this
Agreement remains the exclusive property of FTB. The City shall have the right to use and process
the disclosed information for the purposes stated in this Agreement, which right shall be revoked and
terminated immediately upon completion of this Agreement.
2. STATEMENT OF CONFIDENTIALITY: The Franchise Tax Board has tax return information and
other data in its custody, which is confidential data. Unauthorized inspection or disclosure of state
tax return information or other confidential data is a misdemeanor (Revenue and Taxation Code
Section 19542 and 19542.1).
3. 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 by this Agreement. 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.
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 ensure such information is disclosed only to
those individuals and of such purpose, as authorized by the Revenue and Taxation Code.
5. DISCLOSURE OF CONFIDENTIAL INFORMATION: Any unwarranted disclosure or use of state tax
return information or any willful unauthorized inspection of the return information is an act punishable
as a misdemeanor. Inspection is defined to mean any examination of confidential information. No
one other than authorized employees may access, use, view, or manipulate the data being
transmitted to the City under this Agreement. The City, in recognizing the confidentiality of state tax
return information, agrees to take all appropriate precautions to protect from unauthorized disclosure
of the confidential information obtained pursuant to this Agreement. The City will conduct oversight
of its users with access to the confidential information provided under this Agreement, and will
promptly notify FTB of any suspected violations of security or confidentiality by its users.
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 (FTB 712), 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.
City of Downey Agreement # C1200111
EXHIBIT D •-r-r
SPECIAL TERMS AND CONDITIONS (continued)
6. PROTECTING CONFIDENTIAL INFORMATION/ INCIDENT REPORTING: Both agencies, in
recognizing the confidentiality of information exchanged, agree to take all appropriate precautions to
protect the confidential information obtained pursuant to this Agreement from unauthorized
disclosure. Both agencies will conduct oversight of its users with access to the confidential
information provided under this Agreement, and will immediately notify the FTB's Information
Security Audit Unit (SecurityAuditMail@ftb.ca.gov) of any unauthorized or suspected unauthorized
accesses; uses and /or disclosures (incidents). For purposes of this section, immediately is defined
within 24 hours of the discovery of the breach. The notification must describe the incident in detail
and identify responsible personnel (name, title, and contact information). The agency with an
incident will comply with the incident reporting requirements in accordance with Civil Code Section
1798.29 and SAM Chapter 5300 to facilitate the required reporting to the taxpayers or state
oversight agencies.
7. 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.
8. CLOUD COMPUTING ENVIRONMENT: A Cloud Computing Environment cannot be used to
receive, transmit, store or process FTB's confidential data.
9. 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.
10. 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.
11. SETTLEMENT OF DISPUTES: 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 or his /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.
City of Downey Agreement # C1200111
EXHIBIT D
SPECIAL TERMS AND CONDITIONS (continued)
12. SAFEGUARD REVIEW QUESTIONNAIRE AND REVIEW: Prior to sending data to the City, FTB
requires the City to submit a Safeguard Review Questionnaire (FTB 7484) 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.
13. 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.
14. 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.
15. 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.
16. 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.
City of Downey Agreement # C1200111
EXHIBIT E
CITY RECORD FORMAT SPECIFICATIONS
Data Element Name Start End Field Usage Description
Pos. Pos. 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 fill if not
known.
BUSINESS CEASE DATE 186 193 8 N Enter the eight -digit date
(MMDDYYYY) if out of
business. Zero fill if not known or
still in business.
CITY BUSINESS TAX 194 196 3 N Enter three -digit number assigned
City of Downey Agreement # C1200111
EXHIBIT E
CITY RECORD FORMAT SPECIFICATIONS
Data Element Name Start End Field Usage Description
Pos. Pos. 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 fill if not
known.
.--.. BUSINESS CEASE DATE 186 193 8 N Enter the eight -digit date
(MMDDYYYY) if out of
business. Zero fill if not known or
still in business.
CITY BUSINESS TAX 194 196 3 N Enter three -digit number assigned
City of Downey Agreement # C1200111
NUMBER by FTB. ,.,..,
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
City of Downey Agreement # C1200111
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 filed with a joint return.
SPOUSE LAST NAME 17 72 For "P" records filed with a joint return.
SPOUSE FIRST NAME 11 89 For "P" records filed with a joint return.
SPOUSE MIDDLE INITIAL 1 100 For "P" records filed with a joint return.
PBA CODE 6 101 Principal Business Activity code.
ADDRESS NUMBER 10 107
PRE - DIRECTIONAL DIRECTOR 2 117 Postal Service term (i.e., N, S, E, W, NE,
NW, SE, SW).
STREET NAME 28 119
STREET SUFFIX 4 147 e.g., ST, WAY, HWY, BLVD, etc.
POST - DIRECTIONAL INDICATOR 2 151 Postal Service term (i.e., N, S, E, W, NE,
NW, SE, SW).
STREET SUFFIX 2 4 153
APARTMENT /SUITE NUMBER 10 157 e.g., APT, UNIT, FL, etc.
CITY 13 167
STATE 2 180 Standard state abbreviation.
ZIP CODE 5 182 The five -digit ZIP Code assigned by the U.S.
Postal Service.
ZIP CODE SUFFIX 4 187 Provided if known.
CBT MATCH 1 191 "N" — No match per CBT data.
"Y" — Yes: CBT matched to state tax return
filed.
City of Downey Agreement # C1200111
EXHIBIT G ,...,
CONFIDENTIALITY STATEMENT
State of California 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 best interest of the city and state.
As a city employee, you are required to protect all information from the Franchise Tax Board (FTB). To
protect confidential tax data, you must:
• Access or modify tax data solely to perform official duties.
• Never access or inspect tax data for curiosity or personal reasons.
• Never show or discuss confidential tax data with anyone who does not have a need to
know.
• Never remove confidential tax data from your worksite without authorization.
• Placing confidential information in approved locations only.
Unauthorized inspection, access, use, or disclosure of confidential tax data is a crime under state laws,
including but not limited to, California Revenue and Taxation Code Sections 19542 and 19552 and Penal
Code Section 502. Unauthorized access, inspection, use, or disclosure may result in either or both of the
following:
• State criminal action
• State and/or taxpayer civil action
I certify that I have read the confidentiality statement printed above. 1 further certify and
understand that unauthorized access, inspection, use, or disclosure of confidential information
may be punishable as a crime and may result in disciplinary and /or civil action against me.
Name
Signature Date