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Title:
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Approval of a Professional Services Agreement with Mayer Hoffman McCann P.C. for Transient Occupancy Tax Audit Services for an Amount Not-to-Exceed $32,400.
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City of Culver City, California
City Council Agenda Item Report
RECOMMENDATION:
Staff recommends that the City Council award a professional services agreement to
Mayer Hoffman McCann P.C., to provide Transient Occupancy Tax audit services
for an amount not-to-exceed $32,400.
BACKGROUND:
Section 11.02.105 of the Culver City Municipal Code (CCMC) establishes a
Transient Occupancy Tax (TOT) of fourteen percent. Hotels and motels are
required to collect the tax from the customer and remit it to the City on a monthly
basis. Section 11.02.145 of the CCMC establishes that hotel and motel operators
must keep records related to the collection and remittance of the TOT for a period of
three years, and that the Tax Administrator shall have the right to inspect them at all
reasonable times. It has been the practice of the City to hire a consultant
approximately every three years to perform a TOT audit. The last such audit was
completed in 2010. Therefore, the Finance Department requested, and City Council
approved, one-time funds in the City Council Adopted Budget for Fiscal Year
2013/2014 to engage a firm to conduct another TOT audit to cover a three year
period.
DISCUSSION:
Staff released a Request for Proposal for TOT audit services on June 17, 2013.
Proposals were received from three (3) qualified firms by the due date of July 18,
Meeting Date: 09/09/2013 Item Number: C-4
AGENDA ITEM: Approval of a Professional Services Agreement with Mayer
Hoffman McCann P.C. for Transient Occupancy Tax Audit Services for an Amount
Not-to-Exceed $32,400.
Contact Person/Dept.: Jeff Muir, Finance
Department
Phone Number: (310) 253-5865
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Public Hearing: [] Action Item: [] Attachments: []
Commission Action Required: Yes [] No [X] Date: _______________
Public Notification: (Email) Meetings and Agendas – City Council (09/04/2013); (E-mail)
Mayer Hoffman McCann P.C., MuniServices LLC, and Moss, Levy & Hartzheim, LLC
(09/04/2013)
Department Approval:
Jeff Muir (09/04/13)
City Attorney Approval:
Carol Schwab (by H. Baker) (09/04/13)
Chief Financial Officer Approval:
Jeff Muir (09/04/13)
City Manager Approval:
John M. Nachbar (09/04/13) City of Culver City, California
City Council Agenda Item Report
2013. The firms that submitted proposals were Mayer Hoffman McCann P.C.
(MHM), MuniServices LLC, and Moss, Levy & Hartzheim, LLP.
All firms were evaluated based on the following criteria:
1. Thoroughness of response and understanding of the task to be completed;
2. Responsiveness to requirements of the project;
3. Firm’s experience in TOT audits, especially in California;
4. Overall experience of staff assigned to the project;
5. Time required to accomplish the requested services;
6. Client references; and
7. Cost of service.
Based on the Finance Department’s evaluation of the proposals, MHM and
MuniSerivces were selected as finalists. Both firms demonstrated a complete
understanding of the requested service, have extensive experience performing TOT
audits in California, and proposed experienced staff to provide the service. The
following table summarizes the costs contained within the proposals:
In comparing the two proposals, staff felt that the MHM proposal indicated a higher
level of transaction testing and detail work. MHM performed the last TOT audit for
the City in 2010, and staff was satisfied with the services provided. For these
reasons, staff is recommending the selection of MHM.
It is the City’s policy to rotate the independent auditor of the financial statements
every five years. While this is not a requirement for TOT audit services, it is likely
staff would recommend the use of a different consultant the next time a TOT audit is
undertaken.
FISCAL ANALYSIS:
The cost of the audit will be $32,400. Sufficient funds have been included in the City
Council Adopted Budget for Fiscal Year 2013/2014 Adopted Budget.
Mayer Hoffman
McCann P.C.
MuniServices
LLC
Moss, Levy &
Hartzheim, LLP
Fee 32,400 28,800 39,270
Expenses 2,500
Total Not-to-Exceed 32,400 31,300 39,270 City of Culver City, California
City Council Agenda Item Report
ATTACHMENT(S):
None
MOTION:
That the City Council:
1. Approve a professional services agreement with Mayer Hoffman McCann P.C. to
provide Transient Occupancy Tax audit services in an amount not-to-exceed
$32,400; and
2. Authorize the City Attorney to review/prepare the necessary documents; and,
3. Authorize the City Manager to execute the agreement on behalf of the City.