HomeMy WebLinkAboutStaff Report 2304-133733.Approval of Contract No. C23187298A with MuniServices, LLC for Tax and Fee Consulting
Services in a Total Not-To-Exceed Amount of $1,161,550 Over a Five-Year Term and
Contract No. C23187298B with HdL Coren & Cone for Property Tax Consulting Services in
a Total Not-To-Exceed Amount of $111,800 Over a Five-Year Term; CEQA Status – Not a
Project
2
0
7
4
City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Administrative Services
Meeting Date: June 19, 2023
Report #:2304-1337
TITLE
Approval of Contract No. C23187298A with MuniServices, LLC for Tax and Fee Consulting
Services in a Total Not-To-Exceed Amount of $1,161,550 Over a Five-Year Term and Contract
No. C23187298B with HdL Coren & Cone for Property Tax Consulting Services in a Total Not-To-
Exceed Amount of $111,800 Over a Five-Year Term; CEQA Status – Not a Project
RECOMMENDATION
Staff recommends that the City Council:
1. Approve and authorize the City Manager or his designee to execute the attached
contract with MuniServices, LLC (Attachment A, Contract No. C23187298A) in an
amount not-to-exceed $1,161,550 for tax and fee program administration, fee payment
collection and reporting services over a five-year term,
2. Approve and authorize the City Manager or his designee to execute the attached
contract with HdL Coren and Cone (Attachment B, Contract No. C23187298B) in an
amount not-to-exceed $111,800 for property tax analysis and reporting services over a
five-year term.
EXECUTIVE SUMMARY
A Request for Proposal (RFP) for tax and fee consulting services was issued in Spring 2023. The
RFP solicited proposals for support administration, reporting, and auditing of certain taxes and
to also implement the City’s new Business Tax (BT), as passed by the voters in November 2022.
Staff received proposals from three consulting firms for the following services:
1. Sales tax analysis, information, and reporting services
2. Administration, reporting, and audit services for:
a. Business Tax (BT)
b. Business Registry Certificate Program (BRC)
c. Business Improvement District fees (BID)
d. Transient Occupancy Tax (TOT)
2
0
7
4
e.Telephone Users Tax (TUT)
3.Property tax analysis, information, and reporting services
The three proposals were evaluated based on criteria outlined in the RFP. Staff recommends
awarding services to two of the three consulting firms that submitted proposals: MuniServices,
LLC for services described in one and two listed above. Staff recommends awarding property
tax analysis to HdL Coren & Cone (HdL CC) (task three listed above).
Completion and recommended selection of consulting resources to administer the new
Business Tax was a key variable in determining staffing resource needs to administer this new
revenue. With the completion and recommended selection of a service provider, staff also
recommends approval of funding for the equivalent of two positions (2.0 FTE) to support the
administration of the new tax in collaboration with the consulting support. Resources to fund
consulting services and internal staff resources are included in the June 19, 2023 City Manager
Report, Adoption of the FY 2024 Operating and Capital Budgets staff report (CMR 2303-1162).
BACKGROUND
MuniServices is the current consultant for sales and use tax audit and information services and
BRC, BID, TOT and TUT administration, report, and audit services. The firm was selected based
on a competitive solicitation process conducted in 2019 and agreements were approved by
Council on December 2, 20191. The existing contract with MuniServices expires December 2,
2024, however staff issued the RFP in advance acknowledging implementation of the BT will
begin summer 2023 for the first collection in January 2024.
Property tax analysis and reporting services is currently performed by HdL CC, who was the only
firm to submit a proposal for these services. The initial contract with HdL CC began in 2019 and
was recently extended2 to continue services during the timeframe the RFP was issued. HdL CC
has provided valuable information and insight beyond reports provided by the County that
assists staff with forecasting property tax and documentary transfer tax revenues.
Below are brief descriptions of the analysis, reporting, and tax administrative services provided:
Sales and Use Tax Analysis, Information, and Reporting Services: Quarterly sales and use tax
reports from the City’s sales tax consultant provide revenue projections that are used regular
revenue monitoring activities, the City’s Long Range Financial Forecast (LRFF), and in the City’s
annual budget process. Briefings and analysis from the sales tax consultant include information
from the California Department of Tax and Fee Administration (CDTFA), the state agency that
administers sales and use tax, of sales and use tax revenue performance; top revenue
producers by economic segment and/or geographical area; trend analysis; revenue projections;
1 City Council, December 2, 2019, Item #4: https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-
reports/reports/city-manager-reports-cmrs/year-archive/2019/10493.pdf?t=61629.45
2 City Council, April 10, 2023, Item #6: https://recordsportal.paloalto.gov/Weblink/DocView.aspx
?id=82343
2
0
7
4
identification of major businesses that influence change in the City’s tax revenue; and an
analysis of potential growth or decline shifts in local, state, and national economy; and
legislature related to sales and use tax. In addition, sales and use tax audit and discovery efforts
are included in this package of services; approximately $0.5 million in sales tax revenue has
been recovered since 2019.
Tax and Fee Administration, Reporting and Audit Services (BT, BRC, BID, TOT, and TUT): These
services assist with streamline the administration and collection of taxes and assessment fees.
Collection, reporting, and payment remittance for these taxes and fees are done online through
the City’s website. This contract includes audit and discovery to achieve improved assurance
that these taxes and fees are accurate and complete. The scope, work plan, and fees for these
services, which includes up front costs for configuration and roll out of the new BT, can be
found in the attached draft contract.
Property Tax Analysis, Information, and Reporting Services: Information provided by the City’s
property tax consultant is used with data provided by the County of Santa Clara to provide
insight into real estate activity occurring in the City. Additional informational reports can be
provided on an ad hoc basis to support special projects or requests. Examples of such reporting
needs include parcel tax or general obligation (GO) bond modeling; LRFF development; the
annual budget process; and other special projects in the Treasury, Debt, and Investments
Division. Parcel information used for the BT is a recent example of a special project.
ANALYSIS
nd and the City received three
proposals. Table 1 outlines a summary of the RFP process:
Table #1: Summary of Request for Proposal3
3 Tax and Fee Consulting Services Request for Proposal posted on PlanetBids:
https://pbsystem.planetbids.com/portal/25569/bo/bo-detail/102065
2
0
7
4
Table #1: Summary of Request for Proposal3
Proposal Price Range $111,800 to $1,292,300
Public Link to Solicitation https://pbsystem.planetbids.com/portal/25569
/bo/bo-detail/1020654
A committee was formed that included staff from the Treasury Division and Revenue
Collections Divisions in ASD, the Information Technology Department and the City Manager's
Office to evaluate the three proposals submitted to the City, based on criteria outlined in the
RFP. Proposals were first evaluated and then an interview and demonstration of each firms
platform was conducted. The heaviest weighed criteria were quality of the proposal,
effectiveness of services and website portal, and firm experience. Based on the evaluation
committee review, MuniServices and HdL CC were selected. Both MuniServices and HdL CC
were the firms who submitted the lowest cost proposals for the services offered by the firm.
Table 2 compares fees for the new contract and previous contract with MuniServices; changes
are noted in bold/italic. The new five-year contract with Avenu totals $1,161,550 (includes
$50,000 of additional services), a $461,550 increase compared to the previous contract, driven
primarily by fees for collection and administration of the business tax. The one-time set up fee
for the business tax is $30,000. Ongoing costs will be an annual flat fee of $10,000, with a $13
per participant annual fee (increased annually by CPI). The per participant cost over five years
totals $668,050, which ranges between $120,000 and $147,000 annually, assuming the
maximum 5% CPI adjustment. Estimated generated revenue for the business tax assumed 1,210
commercial properties in the City. There are approximately 1,600 businesses in the BRC and
approximately 7,000 sales tax payors. The annual participant cost was calculated assuming
9,300 business tax and fee participants within the City (25% above the number of sales tax
payors) to account for business that are subject to the business tax but do not pay sales tax.
This count of businesses will be refined after the first year of collection.
4 PlanetBids, RFP 187298 – Tax and Fee Consulting Services:
https://pbsystem.planetbids.com/portal/25569/bo/bo-detail/102065
Table #2: MuniServices Comparison of Previous and New Contract
TAX
AREA SERVICE PREVIOUS NEW
Collection &
Administration
$12/initial registry; $3.75 filing per
transaction
BT Set-up fee: $30,000
Annual flat fee: $10,000
Annual $13/participant fee
BU
S
I
N
E
S
S
TA
X
&
F
E
E
S
Discovery and
Audit (if City
elects)
Discovery: 35% contingency; if City
decides to waive collection,
MuniServices shall be entitled to ½
of the fee for the waived portion of
the deficiency.
Discovery:
Minimum annual fee: $7,500
35% contingency
Audit: $100/hour
2
0
7
4
Staff Resources
Modifying the BRC portal for the business tax is planned for summer 2023, in anticipation that
the portal will be available for taxpayers to register in fall 2023. The implementation calendar
can be found on the City’s website5. Collection and administration of the business tax portal will
be done by MuniServices, however staff resources are required to manage the program. These
functions include overseeing collection, reporting, and auditing functions performed by the
consultant; in-house tax administrator support (as defined by the business tax ordinance); tax
analysis and review beyond the consultant’s scope of work; and customer service and support
for the City’s business community. Staff recommends the addition of one full-time
Management Analyst position and one full-time Accounting Specialist (approximately $186,000
and $124,000 ongoing salary and benefit costs, respectively), totaling $310,000. Staff
recommends that the salary and benefit costs totaling $232,500 be added to the FY 2024
Adopted Budget. A formal action to adjust the Table of Organization will be forth coming in a
future budget process as staff continue to assess needs through the implementation process
versus ongoing administration. Adjustments to the FY 2024 budget for staff resources is
included the budget adoption staff report, presented to City Council on June 19, 2023 (CMR
2303-1162).
FISCAL/RESOURCE IMPACT
During the development of the business tax, preliminary administrative cost estimates ranged
between $0.5 million to $1.0 million. As noted in the FY 2024 Proposed Operating Budget
5 www.cityofpaloalto.org/businesstax
Reporting
Services
$4,000 annually $4,000 annually
SA
L
E
S
&
US
E
T
A
X
Audit &
Discovery
15% contingency 15% contingency
Collection &
Administration
$150/lodging property annually;
One-time set up: $2,500
$150/lodging property annually
TO
T Audit Analysis phases total $54,000; 30%
contingency fee, with on-site
auditing services
Analysis phases total $40,000
Collection &
Administration
$2.95 filing per transaction
One-time set up: $1,000
$2.95 filing per transaction
TU
T
Compliance 30% contingency fee 30% contingency fee
2
0
7
4
Transmittal Letter, Attachment C6, recommended resources were reviewed and staff presents
both revenues and resource needs via this report. The attached contract with MuniServices
results in economies of scale from integrating three programs (business registry, business
improvement district, and business tax) into one platform.
7.
STAKEHOLDER ENGAGEMENT
ENVIRONMENTAL REVIEW
ATTACHMENTS
6 City of Palo Alto FY 2024 Proposed Operating Budget, p. XXXIV:
https://www.cityofpaloalto.org/files/assets/public/administrative-services/city-budgets/fy-2024-city-
budget/proposed/city-of-palo-alto-proposed-operating-budget_final.pdf#page=35
7 City Council, August 22, 2022, Item #AA1: https://www.cityofpaloalto.org/files/assets/public/agendas-minutes-
reports/agendas-minutes/city-council-agendas-minutes/2022/20220822/20220822pccsm-amended-redacted-
linked.pdf#page=313
2
0
7
4
Attachment B: Contract No. C23187298B with HdL Coren & Cone for Property Tax
Consulting Services
APPROVED BY:
Professional Services
Rev. Dec.15, 2020 Page 1 of 58
CITY OF PALO ALTO CONTRACT NO. C23187298A
AGREEMENT FOR PROFESSIONAL SERVICES
BETWEEN THE CITY OF PALO ALTO AND
MUNISERVICES, LLC
This Agreement for Professional Services (this “Agreement”) is entered into as of the 19th day of
June 2023 (the “Effective Date”), by and between the CITY OF PALO ALTO, a California
chartered municipal corporation (“CITY”), and MUNISERVICES, LLC, a Delaware limited
liability company, located at 5860 Trinity Parkway, Suite 120, Centreville, VA 20120
(“CONSULTANT”).
The following recitals are a substantive portion of this Agreement and are fully incorporated herein
by this reference:
RECITALS
A. CITY seeks Tax Analysis, Reporting, and Collection services for various City taxes (the
“Project”) and desires to engage a consultant such services in connection with the Project (the
“Services”, as detailed more fully in Exhibit A).
B. CONSULTANT represents that it, its employees and subconsultants, if any, possess the
necessary professional expertise, qualifications, and capability, and all required licenses and/or
certifications to provide the Services.
C. CITY, in reliance on these representations, desires to engage CONSULTANT to provide
the Services as more fully described in Exhibit A, entitled “SCOPE OF SERVICES”.
NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this
Agreement, the parties agree as follows:
SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described
in Exhibit A in accordance with the terms and conditions contained in this Agreement. The
performance of all Services shall be to the reasonable satisfaction of CITY.
SECTION 2. TERM.
The term of this Agreement shall be from the date of its full execution through March 31, 2028
unless terminated earlier pursuant to Section 19 (Termination) of this Agreement.
SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance
of Services under this Agreement. CONSULTANT shall complete the Services within the term of
this Agreement and in accordance with the schedule set forth in Exhibit B, entitled “SCHEDULE
OF PERFORMANCE”. Any Services for which times for performance are not specified in this
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 2 of 58
Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and
timely manner based upon the circumstances and direction communicated to the CONSULTANT.
CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery
of damages for delay if the extension is required due to the fault of CONSULTANT.
SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to
CONSULTANT for performance of the Services shall be based on the compensation structure
detailed in Exhibit C, entitled “COMPENSATION,” including any reimbursable expenses
specified therein, and the maximum total compensation shall not exceed One Million One
Hundred Eleven Thousand Five Hundred Fifty Dollars ($1,111,550.00). The hourly schedule
of rates, if applicable, is set out in Exhibit C-1, entitled “SCHEDULE OF RATES.” Any work
performed or expenses incurred for which payment would result in a total exceeding the maximum
compensation set forth in this Section 4 shall be at no cost to the CITY.
Optional Additional Services Provision (This provision applies only if checked and a
not-to-exceed compensation amount for Additional Services is allocated below under this
Section 4.)
In addition to the not-to-exceed compensation specified above, CITY has set aside the not-
to-exceed compensation amount of Fifty Thousand Dollars ($50,000.00) for the
performance of Additional Services (as defined below). The total compensation for
performance of the Services, Additional Services and any reimbursable expenses specified
in Exhibit C, shall not exceed One Million One Hundred Sixty-One Thousand Five
Hundred Fifty Dollars ($1,161,550.00), as detailed in Exhibit C.
“Additional Services” means any work that is determined by CITY to be necessary for the
proper completion of the Project, but which is not included within the Scope of Services
described at Exhibit A. CITY may elect to, but is not required to, authorize Additional
Services up to the maximum amount of compensation set forth for Additional Services in
this Section 4. CONSULTANT shall provide Additional Services only by advanced,
written authorization from CITY as detailed in this Section. Additional Services, if any,
shall be authorized by CITY with a Task Order assigned and authorized by CITY’s Project
Manager, as identified in Section 13 (Project Management). Each Task Order shall be in
substantially the same form as Exhibit A-1, entitled “PROFESSIONAL SERVICES TASK
ORDER”. Each Task Order shall contain a specific scope of services, schedule of
performance and maximum compensation amount, in accordance with the provisions of
this Agreement. Compensation for Additional Services shall be specified by CITY in the
Task Order, based on whichever is lowest: the compensation structure set forth in Exhibit
C, the hourly rates set forth in Exhibit C-1, or a negotiated lump sum.
To accept a Task Order, CONSULTANT shall sign the Task Order and return it to CITY’s
Project Manager within the time specified by the Project Manager, and upon authorization
by CITY (defined as counter-signature by the CITY Project Manager), the fully executed
Task Order shall become part of this Agreement. The cumulative total compensation to
CONSULTANT for all Task Orders authorized under this Agreement shall not exceed the
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 3 of 58
amount of compensation set forth for Additional Services in this Section 4.
CONSULTANT shall only be compensated for Additional Services performed under an
authorized Task Order and only up to the maximum amount of compensation set forth for
Additional Services in this Section 4. Performance of and payment for any Additional
Services are subject to all requirements and restrictions in this Agreement.
SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly
invoices to the CITY describing the Services performed and the applicable charges (including, if
applicable, an identification of personnel who performed the Services, hours worked, hourly rates,
and reimbursable expenses), based upon Exhibit C or, as applicable, CONSULTANT’s schedule
of rates set forth in Exhibit C-1. If applicable, the invoice shall also describe the percentage of
completion of each task. The information in CONSULTANT’s invoices shall be subject to
verification by CITY. CONSULTANT shall send all invoices to CITY’s Project Manager at the
address specified in Section 13 (Project Management) below. CITY will generally process and
pay invoices within thirty (30) days of receipt of an acceptable invoice.
SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All Services shall be performed
by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT represents that it,
its employees and subcontractors, if any, possess the professional and technical personnel
necessary to perform the Services required by this Agreement and that the personnel have
sufficient skill and experience to perform the Services assigned to them. CONSULTANT
represents that it, its employees and subcontractors, if any, have and shall maintain during the term
of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature
that are legally required to perform the Services. All Services to be furnished by CONSULTANT
under this Agreement shall meet the professional standard and quality that prevail among
professionals in the same discipline and of similar knowledge and skill engaged in related work
throughout California under the same or similar circumstances.
SECTION 7. COMPLIANCE WITH LAWS. CONSULTANT shall keep itself informed of
and in compliance with all federal, state and local laws, ordinances, regulations, and orders that
may affect in any manner the Project or the performance of the Services or those engaged to
perform Services under this Agreement, as amended from time to time. CONSULTANT shall
procure all permits and licenses, pay all charges and fees, and give all notices required by law in
the performance of the Services.
SECTION 8. ERRORS/OMISSIONS. CONSULTANT is solely responsible for costs,
including, but not limited to, increases in the cost of Services, arising from or caused by
CONSULTANT’s errors and omissions, including, but not limited to, the costs of corrections such
errors and omissions, any change order markup costs, or costs arising from delay caused by the
errors and omissions or unreasonable delay in correcting the errors and omissions.
SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works
project, CONSULTANT shall submit estimates of probable construction costs at each phase of
design submittal. If the total estimated construction cost at any submittal exceeds the CITY’s
stated construction budget by ten percent (10%) or more, CONSULTANT shall make
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 4 of 58
recommendations to CITY for aligning the Project design with the budget, incorporate CITY
approved recommendations, and revise the design to meet the Project budget, at no additional cost
to CITY.
SECTION 10. INDEPENDENT CONTRACTOR. CONSULTANT acknowledges and agrees
that CONSULTANT and any agent or employee of CONSULTANT will act as and shall be
deemed at all times to be an independent contractor and shall be wholly responsible for the manner
in which CONSULTANT performs the Services requested by CITY under this Agreement.
