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City of San Leandro <br />Meeting Date: December 3, 2018 <br />Staff Report <br />Agenda Section:File Number:18-598 CONSENT CALENDAR <br />Agenda Number:8.E. <br />TO:City Council <br />FROM:Jeff Kay <br />City Manager <br />BY:David Baum <br />Finance Director <br />FINANCE REVIEW:David Baum <br />Finance Director <br />TITLE:Staff Report for a City of San Leandro City Council Resolution to Authorize the <br />City Manager to enter into a Service Agreement with HdL Companies to Provide <br />Business License Tax Administration Services Not to Exceed Amount of <br />$125,000 and to Appropriate Funds from the General Fund Economic <br />Uncertainty Fund Balance in the Amount of $125,000 <br />SUMMARY AND RECOMMENDATIONS <br />Staff recommends (1) that the City Council approve and authorize the City Manager to enter into a <br />service agreement with HdL Companies (HdL) to provide Business License tax administration <br />and management services. The services will include the processing of new business license <br />accounts and renewals, payment processing, on-line services, business support, and collection <br />services. And, (2) that the City Council appropriate funds of $125,000 from the General Fund <br />Economic Uncertainty fund balance for these purposes. Revenue generated from the annual <br />business license program will fully offset these costs. <br />BACKGROUND <br />The City of San Leandro collects and processes approximately 9,900 current and active business <br />license accounts. It results in tax revenues of approximately $6.3 million. <br />The administration, processing, and collection of business licenses is labor intensive, and is <br />difficult to conduct in-house with current staffing levels. Therefore, a pilot project is recommended <br />by staff in order to protect the City’s business license tax revenue, and maintain high levels of <br />customer service. It is critical to supplement staff activities with a contractor that specializes in <br />municipal operations and revenue enhancement services. <br />The business license process by HdL uses a turnkey approach. Staff believes that this pilot <br />project will improve efficiency in the administration and collection of the City’s business license <br />taxes and fees and will help to increase overall taxpayer compliance into the future. The end result <br />Page 1 City of San Leandro Printed on 11/27/2018