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To: BOARD OF SUPERVISORS
Contra
PHIL BATCHELOR , COUNTY ADMINISTRATOR AND
FROM: GUS S. KRAMER, ASSESSOR Costa
County
DATE: October 21, 1997
r' c UNS;
SUBJECT: APPROVE STATE PROPERTY TAX ADMINISTRATION CONTRACT
SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION
RECOMMENDATION:
1. Approve and authorize the Chair of the Board of Supervisors to execute a contract
between Contra Costa County and the State Department of Finance. This contract
provides $2,022,000 in Property Tax Administration Funds to the Assessor's Office in
1997-98 for improving operations and to offset funding shortfalls. All interest earned
by these funds while in the trust account will be credited to the trust account for
enhancing the property tax administration system.
BACKGROUND:
At the November 23, 1995 Board meeting, the Board approved the County's participation
in AB818 which is the source of the Property Tax Administration funding. AB818 makes
available over$2 million to the County in fiscal years 1995-96, 1996-97, and 1997-98. If
the Assessor's Office performs annually at the anticipated level, these funds will not have
to be repaid to the State. The Assessor's Office received the funds in 1995-96 and 1996-
97 and has performed at a level where these funds will not have to be repaid. The
Assessor's Office in coordination with the County Auditor, County Administrator and
County Counsel has developed a performance and spending plan for 1997-98 that has
been approved by the State Department of Finance and will receive funding within 30 days
after the contract has been signed by both parties.
See attached contract.
CONTINUED ON ATTACHMENT: YES SIGNATURE:
—RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
APPROVE OTHER
SIGNATURE (S):
ACTION OF BOARD ON - APPROVED AS RECOMMENDED OTHER
VOTE OF SUPERVISORS
I HEREBY CERTIFY THAT THIS IS A TRUE
UNANIMOUS(ABSENT— AND CORRECT COPY OF AN ACTION TAKEN
AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD
ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN.
CC: Assessor ATTESTED �r P.. • -County Counsel ---- , "9g7
County Administrator PHIL BATCHELOR,CLERK OF THE BOARD OF
SUPERVISORS AND COUNTY ADMINISTRATOR
11•la7 ininn• nV
i
October 8, 1997
AGREEMENT FOR STATE-COUNTY
PROPERTY TAX ADMINISTRATION PROGRAM
THIS AGREEMENT is entered into this Q 4 day of 1997,
by and between the County of Contra Costa (County) and the State Department of
Finance (State).
WITNESSETH:
WHEREAS, Revenue and Taxation Code Section 95.31 provides that upon
recommendations of the Assessor, and by resolution of the Board of Supervisors, the
County may elect to participate in the State-County Property Tax Administration Program,
administered by the State; and
WHEREAS, the County elects to participate in the State-County Property Tax
Administration Program and to apply for a loan of $2,022,000 for fiscal year 1997-98.
WHEREAS, the County finds it necessary to apply for this loan to enhance its property
tax administration system; reduce backlog of new construction; prepare a defense for
each appeals case that is scheduled by the Assessment Appeals Board; enroll
Proposition 8 declines in value; reduce backlog of non-mandatory audits; and maximize
value enrollment capabilities; and
WHEREAS, in order to participate in the State-County Property Tax Administration
Program, the County must enter into an agreement with the State;
NOW, THEREFORE, the parties agree as follows:
1. PERIOD OF AGREEMENT
This agreement shall commence upon the date of execution by both parties and
shall expire on June 30, 2000.
2. LOAN AMOUNT
The State agrees to make available to the County a loan in the amount of
$2,022,000 for fiscal year 1997-98.
3. COUNTY REQUIREMENTS
The County agrees to use the funds received from the State to enhance the
property tax administration system. The County agrees not to use this loan to
supplant the Assessor's current level of funding. The County understands and
agrees that in order for the County to be eligible to participate in this State-County
Property Tax Administration Program, it must maintain a base staffing, including contract
staff, and total funding level in the Assessor's Office, independent of the loan proceeds
provided pursuant to this Act, equal to the levels in the 1994-95 fiscal year exclusive of
the amounts provided to the Assessor's Office pursuant to item 9100-102-001 of the
Budget Act of 1994.
The 1994-95 fiscal year base funding and staffing levels, as determined by the
Assessor's Office and the Chief Administrative Office of the County, which shall be
deemed to satisfy this requirement is as follows:
Gross Appropriations $7,503,192
Total Budgeted Positions 118
4. RECEIPT OF FUNDING
In fiscal year 1997-98, the County shall receive payment of$2,022,000 within thirty
(30) days after the approval of this agreement by both parties.