CONSULTANT and any agent or employee of CONSULTANT will not have employee status
with CITY, nor be entitled to participate in any plans, arrangements, or distributions by CITY
pertaining to or in connection with any retirement, health or other benefits that CITY may offer its
employees. CONSULTANT will be responsible for all obligations and payments, whether
imposed by federal, state or local law, including, but not limited to, FICA, income tax
withholdings, workers’ compensation, unemployment compensation, insurance, and other similar
responsibilities related to CONSULTANT’s performance of the Services, or any agent or
employee of CONSULTANT providing same. Nothing in this Agreement shall be construed as
creating an employment or agency relationship between CITY and CONSULTANT or any agent
or employee of CONSULTANT. Any terms in this Agreement referring to direction from CITY
shall be construed as providing for direction as to policy and the result of CONSULTANT’s
provision of the Services only, and not as to the means by which such a result is obtained.
SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of
CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign
or transfer any interest in this Agreement nor the performance of any of CONSULTANT’s
obligations hereunder without the prior written approval of the City Manager. Any purported
assignment made without the prior written approval of the City Manager will be void and without
effect. Subject to the foregoing, the covenants, terms, conditions and provisions of this Agreement
will apply to, and will bind, the heirs, successors, executors, administrators and assignees of the
parties.
SECTION 12. SUBCONTRACTING.
Option A: No Subcontractor: CONSULTANT shall not subcontract any portion of the
Services to be performed under this Agreement without the prior written authorization of the City
Manager or designee. In the event CONSULTANT does subcontract any portion of the work to
be performed under this Agreement, CONSULTANT shall be fully responsible for all acts and
omissions of subcontractors.
Option B: Subcontracts Authorized: Notwithstanding Section 11 (Assignment) above, CITY
agrees that subcontractors may be used to complete the Services. The subcontractors authorized
by CITY to perform work on this Project are:
CONSULTANT shall be responsible for directing the work of any subcontractors and for any
compensation due to subcontractors. CITY assumes no responsibility whatsoever concerning
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 5 of 58
compensation of subcontractors. CONSULTANT shall be fully responsible to CITY for all acts
and omissions of subcontractors. CONSULTANT shall change or add subcontractors only with
the prior written approval of the City Manager or designee.
SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Tanmin Rima, Client
Success Manager, email tanmin.rima@avenuinsights.com as the CONSULTANT’s Project
Manager to have supervisory responsibility for the performance, progress, and execution of the
Services and represent CONSULTANT during the day-to-day performance of the Services. If
circumstances cause the substitution of the CONSULTANT’s Project Manager or any other of
CONSULTANT’s key personnel for any reason, the appointment of a substitute Project Manager
and the assignment of any key new or replacement personnel will be subject to the prior written
approval of the CITY’s Project Manager. CONSULTANT, at CITY’s request, shall promptly
remove CONSULTANT personnel who CITY finds do not perform the Services in an acceptable
manner, are uncooperative, or present a threat to the adequate or timely completion of the Services
or a threat to the safety of persons or property.
CITY’s Project Manager is Josie Stokes, Administrative Services Department, Revenue
Collections Division, 250 Hamilton Avenue, Palo Alto, CA 94301, Telephone: 650-329-2291.
Email: josie.stokes@cityofpaloalto.org. CITY’s Project Manager will be CONSULTANT’s point
of contact with respect to performance, progress and execution of the Services. CITY may
designate an alternate Project Manager from time to time.
SECTION 14. OWNERSHIP OF MATERIALS. All work product, including without
limitation, all writings, drawings, studies, sketches, photographs, plans, reports, specifications,
computations, models, recordings, data, documents, and other materials and copyright interests
developed under this Agreement, in any form or media, shall be and remain the exclusive property
of CITY without restriction or limitation upon their use. CONSULTANT agrees that all copyrights
which arise from creation of the work product pursuant to this Agreement are vested in CITY, and
CONSULTANT hereby waives and relinquishes all claims to copyright or other intellectual
property rights in favor of CITY. Neither CONSULTANT nor its subcontractors, if any, shall
make any of such work product available to any individual or organization without the prior written
approval of the City Manager or designee. CONSULTANT makes no representation of the
suitability of the work product for use in or application to circumstances not contemplated by the
Scope of Services.
SECTION 15. AUDITS. CONSULTANT agrees to permit CITY and its authorized
representatives to audit, at any reasonable time during the term of this Agreement and for four (4)
years from the date of final payment, CONSULTANT’s records pertaining to matters covered by
this Agreement, including without limitation records demonstrating compliance with the
requirements of Section 10 (Independent Contractor). CONSULTANT further agrees to maintain
and retain accurate books and records in accordance with generally accepted accounting principles
for at least four (4) years after the expiration or earlier termination of this Agreement or the
completion of any audit hereunder, whichever is later.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 6 of 58
SECTION 16. INDEMNITY.
[Option A applies to the following design professionals pursuant to Civil Code Section
2782.8: architects; landscape architects; registered professional engineers and licensed
professional land surveyors.] 16.1. To the fullest extent permitted by law, CONSULTANT shall
indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents
(each an “Indemnified Party”) from and against any and all third party demands, claims, or liability
of any nature, including death or injury to any person, property damage or any other loss, including
all costs and expenses of whatever nature including attorney’s fees, experts fees, court costs and
disbursements (“Claims”) to the extent that such Claims arise out of, pertain to, or relate to the
negligence, recklessness, or willful misconduct of CONSULTANT, its officers, employees, agents
or contractors under this Agreement, regardless of whether or not it is caused in part by an
Indemnified Party. CITY will reimburse CONSULTANT for the proportionate percentage of
defense costs exceeding CONSULTANT’s proportionate percentage of fault as determined by the
final judgment of a court of competent jurisdiction.
[Option B applies to any consultant who does not qualify as a design professional as
defined in Civil Code Section 2782.8.] 16.1. To the fullest extent permitted by law,
CONSULTANT shall indemnify, defend and hold harmless CITY, its Council members, officers,
employees and agents (each an “Indemnified Party”) from and against any and all demands, claims,
or liability of any nature, including death or injury to any person, property damage or any other
loss, including all costs and expenses of whatever nature including attorney’s fees, experts fees,
court costs and disbursements (“Claims”) resulting from, arising out of or in any manner related
to performance or nonperformance by CONSULTANT, its officers, employees, agents or
contractors under this Agreement, regardless of whether or not it is caused in part by an
Indemnified Party.
16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to
require CONSULTANT to indemnify an Indemnified Party from a Claim arising from the active
negligence or willful misconduct of an Indemnified Party that is not contributed to by any act of,
or by any omission to perform a duty imposed by law or agreement by, CONSULTANT, its
officers, employees, agents or contractors under this Agreement.
16.3. The acceptance of CONSULTANT’s Services and duties by CITY shall not
operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive
the expiration or early termination of this Agreement.
SECTION 17. WAIVERS. No waiver of a condition or nonperformance of an obligation under
this Agreement is effective unless it is in writing in accordance with Section 29.4 of this
Agreement. No delay or failure to require performance of any provision of this Agreement shall
constitute a waiver of that provision as to that or any other instance. Any waiver granted shall
apply solely to the specific instance expressly stated. No single or partial exercise of any right or
remedy will preclude any other or further exercise of any right or remedy.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 7 of 58
SECTION 18. INSURANCE.
18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in
full force and effect during the term of this Agreement, the insurance coverage described in Exhibit
D, entitled “INSURANCE REQUIREMENTS”. CONSULTANT and its contractors, if any, shall
obtain a policy endorsement naming CITY as an additional insured under any general liability or
automobile policy or policies.
18.2. All insurance coverage required hereunder shall be provided through
carriers with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or
authorized to transact insurance business in the State of California. Any and all contractors of
CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in
full force and effect during the term of this Agreement, identical insurance coverage, naming CITY
as an additional insured under such policies as required above.
18.3. Certificates evidencing such insurance shall be filed with CITY
concurrently with the execution of this Agreement. The certificates will be subject to the approval
of CITY’s Risk Manager and will contain an endorsement stating that the insurance is primary
coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except
after filing with the Purchasing Manager thirty (30) days’ prior written notice of the cancellation
or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30)
days’ notice to CONSULTANT, CONSULTANT shall provide the Purchasing Manager written
notice of the cancellation or modification within two (2) business days of the CONSULTANT’s
receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates
evidencing the insurance are provided to CITY’s Chief Procurement Officer during the entire term
of this Agreement.
18.4. The procuring of such required policy or policies of insurance will not be
construed to limit CONSULTANT’s liability hereunder nor to fulfill the indemnification
provisions of this Agreement. Notwithstanding the policy or policies of insurance,
CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss
caused by or directly arising as a result of the Services performed under this Agreement, including
such damage, injury, or loss arising after the Agreement is terminated or the term has expired.
SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES.
19.1. The City Manager may suspend the performance of the Services, in whole
or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written
notice thereof to CONSULTANT. If CONSULTANT fails to perform any of its material
obligations under this Agreement, in addition to all other remedies provided under this Agreement
or at law, the City Manager may terminate this Agreement sooner upon written notice of
termination. Upon receipt of any notice of suspension or termination, CONSULTANT will
discontinue its performance of the Services on the effective date in the notice of suspension or
termination.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 8 of 58
19.2. In event of suspension or termination, CONSULTANT will deliver to the
City Manager on or before the effective date in the notice of suspension or termination, any and
all work product, as detailed in Section 14 (Ownership of Materials), whether or not completed,
prepared by CONSULTANT or its contractors, if any, in the performance of this Agreement. Such
work product is the property of CITY, as detailed in Section 14 (Ownership of Materials).
19.3. In event of suspension or termination, CONSULTANT will be paid for the
Services rendered and work products delivered to CITY in accordance with the Scope of Services
up to the effective date in the notice of suspension or termination; provided, however, if this
Agreement is suspended or terminated on account of a default by CONSULTANT, CITY will be
obligated to compensate CONSULTANT only for that portion of CONSULTANT’s Services
provided in material conformity with this Agreement as such determination is made by the City
Manager acting in the reasonable exercise of his/her discretion. The following Sections will
survive any expiration or termination of this Agreement: 14, 15, 16, 17, 19.2, 19.3, 19.4, 20, 25,
27, 28, 29 and 30.
19.4. No payment, partial payment, acceptance, or partial acceptance by CITY
will operate as a waiver on the part of CITY of any of its rights under this Agreement, unless made
in accordance with Section 17 (Waivers).
SECTION 20. NOTICES.
All notices hereunder will be given in writing and mailed, postage prepaid, by
certified mail, addressed as follows:
To CITY: Office of the City Clerk
City of Palo Alto
Post Office Box 10250
Palo Alto, CA 94303
With a copy to the Purchasing Manager
To CONSULTANT: Attention of the Project Manager at the address of
CONSULTANT recited on the first page of this Agreement.
CONSULTANT shall provide written notice to CITY of any change of address.
SECTION 21. CONFLICT OF INTEREST.
21.1. In executing this Agreement, CONSULTANT covenants that it presently
has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which
would conflict in any manner or degree with the performance of the Services.
21.2. CONSULTANT further covenants that, in the performance of this
Agreement, it will not employ subcontractors or other persons or parties having such an interest.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 9 of 58
CONSULTANT certifies that no person who has or will have any financial interest under this
Agreement is an officer or employee of CITY; this provision will be interpreted in accordance
with the applicable provisions of the Palo Alto Municipal Code and the Government Code of the
State of California, as amended from time to time. CONSULTANT agrees to notify CITY if any
conflict arises.
21.3. If the CONSULTANT meets the definition of a “Consultant” as defined by
the Regulations of the Fair Political Practices Commission, CONSULTANT will file the
appropriate financial disclosure documents required by the Palo Alto Municipal Code and the
Political Reform Act of 1974, as amended from time to time.
SECTION 22. NONDISCRIMINATION; COMPLIANCE WITH ADA.
22.1. As set forth in Palo Alto Municipal Code Section 2.30.510, as amended
from time to time, CONSULTANT certifies that in the performance of this Agreement, it shall not
discriminate in the employment of any person due to that person’s race, skin color, gender, gender
identity, age, religion, disability, national origin, ancestry, sexual orientation, pregnancy, genetic
information or condition, housing status, marital status, familial status, weight or height of such
person. CONSULTANT acknowledges that it has read and understands the provisions of Section
2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the
penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510 pertaining
to nondiscrimination in employment.
22.2. CONSULTANT understands and agrees that pursuant to the Americans
Disabilities Act (“ADA”), programs, services and other activities provided by a public entity to
the public, whether directly or through a contractor or subcontractor, are required to be accessible
to the disabled public. CONSULTANT will provide the Services specified in this Agreement in a
manner that complies with the ADA and any other applicable federal, state and local disability
rights laws and regulations, as amended from time to time. CONSULTANT will not discriminate
against persons with disabilities in the provision of services, benefits or activities provided under
this Agreement.
SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO
WASTE REQUIREMENTS. CONSULTANT shall comply with the CITY’s Environmentally
Preferred Purchasing policies which are available at CITY’s Purchasing Department, hereby
incorporated by reference and as amended from time to time. CONSULTANT shall comply with
waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero
Waste best practices include, first, minimizing and reducing waste; second, reusing waste; and,
third, recycling or composting waste. In particular, CONSULTANT shall comply with the
following Zero Waste requirements:
(a) All printed materials provided by CONSULTANT to CITY generated from a
personal computer and printer including but not limited to, proposals, quotes, invoices, reports,
and public education materials, shall be double-sided and printed on a minimum of 30% or greater
post-consumer content paper, unless otherwise approved by CITY’s Project Manager. Any
submitted materials printed by a professional printing company shall be a minimum of 30% or
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 10 of 58
greater post-consumer material and printed with vegetable-based inks.
(b) Goods purchased by CONSULTANT on behalf of CITY shall be purchased in
accordance with CITY’s Environmental Purchasing Policy including but not limited to Extended
Producer Responsibility requirements for products and packaging. A copy of this policy is on file
at the Purchasing Department’s office.
(c) Reusable/returnable pallets shall be taken back by CONSULTANT, at no
additional cost to CITY, for reuse or recycling. CONSULTANT shall provide documentation from
the facility accepting the pallets to verify that pallets are not being disposed.
SECTION 24. COMPLIANCE WITH PALO ALTO MINIMUM WAGE ORDINANCE.
CONSULTANT shall comply with all requirements of the Palo Alto Municipal Code Chapter 4.62
(Citywide Minimum Wage), as amended from time to time. In particular, for any employee
otherwise entitled to the State minimum wage, who performs at least two (2) hours of work in a
calendar week within the geographic boundaries of the City, CONSULTANT shall pay such
employees no less than the minimum wage set forth in Palo Alto Municipal Code Section 4.62.030
for each hour worked within the geographic boundaries of the City of Palo Alto. In addition,
CONSULTANT shall post notices regarding the Palo Alto Minimum Wage Ordinance in
accordance with Palo Alto Municipal Code Section 4.62.060.
SECTION 25. NON-APPROPRIATION. This Agreement is subject to the fiscal provisions of
the Charter of the City of Palo Alto and the Palo Alto Municipal Code, as amended from time to
time. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the
event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal
year in the event that funds are only appropriated for a portion of the fiscal year and funds for this
Agreement are no longer available. This Section shall take precedence in the event of a conflict
with any other covenant, term, condition, or provision of this Agreement.
SECTION 26. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC
WORKS CONTRACTS.
26.1. This Project is not subject to prevailing wages and related
requirements. CONSULTANT is not required to pay prevailing wages and meet related
requirements under the California Labor Code and California Code of Regulations in the
performance and implementation of the Project if the contract:
(1) is not a public works contract;
(2) is for a public works construction project of $25,000 or less, per California
Labor Code Sections 1782(d)(1), 1725.5(f) and 1773.3(j); or
(3) is for a public works alteration, demolition, repair, or maintenance project of
$15,000 or less, per California Labor Code Sections 1782(d)(1), 1725.5(f) and
1773.3(j).
OR
26.1. This Project is subject to prevailing wages and related requirements as
a “public works” under California Labor Code Sections 1720 et seq. and related regulations.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 11 of 58
CONSULTANT is required to pay general prevailing wages as defined in California Labor
Code Section 1773.1 and Subchapter 3, Title 8 of the California Code of Regulations Section
16000 et seq., as amended from time to time. Pursuant to Labor Code Section 1773, the CITY has
obtained the general prevailing rate of per diem wages and the general rate for holiday and
overtime work in this locality for each craft, classification, or type of worker needed to execute
the contract for this Project from the State of California Department of Industrial Relations
(“DIR”). Copies of these rates may be obtained at the CITY’s Purchasing Department office. The
general prevailing wage rates are also available at the DIR, Division of Labor Statistics and
Research, web site (see e.g. http://www.dir.ca.gov/DLSR/PWD/index.htm) as amended from time
to time. CONSULTANT shall post a copy of the general prevailing wage rates at all Project job
sites and shall pay the adopted prevailing wage rates as a minimum. CONSULTANT shall
comply with all applicable provisions of Division 2, Part 7, Chapter 1 of the California Labor Code
(Labor Code Section 1720 et seq.), including but not limited to Sections 1725.5, 1771, 1771.1,
1771.4, 1773.2, 1774, 1775, 1776, 1777.5, 1782, 1810, 1813 and 1815, and all applicable
implementing regulations, including but not limited to Subchapter 3, Title 8 of the California Code
of Regulations Section 16000 et seq. (8 CCR Section 16000 et seq.), as amended from time to
time. CONSULTANT shall comply with the requirements of Exhibit E, entitled “DIR
REGISTRATION FOR PUBLIC WORKS CONTRACTS”, for any contract for public works
construction, alteration, demolition, repair or maintenance, including but not limited to the
obligations to register with, and furnish certified payroll records directly to, DIR.
SECTION 27. CLAIMS PROCEDURE FOR “9204 PUBLIC WORKS PROJECTS”. For
purposes of this Section 27, a “9204 Public Works Project” means the erection, construction,
alteration, repair, or improvement of any public structure, building, road, or other public
improvement of any kind. (Cal. Pub. Cont. Code § 9204.) Per California Public Contract Code
Section 9204, for Public Works Projects, certain claims procedures shall apply, as set forth in
Exhibit F, entitled “Claims for Public Contract Code Section 9204 Public Works Projects”.
This Project is a 9204 Public Works Project and is required to comply with the
claims procedures set forth in Exhibit F, entitled “Claims for Public Contract Code Section 9204
Public Works Projects”.
OR
This Project is not a 9204 Public Works Project.
SECTION 28. CONFIDENTIAL INFORMATION.
28.1. In the performance of this Agreement, CONSULTANT may have access to
CITY’s Confidential Information (defined below). CONSULTANT will hold Confidential
Information in strict confidence, not disclose it to any third party, and will use it only for the
performance of its obligations to CITY under this Agreement and for no other purpose.
CONSULTANT will maintain reasonable and appropriate administrative, technical and physical
safeguards to ensure the security, confidentiality and integrity of the Confidential Information.
