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Item 5CCity of Southlake, Texas MEMORANDUM July 28, 2003, TO: Shana Yelverton, City Manager FROM: Sharen Elam, Director of Finance, ext. 1713 SUBJECT: Approval of the Tarrant County Tax Collection Contract Action Requested: Approval of the contract with Tarrant County for assessment and collection services for ad valorem taxes levied by the City of Southlake. Background Information: Since 1982, the Tarrant County Tax Assessor /Collector has collected property taxes for the City of Southlake. The renewal contract has been presented to the City for collection of the 2005 taxes for the fiscal year beginning October 1, 2005. Tarrant County charges $.50 per account. The number of accounts will be based on the October billing roll certified to the assessor /collector by the Tarrant Appraisal District. New accounts added by Tarrant Appraisal District will be billed to the city quarterly. The fee is a very reasonable charge for the service provided. Southlake would spend far in excess of the $6,000 budgeted for this service in personnel costs alone if the tax collection was done by the city. The working relationship over the years with the Tarrant County tax office has been excellent. The contract provides for disbursements to be made to the City when daily collections exceed $100, or at the close of the month. Also included in the contract is a listing of the reports provided to the City. The contract provides that the County may invest the collected tax funds in a manner that complies with the Public Funds Investment Act. There are provisions that allow the City to perform an audit of the County's collection process if we choose to do so. Financial Considerations: If the contract is not approved the City would have to make provisions to collect taxes for ourselves. This would cost significantly more than the cost for Tarrant County to collect the City's taxes. Citizen Input/ Board Review: There is no requirement for citizen or board review of the contract with Tarrant County for tax collection. Legal Review: The contract has been reviewed by the City Attorney. Alternatives: The City could assess and collect taxes for ourselves at a significantly higher cost than what is proposed by Tarrant County. Supporting Documents: Contract for Tax Collection with Tarrant County Staff Recommendation: Approval of the contract with Tarrant County for assessment and collection services for ad valorem taxes levied by the City of Southlake. § Agreement For The Collection Of Tares COUNTY OF TARRANT § Agreement made (his day of 2005, by and between the Tarrant County Tax Assessor /Collector, hereinafter referred to as ASSESSORICOLLECTOR, and Tarrant County, hereinafter referred to as the COUNTY, both of whom are addressed at 100 E. Wcatherf)rd Street, Fort Worth, Texas 76I9b -0301, and the City of Southlake, hereinafter referred to as City, whose address is 1400 Main St Ste 270, South lakc, TX 76092. PURPOSE OFAGREEMENT The purpose of this Agreement is to state the terms and conditions under which the ASSESSORICQLLECTOR will provide assessment and collection services of Ad Valorem taxes levied by the City. NOW THEREFORE, in consideradou of the mutual promises herein contained, the parties hereto agree as follows: SERVICES TO BE PERFORMED The ASSESSORICOLLECTOR agrees to collect the taxes due and owing on taxable properiy upon which the City has imposed said taxes.. The ASSESSORICOLLECTOR shall perform the said services in the same manner and fashion as Tarrant County collects its own taxes due and awing on taxable property situated within its boundaries. The services performed are as follows: receiving information from the Tarrant Appraisal District for purposes of the Certified Appraisal Roll, and monthly changes thereto; providing mortgage companies, property owners and tax representatives, tax roll and payment data; providing all n"essary assessments of taxes and Truth in Taxation calculations as required; the transmittal of tax statements via the U.S. Mail or electronic transfer of data; and rapid deposit payment processing All City disbursements, made by check or by electronic transfer (wire), for collected tax accounts will be made to the City on the day the COUNTY Depository Bank indicates the mandatory assigned "float" period has elapsed and the funds are posted to the collected balance. If any daily collection total is less than one hundred dollars ($100.00), the disbtrrsemcnt may be withheld unfil the cumulative total oftaxes collected for the City cyuals at least one hundred dollars ($100.00), or at the close of the month. REPOR The ASSESSORJOOLLECTOR will provide the City the following reports, if requested: Daily: General Ledger Distribution Report Weekly: Detail Collection Rat (Summary) Monthly: Tax Roll Suoanary {Totals Only) Year - coo -Date Summary Repeal Detail Coltution Report (Summary) Distribution Report (Summary) Delinquent Tax Attorney Tape Annual- Paid Tax Roll DtAinquem Tax Roll Current Tax Roll A selection of the above listed Reports will only be available by intemet access. The ASSESSORICOLLECTOR will provide the City the General Ledger Revenue & Expense Report monthly as required by Sec. 31.10 of the Texas Pmperty Tax Code, III. COMPENSATION In consideration of the services to be performed by the ASSESSORICOLLECTOR, Compensation for the services tendered is a rate of fifty cents (S.50) per account. The number of accounts will be based on the October billing roll certified to the ASSESSORICOLLECTOR by The Tarrant Appraisal District. New accounts added by The Tarrant Appraisal District will be billed to the entity. The ASSESSOWCOLLECTOR will invoice for all these accounts serviced on a quarterly basis. IV. AUDITS The ASSES SORICOLLECTOR will provide to the City auditor necessary explanations of all reports and access to ASSESSORICOLLECTOR icehouse tax system computer terminals to assist the City auditor in verifying audit samples of the finan vial data previously provided by the ASSESSORICOLLECTOR during the past audit period. If the City elects to have its auditors conduct a "computer system assurance Tcvicw audit" requiring assistance from ASSESSOR/COLLECTOR systems programmers and accountants, the fee is $660.00 per day, which will be deducted from the City's current collections at the end of the month. TAX FATE REQUfRE.MEYT The City will provide the ASSESSOWCOLLECTOR, in writing, the City's newly adopted tax rate and exemption schedule to be applied for assessing purposes by Friday, September 9, 2005, but no later than 2:00 p.m., Friday, September 16, 2005. Under authority of Sectiou 31.41 (h) of the Property Tax Code, any additional cost of printing and mailing tax statements because of late reporting of The tax rate or the exemption schedule will be charged to and must be paid by the City. If the City wishes Its collection reports to be itemized m to maintenance and operation fund and interest and sinking fund, then the notice advising of the new tax rate must set out the separate rates, as well as the total rate. The tax rate and the exemption schedule for each of the last five (5) years in which an ad valorem tax was levied, or all poor years where there rciiaains delinquent tax, must be fumished in writing to the ASSESSORICOLLCCTOR at the time of the initial contract. VI. COMPLMNCE WITHAPPLICABLE STAMM ORDINANCES, AND REGti'LATIONS In performing the services required under this Agreement; the ASSESSOWCOLLECTOR stroll comply with all applicable federal and state statutes, final Court orders and Comptroller regulations. If such compliance is impossible far reasons beyond its control the ASSESSOR/COLLECTOR shall immediately notify the City ofthat fact and the reasons therefore. "I. DEPOSIT OF FUNDS All funds collected by the AS SESSORICOLLECTOR in the performance of the services stated herein for the City shall be promptly transferred to the account of the City at the City's depository bank. Electronically transferred funds may incur an additional fee, which will be charged back to the City and deducted from those collected fends. The transfer fees charged will be the same fees charged to the County by its frank depository. if the City Aesires its tare disbursements to be made by electronic transfer of ftnrds (wire) the ASSESSORICOLLECTOR has no liability for the fiords after initiation of the electronic transfer of the City's ftuids from the COUNTY Depository to the City's designated depository. Yf7I. INVESTMENT Of FUNDS The City hereby agrees that the COUNTY, acting through the COUNTY Auditor, may invest collected ad valorem tax funds of the City during the period between collection and payment. The COUNTY agrees that it will invest such funds in compliance with the Public Funds Investment Act. The COUNTY further agrees that it will pay to the City all interest or other earnings attributable to taxes owed to the City_ The ASSES SORICOLLECTOR agrees to deliver to the COUNTY Auditor all ad valoT2lI1 taxes collw d on behalf of the City for inn mcnt on a tittlCly basis. All parties agree that this Agreement will riot be construed to lengthen the time period during which the COUNTY or the ASSESSORICOLI=OR may hold such funds before payment to the City. Ix REFUNDS Refunds will be trade by the ASSESSORICOLLECTOR except as set forth herein. The ASSESSORICOLLECTOR will advise the" of changes in the tax roll which were mandated by the Tarrant Appraisal District. The ASSESSORICOLLECTOR will not make re funtis on prior year paid accounts unless the prior year paid accounts for the past five (5) years are provided