HomeMy WebLinkAboutUnbudgeted Expenditure - Additional Appropriation for Sales (11)c_ VIAK�Iiv) ADM* A41V,
,TY OF HUNTINGTON BEA(- -- W. (`9c yAPS ADM 5W,
MEETING DATE: APRIL 1, 2002
DEPARTMENT ID N BER: AS-02-008
Council/Agency Meeting Held:
Deferred/Continued to:
Approved ❑ Conditionally Approved ❑ DeniedP_Ci
y Clerk' Signature
Council Meeting Date: APRIL 1, 2002
Department ID Number: ASZ2-O:U8
CITY OF HUNTINGTON BEACH
REQUEST FOR ACTION —�
c� r•"
-- a _�
SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS rJ�
SUBMITTED BY: RAY SILVER, CITY ADMINISTRATOR07egj
PREPARED BY: CLAY MARTIN, DIRECTOR OF ADMINISTRATIVE SERVICES
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?
Fundina Source:
General Fund Unreserved Fund Balance in the amount of $23,000.
Recommended Action:
Approve appropriation of $23,000 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 2002 first quarter sales tax audit and was able to recapture $166,792.16 in
sales tax revenue for the City. A majority of the revenue $151,369.50 was collected from
Sparks Exhibits, LTD. Sparks Exhibits is a company that designs exposition booths for
companies at industry conventions. Since the first quarter of calendar year 1998, Sparks
HARCA's\Sales Tax Audit.doc -7- 3/21/2002 12:40 PM
REQUEST FOR ACTION
MEETING DATE: APRIL 1, 2002 DEPARTMENT ID NUMBER: AS-02-008
Exhibits sales tax was mistakenly solely reported to the City of San Bernardino and not
divided between San Bernardino and Huntington Beach. The reason for this error was that
Sparks Exhibits manufactures its exposition booths in San Bernardino but sells them in both
their San Bernardino and Huntington Beach offices. HdL was able to determine that Sparks
Exhibit was selling exposition booths in their Huntington Beach office and had the Franchise
Tax Board reverse the prior thirteen quarters of sales tax revenue ($151,369.50) 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 from Sparks Exhibits. The HdL
Companies are due $22,705.43 of the $151,369.50 recovered. 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
Document1 3/21/2002 2:14 PM
P,
ATTACHMENT #1
�CITY OF HUNTINGTON BEACH
INTERDEPARTMENTAL COMMUNICA TION
To: Ray Silver, City Administrator
From: Clay Martin, Director of Administrative Services
Subject: FIS 2002-10 Approval of Additional Appropriation for Sales
Tax Auditing Service
Date: March 20, 2002
As required by Resolution 4832, this Fiscal Impact Statement has
been prepared for "Approval of Additional Appropriation for Sales Tax
Auditing Service".
If the City Council approves this request (total appropriation $23,000),
the estimated unreserved, undesignated fund balance of the General
Fund at September 30, 2002 will remain at $10,651,000.
Clay M in,
Direct6r of Administrative Services
Fund Balance - General Fund Adopted Budget Current Estimate
Beginning Fund Balance 10/1/20001
$ 12,000,000
$ 12,000,000
Plus: Estimated Revenue
133,633,000
132,170,000
Less: Estimated Expenditures
(134,813,000)
(132,519,000)
Expected Additional Appropriations
(899,000)
Pending/Approved FIS's:
(78,000)
Fis #10
(23,000)
Estimated 9/30/2002 Unreserved Balance
$ 10,820,000
1 $ 10,651,000
12000000
10000000
8000000
6000000
4000000
2000000
0
General Fund Balance 2001-02
ADOPTED CURRENT
BUDGET ESTIMATE
RCA ROUTING SHEET
INITIATING DEPARTMENT:
ADMINISTRATIVE SERVICES
SUBJECT:
APPROVAL OF ADDITIONAL APPROPRIATION FOR
SALES TAX AUDITING SERVICES
COUNCIL MEETING DATE:
April 1, 2002
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 CityAttomey)
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
Not Applicable
EXPLANATION FOR MISSING ATTACHMENTS
REVIEWED
RETURNED
FORWARDED
Administrative Staff
(
( )
Assistant City Administrator (Initial)
( )
( )
City Administrator (Initial)
( )
( )
City Clerk
EXPLANATION FOR RETURN