Notwithstanding the foregoing, CONSULTANT may disclose Confidential Information to its
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 12 of 58
employees, agents and subcontractors, if any, to the extent they have a need to know in order to
perform CONSULTANT’s obligations to CITY under this Agreement and for no other purpose,
provided that the CONSULTANT informs them of, and requires them to follow, the confidentiality
and security obligations of this Agreement.
28.2. “Confidential Information” means all data, information (including without
limitation “Personal Information” about a California resident as defined in Civil Code Section
1798 et seq., as amended from time to time) and materials, in any form or media, tangible or
intangible, provided or otherwise made available to CONSULTANT by CITY, directly or
indirectly, pursuant to this Agreement. Confidential Information excludes information that
CONSULTANT can show by appropriate documentation: (i) was publicly known at the time it
was provided or has subsequently become publicly known other than by a breach of this
Agreement; (ii) was rightfully in CONSULTANT’s possession free of any obligation of
confidence prior to receipt of Confidential Information; (iii) is rightfully obtained by
CONSULTANT from a third party without breach of any confidentiality obligation; (iv) is
independently developed by employees of CONSULTANT without any use of or access to the
Confidential Information; or (v) CONSULTANT has written consent to disclose signed by an
authorized representative of CITY.
28.3. Notwithstanding the foregoing, CONSULTANT may disclose Confidential
Information to the extent required by order of a court of competent jurisdiction or governmental
body, provided that CONSULTANT will notify CITY in writing of such order immediately upon
receipt and prior to any such disclosure (unless CONSULTANT is prohibited by law from doing
so), to give CITY an opportunity to oppose or otherwise respond to such order.
28.4. CONSULTANT will notify City promptly upon learning of any breach in
the security of its systems or unauthorized disclosure of, or access to, Confidential Information in
its possession or control, and if such Confidential Information consists of Personal Information,
CONSULTANT will provide information to CITY sufficient to meet the notice requirements of
Civil Code Section 1798 et seq., as applicable, as amended from time to time.
28.5. Prior to or upon termination or expiration of this Agreement,
CONSULTANT will honor any request from the CITY to return or securely destroy all copies of
Confidential Information. All Confidential Information is and will remain the property of the CITY
and nothing contained in this Agreement grants or confers any rights to such Confidential
Information on CONSULTANT.
28.6. If selected in Section 30 (Exhibits), this Agreement is also subject to the
terms and conditions of the Information Privacy Policy and Cybersecurity Terms and Conditions.
SECTION 29. MISCELLANEOUS PROVISIONS.
29.1. This Agreement will be governed by California law, without regard to its
conflict of law provisions.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 13 of 58
29.2. In the event that an action is brought, the parties agree that trial of such
action will be vested exclusively in the state courts of California in the County of Santa Clara,
State of California.
29.3. The prevailing party in any action brought to enforce the provisions of this
Agreement may recover its reasonable costs and attorneys’ fees expended in connection with that
action. The prevailing party shall be entitled to recover an amount equal to the fair market value
of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third
parties.
29.4. This Agreement, including all exhibits, constitutes the entire and integrated
agreement between the parties with respect to the subject matter of this Agreement, and supersedes
all prior agreements, negotiations, representations, statements and undertakings, either oral or
written. This Agreement may be amended only by a written instrument, which is signed by the
authorized representatives of the parties and approved as required under Palo Alto Municipal
Code, as amended from time to time.
29.5. If a court of competent jurisdiction finds or rules that any provision of this
Agreement is void or unenforceable, the unaffected provisions of this Agreement will remain in
full force and effect.
29.6. In the event of a conflict between the terms of this Agreement and the
exhibits hereto (per Section 30) or CONSULTANT’s proposal (if any), the Agreement shall
control. In the event of a conflict between the exhibits hereto and CONSULTANT’s proposal (if
any), the exhibits shall control.
29.7. The provisions of all checked boxes in this Agreement shall apply to this
Agreement; the provisions of any unchecked boxes shall not apply to this Agreement.
29.8. All section headings contained in this Agreement are for convenience and
reference only and are not intended to define or limit the scope of any provision of this Agreement.
29.9. This Agreement may be signed in multiple counterparts, which, when
executed by the authorized representatives of the parties, shall together constitute a single binding
agreement.
SECTION 30. EXHIBITS. Each of the following exhibits, if the check box for such exhibit is
selected below, is hereby attached and incorporated into this Agreement by reference as though
fully set forth herein:
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 14 of 58
EXHIBIT A: SCOPE OF SERVICES
EXHIBIT A-1 PROFESSIONAL SERVICES TASK ORDER
EXHIBIT B: SCHEDULE OF PERFORMANCE
EXHIBIT C: COMPENSATION
EXHIBIT C-1: SCHEDULE OF RATES
EXHIBIT D: INSURANCE REQUIREMENTS
EXHIBIT E: INFORMATION PRIVACY POLICY
EXHIBIT F: CYBERSECURITY TERMS AND CONDITIONS
THIS AGREEMENT IS NOT COMPLETE UNLESS ALL SELECTED EXHIBITS
ARE ATTACHED.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 15 of 58
CONTRACT No. C23187298A SIGNATURE PAGE
IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives
executed this Agreement as of the date first above written.
CITY OF PALO ALTO
____________________________
City Manager
APPROVED AS TO FORM:
__________________________
City Attorney or Designee
MUNISERVICES, LLC
Officer 1
By:___________________________
Name:_________________________
Title:__________________________
Officer 2
By:____________________________
Name:__________________________
Title:___________________________
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Paul Colangelo, Chief Executive Officer
CEO
CFO
Carl Kumpf, Chief Financial Officer
Professional Services
Rev. Dec.15, 2020 Page 16 of 58
EXHIBIT A
SCOPE OF SERVICES
CONSULTANT shall provide the Services detailed in this Exhibit A, entitled “SCOPE OF
SERVICES”.
Task 1: Business Fee and Collection Services
CONSULTANT will provide fee collection services for the Business Tax, Business Registry
Certificate and Business Improvement District programs. CONSULTANT will conduct research
and ensure the City’s database of businesses is accurate and reliable. In addition, the
CONSULTANT will communicate directly with business on behalf of the City and provide the
City additional support, program customization and consulting services if requested to do so by
the City.
Requirements
1) Database verification and management
a) Review the CITY’s existing database of businesses processes and update using external
sources such as, but not limited to, CONSULTANT’s proprietary database sources, the
State of California Sales Tax data, Santa Clara County Real Property data, Dun &
Bradstreet, and InfoUSA.
b) CITY will provide CONSULTANT the database in various formats and CONSULTANT
will standardize the data for use for in administration and collections of fees.
c) Cross reference data and check for duplicates possibly due name used, DBA and or address.
CITY may require data to include Federal Employer Identification Number (FEIN) and
NAICS code to be collected.
d) Ensure all application data fields completed correctly prior to data transfer to the CITY in
an acceptable data format.
2) Administration & Collections
a) Have experience and capabilities to process new business payments, renewals, delinquent
payments and ongoing monitoring and administration of CITY’s fees as described in the
CITY’s municipal code, ordinances, policies and program procedure manuals.
b) Provide businesses with ability to pay online or by mail.
c) Draft correspondences for mailings and maintain website portal for payments.
i) Collections for the Business Tax are quarterly
ii) Business Registry Certificate fees will occur annually and begin by March 1
d) Hold funds, make monthly ACH transfer to the CITY and provide transfer logs with details
of payment by business.
3) Customer Service
a) Develop an outreach plan for the business community that outlines tax characteristics,
provides instructions for payment, and provide ongoing customer support to businesses.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 17 of 58
b) Lead communication with businesses through phone and email and manage all account
communications including general questions, account inquiries, application questions and
issue resolutions.
c) Be available through a toll-free telephone line Monday through Friday, 8:00AM to 5:00PM
Pacific Time.
d) Respond to business correspondence via return phone call or written correspondence within
24 hours.
e) Standard correspondence templates will be drafted by the CONSULTANT and must be
approved by the CITY.
f) Maintain communications with CITY staff to communicate project activity and any issues.
g) Promptly respond to CITY staff regarding any questions or issues within 24 hours.
4) Data Analytics
a) Maintain and update an online portal with lookup tools so that CITY staff can review
business information and revenue data.
b) Database shall have capabilities to generate reports for analysis and ability for
CONSULTANT and/or CITY to create custom reports as described by the CITY and
provide within three business days.
Business Tax, Business Registry Certificate, and Business Improvement District Discovery
Services
1) Preparation. CONSULTANT’S initial steps are to understand City’s processes and
requirements, obtain data from both City and external sources, and standardize the data for use
in CONSULTANT’S proprietary database. The standardization process shall be completed by
trained professionals who merge City provided and external source data. The data shall be
cross referenced and checked for possible duplicates due name used, DBA and or address.
CONSULTANT shall also integrate the data, generate correspondence and forms, and modify
CONSULTANT’s online-hosted SaaS Compliance Administration system to calculate
delinquent fees. The result shall be an inventory of the compliant and non-compliant entities
operating in City. The City shall provide CONSULTANT with the following information to
begin Discovery:
a) City’s BRC and BID account data in electronic format along with the payment history of
all registered businesses
b) Database files such as commercial utility billing records and a copy of City-preferred
vendors
c) The business fee and business and occupation application forms
d) Other documentation required as a prerequisite to the issuing of a certificate
2) Testing. To test CONSULTANT’S processes developed during preparation, CONSULTANT
shall begin with mailing a sample of business accounts to ensure addresses, recipients and other
data points are accurate prior to bulk notifications. CONSULTANT will submit sample
account statements, so City can validate fee calculations and classifications prior to sending
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 18 of 58
out invoices. CONSULTANT shall also validate the payment posting and application
processing procedures.
3) Execution. CONSULTANT shall notify and register non-compliant businesses through bulk
mailings, and CONSULTANT shall modify the timing as new milestones are added.
Business Tax and Fee Administration
CONSULTANT shall provide City with a full-service turnkey Business Tax, Business Registry
Certificate and Business Improvement District Fee program related to the City’s business payment
processing, renewals, collections, and ongoing monitoring and administration of City’s fees and
follow City’s municipal code, ordinances, policies and program procedure manuals. The service
will be performed utilizing CONSULTANT’S internal programs and processes.
At a minimum, the service will include the following which are described more fully in the sections
below:
• New application processing – including review and verification of applications and
application data, establishing processes for established departmental prerequisites to
licensure;
• Annual renewal application processing – including mailing of renewal applications and
processing of completed renewal applications; and generating BRC certificates;
• Business Improvement District fee processing – as City’s direction is to now collect
this fee at the same time of the Business Registration fee, CONSULTANT will include
the fee processing in with those registrants who need to complete both payments;
• Business account follow-up – for businesses that do not return their annual renewal
application, CONSULTANT will send two additional notices and make one follow up
phone call. To the extent these efforts do not result in compliance, the account will be
handled under CONSULTANT’S Discovery Service.
New Account Processing
The new application processing will include a review and verification of applications and
application data, establishing processes for established departmental prerequisites for a certificate
to be issued. Included in the administration project setup will be review of City’s current new
application process for mutually agreed upon liaisons and modification if necessary.
Renewal Processing
CONSULTANT shall provide a service customization to assist with new business and renewal
“walk-ins”.
The annual renewal application processing will include mailing of renewal applications and
processing of completed renewal applications; and generating BRC.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 19 of 58
As a follow up for accounts that do not return their annual renewal application, CONSULTANT
shall send two additional notices and make one follow up phone call. Any accounts who do not
remit payment by this point will be referred to CONSULTANT’S Discovery Services to ensure
they are indeed still in business and follow up with additional notices if applicable. If collection
attempts are still not successful at this point, the remaining list will be turned over to City for final
enforcement authority by City determined processes.
Collecting, Posting and Processing Payments
• Collection of BT/BRC/BID fees: For both new and renewals with timely remittance or
deposit on behalf of City;
• Monthly detail reporting of payments received: Including monthly reconciliation of
payments received to payments remitted or deposited on behalf of City. Credit Card
payment processing will be accepted pursuant to City approval. CONSULTANT and City
will work together to determine the best method for processing credit card payments;
• Business compliance: For businesses who do not remit payment with their application or
whose check is not honored by the bank (NSF check), CONSULTANT will send additional
notices and follow up phone calls.
Business Community and City Staff Communications
Communications with Business Accounts
CONSULTANT will handle all account communications including general questions, account
inquiries, BT/BRC/BID application questions and issue resolution. CONSULTANT’S National
Call Center will be available through a toll-free telephone line Monday through Friday, 7:00AM
to 5:00PM Pacific Time. CONSULTANT will respond to business correspondence via return
phone call or written correspondence. All standard correspondence templates will be subject to
CITY approval.
Client Communications
CONSULTANT will maintain regular and close communications with City staff to communicate
project activity and any issues. CONSULTANT will provide prompt responses to City staff
regarding any questions or issues.
City will have the right, at City’s option, to elect not to proceed with recovery of any identified
deficiencies. Deficiencies which are uncollectible due to insolvency or dissolution of the entity
liable, or for deficiencies which are otherwise incapable of collection (e.g. statute of limitations
expiration or other legal defense) will not be considered an “election” by City for the purposes of
the Agreement. For deficiencies otherwise collectable but for which City elects not to collect, City
will notify CONSULTANT of its election not to pursue (“waive”) collection of said deficiencies.
CONSULTANT will be entitled to one-half (½) of the fee CONSULTANT would have been
entitled to for the waived portion of the deficiency.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 20 of 58
Online-hosted SaaS Filing and Payment Processing
CONSULTANT has successfully implemented and continues to support CONSULTANT’S online
file-and-pay option for over 135 of CONSULTANT’S clients and have found that online
BT/BRC/BID filing, and payment is the most convenient option for most businesses, and results
in expedited filing and payment throughput for CONSULTANT’S clients.
CONSULTANT’S online-hosted SaaS system seamlessly handles the basic processing steps in the
filing process:
• Applicants’ filings and payments are entered using secure website.
• Online payments are recorded in CONSULTANT’S online-hosted SaaS system.
• Automatic reconciliation between payment and application.
Typically, the process takes most applicants no more than five minutes from start to finish. The
same portal enables businesses to update their account information, correspond with
CONSULTANT specialists, view their previously filed returns that were submitted through the
online filing website and receive assistance for their BT/BRC/BID questions. CONSULTANT
shall encourage businesses to utilize CONSULTANT’S online file-and-pay option by providing
24/7 access to a secure web-based portal.
Reporting
CONSULTANT’S online-hosted SaaS reporting system shall allow City to access reports and
business information whenever City shall require it.
Here is a sample list of the reports available online:
• New Account Listing
• Transfer and Distribution Report
• Daily, Weekly and Monthly Reconciliation Reports
• Detailed Payment History Reports
• Top Remitters Reports
• BRC Issued Report
• BRC Certificates on Hold Report
• Business Search Tool
In addition to the collection of reports and business lookup tool available online, CONSULTANT
shall have a large collection of reports available for electronic transfer. These reports originated
from internal analysis or clients suggesting new analysis formats. CITY will have access to any
new reports or features on the online system as soon as they are implemented. All of
CONSULTANT’S clients benefit from the ideas and suggestions of CONSULTANT’S other
clients.
Support Services
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 21 of 58
Government Relations/Legislative and Policy Updates/Advocacy. CONSULTANT’S product and
service offerings are complemented by a dedicated Government Relations team that provides local
government advocacy, policy, regulatory and legislative consulting support and expertise.
CONSULTANT has a proven track record of surfacing and successfully resolving numerous issues
that have resulted in the preservation and expansion of the tax base for its clients.
CONSULTANT’S Government Relations Team is located in the League of California Cities
building in Sacramento which provides opportunities for firsthand collaboration on a daily basis
with the advocacy groups that support California cities. CONSULTANT’S overall Government
Relations program brings tremendous value to the client and is a natural progression in the
successful determination of revenue preservation and enhancement; and for which no consulting
fee is charged to CITY for the associated policy, regulatory, and legislative support.
Industry Partner. CONSULTANT is a proud partner and supporter of industry organizations
dedicated to local government. CONSULTANT’S firm is a long-standing associate member and
local government business partner for industry organizations including the League of California
Cities, the California Municipal Revenue Tax Association and California Society of Municipal
Finance Officers. CONSULTANT is the sole Business Council Member of the United States
Conference of Mayors (USCM) that provides local government revenue enhancement, information
and consulting services. CONSULTANT’S Business Tax Compliance and Discovery Program
was featured in the USCM’s 2016 Mayors Business Council Best Practices. Each member of
CONSULTANT’S team shares the common goal with these organizations – strengthening local
government. CONSULTANT’S team members are invested in their communities and in local
government. CONSULTANT makes the necessary investment into its team to ensure active
involvement with industry organizations throughout the country. CONSULTANT’S experts
regularly present as conference speakers, participate as exhibitors and sponsors, and participate in
policy development.
The Services, where provided by CONSULTANT’s online-hosted SaaS, include all related
services and support necessary to implement the Services detailed in this Scope of Services,
including, for example and without limitation, data/content migration, software licensing, online-
hosting, maintenance, updates, upgrades, security, and technical and user support as detailed in
this Scope of Services and elsewhere in this Agreement, in CONSULTANT’s proposal, and in the
Documentation.
Task 2: Sales and Use Tax Audit and Information Services
CONSULTANT will provide sales and use tax audit and information services. This will include
identifying and ensuring City receipt of misallocated or underreported tax revenues. Revenue
reporting services will include written reports and periodic briefings concerning revenue
performance, trend analysis, gains and declines, revenue projections, enhanced recovery options,
and, if appropriate, an analysis of present and future issues related to revenue recovery.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 22 of 58
Requirements
1) Verify California Department of Tax and Fee Administration (CDTFA) quarterly sales and
use tax allocations to the City.
2) Track and report on misallocations that have been corrected as a result of
CONSULTANT’s efforts and remitted to the City by the CDTFA.
3) Provide sales and use tax reporting services that include detail and summary information
for:
a) Quarterly sales and use tax analysis reports that are benchmarked to previous years.
Analysis should include information on the top revenue producers, indication of
revenue changes by business and economic category, identification of the major
businesses that influenced change in the City’s tax revenue, analysis of key businesses
that grew or declined during the reporting period, identification of the top revenue
generators in the City, and an analysis of their potential to grow or decline.
b) Reports by geographical area (for example, shopping centers, business districts,
commercial districts, redevelopment area, governmental, residential, etc.).
c) Revenue forecasting reports.
d) Other sales and use tax summary reports.
4) The ability to provide at least four quarters of historical data and continuity of reporting
during transition is critical.
5) Ability to provide sales and use tax data for City use that can be downloaded standard file
format (e.g., comma-delimited text, Excel, MS Access) or access to a web-based
application to view or download data.
6) Ability and commitment to tailor reports to the City’s reporting needs in a mutually agreed
format.
7) Attend quarterly meetings to discuss analytical reports for sales and use tax. Provide charts
and graphs as supporting documentation. Assign staff such that the City has a consistent
point of contact in these discussions.