to the ASSESSORICOLLECTOR. All refunds of overpayments or erroneous payments due, but not requested, and as described in Section 31.11 of the Texas Property Tax Code, will after three years from the date of payment, be proportionately disbursed to those entities contracting with the ASSESSOR/COLLECTOR. The contract must have been in force, actual assessment and collection functions begun and the tax account was at the time of the over or erroneous payment within the City's jurisdiction. The proportional sham is based upon the City's percent of the tax accounts total levy assessed at the lime oCreceipt ofthe over w erroneous payment. In the event any lawsuit regarding the collection of taxes provided for in this agreement to which City of Southlakc is a party, is settled or a final judgment rendered, and which final judgment is not appealed, and the terms of such settlement agreement or final judgment require that a refund be issued by City of Southlake to the taxpayer, such refrtnd shall be made by ASSESSORICOLLECTOR by debiting funds collected by ASSESSORICOLLECTOR on bchalf of City of Southlake and remitting such refund to the taxpayer in conformity with the terns of the settlement agreement or final judgment. X DELINQUENT COLLECTIONS The ASS ESSORICOLLECTOR will assess and collect the collection fee pursuant to Sections 33.07, 33.0$ and 33.48 of the Property Tax Code, when allowed. The ASSESSORICOLLECTOR will collect attorney fees that are specified by the City through written agreement with a delinquent collection Attorney. The ASSESSOWCOLLECTOR will disburse the amount directly to the City for compensation to a Firm under contract to the City. If the delinquent collection Attorney contracted by the City requires a ttendance of ASSESSOR/COLLECTOR personnel at a court other than the District Courts in downtown Fort Worth, and the COUNTY is not a patty, the employees expenses and proportionate salary will by the n $ppnsibihty Rf the City anti will he added to the collection expenses and charged to the City. The ASSESSORICOLLECfOR will not be responsible for the collection of prior year delinquent accounts unless all delinquent accounts infonnation is provided to the ASSESSORICOLLECTOR. xI. TERM OFAGREEMENT This Agreement shall become effective as of the date hereinabove set out, and shall continue in effect during, the 2005 tax year, unless sooner terminated by providing sixty (60) day written notice, as outlined in paragraph X11. XIL NOTICES Any notices to he given hereunder by either party to the other may be effected, in writing, either by personal delivery or by mail, registered or certified, postage prepaid with return receipt requested. Mailed notices shall be addressed to the address of the parties as they appear in the introductory paragraph of this Agreement, but each party may change this address by written notice in accordance with this paragraph. X111. MISCELL.A!â–ºEOUS PROVISIONS This insnwnent hereto contains the entire Agreenvurst between the parties relating to the rights herein granted and obligations hctcin assumed. Any oral representations or nxsdifications concerning this instrument shall be of no force or effect. This Agreement shall'be construed under and in accordance with the laws of the State of Texas, and all obligations of the patties created hereunder are performable in Tarrant County, Texas. This Agreement shall be binding upon and inure to the benefit of the pasties hereto and their respective legal representatives and successors. In case any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or enforceability shall not affect any other provision hereof and this Agreement shall be coast rued as iNuch invalid, illegal, or unenforceable provisions had never been contained. This Agreement and the attashrnents hereto constitutes the sole and only agreement of the parties hereto and supersedes any prior understandings or written or oral agreements between the parties respecting the within subject n atier- Executed on the day and year first above writtcn; Tarrant County, Texas. BY: BETSY PRICE DATE TAX ASSESSOR/C'OLLECWR TARRANT COUNTY FO THE C1T'Y OF S0P711LAKE: BY: TITLE: FOR TARRANT COUNTY: DATE BY: TOM P NDF.RGRIF'F DATE TARRANT C'OUNTYJUDGE APPROVED AS TO FORM "AND CONTENT BY: DISTRICT ATTORNEY'S OFFICE DATE 'By law, the oistxict Attorney's office may only advise or approve contracts or legal documents on behalf of its clients. It may not advise or approve a contract or legal document on behalf of other parties. our review of this dccument was conducted solely from the legal perspective of our client. our approval of this document was offered solely for the benefit of our client. other parties should not rely on this approval, and should seek review and approval by their own respective attorney1.51.