HomeMy WebLinkAboutResolution - 2004-R0160 - Professional Services Agreement - Kasner & Associates, LLC - 03_23_2004Resolution No. 2004-RO160
March 23, 2004
Item No. 60
RESOLUTION
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the City Manager of the City of Lubbock BE and is hereby authorized and
directed to execute for and on behalf of the City of Lubbock, an Agreement for
professional services to perform a Transactional Tax Analysis, by and between the City
of Lubbock and Kasner & Associates LLC., and related documents. Said Agreement is
attached hereto, and incorporated in this resolution as if fully set forth herein and shall be
included in the minutes of the City Council.
Passed by the City Council this 23rd
RdVeccJ Garza, Ulty Secretary
APPROVED AS TO CONTENT:
bhn
A Finance
FORM:
City Attorney
gs/ccdocs/res-Trans Tax Analysis
March 16, 2004
day of Larch , 2004.
arc M u al, Mayor
Resolution No. 2004—RO160
Letter of Agreement
This Agreement is entered into by Kasner & Associates, a Texas LLC, (herein called "Firm")
and the Client of Lubbock, Texas (herein called "Client").
In consideration of the mutual promises herein contained, Firm and Client agree that:
I. Scope of Services
The Firm shall to the best of its ability and skill, perform: 1) a review and analysis of
the Client's sales/use tax receipts for its top sales/use taxpayers (believed to be no
more than 100) and how these taxpayers would be affected if the sales tax collection
in Texas is changed from point of sale to point of delivery. 2) a report, showing the
possible economic impact on Client if the sales tax point of collection changed from
present law.
The Client will provide to the Firm a listing of tax remittances by each Client business
for the 2003 period. Additionally, the Client shall provide to the Firm a listing of
every business with an active outlet within the Client including SIC codes.
The information upon which this analysis is based is confidential and is provided to
the Firm for the sole purpose of determining the above -mentioned review, analysis
and report. The Firm agrees to abide by the same restrictions and conditions that the
Client agreed to in obtaining the data from the Texas Comptroller.
A report summarizing the findings shall be made to Client in a one -hour presentation
on a mutually convenient date and time. Three copies of the report will facilitate the
presentation by the Firm.
II. Fees & Billings
Fees for this project will not exceed $3,500 plus out-of-pocket expenses estimated to
not exceed $ 750.
Payment will be made on completion of report as stated in Paragraph I.
III. Responsibilities of the Firm
Firm services will be performed based upon the information provided by the Client
and tax authorities. In addition, services will be performed in consideration of
applicable tax laws, regulations and associated interpretations relative to the
appropriate jurisdiction as of the date the services are provided. Tax laws and
regulations are subject to change at any time, and such changes may be retroactive in
effect and may be applicable to advice given or other services rendered before their
effective dates.
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IV. Engagement Limitations/Termination
The Firm is not restricted by anything in this agreement from providing services for
other Cities.
The Client reserves the right to terminate the services covered by this agreement at
any time by providing the Firm written notice.
This review does not result in any opinion, attestation, or other form of assurance with
respect to the Client's transactional tax reporting or any other financial reporting
functions of the Client. The procedures employed by this review do not constitute an
examination or a review per General Accepted Auditing Standards. Neither does this
review constitute a review of internal controls over any Client financial reporting
function. The review is not limited nor directed towards the discovery of fraud,
illegal acts, or material exceptions. The Firm is not a public accounting firm.
The services required within this Agreement shall be completed by Firm no later than
June 15, 2004, unless requested otherwise by Client.
This agreement is performable in the State of Texas and shall be governed by the laws of the
State of Texas. Venue on any suit hereunder shall be in Dallas County, Texas.
L1? 1) FOX1C i ZMAI 6&X
Name/Title
Approved as to content:
2004;
sne ng ember
Approved as to form:
icial Johnn. Knight, stant ity
Attorney 34/0 y
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Resolution No. 2004—RO160
Professional Service Agreement
This Agreement is entered into by Kasner & Associates, a Texas LLC, (herein called
"Firm") and the City of Lubbock, Texas (herein called "Client").
