Item 5BCity of Southlake, Texas
MEMORANDUM
July 28, 2003,
TO: Billy Campbell, 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 2003 taxes for the fiscal year beginning October 1,
2003. Tarrant County charges $.50 per financial transaction, defined as a
payment or refund on an account. The transaction fee is a very reasonable
charge for the service provided. Southlake would spend far in excess of the
$5,500 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 Tuxes
COUNTY OF TARRANT S
Agreernent made this day of 2003, by and between the Tarrant County Tax Assessor - Collector,
hereinafter referred to ae ASSESSOR/COLLECTOR, and Tarrant County, hereinafter referred to as the COUNTY, both of
whom are addressed at 100 E. Weatherford Street, Fort Worth, Texas 76196-0361, and the City of Southlake, hereinafter
referred to as City, whose address is 1400 Main St, Southlake, TX 76092.
PURPOSE OF AGREEMENT
The purpose of this Agreement is to state the terms and conditions under which the ASSESSOR/COLLECTOR will provide
assessment and collection services of Ad Valorem taxes levied by the City.
NOW THEREFORE, in consideration of the mutual promises herein contained, the parties hereto agree as follows:
L
SERVICES TO RE PERFORM rD
The ASSESSOR/COLLECTOR agrees to collect the taxes due and owing on taxable property upon which the City has imposed
said taxes. The ASSESSOkU COLLECTOR shall perform: the said services in the same manner and fashion as Tarrant County
collects its own taxes due and owing on taxable property situated within its boundaries. The services performed shall include,
but not be limited to: 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 necessary 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 ($100.00), the disbursement will be withheld until the cumulative total of taxes
collected for the City equals one hundred dollars ($ l oo.00), or at the close of the month
The ASSESSOR/COLLECTOR will provide the City the General Ledger Revenue & Expense Report monthly as required by
Sec. 3 1.10 of the Texas Proverty Tax Code..
H.
REPORTS
The ASSESSOR/COLLECTOR will provide the City the following reports, if requested:
Daily.
General Lodger Distribution Report
Weekly:
Detail Collection Report (Summary)
Annual:
Paid Tax Roll
Delinquent Tax Roll
Current Tax Roll
Monthly:
Tax Roll Summary (Totals Only)
Year-to-Date Summary Report
Detail Collection Report (Summary)
Delinquent Tax Attorney Tape
The ASSESSOR/COLLECTOR will provide the City the General Ledger Revenue & Expense Report monthly as required by
Sec. 3 1.10 of the Texas Proverty Tax Code..
lu
COMPENSATION
In consideration of the services to be performed by the ASSESSOR/COLLECTOR, compensation for the services rendered is a
rate of fifty cents ($.50) per account. The mamber 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 quarterly. The ASSESSORICOLLECTOR will collect for these services from each entity's collections
quarterly.
IV.
AUDITS
The ASSESSORICOLLECTOR will provide to the City auditor necessary explanations of all reports and access to
ASSESSORICOLLECTOR in -house tax system computer terminals to assist the City auditor in verifying audit samples of the
financial data previously provided by the ASSESSORICOLLECTOR during the past audit period.
If the City elects to have its auditors conduct a "computer system assurance review audit" requiring assistance from
ASSESSORICOLLECTOR system's programmers and accountants, the fee is $660.00 per day, which will be deducted from the
City's cur collections at the end of the month.
V.
TAX RATE REQ
The City will provide the ASSESSORICOLLECTOR, in writing, the City's newly adopted tax rate and exemption schedule to
be applied for assessing purposes no later than 2:00 p.m., Friday, September 12, 2003. Under authority of Section 31.01 (h) of
the Property Tax Code, any additional cost of printing and trailing 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 as to
maintenance and operation fund and interest and sinking fiord, 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 prior
years where there remains delinquent tax, must be fimrished in writing to the ASSESSORICOLLECTOR at the time of the
initial contract.