8) Meet with designated City staff as necessary to support the City in recovering and
preventing tax deficiencies.
9) Define methodology for identifying potential misallocations and underreported sales and
use tax.
10) Provide ongoing communication to the City on revenue recovery work in progress. This
requirement will include:
a) Providing a quarterly report of all inquiries filed on behalf of the City and the status of
outstanding past inquiries filed with the CDTFA;
b) Notifying the City’s Project Manager of all oral communication with the CDTFA
regarding the City; and
c) Providing the City’s Project Manager with a copy of all written communication (e.g.
correspondence and email) with the CDTFA regarding the City.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 23 of 58
11) Prepare short forms or other appropriate documentation to facilitate the recovery of
revenue due the City from prior reporting periods (plus applicable interest and penalties, if
appropriate).
12) Provide a detailed listing of all misallocations and underreported sales and use tax detected
by the firm. Information shall include the company name, account number, value of the
detection, correction status, payment amount received by the City, payment amount due,
reporting period for which the payment is related, and any additional information deemed
necessary by the firm.
13) Provide support for the development of a point-of-sale attraction and retention strategy.
This includes, but is not limited to:
a) Yearly: A complete list of businesses by North American Industry Classification
System (NAICS) codes, in excel format, including geographic area (e.g., Downtown,
Midtown).
b) Quarterly: List of all new businesses in Palo Alto by size, location, etc., including an
estimate of revenue potential for the City.
c) Quarterly: List of businesses looking to expand in the region, with appropriate contact
information.
d) Quarterly: Newsletter customized for Palo Alto public consumption, in PDF form.
e) Quarterly: Track and report sales tax data for the following cities in Santa Clara County
and others as agreed by City and CONSULTANT.
f) Yearly: Training on software, customization of reports, and all available tools.
g) Relevant Strategic Plans from other similar cities.
h) A list of interesting incentive programs from other California cities.
14) Obtain advanced, written authorization from City Staff to perform work beyond the filing
of a short form to recover funds on behalf of the City, such as a decision appeal, in instances
where the CDTFA has an earlier date of knowledge than the firm. The firm will not be
eligible to earn compensation for work performed unless such authorization is obtained.
Task 3: Transient Occupancy Tax (TOT) Administrative and Reporting Services
CONSULTANT will ensure compliance with the City’s TOT regulations and filing procedures.
The City’s TOT regulations can be found in Title 2, Chapter 2.33 of the Palo Alto Municipal Code
(PAMC). The PAMC requires that the City assess a 15.5 percent TOT on its approximately 30
plus hotels, inns, and various lodging houses and on-line platforms (e.g. AirBnB, Expedia, Inc.
Aboda, Inc., etc.) that are intended or designed for occupancy by transients for dwelling. At a
minimum, the following capabilities are required: tax return processing and posting; reporting of
tax assessment, including relevant statistical data for analytical purposes; compliance monitoring;
and customer support services for lodging providers.
Requirements
1) Payment processing – process all payments made by new and existing lodging providers,
using the CONSULTANT-provided secure online-hosted filing and payment website. The
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 24 of 58
website and database will be hosted, administered, supported, updated and maintained by
the CONSULTANT. TOT filings will be processed within three (3) business days of
submission.
2) Database management – maintain and update the tax registration database for new TOT
registrations for lodging, including newly opened establishments, business name changes,
and/or changes in business owners. Registration of lodging businesses the database
accessible by City staff.
3) Customer support for lodging businesses – provide multiple customer support options for
businesses on how to register, file, make payment, and answer general inquiries regarding
the TOT tax and filing process. Provide a response to the business within one (1) business
day.
4) Compliance monitoring – review filings to ensure accuracy and the correct TOT amount
has been remitted to the City. Conduct compliance audits as mutually agreed to by the City
and the CONSULTANT.
5) Prepare, or make data available online for City staff review, reports that summarize activity
and statistics on a monthly, quarterly, and annual basis. Types of information include total
occupancy revenue, TOT payments, number of rooms, occupied (rental) days, available
(rental) days, exemptions, amounts, etc.
6) Provide monthly reports, on or before the 10th of every month, that summarize collected
tax, less proposed fees, along with remittance of TOT revenue collected for the preceding
month.
Ongoing Tax Administration Cycle
1) Beginning on the scheduled date, CONSULTANT will receive filings and payments by
mail and online.
2) All paper filings checks and correspondence will be opened and batched in our secure
facility.
3) Paper filings will be reconciled with payments and any errors, omissions or balance
discrepancies logged for follow-up. Web filings are reconciled daily. CONSULTANT also
handles NSF check processing, returns and refunds.
4) CONSULTANT will generate and send invoices for balances due to any taxpayer under-
payments or late payments.
5) Payments received will be deposited and disbursed to the City 10 – 12 times per month.
6) CONSULTANT Tax Specialists will contact the taxpayer by phone to resolve any filing
errors, omissions, or discrepancies.
7) Each month, the CONSULTANT Administration System will flag any missed filings for
follow-up. Taxpayers will receive a courtesy phone call and a late notice to let them know
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 25 of 58
a filing has not been received as of the due date. The CONSULTANT will continue to
follow-up with the taxpayer until payments are received and taxpayer complies.
8) Monthly, CONSULTANT Tax Specialists will analyze the month’s receipts and flag
significant variations for follow-up with the taxpayer and possible auditor review.
9) CONSULTANT will provide complete taxpayer support via toll-free number and e-mail
to taxpayers requiring assistance with filing or payment, mailing address or contact
changes, and any other related issues they may have.
10) CONSULTANT will register new taxpayers and assist them with all materials needed to
begin and maintain filing.
TOT Compliance Services
In addition to TOT administrative services, the goal of the TOT compliance services program is
to ensure successful, long-term compliance for lodging establishments that operate in the City. The
TOT inventory and compliance services cover traditional lodging properties (hotels, motels, inns)
and it does not cover online short-term rentals (such as Air BnB, VRBO, etc.). Should the City
seek inventory and compliance services for online short-term rental properties, there will need to
be an amendment to this contract pursuant to Section 27.4. This amendment would be at the City’s
sole and absolute discretion and the pricing, services, and terms of such an amendment will be
negotiated at a future date.
The TOT Compliance Services workplan and project schedule for the program are outlined below:
Analysis - Phase 1
1) Inventory. Establish a comprehensive inventory of all lodging properties subject to taxation
by the City and the database elements (public and private databases) needed to facilitate
further analysis to identify and locate lodging providers not properly registered with the
City and not appearing on the City rolls as TOT remitters.
2) Analysis. Analyze lodging provider “return information” to identify unusual or suspicious
reporting and/or activities that warrant further review.
3) Data collection. Conduct unobtrusive collection of information on each property, including
number of rooms, occupancy rate, transient and non-transient guests, exemptions,
property’s condition, business dynamics, etc.
4) Reporting. Provide a detailed analysis report to the City identifying lodging providers who
might require additional investigation or review to determine their compliance with the
City’s TOT ordinance and coordinate with the City to review the analysis report.
5) Identify Phase 2 reviews. Work with the City to develop a list of lodging providers subject
to a compliance review of lodging and tax records.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 26 of 58
6) Deliverables. CONSULTANT will provide the City with a detailed analysis report
identifying lodging providers who might require additional investigation or review to
determine their compliance with the City’s TOT ordinance.
Audit and Compliance Review - Phase 2
1) Records. Provide the City with a detailed list of all records required from lodging providers,
together with a draft engagement announcement letter to be sent to each lodging provider.
2) Examine & Verify. Review records pertaining to TOT for each lodging provider selected
for a compliance review and verify the accuracy of filed TOT returns with daily and
monthly activity summaries.
a) Review a random sample of the daily and monthly summaries to determine if the daily
summaries reconcile to the monthly summaries.
b) If CONSULTANT believes such a review is necessary, review secondary and tertiary
documentation such as bank statements to verify that deposits reconcile with the
reported revenue on the TOT returns or other tax filings.
c) Review exempted revenue for proper supporting documentation.
3) Compliance Report. Submit and review with the City a compliance review report that
includes:
a) All review findings;
b) Documentation for each error/omission identified and confirmed by CONSULTANT
that is necessary to facilitate recovery of revenue due from lodging providers for prior
periods.
c) Draft notices of deficiency determination, commendation and warning letters as
applicable.
4) Findings. Assist the City in reviewing any matters submitted in extenuation and mitigation
by lodging providers in contesting a deficiency determination. Prepare and document any
changes to the compliance review findings and provide revised tax, interest or penalty
amounts due the City.
5) Consulting. During the term of this Agreement, provide up to ten (10) hours of additional
consulting time to assist the City in evaluating or implementing any of the proposed actions
suggested by the above report.
6) Deliverables. CONSULTANT will provide City staff with a detailed list of all records
required to be made available by lodging providers for the reviews, together with a draft
engagement announcement letter to be sent to each lodging provider. This Phase will
include:
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 27 of 58
a) Review findings
b) For each identified and confirmed error/omission, CONSULTANT will request
accompanying documentation that CONSULTANT believes is necessary to facilitate
recovery of revenue due from lodging providers for prior periods;
c) Draft notices of deficiency determination, commendation and warning letters as
applicable, and recommendations.
Within 30 days of completing all audit reviews, CONSULTANT will provide a summary report
of all findings to the City.
Legislative analysis, economic impact reporting on measures, consulting and policy updates are
provided timely, regularly and year-round, and are included as part of the overall Compliance
services.
TOT Project Schedule
1) Start-up of TOT Audit Process (within first 30-60 days)
a) Procedural meeting with the City
b) Request Documentation from City
i) 48 Months of Returns for all properties (or properties City selected)
ii) Current TOT Ordinance and any related information
2) Property Review and Hotels Selected for Audits (within 90 days)
a) When the CONSULTANT receives the returns, the CONSULTANT enters the data
into worksheets to develop trends, property comparison, exempt rent to gross rent
variation, etc. The CONSULTANT will research the statistics on the City and
properties. Based on this data, the CONSULTANT selects specific properties for audit
(if the City hasn’t requested specific properties).
b) The CONSULTANT will submit to the City an Audit Report identifying the properties
and reasons they were selected.
c) Once the City approves the hotels selected for audits, the CONSULTANT will forward
the City Announcement Letters that need to be mailed to the properties on City
letterhead. Once the City sends out the letters to the properties, CONSULTANT
requests City send CONSULTANT a copy of the signed letters.
3) Start-up of TOT Audits (30 days later)
a) Auditors will contact the City for a brief conference call to discuss the audit timeline.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 28 of 58
b) Once the timeline has been approved, CONSULTANT issues an Appointment Letter
with a list of required information.
c) The date for the on-site review will allow the property a minimum of 30 days of
preparation time.
4) Desk Audits and Field Audits (8 weeks later)
a) Conduct a review search on specifics of hotels to determine/confirm number of rooms,
any special requirements and any other charges to which guests may be charged.
b) One week after the Appointment Letters are mailed, contact hotel operator to confirm
date and time of audit, explain procedures, and request data for sample months selected
(such as Property Management System, Month End Reports, Profit & Loss Statements,
Exemption Reports, etc.).
c) Conduct on-site review.
5) Provide Final Audit Report to the City (30 days following completion of audit program)
a) Auditors will submit (via email) all the Commendation/Deficiency Letters that need to
be submitted to the hoteliers by the City.
b) City will receive an electronic copy of the Final Audit Report.
Task 4: Telecommunications Users Tax (TUT) Administrative and Reporting Services
The City assesses a TUT (Palo Alto Municipal Code, Title 2, 2.35.090) upon every person in the
City using telephone communication services in the City at a rate of 4.75 percent of the charges
made to service the user. Tax returns are due from each service supplier at the end of the month
for activity and taxes collected for the preceding month. CONSULTANT will provide the
following:
Requirements
1) Payment processing – process all payments made by every service supplier that is operating
in the City. TUT filings will be processed within three (3) business days of submission.
2) Database management – update and maintain the tax registration database for all TUT
payors.
3) Customer support for TUT payors – provide multiple customer support options for
businesses on how to register, file, make payment, and answer general inquiries regarding
the TUT tax and filing process. CONSULTANT shall provide a response to the business
within one (1) business day.
4) Compliance monitoring – review filings to ensure accuracy and the correct TUT amount
has been remitted to the City. Conduct compliance audits as mutually agreed to by the City
and the CONSULTANT.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 29 of 58
5) Prepare, or make data available online for City staff review, reports that summarize activity
and statistics on a monthly, quarterly, and annual basis.
6) Provide monthly reports, on or before the 10th of every month, that summarize collected
tax, less proposed fees, along with remittance of TUT revenue collected for the preceding
month.
Ongoing Tax Administration Cycle
1) Beginning as of the scheduled date, CONSULTANT will receive filings and payments by
mail and online.
2) All paper filings checks and correspondence will be opened and batched in our secure
facility.
3) Paper filings will be reconciled with payments and any errors, omissions or balance
discrepancies logged for follow-up. Web filings are reconciled daily. CONSULTANT
also handles NSF check processing, returns and refunds.
4) CONSULTANT will generate and send invoices for balances due to any TUT taxpayer
under-payments or late payments.
5) Payments received will be deposited and disbursed to the City 10 – 12 times per month.
6) CONSULTANT’ TUT Tax Specialists will contact the taxpayer by phone to resolve any
filing errors, omissions, or discrepancies.
7) Each month, the CONSULTANT TUT online-hosted SaaS Administration system will
flag any missed filings for follow-up. Taxpayers will receive a courtesy phone call and a
late notice to let them know a filing has not been received as of the due date.
CONSULTANT will continue to follow-up with the taxpayer until payments are received
and taxpayer complies.
8) Monthly, CONSULTANT TUT Tax Specialists will analyze the month’s receipts and flag
significant variations for follow-up with the taxpayer and possible auditor review.
9) CONSULTANT will provide complete TUT taxpayer support via toll-free number and e-
mail to taxpayers requiring assistance with filing or payment, mailing address or contact
changes, and any other related issues they may have.
10) CONSULTANT will register new TUT taxpayers and assist them with all materials
needed to begin and maintain TUT filing.
TUT Compliance Program Objectives and Scope
The CONSULTANT will provide the following Compliance Activities:
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 30 of 58
1) Optional City Specific Compliance Reviews. At City’s option, CONSULTANT will offer
“City-Specific” reviews on a performance fee or other negotiated basis, if the above
activities or other factors (e.g., non-response by utility provider) would suggest that there
is a reasonable need to do so. If City elects to have CONSULTANT conduct such optional
reviews, assignment and authorization of such services may be approached as Additional
Services pursuant to Section 1 (“Scope of Services”) and Section 4 (“Not to exceed
Compensation”) provided that the amount set aside for Additional Services is not
exceeded. Otherwise, if the City elects to have CONSULTANT conduct such optional
reviews, the parties may execute an amendment to this Agreement pursuant to Section
27.4.
Administrative and Reporting Activities 1) UUT Payment History. CONSULTANT will provide the City, on a monthly or otherwise
mutually agreed upon basis, with a spreadsheet reflecting the City’s TUT payments by
provider and utility category (based on remittance data provided by City to CONSULTANT).
Revenue Protection and Enhancement Activities
1) Legislative Review Services. CONSULTANT will monitor proposed state and federal
legislation to identify issues affecting the City’s TUT or utility franchise revenues and, make
recommendations to client cities, their lobbyists, and other potential stakeholders or municipal
advocates and otherwise assist in developing effective consensus positions and coordinated
advocacy.
2) Technology and Marketing Analysis. CONSULTANT will identify, monitor and anticipate
changes in technology, services, or marketing of services, which may have an impact on
future TUT revenues.
Additional Customization & Consulting Services (Not Included in Scope of Services)
CITY may request CONSULTANT provide Additional Services, as detailed in Section 4 (“Not to
Exceed Compensation”) of this Agreement, including but not limited to enhanced customization
to its online filing website, reports, or Client Reporting Portal beyond the customization outlined
in this Agreement. In such a situation, CITY and CONSULTANT may identify CITY’S desired
scope and reasonable and customary fees (a cost proposal) for the desired scope, pursuant to a
Task Order as detailed in Section 1 (“Scope of Services”) herein. Before making any such
enhanced customizations, such Additional Services shall be authorized and executed as provided
in Section 1 and in accordance with Section 4.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 31 of 58
EXHIBIT A-1
PROFESSIONAL SERVICES TASK ORDER
CONSULTANT shall perform the Services detailed below in accordance with all the terms and conditions
of the Agreement referenced in Item 1A below. All exhibits referenced in Item 8 are incorporated into this
Task Order by this reference. CONSULTANT shall furnish the necessary facilities, professional, technical
and supporting personnel required by this Task Order as described below.
CONTRACT NO.
OR PURCHASE ORDER REQUISITION NO. (AS APPLICABLE)
1A. MASTER AGREEMENT NO. (MAY BE SAME AS CONTRACT / P.O. NO. ABOVE):
1B. TASK ORDER NO.:
2. CONSULTANT NAME:
3. PERIOD OF PERFORMANCE: START: COMPLETION:
4 TOTAL TASK ORDER PRICE: $__________________
BALANCE REMAINING IN MASTER AGREEMENT/CONTRACT $_______________
5. BUDGET CODE_______________
COST CENTER________________
COST ELEMENT______________
WBS/CIP__________
PHASE__________
6. CITY PROJECT MANAGER’S NAME & DEPARTMENT:_____________________________________
7. DESCRIPTION OF SCOPE OF SERVICES (Attachment A)
MUST INCLUDE:
SERVICES AND DELIVERABLES TO BE PROVIDED
SCHEDULE OF PERFORMANCE
MAXIMUM COMPENSATION AMOUNT AND RATE SCHEDULE (as applicable)
REIMBURSABLE EXPENSES, if any (with “not to exceed” amount)
8. ATTACHMENTS: A: Task Order Scope of Services B (if any): _____________________________
I hereby authorize the performance of the
work described in this Task Order.
APPROVED:
CITY OF PALO ALTO
BY:____________________________________
Name __________________________________
Title___________________________________
Date ___________________________________
this Task Order and warrant that I have
authority to sign on behalf of Consultant.
APPROVED:
COMPANY NAME: ______________________
BY:____________________________________
Name __________________________________
Title___________________________________
Date ___________________________________
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 32 of 58
EXHIBIT B
SCHEDULE OF PERFORMANCE
CONSULTANT shall perform the Services so as to complete each milestone within the number
of days/weeks specified below. The time to complete each milestone may be increased or
decreased by mutual written agreement of the Project Managers for CONSULTANT and CITY so
long as all work is completed within the term of the Agreement. CONSULTANT shall provide a
detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the
notice to proceed (“NTP”) from the CITY.