5. DEFINITION OF REPAYMENT
Repayment of the loan shall be evaluated based upon the Assessor's performance
under the following criteria:
(a) Reduces the July 1, 1997 backlog of 10,015 new construction assessments
by June 30 by completing the accumulated number of reassessments. In
1997 we are also updating the property records to improve our
characteristics file used in evaluating comparable sales. (Weighted 10%
for determining percentage of success.)
Accumulated Number
Accumulated of Reassessments Backlog
Year Workload (Esta Completed (Est.) Goal
1997-98 24,230 15,015 9,215
(b) Reduces the July 1, 1997 backlog of 8,900 property re-inventory by June
30 as stated below by completing the following accumulated number of
property re-inventories. In 1997 we will update our sales and property
records to improve our characteristics file used in evaluating comparable
sales. (Weighted 5% for determining percentage of success.)
Accumulated Number
Accumulated of Inventories Backlog
Year Workload (Est.) Completed (Est.) Goal
1997-98 8,900 500 8,400
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(c) Reduces the July 1, 1997 backlog of 330 appeal cases. We will Prepare
a defense for all assessment appeal cases that are scheduled by the
Assessment Appeals Board. (Weighted 60% for determining percentage
of success.)
Accumulated Accumulated Goal
Appeals Appeals (Appeals Not
Year Scheduled (Est.) Defended (Est.) . Defended
1997-98 991 991 0
The potential assessed value loss for year 1997-98 is in excess of $2.3 billion.
(d) Reduces the July 1, 1997 backlog of 2,200 Proposition 8 computer selected
and taxpayer requested reductions in value by June 30 of each fiscal year
as stated below by completing the following accumulated number of
reassessments. (Weighted 10% for determining percentage of success.)
Accumulated Number
Accumulated of Reassessments Backlog
Year Workload (Est.) Completed (Esta Goal
1997-98 59,303 58,803 500
(e) Reduces the July 1, 1997 backlog of 113 non-mandatory audits by June 30
as stated below by completing the following accumulated number of audits.
The non-mandatory audits are a result of unretumed Business Property
Statements. (Weighted 15% for determining percentage of success.)
Accumulated Number
Accumulated of Audits Backlog
Year - Workload (Est.) Completed (Est.) Goal
1997-98 1,292 1,254 38
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In measuring payment, the following formula shall be used:
A + (B-C) "A" = The actual accumulated number of reassessments/audits
A completed or assessment appeals defended
"B" = The backlog goal/appeals not defended
"C" = The achieved backlog/appeals not defended
For example:
If the achieved backlog for(a) above for 1997-98 is 9,300, the above formula will produce
the following:
9,215 - 9,300 = -85; 15,015 - 85 = 14,930/15,015 = 99.43%
If the achieved backlog for(a) above for 1997-98 is 9,150, the above formula will produce
the following:
9,215 - 9,150 = +65; 15,015 + 65 = 15,080/15,015 = 100.43%
The percentage of success including percentages over 100, for each of the five goals
("a"through "e") will be weighted according to the percentages identified in each category
to determine the total percentage of success. If this total is 95% or greater, the loan shall
be considered to have been repaid. If the percentage is less than 95%, that percentage
multiplied by the loan amount shall be considered the amount that has been repaid.
If the workload increases for items ("a" through "e") of section 6 by 10% or more the
target backlogs for each year will be automatically increased by the numeric amount of
the workload increase.
In addition, the Assessor will continue compliance with section 469 of the Revenue and
Taxation Code, and continue processing and monitoring Proposition 8 decline in value
assessments.
6. RENEGOTIATION OF THE REPAYMENT DEFINITION
At the request of the County, the State agrees to renegotiate in good faith the
definition of repayment specified in Section 6, if there is any major misfortune or
calamity occurring in the County proclaimed by the Governor to be in a state of
disaster and affecting 1% of the assessable parcels in the County. If an
agreement is not reached, the provisions of Section 6 will apply; however, the
repayment date will be extended to June 30 of the fiscal year following the year in
which the loan is made and, upon request, the County will be granted a repayment
extension as provided in Section 95.31 of the Revenue and Taxation Code.
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7. PROPOSED USE OF LOAN
The County plans to use the funds received from the State and interest earned by
these funds to fund appraisal, clerical and support positions, overtime as needed,
and to enhance its property tax administration system, as specified in Exhibit A.
It is understood and agreed that funds received by the County pursuant to this
program shall be deposited into a trust account to be used as required by
Revenue and Taxation Code Section 95.31. Any funds remaining in the account
at the end of each annual term may be rolled over to the next fiscal year for
authorized uses consistent with the provisions of Section 95.31.
It is also understood that upon satisfaction of the terms set forth in Section 6 as
repayment for each annual loan, the State will have no further claim on these
funds provided the County continues to meet the requirements stipulated in
Section 3.
However, in the event that the County has not expended all of the loan proceeds,
the County may, at its option, return to the State all or a portion of any unspent
loan proceeds to reduce the amount of the loan.