VL
COQ EL4NCE 97TH APPLICABLE
STATUTES, ORDINANCES, AND REGUL4TIONS
In perfornuug the services required under this Agreement, the ASSESSOR/COLLECTOR shall comply with all applicable
federal and state statutes, final Court orders and Comptroller regulations. If such compliance is impossible for reasons beyond
its control, the ASSESSORICOLLECTOR shall inunediately notify the City of that fact and the reasons therefore.
VIL
DEPOSIT OF FUNDS
All funds collected by the ASSESSORICOLLECTOR in the perf ormance 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 incur an
additional fee, which will be charged back to the City and deducted from those collected funds. If the City desires its tax
disbursements to be made by electronic transfer of hands (wire) the ASSESSOR/COLLECTOR has no liability for the funds
after initiation of the electronic transfer of the City's funds from the COUNTY Depository to the City's designated depository.
T�
INVESTMENT OF FUNDS
The City hereby agrees that the COUNTY, acting through the COUNTY Auditor, may invest collected ad valorem tax fiords 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 fiuther agrees that it will pay to the City all interest or other ea rning s
attributable to taxes owed to the City. The ASSESSOR/COLLECTOR agrees to deliver to the COUNTY Auditor all ad
valorem taxes collected on behalf of the City for investment on a timely basis. All parties agree that this Agreement will not be
construed to lengthen the time period during which the COUNTY or the ASSESSORICOLLECTOR may hold such funds
before payment to the City.
Ix
REFUNDS
Refunds will be made by the ASSESSOR/COLLECTOR except as set forth herein. The ASSESSOR/COLLECTOR will
advise the City of changes in the tax roll which were mandated by the Tarrant Appraisal District.
The ASSESSOR/COLLECTOR will not make refimds on prior year paid a000►mts unless the prior year paid accounts for the
past five (5) years are provided to the ASSESSOR/COLLECTOR.
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 share is
based upon the City's percent of the tax account's total levy assessed at the time of receipt of the over or erroneous payment.
X
DELINQUENT COLLECTIONS
The ASSESSOR/COLLECTOR will assess and collect the fifteen percent (15 %) collection fee pursuant to Sections 33.07,
33.48 and 33.48 of the Property Tax Code, when allowed. The ASSESSOR/COLLECTOR 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 attendance of ASSESSOR/COLLECTOR personnel at a
court other than the District Courts in downtown Fort Worth, and the COUNTY is not a party, the employee's expenses and
proportionate salary will be the responsibility of the City and will be added to the collection expenses and charged to the City.
The ASSESSOR/COLLECTOR will not be responsible for the collection of prior year delinquent accounts unless all delinquent
accounts information is provided to the ASSESSOR/COLLECTOR.
M.
TERM OFAGREEMENT
This Agreement shall become effective as of the date heremabove set out, and shall continue in effect during the 2003 tax year,
unless sooner terminated by providing sixty (60) day written notice, as outlined in paragraph JOI.
XEE
NOTICES
Any notices to be 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.
FIR
MISCELLANEOUS PROVISIONS
This instrument hereto contains the entire Agreement between the parties relating to the rights herein granted and obligations
herein assumed. Any oral representations or modifications 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 parties
created hereunder are performable in Tan -ant County, Texas.
This Agreement shall be binding upon and inure to the benefit ofthe parties 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 construed as if such invalid, illegal, or unenforceable provisions had never been contained.
This Agreement and the attachments hereto constitutes the sole and only agreement of the parties hereto and supersedes any
prior understandings or written or oral a &7eements between the parties respecting the within subject matter.
Executed on the day and year first above written, Tarrant County, Texas
BY
BETSYPRICE
DATE
TAX ASSESSOBICOLLECTOR
TARRANT COUNTY
FOR THE CITY OFSOVTHL41;� .
BY.•
DAT E
T [ MtZ
FOR TARRANT COUNTY.
BY.•
TOM VANDERGRIFF
DATE
TARRANT COUNTYJUDGE
APPROVED AS TO FORM * AND CONTENT
BY
DISTRICT ATTORNEY'S OFFICE
DATE
*By law, the District 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 document 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 attorney {s}.