TASK SCHEDULE
Task 1: Business Fee Collection Services for the Business Registration Certificate and
Business Improvement District Programs (BRC and BID)
Task 1B:
Business Registry Certificate and Business Improvement
District (BID) Fee Administration
annual cycle launch
occurring January to March
On-going Business Registry Certificate / Business
Improvement District (BID) Discovery Services
of respective year; prior to
launch of annual cycle; and
Continuation of customer support as described in Exhibit A -
Additional Customization & Consulting Services (if executed
Task 1: Business Tax Collection Services for the Business Tax (BT)
Task 1A:
Convert and load all existing taxpayer records (provided by
the CITY and exiting vendor records) to CONSULTANT
Verify with the CITY all taxpayer letters, forms, notices and
any other taxpayer correspondence that are in use for the
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 33 of 58
the CITY’S taxpayers. Provide “test site” for City review.
Task 4:
Provide customer access to on-line portal.
By Mid-September 2023
Task 1B:
Contact all taxpayers a) by mail, including introductory letter
with new filing address, telephone contact for taxpayer
support, and web filing instructions; and then b) by telephone
October 2023
Ongoing BT Administrative and Reporting Services as
Ongoing BT Compliance Activities as described in
Additional Customization & Consulting Services (if executed
Task 2: Sales & Use Tax Audit and Information Services
Task 2A:
Delivery of reports specified in Exhibit A – Scope of Work,
including report of all inquiries filed on behalf of the CITY
and the status of outstanding pas inquiries filed with the
CDTFA; update to Clearview database of sales and use ta
data for the most recent quarter; and meeting with designated
CITY staff. Complete list of businesses by NAICS codes
(when available), in Excel format, including geographic area
middle of the first month of
each quarter in January,
April, July, and October
Training on Clearview software, customization of reports,
Additional Customization & Consulting Services (if executed
Task 3: Transient Occupancy Tax Administrative and Reporting Services (TOT)
Task 3A:
Continuation of TOT Administrative and Reporting Services
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 34 of 58
Optional Schedule of Performance Provision for On-Call or Additional Services Agreements.
(This provision only applies if checked and only applies to on-call agreements per Section 1 or
agreements with Additional Services per Section 4.)
The schedule of performance shall be as provided in the approved Task Order, as detailed in
Section 1 (Scope of Services) in the case of on-call Services, or as detailed in Section 4 in the case
of Additional Services, provided in all cases that the schedule of performance shall fall within the
term as provided in Section 2 (Term) of this Agreement.
Task 3A:
Continuation of customer support as described in Exhibit A –
Additional Customization & Consulting Services (if executed
Task 4: Telecommunications Users Tax Administrative and Reporting Services (TUT)
Task 4A:
Ongoing TUT Administrative and Reporting Services as
Continuation TUT Compliance Activities as described in
Continuation of customer support as described in Exhibit A –
Ongoing – TUT Revenue Protection and Enhancement,
Ordinance Advisory Services, and Legislative and
Regulatory Review Services as described in Exhibit A –
Additional Customization & Consulting Services (if executed
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 35 of 58
EXHIBIT C
COMPENSATION
CITY agrees to compensate CONSULTANT for Services performed in accordance with the terms
and conditions of this Agreement, and as set forth in the budget schedule below. Compensation
shall be calculated based on the rate schedule attached as Exhibit C-1 up to the not to exceed
budget amount for each task set forth below.
CITY’s Project Manager may approve in writing the transfer of budget amounts between any of
the tasks or categories listed below, provided that the total compensation for the Services,
including any specified reimbursable expenses, and the total compensation for Additional Services
(if any, per Section 4 of the Agreement) do not exceed the amounts set forth in Section 4 of this
Agreement.
CONSULTANT agrees to complete all Services, any specified reimbursable expenses, and
Additional Services (if any, per Section 4), within this/these amount(s). Any work performed or
expenses incurred for which payment would result in a total exceeding the maximum amount of
compensation set forth in this Agreement shall be at no cost to the CITY.
Consumer Price Index Adjustments
Where noted in this Exhibit, the Consumer Price Index refers to the Consumer Price Index – All
Urban Consumers for San Francisco-Oakland-Hayward Area as reported by the Bureau of Labor
Statistics. The initial CPI used for the first CPI adjustment will be the CPI for the month in which
the agreement is fully signed. The adjustments thereafter will be based on the CPI from December
of the prior calendar year. Each annual adjustment will not be less than two percent (2%) or greater
than five percent (5%).
Credit Card Processing Fee for Tax and Fee Collection Services
If the City opts to absorb the credit card processing fees charged by the credit card companies, the
CONSULTANT will withhold the exact processing fees charged by the credit card companies
when the CONSULTANT remits Business Tax, Business Registry, Business Improvement
District, Transient Occupancy Tax, and/or Telecommunication Users Tax revenue to the City. If
the City opts-out of absorbing this cost, a standard 3% processing fee will be directly paid by
businesses that choose this payment option and added to the business licensing fees at the time of
payment.
Task 1: Business Tax, Business Registry, and Business Improvement District Program
Administrative, Reporting, and Audit Services
A. Business Tax, Business Registry and Business Improvement District Administration
The fee for the Administration is determined by how many business taxpayers and business
registry certificates the City has and what the City ordinance is for administrative fees.
compensation for providing the standard Administration Services shall be:
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 36 of 58
• Setup fee to implement City’s new Business Tax: $15,000
o May increase to $30,000 depending on City requirements and will be determined
and mutually agreed upon between CITY and CONSULTANT as requirements
are finalized during implementation planning.
• Annual flat fee: $10,000
• $13.00 annual per participant fee, adjusted by CPI-U at the beginning of each calendar year
• For a customization beyond the standard offering and current processes, a mutually agreed
upon one-time set up fee may apply or a slightly higher per registry fee may apply. This
will be determined through more in-depth needs gathering from the City.
Included in the above compensation for Administration Services are:
• Incorporation/Merging of the Business Registry and Business Improvement District
database with the Business Tax
• Printing and Mailing costs (for notifications, registry issuance, etc.)
• Ongoing database management and back-up (business applicant information)
• Forms processing and funds disbursement (secure lockbox operation)
• Development and support of an on-line business registry filing and payment application.
Cost for Sending the Original Registry/Application to the City
The CONSULTANT archives all original registry certificate/applications. If the City wants a copy
of the original registry/application, a fee of $3.75 per business registry/application for the mailing
or faxing.
Delinquencies
Should the usual process of notifying businesses (2 additional notices and a follow-up phone call)
result in the non-payment of a business listed on the CONSULTANT’S online-hosted SaaS system
or the data sent to the CONSULTANT from the City, the account will then be considered a
delinquency. Delinquency processing involves another strongly worded notice and additional
phone calls. The account is then subject to the same fees as the LTC Discovery services listed
below.
Non-Sufficient Funds (NSF) and Associated Penalties
If a business pays its Business Registry fee by check without sufficient funds, then a $25 NSF will
be charged to the business. If the NSF payment causes the Business Registry/BID payments to be
late, then the associated late penalties and interest will apply.
The CONSULTANT offers a variety of payment option to businesses seeking a Business Registry
Certificate. Some of these options incur additional fees and costs. The CONSULTANT
understands it is customary and reasonable for certain fees and charges to be absorbed by the
issuing party and others to be charged to the business applicant/remitter. The CONSULANT will
follow existing City policy in charging any applicable fees and charges to either the business
applicant/remitter or continue to allow the City to absorb those fees and charges.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 37 of 58
Remitters’ Payments and Invoice Process
The following section describes how applicant/remitters’ payments are handled by the
CONSULTANT and invoices the City for its fees.
Payments received by the CONSULTANT shall be deposited into a general non-interest bearing,
collateral trust account maintained by the CONSUTLANT. The business applicants/remitters’
payments deposited into the escrow account shall be remitted to the City on a bi-weekly basis
(typically on the 15th and by the last business day of each month) net of the CONSULTANT’S
fees.
Should there be any disputed payments; the CONSULTANT shall work with City to mutually
resolve these issues. If the resolution results in City’s favor, the CONSULTANT shall refund the
applicable portion of the fee to City within 10 days of resolution.
Completion of Services
The CONSULTANT’S service may result in collection of deficiencies after termination of the
Agreement, the City’s obligation to collect fees and notify the CONSULTANT, and the
CONSULTANT’S right to continue to receive contingency fees, shall survive termination of the
Agreement.
The City shall have the right, at the City’s option, to elect not to proceed with recovery of any
identified deficiencies. Deficiencies which are uncollectible due to insolvency or dissolution of the
entity liable, or for deficiencies which are otherwise incapable of collection (e.g. statute of
limitations expiration or other legal defense) shall not be considered an “election” by the City for
the purposes of this Agreement. For deficiencies otherwise collectable but for which the City elects
not to collect, the City shall notify the CONSULTANT of its election not to pursue (“waive”)
collection of said deficiencies. The CONSULTANT shall be entitled to one-half (½) of the fee the
CONSULTANT would have been entitled to for the waived portion of the deficiency.
Business Tax, Business Registry, and Business Improvement District Discovery
Compensation for providing Discovery Services shall be a contingency fee of thirty five percent
(35%) of the additional revenue received by the City from the services. The contingency fee shall
apply to the calendar year, all eligible prior period revenues, and any applicable penalties, interest,
and late charges. The contingency fee only applies to revenue received by the CITY. If CITY elects
this service, the annual minimum fee is $7,500.
Task 2: Sales and Use Tax Audit and Information Services
A. Sales and Use Tax Information and Reporting
The Sales Tax Analysis and Reporting Service (STARS) will be provided at an annual fixed fee
of $4,000 paid $1,000 per quarter. The Annual Fee will be adjusted at the beginning of each
calendar year by CPI as reported by the Bureau of Labor Statistics.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 38 of 58
B. Sales and Use Tax Audit
The Sales and Use Tax Audit (SUTA) services will be provided for a fifteen percent (15%)
contingency fee for the tax revenues identified by the CONSULTANT and corrected by the
California Department of Tax and Fee Administration (CDTFA). This fee applies to four (4)
quarters after the Date of Correction and all eligible prior quarters back to and including the three
(3) quarters prior to the Date of Knowledge quarter with a maximum of ten total quarters. As used
herein, the Date of Knowledge is the quarter during which the CONSULTANT notifies the
CDTFA of the existence of a misallocation. As used herein, the Date of Correction refers to the
quarter in which the taxpayer has correctly reported the local tax and the CDTFA distributes the
local tax properly to City based on the taxpayer’s reporting, together with any prior period
reallocations. For QDR Misallocations detected and corrected, the CONSULTANT’S
compensation will only include the quarters in which the misallocation actually occurred.
For clarification and to encourage communication and collaboration between the CONSULTANT
and the CITY, the CONSULTANT shall be entitled to full payment of all compensation as
provided herein even if any one or more of City, its personnel, agents, or representatives, or any
third party or parties provide(s) information to the CONSULTANT that assists or is used by the
CONSULTANT in the identification, detection, and correction of point-of-sale distribution errors
or the reporting and/or misallocation of revenue.
Completion of Services
Because the services performed by the CONSULTANT results in corrections of misallocations
and other revenue after cessation of services performed by the CONSULTANT for the City, the
City agrees that with regards to misallocations identified to the CDTFA whose Date of Knowledge
occurred during the CONSULTANT performance of services for the City or for other revenue
resulting from the CONSULTANT’S actions taken during the term of the Agreement, that the
City’s obligation to pay the CONSULTANT in accordance with the compensation language of the
Agreement will survive expiration or termination of the Agreement for any reason. Additionally,
notwithstanding any other provision of the Agreement, if the Agreement is terminated or expires,
the CONSULTANT will continue to pursue corrections of accounts identified during the term of
the Agreement that have not been corrected by the CDTFA as of the effective date of termination
or expiration. The period after termination during which the CONSULTANT is pursuing
correction of accounts identified before termination is referred to as the “completion period.” The
City will compensate the CONSULTANT in accordance with the compensation language of the
Agreement for corrected misallocations that result from the CONSULTANT efforts during the
completion period. The City will also take all necessary steps to allow the CONSULTANT to
continue to receive the required information from the SBE during this completion period.
Method of Payment
The Sales and Use Tax Audit Service is self-funding and entirely predicated and contingent upon
the CONSULTANT’S audit service producing new sales/use tax revenue that would not otherwise
have been realized by the City. The sales/use tax audit shall be paid by quarterly invoice, after the
City has received the revenue from the correction and the quarterly distribution report has verified
this receipt. Each invoice will include the business name, permit number, local allocation amount
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 39 of 58
received by the City, and amount due to the CONSULTANT. Invoices shall be due and payable
upon receipt.
Task 3: Transient Occupancy Tax (TOT) Administration and Reporting Services
A. Administration and Reporting Services
Transient Occupancy Tax administration services are available to the CITY for an annual cost of
$150 per lodging property, adjusted by CPI at the beginning of the calendar year. The annual cost
of $150 applies regardless of whether the lodging property is hotel or a short-term rental. The TOT
Administration Service will be invoiced to the City at the beginning of each contract year based
on the number of properties registered to report transient occupancy tax. Should new short-term
rental properties be added to the administration program during the year, these new properties will
be billed on a pro-rated annual basis from the time they join the program.
B. TOT Audit and Compliance Services
Upon mutual agreement between CITY and CONSULTANT, TOT audits can be provided for
hotel and lodging properties on a fixed fee basis. Our TOT audit services consist of two inter-
related audit phases. The Phase 1 review must be done first, and it must include all traditional
(hotels, motels, inns) lodging properties within the City. This service does not include TOT audit
and compliance services for online short-term rentals (Air Bnb, VRBO, etc.), as detailed in the
“TOT Compliance Services” section of Exhibit A (“Scope of Services”) of this Agreement. Phase
2 cannot proceed without a Phase 1 review first being completed. The City can determine the
number of Phase 2 audits that they wish for the CONSULTANT to complete (typically
CONSULTANT recommends roughly 33% of lodging properties for Phase 2 audit but it is up to
the City to determine the number).
Phase 1: Analysis
The City will pay the CONSULTANT a fixed fee of $800 per lodging property. This fee applies
to all lodging properties located in the City limits. The CONSULTANT will invoice this upon
delivery of the analysis report.
Phase 2: Audit and Compliance Review
The City will pay the CONSULTANT a fixed fee of $1,200 per lodging property reviewed unless
the City does not approve the list of lodging properties for Compliance Review within 90 days of
submission, in which the cost will increase to $1,400 per lodging property reviewed. The
CONSULTANT will invoice this upon delivery of the compliance report with payment to be made
within thirty-days (30) of receipt of invoice.
Based on our experiences, through review of lodging properties in the initial Discovery and Audit
Phase (Phase 1), our staff typically recommends approximately 33% of the lodging providers for
the Phase 2 Compliance Review.
Reimbursement of Travel Costs for Audit Services (Visits to City)
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 40 of 58
For the Transient Occupancy Tax services, the CONSULTANT will also charge the City out-of-
pocket expenses for travel costs related to the performance of the audits in accordance with the
City of Palo Alto’s policy for reimbursement of travel and meal expenses. Travel costs will not
exceed $2,500 per visit. If CONSULTANT expect to spend more than $2,500 per visit,
CONSULTANT will get prior approval from the City for any amounts over the allotted $2,500,
executed in writing per Section 27.4 of this Agreement. The travel costs will be invoiced to the
City upon delivery of the final report to the City.
Typically for years two and three there will not be a need to audit every property within the statute.
The CONSULTANT will continue to monitor the lodging properties reporting and notify the City
of any anomaly and then charge $500 per property for any of those that require further compliance
review.
Should the City elect the full Phases 1 and 2 service for years two and three, the travel costs
reimbursement provisions above will apply, to be executed in writing per Section 27.4 of this
Agreement.
Task 4: Telecommunications Users Tax (TUT) Administrative and Reporting Services
A. Administration and Reporting Services
Telecommunications Users Tax (TUT) administration services are available to the City for a
monthly administration fee equal to $2.95 per filing transaction (typically one transaction per UUT
taxpayer per month), adjusted by CPI at the beginning of the calendar year. The Administration
Service will be invoiced to the City on a monthly basis and be based on the number of returns filed
in the month.
B. Utility User Tax City-Specific Compliance Review Audit
Upon mutual agreement of a suitable telecommunications utility for compliance review, the City
shall pay the CONSULTANT thirty percent (30%) of the additional revenues, including interest
and penalties, that has resulted from its City-specific compliance review activities. The
CONSULTANT will seek to recover or assist the City in recovering all revenue due the City from
prior periods, if any, and the CONSULTANT will receive 30% of any retroactive recovery. Said
30% also applies to the additional revenue received by the City for the first three years following
the correction of the error/omission. As used in this subsection, the term “additional revenues”
includes the value of any other services, credits, property of every kind or nature, or other
consideration received by the City in lieu of monetary payment.
Compensation is due and payable within thirty (30) days of the City’s receipt of the invoice. Any
amounts which remain unpaid after thirty (30) days shall accrue interest at a rate of one and one-
half percent (1.5%) per month, or the maximum amount permitted by law.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 41 of 58
REIMBURSABLE EXPENSES
The administrative, overhead, secretarial time or secretarial overtime, word processing,
photocopying, telecommunications, in-house printing, insurance and other ordinary business
expenses are included within the scope of payment for services and are not reimbursable expenses.
CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses
for which CONSULTANT shall be reimbursed are as detailed below, not to exceed $2,500 per
visit (per the “Reimbursement of Travel Costs for Audit Services (Visits to City)” section above):
1) Travel related to discovery and/or audits as authorized in writing by the City’s Project
Manager, including transportation and meals, will be reimbursed at actual cost subject to the City
of Palo Alto’s policy for reimbursement of travel and meal expenses.
All requests for payment of expenses shall be accompanied by appropriate backup information.
ADDITIONAL SERVICES
The CONSULTANT shall provide Additional Services, as detailed in Section 4 of this Agreement,
only by advanced, written authorization from the CITY as detailed in Section 1 of this Agreement.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 42 of 58
BUDGET SCHEDULE RATE
Administrative, Reporting, and Audit Services
a. Business tax, Business Registry,
and Business Improvement District
Program set up and
• Set-up fee: $30,000 • $30,000.00
b. Business tax, Business Registry,
and Business Improvement District
Program administration and
reporting
• • $50,000.00
• Annual fee per participant:
$13/annually (adj annually by
CPI) – extended NTE assumes
9,300 businesses, over 5 years,
• $668,050.00
c. Business Tax and Business Registry
discovery and recovery (if City
• • $50,000.00
• Minimum annual fee: $7,500
d. Business Tax and Business Registry
audit
•
by CPI)
• $50,000.00
SUBTOTAL: BASIC SERVICES $848,050.00
e. Additional customization and
consulting services (if City elects
•
C-1
$50,000.00
Task 2: Sales and Use Tax Audit and Information Services
a. Sales and use tax information • Annual flat fee: $4,000 (adj
annually by CPI) – extended
NTE assumes 5% CPI over 5
$22,500.00
b. Sales and use tax audit • Contingency fee: 15% • $100,000.00
SUBTOTAL: BASIC SERVICES $122,500.00
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 43 of 58
Task 3: Transient Occupancy Tax Administrative, Reporting, and Audit Services
a. Transient Occupancy Tax
administrative and reporting
• Annual fee per lodging
property: $150 (adj annually
by CPI) – extended NTE
assumes 35 lodging
properties, over 5 years, and
$29,000.00
b. Transient Occupancy Tax audit
(traditional hotel/motel) (if City
elects this service) – extended NTE
assumes one round each of Phase
1 and 2 for half of the City’s hotel
properties, travel costs for one
visit, and compliance review as
agreed upon.