In consideration of the mutual promises herein contained, Firm and Client agree that:
I. Scope of Services
The Firm shall to the best of its ability and skill, perform a review of the Client's
data concerning Client's businesses, transactional tax accounting systems, audits,
procedures, invoices, internal/external reports/filings, contracts, agreements, and
other supporting records to ensure proper application of local tax situs, state & local
tax exemptions, exclusions, and/or apportionment in order to identify, quantify, and
secure recoveries on behalf of the Client.
The first deliverable will be an Initial Recovery Plan that outlines opportunities,
data necessary to perfect any potential recoveries, processes and procedures that
must be implemented to actual secure Client's potential recoveries, and defines
future deliverables. Upon mutual acceptance of the Initial Recovery Plan, the Firm
will provide all process and procedures steps necessary to fully implement the Plan.
Upon project completion, a report summarizing recoveries identified and, review
procedures employed will be provided, to the extent significant recoveries are
secured on behalf of the Client. To the extent possible, such a report will offer
recommendations concerning measures that the Client may wish to employ to
increase the accuracy of its transactional tax reporting practices. Implementation of
any such recommendations is not included within the scope of this Agreement.
The periods included in this review are all periods open under state, federal and/or
other taxing jurisdictions' statute of limitations or four years, whichever is greater.
This review does not result in any opinion, attestation, or other form of assurance
with respect to the Client's transactional tax reporting or any other financial
reporting functions of the Client. The procedures employed by this review do not
constitute an examination or a review per General Accepted Auditing Standards.
Neither does this review constitute a review of internal controls over any Client
financial reporting function. The review is not limited nor directed towards the
discovery of fraud, illegal acts, or material exceptions. The firm is not a public
accounting firm.
II. Fees & Billings
Fees, including all out-of-pocket expenses, for this review will be 33% of all
Recoveries.
Recoveries include any and all transactional tax increases to Client's monthly
State sales/use tax allocations reflected in its Texas Comptroller Local Tax
Account # 2152015, and any other Comptroller Accounts in which sales/use
tax is remitted to the Client for past taxes improperly reported by businesses
and identified as a result of the Firm's efforts, or any other transactional tax
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refunds or credits identified by the Firm. Included in Recoveries is any tax,
interest or penalty refunded or offset against existing, past or future liabilities.
We reasonably expect and recommend that any Recoveries identified will
undergo substantive review and consideration by the taxing authorities.
However, if Client elects to forego such a review by taxing authorities an
addendum to this Agreement will be required specifying the amended terms.
Fees are due and payable at the earlier of -
documented offset of the Recoveries to reduce any past, current
or future tax liability or vendor accounts payable balance; or
receipt by the Client of Recoveries from the tax jurisdiction(s),
including the increased State city tax allocations, or refunds/credits
received from vendors.
Once opportunities that may lead to Recoveries are identified, an Agreement to
Proceed will be issued. The Agreement to Proceed will outline the opportunities
and affirm that the Client will seek such recoveries to its fullest efforts.
If at any time after the Agreement to Proceed has been approved, Client elects to
forego any or all opportunities for recoveries to which it is entitled under tax
authority law, regulation, or published tax authority policy, interpretation, or ruling
court, Client agrees that fees as stated in Section II will be due and payable
immediately as if Client has acknowledged the forgone opportunity as valid.
In the event the Client does not agree to proceed using the Firm's services with any
or all of the opportunities outlined in the Agreement to Proceed no fees will be due.
However, if the Client independent of the Firm pursues the identified opportunities,
or elects to prospectively implement corrective measures concerning the
opportunities, either with its own resources or those of another party, the Client
agrees that fees as stated in Section II will be due and payable immediately to the
Firm as if the Client has acknowledged the opportunity(ies) as valid.
Fees for optional services requested, beyond those described in Section I, will
be incurred only to the extent of the Client's request. We will submit a
separate Professional Services Agreement for the Client's approval prior to
commencing any work.
