HomeMy WebLinkAboutUnbudgeted Expenditure - Additional Appropriation for Sales (10)CITY OF HUNTINGTON BEACH
MEETING DATE: APRIL 19, 2004
DEPARTMENT ID NUMBER: AS-04-012
Council/Agency Meeting Held: D
Deferred/Continued to:
Approved ❑ Conditionally Approved ❑ Denied rk's ign ur
Council Meeting Date: APRIL 19, 2004 Departm nt Number: AS-04*12
CITY OF HUNTINGTON BEACH
REQUEST FOR ACTION��,'
SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS w
S D
SUBMITTED BY: RAY SILVER, CITY ADMINISTRATORaW
PREPARED BY: CLAY MARTIN, DIRECTOR OF ADMINISTRATIVE SERVICES
b?�
SUBJECT: APPROVAL OF ADDITIONAL APPROPRIATION FOR SALES TAX
AUDITING SERVICES
Statement of Issue, Funding Source, Recommended Action, Alternative Action(s), Analysis, Environmental Status, Attachment(s)
Statement of Issue:
Should the Council approve an additional appropriation for Sales Tax Auditing Services?
Funding Source:
General Fund Unreserved Fund Balance in the amount of $50,000.
Recommended Action:
Approve appropriation of $50,000 in additional revenue for sales tax auditing service.
Alternative Action(s):
Do not approve reallocation of revenue.
Analysis:
The City's sales tax auditing consultant, the HdL Companies, recently completed the
calendar year 2003 third quarter sales tax audit and was able to recapture $141,019.64 in
sales tax revenue for the City. A majority of the revenue $108,798.99 was collected from a
single vendor within the city. The vendor's sales tax revenue was being reported to the City
of Costa Mesa. The reason for this error was that same company owns another business in
WRCA's\Sales Tax Audit 2004.doc 3/23/200410:59 AM �.
REQUEST FOR ACTION
MEETING DATE: APRIL 19, 2004 DEPARTMENT ID NUMBER: AS-04-012
Costa Mesa. HdL was able to determine the sales that occurred in Huntington Beach and
have the Franchise Tax Board reverse the prior three quarters of sales tax revenue
($108,798.99) back to the City of Huntington Beach.
Per the City's contract with the HdL Companies they receive 15% of any recovered revenue.
The Administrative Services department has only budgeted $20,000 to cover the annual
contract with the HdL Companies. The current budget will not cover the amount due
regarding the 15% of recovered sales tax revenue. The HdL Companies are due $16,319.97
of the $108,798.99 recovered. The total HdL invoice for the third quarter is $21,152.94.
The Administrative Services Department is requesting a total of $50,000 to cover current
invoice and the next two quarters invoices. There will be no negative effect on the
unreserved general fund balance, but the budget will increase.
Council Policy Regarding Requests for an Appropriation of Funds:
As adopted by the City Council in March 1998, all requests for appropriation of funds must
meet one of the following criteria: 1) The request is an unanticipated emergency, 2) The
request is required to implement labor negotiations, or 3) The request will be offset by related
new revenues.
The new appropriation being requested is offset by the additional revenue generated by the
sales tax audit.
Attachment(s):
RCA Author: William McReynolds
H:\RCA's\Sales Tax Audit 2004.doc 3/23/2004 10:59 AM
ATTACHMENT #1
-0 al
To:
From:
Subject:
Date:
CITY OF HUNTINGTON BEACH
INTERDEPARTMENTAL COMMUNICATION
Ray Silver, City Administrator
Clay Martin, Director of Administrative Services
FIS 2004-17 — Approval of Additional Appropriation for
Sales Tax Auditing Services
March 23, 2004
As required by Resolution 4832, this Fiscal Impact Statement has
been prepared for "Approval of Additional Appropriation for Sales Tax
Auditing Services."
If the City Council approves this request (total year appropriation
$50,000) the estimated unappropriated, undesignated General Fund
balance at September 30, 2004 will be reduced to $5,050,000.
Cray May-1(n
Direct r of Administrative Services
RCA ROUTING SHEET
INITIATING DEPARTMENT: ADMINISTRATIVE SERVICES
SUBJECT: APPROVAL OF ADDITIONAL APPROPRIATION FOR
SALES TAX AUDITING SERVICES
COUNCIL MEETING DATE: Aril 19, 2004
RCA ATTACHMENTS
STATUS
Ordinance (w/exhibits & legislative draft if applicable
Not Applicable
Resolution (w/exhibits & legislative draft if applicable)
Not Applicable
Tract Map, Location Map and/or other Exhibits
Not Applicable
Contract/Agreement (w/exhibits if applicable)
(Signed in full by the City Attorney)
Not Applicable
Subleases, Third Party Agreements, etc.
Approved as to form by City Attorney)
Not Applicable
Certificates of Insurance (Approved by the City Attorney)
Not Applicable
Financial Impact Statement (Unbudget, over $5,000)
Attached
Bonds (If applicable)
Not Applicable
Staff Report If applicable
Not Applicable
Commission, Board or Committee Report (If applicable)
Not Applicable
Findings/Conditions for Approval and/or Denial
I Not Applicable
EXPLANATION FOR MISSING ATTACHMENTS
REVIEWED RETURNED' :FO DED
Administrative Staff
Assistant City Administrator Initial
City Administrator Initial cyo.
City Clerk
EXPLANATION FOR RETURN OFITEM....
Author: William McReynolds