•
$40,000.00
• Phase 2: $1,200 per lodging
property (adj annually by CPI)
• Travel costs: up to $2,500 per
visit
Compliance review: $500 per
property
SUBTOTAL: BASIC SERVICES $69,000.00
Task 4: Telecommunication Users Tax Administrative, Reporting, and Audit Services
a. Telecommunication Users Tax
administrative and reporting
services
•
(adj annually by CPI) –
extended NTE assumes 250
filers, over 5 years, and 5%
$47,000
b. Telecommunication users tax audit
services (if City elects this service)
• Contingency fee: 30% • $25,000
SUBTOTAL: BASIC SERVICES $72,000.00
TOTAL BASIC SERVICES $1,111,550.00
TOTAL ADDITIONAL SERVICES $50,000.00
TOTAL NOT TO EXCEED $1,161,550.00
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 44 of 58
EXHIBIT “C-1”
SCHEDULE OF RATES
Additional Consulting Services (“Additional Services”)
Should the City desire Additional Services, per Section 4 and Exhibit “C” of this Agreement, the
City may request that the CONSULTANT provide Additional Services at any time during term of
the Agreement. CONSULTANT shall provide such services on a Time and Materials basis and
based on the hourly rate schedule below.
Position Hourly Rate
Principal $225
Project Manager/Director $200
Client Services Executive $175
Senior Analyst $150
Information Technology $200
Analyst $125
Administrative $85
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 45 of 58
EXHIBIT D
INSURANCE REQUIREMENTS
CONSULTANTS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE
CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW,
AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR
AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA.
AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS AS SPECIFIED HEREIN.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 46 of 58
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 47 of 58
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 48 of 58
EXHIBIT E
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 49 of 58
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 50 of 58
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 51 of 58
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 52 of 58
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 53 of 58
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 54 of 58
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 55 of 58
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 56 of 58
EXHIBIT “F”
CYBERSECURITY TERMS AND CONDITIONS
In order to assure the privacy and security of the personal information of the City's customers and
people who do business with the City, including, without limitation, vendors, utility customers,
library patrons, and other individuals and companies, who are required to share such information
with the City, as a condition of receiving services from the City or selling goods and services to
the City, including, without limitation, the Software as a Service services provider (the
"Consultant") and its subcontractors, if any, including, without limitation, any Information
Technology ("IT") infrastructure services provider, shall design, install, provide, and maintain a
secure IT environment, described below, while it renders and performs the Services and furnishes
goods, if any, described in the Statement of Work, Exhibit B, to the extent any scope of work
implicates the confidentiality and privacy of the personal information of the City's customers. The
Consultant shall fulfill the data and information security requirements (the "Requirements") set
forth in Part A below.
A "secure IT environment" includes (a) the IT infrastructure, by which the Services are provided
to the City, including connection to the City's IT systems; (b) the Consultant's operations and
maintenance processes needed to support the environment, including disaster recovery and
business continuity planning; and (c) the IT infrastructure performance monitoring services to
ensure a secure and reliable environment and service availability to the City. "IT infrastructure"
refers to the integrated framework, including, without limitation, data centers, computers, and
database management devices, upon which digital networks operate.
In the event that, after the Effective Date, the Consultant reasonably determines that it cannot
fulfill the Requirements, the Consultant shall promptly inform the City of its determination and
submit, in writing, one or more alternate countermeasure options to the Requirements (the
"Alternate Requirements" as set forth in Part B), which may be accepted or rejected in the
reasonable satisfaction of the Information Security Manager (the "ISM").
Part A. Requirements:
The Consultant shall at all times during the term of any contract between the City and the
Consultant:
(a) Appoint or designate an employee, preferably an executive officer, as the security liaison
to the City with respect to the Services to be performed under this Agreement.
(b) Comply with the City's Information Privacy Policy:
(c) Have adopted and implemented information security and privacy policies that are
documented, are accessible to the City, and conform to ISO 27001/2 – Information
Security Management Systems (ISMS) Standards. See the following:
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 57 of 58
http://www.iso.org/iso/home/store/catalogue_tc/catalogue_detail.htm?csnumber=42103
http://www.iso.org/iso/iso_catalogue/catalogue_tc/catalogue_detail.htm?csnumber=5029
7
(d) Conduct routine data and information security compliance training of its personnel that is
appropriate to their role.
(e) Develop and maintain detailed documentation of the IT infrastructure, including software
versions and patch levels.
(f) Develop an independently verifiable process, consistent with industry standards, for
performing professional and criminal background checks of its employees that (1) would
permit verification of employees' personal identity and employment status, and (2) would
enable the immediate denial of access to the City's confidential data and information by
any of its employees who no longer would require access to that information or who are
terminated.
(g) Provide a list of IT infrastructure components in order to verify whether the Consultant
has met or has failed to meet any objective terms and conditions.
(h) Implement access accountability (identification and authentication) architecture and
support role-based access control ("RBAC") and segregation of duties ("SoD")
mechanisms for all personnel, systems, and Software used to provide the Services.
"RBAC" refers to a computer systems security approach to restricting access only to
authorized users. "SoD" is an approach that would require more than one individual to
complete a security task in order to promote the detection and prevention of fraud and
errors.
(i) Assist the City in undertaking annually an assessment to assure that: (1) all elements of
the Services' environment design and deployment are known to the City, and (2) it has
implemented measures in accordance with industry best practices applicable to secure
coding and secure IT architecture.
(j) Provide and maintain secure intersystem communication paths that would ensure the
confidentiality, integrity, and availability of the City's information.
(k) Deploy and maintain IT system upgrades, patches and configurations conforming to
current patch and/or release levels by not later than one (1) week after its date of release.
Emergency security patches must be installed within 24 hours after its date of release.
(l) Provide for the timely detection of, response to, and the reporting of security incidents,
including on-going incident monitoring with logging.
(m) Notify the City within one (1) hour of detecting a security incident that results in the
unauthorized access to or the misuse of the City's confidential data and information.
(n) Inform the City that any third party service provider(s) meet(s) all of the Requirements.
(o) Perform security self-audits on a regular basis and not less frequently than on a quarterly
basis, and provide the required summary reports of those self-audits to the ISM on the
annual anniversary date or any other date agreed to by the Parties.
(p) Accommodate, as practicable, and upon reasonable prior notice by the City, the City's
performance of random site security audits at the Consultant's site(s), including the site(s)
of a third-party service provider(s), as applicable. The scope of these audits will extend to
the Consultant's and its third-party service provider(s)' awareness of security policies and
practices, systems configurations, access authentication and authorization, and incident
detection and response.
(q) Cooperate with the City to ensure that to the extent required by applicable laws, rules and
regulations, and the Confidential Information will be accessible only by the Consultant and
any authorized third-party service provider's personnel.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020 Page 58 of 58
(r) Perform regular, reliable secured backups of all data needed to maximize the availability
of the Services. Adequately encrypt the City of Palo Alto's data, during the operational
process, hosted at rest, and the backup stage at the Vendors' environment (including
Vendor's contracting organization's environment).
(s) Maintain records relating to the Services for a period of three (3) years after the expiration
or earlier termination of this Agreement and in a mutually agreeable storage medium.
Within thirty (30) days after the effective date of expiration or earlier termination of this
Agreement, all of those records relating to the performance of the Services shall be
provided to the ISM.
(t) Maintain the Confidential Information in accordance with applicable federal, state, and
local data and information privacy laws, rules, and regulations.
(u) Encrypt the Confidential Information before delivering the same by electronic mail to the
City and or any authorized recipient.
(v) Provide Network Layer IP filtering services to allow access only from the City of Palo
Alto's IP address to the Vendor environment (primarily hosted for the City of Palo Alto).
(w) Offer a robust disaster recovery and business continuity (DR-BCP) solutions to the City
for the systems and services the Vendor provides to the City.
(x) Provide and support Single Sign-on (SSO) and Multifactor Authentication (MFA) solutions
for authentication and authorization services from the "City's environment to the Vendor's
environment," and Vendor's environment to the Vendor's cloud services/hosted
environment." The Vendor shall allow two employees of the City to have superuser and
super-admin access to the Vendor's IT environment, and a cloud-hosted IT environment
belongs to the City.
(y) Unless otherwise addressed in the Agreement, shall not hold the City liable for any direct,
indirect or punitive damages whatsoever including, without limitation, damages for loss of
use, data or profits, arising out of or in any way connected with the City's IT environment,
including, without limitation, IT infrastructure communications.
(z) The Vendor must provide evidence of valid cyber liability insurance policy per the City’s
EXHIBIT “D” INSURANCE REQUIREMENTS.
DocuSign Envelope ID: CF8DD150-7A6C-498B-8E58-3A6A7FE9F4BF
Professional Services
Rev. Dec.15, 2020
Page 1 of 36
CITY OF PALO ALTO CONTRACT NO. C23187298B
AGREEMENT FOR PROFESSIONAL SERVICES
BETWEEN THE CITY OF PALO ALTO AND
HDL COREN & CONE
This Agreement for Professional Services (this “Agreement”) is entered into as of the 19th day of
June 2023 (the “Effective Date”), by and between the CITY OF PALO ALTO, a California
chartered municipal corporation (“CITY”), and HDL COREN & CONE, a California corporation,
located at 120 S. State College Boulevard, Suite 200, Brea, CA 92821 (“CONSULTANT”).
The following recitals are a substantive portion of this Agreement and are fully incorporated herein
by this reference:
RECITALS
A. CITY seeks Property Tax Analysis and Reporting services (the “Project”) and desires to
engage a consultant for Property Tax Consulting Services in connection with the Project (the
“Services”, as detailed more fully in Exhibit A).
B. CONSULTANT represents that it, its employees and subconsultants, if any, possess the
necessary professional expertise, qualifications, and capability, and all required licenses and/or
certifications to provide the Services.
C. CITY, in reliance on these representations, desires to engage CONSULTANT to provide
the Services as more fully described in Exhibit A, entitled “SCOPE OF SERVICES”.
NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this
Agreement, the parties agree as follows:
SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described
in Exhibit A in accordance with the terms and conditions contained in this Agreement. The
performance of all Services shall be to the reasonable satisfaction of CITY.
SECTION 2. TERM.
The term of this Agreement shall be from the date of its full execution through March 31, 2028
unless terminated earlier pursuant to Section 19 (Termination) of this Agreement.
SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance
of Services under this Agreement. CONSULTANT shall complete the Services within the term of
this Agreement and in accordance with the schedule set forth in Exhibit B, entitled “SCHEDULE
OF PERFORMANCE”. Any Services for which times for performance are not specified in this
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 2 of 36
Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and
timely manner based upon the circumstances and direction communicated to the CONSULTANT.
CITY’s agreement to extend the term or the schedule for performance shall not preclude recovery
of damages for delay if the extension is required due to the fault of CONSULTANT.
SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to
CONSULTANT for performance of the Services shall be based on the compensation structure
detailed in Exhibit C, entitled “COMPENSATION,” including any reimbursable expenses
specified therein, and the maximum total compensation shall not exceed One Hundred One
Thousand Eight Hundred Dollars ($101,800.00). The hourly schedule of rates, if applicable, is
set out in Exhibit C-1, entitled “SCHEDULE OF RATES.” Any work performed or expenses
incurred for which payment would result in a total exceeding the maximum compensation set forth
in this Section 4 shall be at no cost to the CITY.
Optional Additional Services Provision (This provision applies only if checked and a
not-to-exceed compensation amount for Additional Services is allocated below under this
Section 4.)
In addition to the not-to-exceed compensation specified above, CITY has set aside the not-
to-exceed compensation amount of Ten Thousand Dollars ($10,000.00) for the
performance of Additional Services (as defined below). The total compensation for
performance of the Services, Additional Services and any reimbursable expenses specified
in Exhibit C, shall not exceed One Hundred Eleven Thousand Eight Hundred Dollars
($111,800.00), as detailed in Exhibit C.
“Additional Services” means any work that is determined by CITY to be necessary for the
proper completion of the Project, but which is not included within the Scope of Services
described at Exhibit A. CITY may elect to, but is not required to, authorize Additional
Services up to the maximum amount of compensation set forth for Additional Services in
this Section 4. CONSULTANT shall provide Additional Services only by advanced,
written authorization from CITY as detailed in this Section. Additional Services, if any,
shall be authorized by CITY with a Task Order assigned and authorized by CITY’s Project
Manager, as identified in Section 13 (Project Management). Each Task Order shall be in
substantially the same form as Exhibit A-1, entitled “PROFESSIONAL SERVICES TASK
ORDER”. Each Task Order shall contain a specific scope of services, schedule of
performance and maximum compensation amount, in accordance with the provisions of
this Agreement. Compensation for Additional Services shall be specified by CITY in the
Task Order, based on whichever is lowest: the compensation structure set forth in Exhibit
C, the hourly rates set forth in Exhibit C-1, or a negotiated lump sum.
To accept a Task Order, CONSULTANT shall sign the Task Order and return it to CITY’s
Project Manager within the time specified by the Project Manager, and upon authorization
by CITY (defined as counter-signature by the CITY Project Manager), the fully executed
Task Order shall become part of this Agreement. The cumulative total compensation to
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 3 of 36
CONSULTANT for all Task Orders authorized under this Agreement shall not exceed the
amount of compensation set forth for Additional Services in this Section 4.
CONSULTANT shall only be compensated for Additional Services performed under an
authorized Task Order and only up to the maximum amount of compensation set forth for
Additional Services in this Section 4. Performance of and payment for any Additional
Services are subject to all requirements and restrictions in this Agreement.
SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit quarterly
invoices to the CITY describing the Services performed and the applicable charges (including, if
applicable, an identification of personnel who performed the Services, hours worked, hourly rates,
and reimbursable expenses), based upon Exhibit C or, as applicable, CONSULTANT’s schedule
of rates set forth in Exhibit C-1. If applicable, the invoice shall also describe the percentage of
completion of each task. The information in CONSULTANT’s invoices shall be subject to
verification by CITY. CONSULTANT shall send all invoices to CITY’s Project Manager at the
address specified in Section 13 (Project Management) below. CITY will generally process and
pay invoices within thirty (30) days of receipt of an acceptable invoice.
SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All Services shall be performed
by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT represents that it,
its employees and subcontractors, if any, possess the professional and technical personnel
necessary to perform the Services required by this Agreement and that the personnel have
sufficient skill and experience to perform the Services assigned to them. CONSULTANT
represents that it, its employees and subcontractors, if any, have and shall maintain during the term
of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature
that are legally required to perform the Services. All Services to be furnished by CONSULTANT
under this Agreement shall meet the professional standard and quality that prevail among
professionals in the same discipline and of similar knowledge and skill engaged in related work
throughout California under the same or similar circumstances.
SECTION 7. COMPLIANCE WITH LAWS. CONSULTANT shall keep itself informed of
and in compliance with all federal, state and local laws, ordinances, regulations, and orders that
may affect in any manner the Project or the performance of the Services or those engaged to
perform Services under this Agreement, as amended from time to time. CONSULTANT shall
procure all permits and licenses, pay all charges and fees, and give all notices required by law in
the performance of the Services.
SECTION 8. ERRORS/OMISSIONS. CONSULTANT is solely responsible for costs,
including, but not limited to, increases in the cost of Services, arising from or caused by
CONSULTANT’s errors and omissions, including, but not limited to, the costs of corrections such
errors and omissions, any change order markup costs, or costs arising from delay caused by the
errors and omissions or unreasonable delay in correcting the errors and omissions.
SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works
project, CONSULTANT shall submit estimates of probable construction costs at each phase of
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 4 of 36
design submittal. If the total estimated construction cost at any submittal exceeds the CITY’s
stated construction budget by ten percent (10%) or more, CONSULTANT shall make
recommendations to CITY for aligning the Project design with the budget, incorporate CITY
approved recommendations, and revise the design to meet the Project budget, at no additional cost
to CITY.
SECTION 10. INDEPENDENT CONTRACTOR. CONSULTANT acknowledges and agrees
that CONSULTANT and any agent or employee of CONSULTANT will act as and shall be
deemed at all times to be an independent contractor and shall be wholly responsible for the manner
in which CONSULTANT performs the Services requested by CITY under this Agreement.
CONSULTANT and any agent or employee of CONSULTANT will not have employee status
with CITY, nor be entitled to participate in any plans, arrangements, or distributions by CITY
pertaining to or in connection with any retirement, health or other benefits that CITY may offer its
employees. CONSULTANT will be responsible for all obligations and payments, whether
imposed by federal, state or local law, including, but not limited to, FICA, income tax
withholdings, workers’ compensation, unemployment compensation, insurance, and other similar
responsibilities related to CONSULTANT’s performance of the Services, or any agent or
employee of CONSULTANT providing same. Nothing in this Agreement shall be construed as
creating an employment or agency relationship between CITY and CONSULTANT or any agent
or employee of CONSULTANT. Any terms in this Agreement referring to direction from CITY
shall be construed as providing for direction as to policy and the result of CONSULTANT’s
provision of the Services only, and not as to the means by which such a result is obtained.
SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of
CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign
or transfer any interest in this Agreement nor the performance of any of CONSULTANT’s
obligations hereunder without the prior written approval of the City Manager. Any purported
assignment made without the prior written approval of the City Manager will be void and without
effect. Subject to the foregoing, the covenants, terms, conditions and provisions of this Agreement
will apply to, and will bind, the heirs, successors, executors, administrators and assignees of the
parties.
SECTION 12. SUBCONTRACTING.
Option A: No Subcontractor: CONSULTANT shall not subcontract any portion of the
Services to be performed under this Agreement without the prior written authorization of the City
Manager or designee. In the event CONSULTANT does subcontract any portion of the work to
be performed under this Agreement, CONSULTANT shall be fully responsible for all acts and
omissions of subcontractors.
Option B: Subcontracts Authorized: Notwithstanding Section 11 (Assignment) above, CITY
agrees that subcontractors may be used to complete the Services. The subcontractors authorized
by CITY to perform work on this Project are:
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 5 of 36
CONSULTANT shall be responsible for directing the work of any subcontractors and for any
compensation due to subcontractors. CITY assumes no responsibility whatsoever concerning
compensation of subcontractors. CONSULTANT shall be fully responsible to CITY for all acts
and omissions of subcontractors. CONSULTANT shall change or add subcontractors only with
the prior written approval of the City Manager or designee.
SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Nichole Cone-
Morishita, CFO, email: ncone@hdlccpropertytax.com, as the CONSULTANT’s Project Manager
to have supervisory responsibility for the performance, progress, and execution of the Services and
represent CONSULTANT during the day-to-day performance of the Services. If circumstances
cause the substitution of the CONSULTANT’s Project Manager or any other of CONSULTANT’s
key personnel for any reason, the appointment of a substitute Project Manager and the assignment
of any key new or replacement personnel will be subject to the prior written approval of the CITY’s
Project Manager. CONSULTANT, at CITY’s request, shall promptly remove CONSULTANT
personnel who CITY finds do not perform the Services in an acceptable manner, are uncooperative,
or present a threat to the adequate or timely completion of the Services or a threat to the safety of
persons or property.