III. Responsibilities of the Firm
Firm services will be performed based upon the information provided by the Client
and tax authorities. In addition, services will be performed in consideration of
applicable tax laws, regulations and associated interpretations relative to the
appropriate jurisdiction as of the date the services are provided. Tax laws and
regulations are subject to change at any time, and such changes may be retroactive
in effect and may be applicable to advice given or other services rendered before
their effective dates. The Firm does not assume responsibility for such changes
occurring after the date we have completed our services.
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With regards to the services provided under the terms of this agreement, the Firm
will discuss with the Client any positions that the Firm believes may subject the
Client to additional liabilities. The Firm is not held responsible for determining
these liabilities, nor is the Firm responsible for any liabilities assessed against the
Client as the result of the Client's failure to provide all relevant information relative
to the issue under consultation. As stated in Section II, any such liabilities are
disregarded for determining fees.
IV. Engagement Limitations/Termination
In the event the Firm discovers activities or practices of the Client that the Firm
deems inappropriate or that would prevent the project from being completed, or
should the Client fail to provide the Firm with adequate and accurate information or
the requisite assistance to allow for the proper completion of this project, the Firm
reserves the right to resign from the engagement prior to the completion of the
work. In such an event, the Client agrees to be responsible for all professional fees
and expenses incurred prior to the resignation.
At any point during the project, the Firm has the right to terminate the services
covered by this agreement by providing written notice to the Client of such
termination. If such an election is made at the Firm's sole discretion, and not as a
result of the Client activities stated above, the Firm's fees will be limited to its
percentage of only those Recoveries received by Client as a result of Firm actions
prior to its termination of the project.
The Firm is not restricted by anything in this agreement from providing services for
other clients.
The Client reserves the right to terminate the services covered by this agreement at
any time by providing the Firm written notice of such intentions subject to Section
II terms and conditions.
The Firm makes no other representation or warranty regarding either the services to
be provided or any deliverables; in particular, and without limitation of the
foregoing, any express or implied warranties of fitness for a particular purpose,
merchantability, warranties arising by custom or usage in the profession, and
warranties arising by operation of law are expressly disclaimed.
Only in the event the Firm is grossly negligent or acted willfully or fraudulently,
shall the Firm be liable to the Client or any related parties, for any amounts in
excess of the total professional fee paid by Client to Firm under this agreement.
V. Non -Disclosure Requirements
In the performance of this Agreement, Client and Firm may not disclose technical,
financial, or other information, material or data either via oral, written, or any other
form, either electronic or otherwise, which is considered confidential and
proprietary (Confidential Information). Such Confidential Information does not
include any information known to the receiving party prior to the Agreement, is
available to the public under Texas' Open Records Act, or published and available
to the general public regardless of source. Unless otherwise agreed, the receiving
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party agrees not to disclose Confidential Information; will use the same degree of
care and diligence to protect and secure Confidential Information as it uses for its
own information; and will not copy or reproduce the Confidential Information
except in the performance of the services described in this Agreement. The
receiving party may disclose such Confidential Information to its associates,
affiliates, consultants, and agents necessary to perform the Agreement's services.
In the event either Client or Firm is required by law, rule, regulation or lawful order
to disclose Confidential Information, the disclosing party agrees to notify the other
party immediately to allow the other party to take steps it deems necessary to
protect its Confidential Information.
Both Client and Firm acknowledge and agree that the disclosing party owns all
rights, interest, and title to the Confidential Information. Both Client and Firm
agree that the unauthorized disclosure of the Confidential Information will cause
irreparable harm to the other party. As a result of the unique nature of the
Confidential Information, in addition to all other available remedies, the disclosing
party shall be entitled to seek injunction and other extraordinary relief in a court of
competent jurisdiction in order to enforce the receiving party's obligations under
this Agreement.
The clauses regarding liability limitations and indemnification shall survive any
termination of this agreement. This agreement will be governed by the laws of the State of
Texas.
Accepted on March 23 2004;
u ox, t ity MarYager Kyle Kasner, Managing Member
1 0 EO)(AII // : [ O"O,#
Approved as to form:
ial ohn . Knight, ista City
Attorney � _ �y
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