CITY’s Project Manager is Josie Stokes, Administrative Services Department, Revenue
Collections Division, 250 Hamilton Avenue, Palo Alto, CA 94301, Telephone: (650) 329-2291.
CITY’s Project Manager will be CONSULTANT’s point of contact with respect to performance,
progress and execution of the Services. CITY may designate an alternate Project Manager from
time to time.
SECTION 14. OWNERSHIP OF MATERIALS. All work product, including without
limitation, all writings, drawings, studies, sketches, photographs, plans, reports, specifications,
computations, models, recordings, data, documents, and other materials and copyright interests
developed under this Agreement, in any form or media, shall be and remain the exclusive property
of CITY without restriction or limitation upon their use. CONSULTANT agrees that all copyrights
which arise from creation of the work product pursuant to this Agreement are vested in CITY, and
CONSULTANT hereby waives and relinquishes all claims to copyright or other intellectual
property rights in favor of CITY. Neither CONSULTANT nor its subcontractors, if any, shall
make any of such work product available to any individual or organization without the prior written
approval of the City Manager or designee. CONSULTANT makes no representation of the
suitability of the work product for use in or application to circumstances not contemplated by the
Scope of Services.
SECTION 15. AUDITS. CONSULTANT agrees to permit CITY and its authorized
representatives to audit, at any reasonable time during the term of this Agreement and for four (4)
years from the date of final payment, CONSULTANT’s records pertaining to matters covered by
this Agreement, including without limitation records demonstrating compliance with the
requirements of Section 10 (Independent Contractor). CONSULTANT further agrees to maintain
and retain accurate books and records in accordance with generally accepted accounting principles
for at least four (4) years after the expiration or earlier termination of this Agreement or the
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 6 of 36
completion of any audit hereunder, whichever is later.
SECTION 16. INDEMNITY.
[Option A applies to the following design professionals pursuant to Civil Code Section
2782.8: architects; landscape architects; registered professional engineers and licensed
professional land surveyors.] 16.1. To the fullest extent permitted by law, CONSULTANT shall
indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents
(each an “Indemnified Party”) from and against any and all third party demands, claims, or liability
of any nature, including death or injury to any person, property damage or any other loss, including
all costs and expenses of whatever nature including attorney’s fees, experts fees, court costs and
disbursements (“Claims”) to the extent that such Claims arise out of, pertain to, or relate to the
negligence, recklessness, or willful misconduct of CONSULTANT, its officers, employees, agents
or contractors under this Agreement, regardless of whether or not it is caused in part by an
Indemnified Party. CITY will reimburse CONSULTANT for the proportionate percentage of
defense costs exceeding CONSULTANT’s proportionate percentage of fault as determined by the
final judgment of a court of competent jurisdiction.
[Option B applies to any consultant who does not qualify as a design professional as
defined in Civil Code Section 2782.8.] 16.1. To the fullest extent permitted by law,
CONSULTANT shall indemnify, defend and hold harmless CITY, its Council members, officers,
employees and agents (each an “Indemnified Party”) from and against any and all demands, claims,
or liability of any nature, including death or injury to any person, property damage or any other
loss, including all costs and expenses of whatever nature including attorney’s fees, experts fees,
court costs and disbursements (“Claims”) resulting from, arising out of or in any manner related
to performance or nonperformance by CONSULTANT, its officers, employees, agents or
contractors under this Agreement, regardless of whether or not it is caused in part by an
Indemnified Party.
16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to
require CONSULTANT to indemnify an Indemnified Party from a Claim arising from the active
negligence or willful misconduct of an Indemnified Party that is not contributed to by any act of,
or by any omission to perform a duty imposed by law or agreement by, CONSULTANT, its
officers, employees, agents or contractors under this Agreement.
16.3. The acceptance of CONSULTANT’s Services and duties by CITY shall not
operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive
the expiration or early termination of this Agreement.
SECTION 17. WAIVERS. No waiver of a condition or nonperformance of an obligation under
this Agreement is effective unless it is in writing in accordance with Section 29.4 of this
Agreement. No delay or failure to require performance of any provision of this Agreement shall
constitute a waiver of that provision as to that or any other instance. Any waiver granted shall
apply solely to the specific instance expressly stated. No single or partial exercise of any right or
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 7 of 36
remedy will preclude any other or further exercise of any right or remedy.
SECTION 18. INSURANCE.
18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in
full force and effect during the term of this Agreement, the insurance coverage described in Exhibit
D, entitled “INSURANCE REQUIREMENTS”. CONSULTANT and its contractors, if any, shall
obtain a policy endorsement naming CITY as an additional insured under any general liability or
automobile policy or policies.
18.2. All insurance coverage required hereunder shall be provided through
carriers with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or
authorized to transact insurance business in the State of California. Any and all contractors of
CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in
full force and effect during the term of this Agreement, identical insurance coverage, naming CITY
as an additional insured under such policies as required above.
18.3. Certificates evidencing such insurance shall be filed with CITY
concurrently with the execution of this Agreement. The certificates will be subject to the approval
of CITY’s Risk Manager and will contain an endorsement stating that the insurance is primary
coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except
after filing with the Purchasing Manager thirty (30) days’ prior written notice of the cancellation
or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30)
days’ notice to CONSULTANT, CONSULTANT shall provide the Purchasing Manager written
notice of the cancellation or modification within two (2) business days of the CONSULTANT’s
receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates
evidencing the insurance are provided to CITY’s Chief Procurement Officer during the entire term
of this Agreement.
18.4. The procuring of such required policy or policies of insurance will not be
construed to limit CONSULTANT’s liability hereunder nor to fulfill the indemnification
provisions of this Agreement. Notwithstanding the policy or policies of insurance,
CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss
caused by or directly arising as a result of the Services performed under this Agreement, including
such damage, injury, or loss arising after the Agreement is terminated or the term has expired.
SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES.
19.1. The City Manager may suspend the performance of the Services, in whole
or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written
notice thereof to CONSULTANT. If CONSULTANT fails to perform any of its material
obligations under this Agreement, in addition to all other remedies provided under this Agreement
or at law, the City Manager may terminate this Agreement sooner upon written notice of
termination. Upon receipt of any notice of suspension or termination, CONSULTANT will
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 8 of 36
discontinue its performance of the Services on the effective date in the notice of suspension or
termination.
19.2. In event of suspension or termination, CONSULTANT will deliver to the
City Manager on or before the effective date in the notice of suspension or termination, any and
all work product, as detailed in Section 14 (Ownership of Materials), whether or not completed,
prepared by CONSULTANT or its contractors, if any, in the performance of this Agreement. Such
work product is the property of CITY, as detailed in Section 14 (Ownership of Materials).
19.3. In event of suspension or termination, CONSULTANT will be paid for the
Services rendered and work products delivered to CITY in accordance with the Scope of Services
up to the effective date in the notice of suspension or termination; provided, however, if this
Agreement is suspended or terminated on account of a default by CONSULTANT, CITY will be
obligated to compensate CONSULTANT only for that portion of CONSULTANT’s Services
provided in material conformity with this Agreement as such determination is made by the City
Manager acting in the reasonable exercise of his/her discretion. The following Sections will
survive any expiration or termination of this Agreement: 14, 15, 16, 17, 19.2, 19.3, 19.4, 20, 25,
27, 28, 29 and 30.
19.4. No payment, partial payment, acceptance, or partial acceptance by CITY
will operate as a waiver on the part of CITY of any of its rights under this Agreement, unless made
in accordance with Section 17 (Waivers).
SECTION 20. NOTICES.
All notices hereunder will be given in writing and mailed, postage prepaid, by
certified mail, addressed as follows:
To CITY: Office of the City Clerk
City of Palo Alto
Post Office Box 10250
Palo Alto, CA 94303
With a copy to the Purchasing Manager
To CONSULTANT: Attention of the Project Manager at the address of
CONSULTANT recited on the first page of this Agreement.
CONSULTANT shall provide written notice to CITY of any change of address.
SECTION 21. CONFLICT OF INTEREST.
21.1. In executing this Agreement, CONSULTANT covenants that it presently
has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 9 of 36
would conflict in any manner or degree with the performance of the Services.
21.2. CONSULTANT further covenants that, in the performance of this
Agreement, it will not employ subcontractors or other persons or parties having such an interest.
CONSULTANT certifies that no person who has or will have any financial interest under this
Agreement is an officer or employee of CITY; this provision will be interpreted in accordance
with the applicable provisions of the Palo Alto Municipal Code and the Government Code of the
State of California, as amended from time to time. CONSULTANT agrees to notify CITY if any
conflict arises.
21.3. If the CONSULTANT meets the definition of a “Consultant” as defined by
the Regulations of the Fair Political Practices Commission, CONSULTANT will file the
appropriate financial disclosure documents required by the Palo Alto Municipal Code and the
Political Reform Act of 1974, as amended from time to time.
SECTION 22. NONDISCRIMINATION; COMPLIANCE WITH ADA.
22.1. As set forth in Palo Alto Municipal Code Section 2.30.510, as amended
from time to time, CONSULTANT certifies that in the performance of this Agreement, it shall not
discriminate in the employment of any person due to that person’s race, skin color, gender, gender
identity, age, religion, disability, national origin, ancestry, sexual orientation, pregnancy, genetic
information or condition, housing status, marital status, familial status, weight or height of such
person. CONSULTANT acknowledges that it has read and understands the provisions of Section
2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the
penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510 pertaining
to nondiscrimination in employment.
22.2. CONSULTANT understands and agrees that pursuant to the Americans
Disabilities Act (“ADA”), programs, services and other activities provided by a public entity to
the public, whether directly or through a contractor or subcontractor, are required to be accessible
to the disabled public. CONSULTANT will provide the Services specified in this Agreement in a
manner that complies with the ADA and any other applicable federal, state and local disability
rights laws and regulations, as amended from time to time. CONSULTANT will not discriminate
against persons with disabilities in the provision of services, benefits or activities provided under
this Agreement.
SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO
WASTE REQUIREMENTS. CONSULTANT shall comply with the CITY’s Environmentally
Preferred Purchasing policies which are available at CITY’s Purchasing Department, hereby
incorporated by reference and as amended from time to time. CONSULTANT shall comply with
waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero
Waste best practices include, first, minimizing and reducing waste; second, reusing waste; and,
third, recycling or composting waste. In particular, CONSULTANT shall comply with the
following Zero Waste requirements:
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 10 of 36
(a) All printed materials provided by CONSULTANT to CITY generated from a
personal computer and printer including but not limited to, proposals, quotes, invoices, reports,
and public education materials, shall be double-sided and printed on a minimum of 30% or greater
post-consumer content paper, unless otherwise approved by CITY’s Project Manager. Any
submitted materials printed by a professional printing company shall be a minimum of 30% or
greater post-consumer material and printed with vegetable-based inks.
(b) Goods purchased by CONSULTANT on behalf of CITY shall be purchased in
accordance with CITY’s Environmental Purchasing Policy including but not limited to Extended
Producer Responsibility requirements for products and packaging. A copy of this policy is on file
at the Purchasing Department’s office.
(c) Reusable/returnable pallets shall be taken back by CONSULTANT, at no
additional cost to CITY, for reuse or recycling. CONSULTANT shall provide documentation from
the facility accepting the pallets to verify that pallets are not being disposed.
SECTION 24. COMPLIANCE WITH PALO ALTO MINIMUM WAGE ORDINANCE.
CONSULTANT shall comply with all requirements of the Palo Alto Municipal Code Chapter 4.62
(Citywide Minimum Wage), as amended from time to time. In particular, for any employee
otherwise entitled to the State minimum wage, who performs at least two (2) hours of work in a
calendar week within the geographic boundaries of the City, CONSULTANT shall pay such
employees no less than the minimum wage set forth in Palo Alto Municipal Code Section 4.62.030
for each hour worked within the geographic boundaries of the City of Palo Alto. In addition,
CONSULTANT shall post notices regarding the Palo Alto Minimum Wage Ordinance in
accordance with Palo Alto Municipal Code Section 4.62.060.
SECTION 25. NON-APPROPRIATION. This Agreement is subject to the fiscal provisions of
the Charter of the City of Palo Alto and the Palo Alto Municipal Code, as amended from time to
time. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the
event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal
year in the event that funds are only appropriated for a portion of the fiscal year and funds for this
Agreement are no longer available. This Section shall take precedence in the event of a conflict
with any other covenant, term, condition, or provision of this Agreement.
SECTION 26. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC
WORKS CONTRACTS.
26.1. This Project is not subject to prevailing wages and related
requirements. CONSULTANT is not required to pay prevailing wages and meet related
requirements under the California Labor Code and California Code of Regulations in the
performance and implementation of the Project if the contract:
(1) is not a public works contract;
(2) is for a public works construction project of $25,000 or less, per California
Labor Code Sections 1782(d)(1), 1725.5(f) and 1773.3(j); or
(3) is for a public works alteration, demolition, repair, or maintenance project of
$15,000 or less, per California Labor Code Sections 1782(d)(1), 1725.5(f) and
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 11 of 36
1773.3(j).
SECTION 27. CLAIMS PROCEDURE FOR “9204 PUBLIC WORKS PROJECTS”. For
purposes of this Section 27, a “9204 Public Works Project” means the erection, construction,
alteration, repair, or improvement of any public structure, building, road, or other public
improvement of any kind. (Cal. Pub. Cont. Code § 9204.) Per California Public Contract Code
Section 9204, for Public Works Projects, certain claims procedures shall apply, as set forth in
Exhibit F, entitled “Claims for Public Contract Code Section 9204 Public Works Projects”.
This Project is not a 9204 Public Works Project.
SECTION 28. CONFIDENTIAL INFORMATION.
28.1. In the performance of this Agreement, CONSULTANT may have access to
CITY’s Confidential Information (defined below). CONSULTANT will hold Confidential
Information in strict confidence, not disclose it to any third party, and will use it only for the
performance of its obligations to CITY under this Agreement and for no other purpose.
CONSULTANT will maintain reasonable and appropriate administrative, technical and physical
safeguards to ensure the security, confidentiality and integrity of the Confidential Information.
Notwithstanding the foregoing, CONSULTANT may disclose Confidential Information to its
employees, agents and subcontractors, if any, to the extent they have a need to know in order to
perform CONSULTANT’s obligations to CITY under this Agreement and for no other purpose,
provided that the CONSULTANT informs them of, and requires them to follow, the confidentiality
and security obligations of this Agreement.
28.2. “Confidential Information” means all data, information (including without
limitation “Personal Information” about a California resident as defined in Civil Code Section
1798 et seq., as amended from time to time) and materials, in any form or media, tangible or
intangible, provided or otherwise made available to CONSULTANT by CITY, directly or
indirectly, pursuant to this Agreement. Confidential Information excludes information that
CONSULTANT can show by appropriate documentation: (i) was publicly known at the time it
was provided or has subsequently become publicly known other than by a breach of this
Agreement; (ii) was rightfully in CONSULTANT’s possession free of any obligation of
confidence prior to receipt of Confidential Information; (iii) is rightfully obtained by
CONSULTANT from a third party without breach of any confidentiality obligation; (iv) is
independently developed by employees of CONSULTANT without any use of or access to the
Confidential Information; or (v) CONSULTANT has written consent to disclose signed by an
authorized representative of CITY.
28.3. Notwithstanding the foregoing, CONSULTANT may disclose Confidential
Information to the extent required by order of a court of competent jurisdiction or governmental
body, provided that CONSULTANT will notify CITY in writing of such order immediately upon
receipt and prior to any such disclosure (unless CONSULTANT is prohibited by law from doing
so), to give CITY an opportunity to oppose or otherwise respond to such order.
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 12 of 36
28.4. CONSULTANT will notify City promptly upon learning of any breach in
the security of its systems or unauthorized disclosure of, or access to, Confidential Information in
its possession or control, and if such Confidential Information consists of Personal Information,
CONSULTANT will provide information to CITY sufficient to meet the notice requirements of
Civil Code Section 1798 et seq., as applicable, as amended from time to time.
28.5. Prior to or upon termination or expiration of this Agreement,
CONSULTANT will honor any request from the CITY to return or securely destroy all copies of
Confidential Information. All Confidential Information is and will remain the property of the CITY
and nothing contained in this Agreement grants or confers any rights to such Confidential
Information on CONSULTANT.
28.6. If selected in Section 30 (Exhibits), this Agreement is also subject to the
terms and conditions of the Information Privacy Policy and Cybersecurity Terms and Conditions.
SECTION 29. MISCELLANEOUS PROVISIONS.
29.1. This Agreement will be governed by California law, without regard to its
conflict of law provisions.
29.2. In the event that an action is brought, the parties agree that trial of such
action will be vested exclusively in the state courts of California in the County of Santa Clara,
State of California.
29.3. The prevailing party in any action brought to enforce the provisions of this
Agreement may recover its reasonable costs and attorneys’ fees expended in connection with that
action. The prevailing party shall be entitled to recover an amount equal to the fair market value
of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third
parties.
29.4. This Agreement, including all exhibits, constitutes the entire and integrated
agreement between the parties with respect to the subject matter of this Agreement, and supersedes
all prior agreements, negotiations, representations, statements and undertakings, either oral or
written. This Agreement may be amended only by a written instrument, which is signed by the
authorized representatives of the parties and approved as required under Palo Alto Municipal
Code, as amended from time to time.
29.5. If a court of competent jurisdiction finds or rules that any provision of this
Agreement is void or unenforceable, the unaffected provisions of this Agreement will remain in
full force and effect.
29.6. In the event of a conflict between the terms of this Agreement and the
exhibits hereto (per Section 30) or CONSULTANT’s proposal (if any), the Agreement shall
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 13 of 36
control. In the event of a conflict between the exhibits hereto and CONSULTANT’s proposal (if
any), the exhibits shall control.
29.7. The provisions of all checked boxes in this Agreement shall apply to this
Agreement; the provisions of any unchecked boxes shall not apply to this Agreement.
29.8. All section headings contained in this Agreement are for convenience and
reference only and are not intended to define or limit the scope of any provision of this Agreement.
29.9. This Agreement may be signed in multiple counterparts, which, when
executed by the authorized representatives of the parties, shall together constitute a single binding
agreement.
SECTION 30. EXHIBITS. Each of the following exhibits, if the check box for such exhibit is
selected below, is hereby attached and incorporated into this Agreement by reference as though
fully set forth herein:
EXHIBIT A: SCOPE OF SERVICES
EXHIBIT A-1 PROFESSIONAL SERVICES TASK ORDER
EXHIBIT B: SCHEDULE OF PERFORMANCE
EXHIBIT C: COMPENSATION
EXHIBIT C-1: SCHEDULE OF RATES
EXHIBIT D: INSURANCE REQUIREMENTS
EXHIBIT E: INFORMATION PRIVACY POLICY
EXHIBIT F: CYBERSECURITY TERMS AND CONDITIONS
THIS AGREEMENT IS NOT COMPLETE UNLESS ALL SELECTED EXHIBITS
ARE ATTACHED.
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 14 of 36
CONTRACT NO. C23187298B SIGNATURE PAGE
IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives
executed this Agreement as of the date first above written.
CITY OF PALO ALTO
____________________________
City Manager
APPROVED AS TO FORM:
__________________________
City Attorney or Designee
HDL COREN & CONE
Officer 1
By:_____________________________
Name: Paula Cone_________________
Title: President____________________
Officer 2
By:______________________________
Name: Nichole Cone-Morishita________
Title: CFO_________________________
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 15 of 36
EXHIBIT A
SCOPE OF SERVICES
CONSULTANT shall provide the following services and deliverables pursuant to this
Agreement:
Property Tax Information Services and Reporting
The CONSULTANT shall furnish a variety of reports detailing property and revenue trends for
the entire City and for custom defined geographic areas. These reports may be used for budgeting
purposes, planning, economic development and public information. Among the reports available
are top 25, 50, 100-property owner/taxpayer listings, multiple ownership properties, non-owner
occupied parcels, identification of property ownership transfers and completed construction
projects for tracking of reassessments. The CONSULTANT will provide the following reports
annually, quarterly or monthly, as appropriate. Reports are also available from prior years if needed
and will be made available in pdf, Microsoft Word and Excel formats, as requested by City, for
use in staff presentations.
Reports in the portfolio of deliverables include but are not limited to:
A five-year history of the values within the City, and custom (city defined) geographic
areas;
A listing of the largest value changes, positive and negative between tax years;
An annual parcel listing of properties with parcel number changes between tax years
identifying parcel splits and combines;
A listing of the major property owners for the City including the combined assessed values
of their property and property use code designation;
A listing of property transfers which occurred since the lien date ordered by month—sales
listing;
A listing of parcels that have not changed ownership since the enactment of Proposition
13;
Analysis of recent sales of properties not sold since prior to Proposition 13.
A comparison of property within the City by county use-code designation;
A multiple year comparison of growth by use code designation over a 5- year period;
A listing by parcel of new construction activity to identify non-residential parcels with new
construction activity and to provide reports for use in the City's preparation of Propositions
4 and 111 State Appropriation Limit calculations;
A listing of multiple owned parcels;
A listing of absentee owner parcels;
Calculate an estimate of property tax revenue anticipated to be received for the fiscal year
by the City based upon the initial information provided by the County and subject to
modification.
Analyses based on geo areas designated by the City to include assessed valuations and
square footage computations for use in economic analysis and community development
planning.
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 16 of 36
One and five-year budget projections for the city general fund and special districts. This
report is interactive for tax modeling.
WEB-BASED SOFTWARE APPLICATION
The CONSULTANT shall make available for use its HDL Coren and Cone Property Tax Web
Application, a web-based software application that provides the City with a user-friendly tool to
store, search, access and analyze the City’s property tax data (also called the “software application”
or “software” in this Agreement. Data in the software application shall be updated monthly to
reflect changes in ownership and deed recordings. Assessment appeals data is updated quarterly.
As modifications and enhancements are made to the program, the City receives the enhanced
version of the software at no additional cost. The City is granted a site license for the software
application under this Agreement, which does not limit the number of users. The software can be
used to access secured, unsecured, cross reference, possessory interest, mineral rights and SBE
non-operating unitary tax rolls. Unsecured assessments are linked to the corresponding secured
parcels where parcel numbers match. This allows users to see all property tax records at a particular
location.
Geographic areas as defined by the City can be created in the software by City staff or, upon
supplying maps with the boundary area of each requested geo defined, will be created by the
CONSULTANT and are included in the cost of this scope of services. Additional areas can be
created at no cost as they become necessary.
Property transfer information is updated monthly and the prior sales transactions are stored with
each record for reference. Filtering is available for Pre-Proposition 13 owned properties, non-
owner occupied properties (absentee owners), specific focused uses, targeted values, and
selection of various other property characteristics. The data can be sorted by parcel number,
owner, situs address, county use code designation and tax rate area. Data can be exported from
the software to Excel, CSV, Text or Html to allow for further analysis through an easy-to-use
export feature. Custom exports are also available to link or integrate with city building or code
enforcement products.
Training will be provided annually at no additional cost to the City and CONSULTANT will
provide support for the City’s use of the software, answering questions, providing phone
assistance and troubleshooting issues that arise between scheduled training events at no
additional cost to the City.
The Services, where provided by CONSULTANT’s online-hosted software, include all related
services and support necessary to implement the Services detailed in this Scope of Services,
including, for example and without limitation, data/content migration, software licensing, online-
hosting, maintenance, updates, upgrades, security, and technical and user support as detailed in
this Scope of Services and elsewhere in this Agreement, in CONSULTANT’s proposal, and in
the Documentation.
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 17 of 36
PROPERTY TAX AUDITS
The CONSULTANT will perform an analysis of the Assessor Rolls to identify all parcels on the
secured, unsecured and cross reference tax rolls and verify that parcel assessed valuations and
the resulting taxes are correctly allocated to the City. This analysis is accomplished using
specialized computer software, assessor maps, City GIS maps, City records, other pertinent
documents, and field investigations. The review will include the lien date rolls noted for the
current tax year as well as historical data back for a total of four (4) tax years.
A report is prepared related to the properties requiring corrective action with a suggested tax rate
area (TRA) and/or correct address and APN and then transmitted to the County Assessor’s office
for review and correction and to the client City at the same time. Once the Assessor’s staff has
reviewed and corrected the misplaced TRAs, the County returns to our office an accounting of
the properties that were corrected and transmitted to the Auditor’s office for tax reassignment.
That report is then provided to the client as verification that corrections were made. If necessary,
we will review our findings and recommendations with designated City project manager.
ON-GOING CONSULTATION (ADDITIONAL SERVICES)
During the term of this Agreement, and constituting “Additional Services” under Section 1
(“Scope of Services”) of this Agreement, the CITY, at its sole discretion, may elect to order
additional services related to special projects beyond what is described in the Scope of Services.
Any such Additional Services are subject to the provisions of this Agreement including without
limitation Section 1 (“Scope of Services”), Section 4 (“Not to Exceed Compensation”) and
Exhibit C (“Compensation”).
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 18 of 36
EXHIBIT A-1
PROFESSIONAL SERVICES TASK ORDER
CONSULTANT shall perform the Services detailed below in accordance with all the terms and conditions
of the Agreement referenced in Item 1A below. All exhibits referenced in Item 8 are incorporated into this
Task Order by this reference. CONSULTANT shall furnish the necessary facilities, professional, technical
and supporting personnel required by this Task Order as described below.
CONTRACT NO.
OR PURCHASE ORDER REQUISITION NO. (AS APPLICABLE)
1A. MASTER AGREEMENT NO. (MAY BE SAME AS CONTRACT / P.O. NO. ABOVE):
1B. TASK ORDER NO.:
2. CONSULTANT NAME:
3. PERIOD OF PERFORMANCE: START: COMPLETION:
4 TOTAL TASK ORDER PRICE: $__________________
BALANCE REMAINING IN MASTER AGREEMENT/CONTRACT $_______________
5. BUDGET CODE_______________
COST CENTER________________
COST ELEMENT______________
WBS/CIP__________
PHASE__________
6. CITY PROJECT MANAGER’S NAME & DEPARTMENT:_____________________________________
7. DESCRIPTION OF SCOPE OF SERVICES (Attachment A)
MUST INCLUDE:
SERVICES AND DELIVERABLES TO BE PROVIDED
SCHEDULE OF PERFORMANCE
MAXIMUM COMPENSATION AMOUNT AND RATE SCHEDULE (as applicable)
REIMBURSABLE EXPENSES, if any (with “not to exceed” amount)
8. ATTACHMENTS: A: Task Order Scope of Services B (if any): _____________________________
I hereby authorize the performance of the
work described in this Task Order.
APPROVED:
CITY OF PALO ALTO
BY:____________________________________
Name __________________________________
Title___________________________________
Date ___________________________________
this Task Order and warrant that I have
authority to sign on behalf of Consultant.
APPROVED:
COMPANY NAME: ______________________
BY:____________________________________
Name __________________________________
Title___________________________________
Date ___________________________________
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 19 of 36
EXHIBIT B
SCHEDULE OF PERFORMANCE
CONSULTANT shall perform the Services so as to complete each milestone within the number
of days/weeks specified below. The time to complete each milestone may be increased or
decreased by mutual written agreement of the Project Managers for CONSULTANT and CITY so
long as all work is completed within the term of the Agreement. CONSULTANT shall provide a
detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the
notice to proceed (“NTP”) from the CITY.
Milestones
Completion
Number of Days/Weeks (as specified below)
1. Property Tax Information and Reporting
Services
• Delivery of reports specified in
Exhibit “A” – Scope of Services
including newsletter, additional
handouts, revenue projections, and/or
of each quarter in January, April, July, and
October. Option to delivery annually or
monthly, as needed.
• Monthly database update
•
Software training schedule TBD and as
needed
• Audit and Compliance Services as
described in Exhibit “A” – Scope of
Services
consultation with CONSULTANT
Services)
If executed per Sections 1 and 4, or per
Optional Schedule of Performance Provision for On-Call or Additional Services Agreements.
(This provision only applies if checked and only applies to on-call agreements per Section 1 or
agreements with Additional Services per Section 4.)
The schedule of performance shall be as provided in the approved Task Order, as detailed in
Section 1 (Scope of Services) in the case of on-call Services, or as detailed in Section 4 in the case
of Additional Services, provided in all cases that the schedule of performance shall fall within the
term as provided in Section 2 (Term) of this Agreement.
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 20 of 36
EXHIBIT C
COMPENSATION
CITY agrees to compensate CONSULTANT for Services performed in accordance with the terms
and conditions of this Agreement, and as set forth in the budget schedule below. Compensation
shall be calculated based on the rate schedule attached as Exhibit C-1 up to the not to exceed
budget amount for each task set forth below.
CITY’s Project Manager may approve in writing the transfer of budget amounts between any of
the tasks or categories listed below, provided that the total compensation for the Services,
including any specified reimbursable expenses, and the total compensation for Additional Services
(if any, per Section 4 of the Agreement) do not exceed the amounts set forth in Section 4 of this
Agreement.
CONSULTANT agrees to complete all Services, any specified reimbursable expenses, and
Additional Services (if any, per Section 4), within this/these amount(s). Any work performed or
expenses incurred for which payment would result in a total exceeding the maximum amount of
compensation set forth in this Agreement shall be at no cost to the CITY.
BUDGET SCHEDULE NOT TO EXCEED AMOUNT
Task 1 & 2
(Property Tax Analysis and Information Services and
Task 3
Total for Services and Reimbursable Expenses $101,800.00
Maximum Total Compensation $111,800.00
REIMBURSABLE EXPENSES
CONSULTANT’S ordinary business expenses, such as administrative, overhead,
administrative support time/overtime, information systems, software and hardware,
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 21 of 36
photocopying, telecommunications (telephone, internet), in-house printing, insurance and
other ordinary business expenses, are included within the scope of payment for Services and
are not reimbursable expenses hereunder.
Reimbursable expenses, if any are specified as reimbursable under this section, will be
reimbursed at actual cost. The expenses (by type, e.g. travel) for which CONSULTANT will
be reimbursed are: NONE up to the not-to-exceed amount of: $0.00.
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 22 of 36
EXHIBIT C-1
SCHEDULE OF RATES
CONSULTANT’s schedule of rates is as follows:
Hourly Rate
Partner $250
Principal $225
Programmer $200
Associate $175
Senior Analyst $125
Analyst $90
Administrative $70
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 23 of 36
EXHIBIT D
INSURANCE REQUIREMENTS
CONSULTANTS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE
CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW,
AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR
AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA.
AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS AS SPECIFIED HEREIN.
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 24 of 36
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 25 of 36
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 26 of 36
EXHIBIT E
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 27 of 36
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 28 of 36
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 29 of 36
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 30 of 36
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 31 of 36
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 32 of 36
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 33 of 36
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 34 of 36
EXHIBIT “F”
CYBERSECURITY TERMS AND CONDITIONS
In order to assure the privacy and security of the personal information of the City's customers and
people who do business with the City, including, without limitation, vendors, utility customers,
library patrons, and other individuals and companies, who are required to share such information
with the City, as a condition of receiving services from the City or selling goods and services to
the City, including, without limitation, the Software as a Service services provider (the
"Consultant") and its subcontractors, if any, including, without limitation, any Information
Technology ("IT") infrastructure services provider, shall design, install, provide, and maintain a
secure IT environment, described below, while it renders and performs the Services and furnishes
goods, if any, described in the Statement of Work, Exhibit B, to the extent any scope of work
implicates the confidentiality and privacy of the personal information of the City's customers. The
Consultant shall fulfill the data and information security requirements (the "Requirements") set
forth in Part A below.
A "secure IT environment" includes (a) the IT infrastructure, by which the Services are provided
to the City, including connection to the City's IT systems; (b) the Consultant's operations and
maintenance processes needed to support the environment, including disaster recovery and
business continuity planning; and (c) the IT infrastructure performance monitoring services to
ensure a secure and reliable environment and service availability to the City. "IT infrastructure"
refers to the integrated framework, including, without limitation, data centers, computers, and
database management devices, upon which digital networks operate.
In the event that, after the Effective Date, the Consultant reasonably determines that it cannot
fulfill the Requirements, the Consultant shall promptly inform the City of its determination and
submit, in writing, one or more alternate countermeasure options to the Requirements (the
"Alternate Requirements" as set forth in Part B), which may be accepted or rejected in the
reasonable satisfaction of the Information Security Manager (the "ISM").
Part A. Requirements:
The Consultant shall at all times during the term of any contract between the City and the
Consultant:
(a) Appoint or designate an employee, preferably an executive officer, as the security liaison
to the City with respect to the Services to be performed under this Agreement.
(b) Comply with the City's Information Privacy Policy:
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 35 of 36
(c) Have adopted and implemented information security and privacy policies that are
documented, are accessible to the City, and conform to ISO 27001/2 – Information
Security Management Systems (ISMS) Standards. See the following:
http://www.iso.org/iso/home/store/catalogue_tc/catalogue_detail.htm?csnumber=42103
http://www.iso.org/iso/iso_catalogue/catalogue_tc/catalogue_detail.htm?csnumber=5029
7
(d) Conduct routine data and information security compliance training of its personnel that is
appropriate to their role.
(e) Develop and maintain detailed documentation of the IT infrastructure, including software
versions and patch levels.
(f) Develop an independently verifiable process, consistent with industry standards, for
performing professional and criminal background checks of its employees that (1) would
permit verification of employees' personal identity and employment status, and (2) would
enable the immediate denial of access to the City's confidential data and information by
any of its employees who no longer would require access to that information or who are
terminated.
(g) Provide a list of IT infrastructure components in order to verify whether the Consultant
has met or has failed to meet any objective terms and conditions.
(h) Implement access accountability (identification and authentication) architecture and
support role-based access control ("RBAC") and segregation of duties ("SoD")
mechanisms for all personnel, systems, and Software used to provide the Services.
"RBAC" refers to a computer systems security approach to restricting access only to
authorized users. "SoD" is an approach that would require more than one individual to
complete a security task in order to promote the detection and prevention of fraud and
errors.
(i) Assist the City in undertaking annually an assessment to assure that: (1) all elements of
the Services' environment design and deployment are known to the City, and (2) it has
implemented measures in accordance with industry best practices applicable to secure
coding and secure IT architecture.
(j) Provide and maintain secure intersystem communication paths that would ensure the
confidentiality, integrity, and availability of the City's information.
(k) Deploy and maintain IT system upgrades, patches and configurations conforming to
current patch and/or release levels by not later than one (1) week after its date of release.
Emergency security patches must be installed within 24 hours after its date of release.
(l) Provide for the timely detection of, response to, and the reporting of security incidents,
including on-going incident monitoring with logging.
(m) Notify the City within one (1) hour of detecting a security incident that results in the
unauthorized access to or the misuse of the City's confidential data and information.
(n) Inform the City that any third party service provider(s) meet(s) all of the Requirements.
(o) Perform security self-audits on a regular basis and not less frequently than on a quarterly
basis, and provide the required summary reports of those self-audits to the ISM on the
annual anniversary date or any other date agreed to by the Parties.
(p) Accommodate, as practicable, and upon reasonable prior notice by the City, the City's
performance of random site security audits at the Consultant's site(s), including the site(s)
of a third-party service provider(s), as applicable. The scope of these audits will extend to
the Consultant's and its third-party service provider(s)' awareness of security policies and
practices, systems configurations, access authentication and authorization, and incident
detection and response.
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3
Professional Services
Rev. Dec.15, 2020
Page 36 of 36
(q) Cooperate with the City to ensure that to the extent required by applicable laws, rules and
regulations, and the Confidential Information will be accessible only by the Consultant and
any authorized third-party service provider's personnel.
(r) Perform regular, reliable secured backups of all data needed to maximize the availability
of the Services. Adequately encrypt the City of Palo Alto's data, during the operational
process, hosted at rest, and the backup stage at the Vendors' environment (including
Vendor's contracting organization's environment).
(s) Maintain records relating to the Services for a period of three (3) years after the expiration
or earlier termination of this Agreement and in a mutually agreeable storage medium.
Within thirty (30) days after the effective date of expiration or earlier termination of this
Agreement, all of those records relating to the performance of the Services shall be
provided to the ISM.
(t) Maintain the Confidential Information in accordance with applicable federal, state, and
local data and information privacy laws, rules, and regulations.
(u) Encrypt the Confidential Information before delivering the same by electronic mail to the
City and or any authorized recipient.
(v) Provide Network Layer IP filtering services to allow access only from the City of Palo
Alto's IP address to the Vendor environment (primarily hosted for the City of Palo Alto).
(w) Offer a robust disaster recovery and business continuity (DR-BCP) solutions to the City
for the systems and services the Vendor provides to the City.
(x) Provide and support Single Sign-on (SSO) and Multifactor Authentication (MFA) solutions
for authentication and authorization services from the "City's environment to the Vendor's
environment," and Vendor's environment to the Vendor's cloud services/hosted
environment." The Vendor shall allow two employees of the City to have superuser and
super-admin access to the Vendor's IT environment, and a cloud-hosted IT environment
belongs to the City.
(y) Unless otherwise addressed in the Agreement, shall not hold the City liable for any direct,
indirect or punitive damages whatsoever including, without limitation, damages for loss of
use, data or profits, arising out of or in any way connected with the City's IT environment,
including, without limitation, IT infrastructure communications.
(z) The Vendor must provide evidence of valid cyber liability insurance policy per the City’s
EXHIBIT “D” INSURANCE REQUIREMENTS.
DocuSign Envelope ID: 07A82D27-BC85-4369-8B88-4A88E27B07F3