8. FAILURE TO REPAY LOAN AMOUNT
If the County fails to repay the loan as specified in Sections 6 and 7 the State shall.
notify the County and Controller. The Controller shall make an apportionment to
the General Fund on behalf of the County in the amount of that required payment
for the purpose of making that payment. The Controller shall make that payment
only from monies credited to the Motor Vehicle License Fee Account in the
Transportation Tax Fund to which the County is entitled at the time under Chapter
5 (commencing with Section 11001) of Part 5 of Division 2 of the Revenue and
Taxation Code, and shall thereupon reduce, by the payment, the subsequent
allocation or allocations to which the County would otherwise be entitled under that
chapter. It is understood and agreed that partial payment of the loan will be
accepted by the State in accordance with the formula established by Section 6.
The State shall be entitled to recover only that portion of the loan considered
unpaid as established by Section 6. '
9. REPORTING CRITERIA
The County agrees to provide to the State, by March 31 of each fiscal year, an
Interim Report listing the projected impact of the increased funding in the current
and subsequent fiscal year regarding the number of reassessments/audits
completed, appeals defended, June 30 backlog, and the average increment of
assessed value change associated with items (a) through (d) of Section 6 of this
contract, plus similar information relating to Proposition 8 "Decline in Value"
claims.
The County will also provide to the State by July 15 of the following fiscal year a
report listing the actual workload, number of reassessments/audits completed or
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appeals defended, the achieved June 30 backlog, and the average increment of
assessed value change associated with items (a) through (d) of Section 6 of this
contract, plus similar information relating to Proposition 8 "Decline in Value"
claims. This report will be verified by the County's Auditor-Controller.
10. PROJECT RESPONSIBILITY - COUNTY
County will provide a Project Director who will be responsible for ensuring the
objectives under this agreement are met. The Project Director will monitor County
performance.
County's Project Director will serve as liaison with the State's Project Director on
an as needed basis.
County's Project Director shall provide direction to the State in the areas relating
to County policy, and information and procedural requirements.
County's Project Director for this agreement shall be:
Bob Nash, Assistant Assessor
Office of the Assessor
834 Court Street
Martinez, CA 94553
(510) 313-7430
County shall notify the State in writing of any change in the name or address of
County's Project Director.
11. PROJECT RESPONSIBILITY - STATE
The State will provide a Project Director who will be responsible for State
performance under this agreement. The Project Director shall be a full-time
employee of the State.
The State's Project Director for this agreement will be:
Diane Cummins, Deputy Director
State of California
Department of Finance
State Capitol, Room 1145
Sacramento, CA 95814
(916) 445-4141
The State's Project Director will serve as liaison with County's Project Director on
an as needed basis.
The State shall notify the County in writing of any changes in the name or address
of the State's Project Director.
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12. EXCLUSIVE AGREEMENT
This agreement constitutes the complete and exclusive statement of
understanding between the parties which supersedes all previous agreements,
written or oral, and all other communications between the parties relating to the
subject matter of this agreement.
13. CHANGES AND AMENDMENTS
The County and the State reserve the right to change any portion of the work
required under this agreement or to amend such other items and conditions as
may become necessary. Any such revisions shall be accomplished only with the
written approval of the Contra Costa County Board of Supervisors and the State.
14. NOTICES
All notices or demands required or permitted to be given or made hereunder shall
be in writing and shall be deemed to have been given if made by hand delivery
with signed receipt, or as shown on the receipt when mailed by first-class,
registered or certified mail, postage prepaid, addressed to the County and State
at their respective addresses designated below or at such other address as
County or State shall have fumished in writing to the other.
The designated addresses of respective parties for the purpose of notice are as
follows:
COUNTY: STATE:
Contra Costa County State of California
Office of the Assessor Department of Finance
834 Court Street State Capitol, Rm. 1145
Martinez, CA 94553 Sacramento, CA 95814
Attn: Bob Nash Attn: Diane Cummins
Assistant Assessor Deputy Director
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Contra Costa County
Office of County Administrator
651 Pine Street
Martinez, CA 94553
Attn: Phil Batchelor
County Administrator
'IN WITNESS WHEREOF:
The County of Contra Costa Board of Supervisors has caused this agreement to be
subscribed by the chairman and the seal of said Board to be hereto affixed and attested
by the Executive Officer and Clerk hereof, and the State has caused this agreement to
be signed by its duly authorized officer this 2 iA;t- -day of n 1997.
COUNTY OF CONTRA COSTA
By IlU✓ _
Chair, Board of Supervisors
ATTEST: Phil Batchelor, Clerk State: State Department of Finance
of the Board of Supervisors and
County Administrator
BY BY
Deputy
APPROVED AS TO FORM BY ;
COUNTY COUNSEL:
VICTOR J. WESTMAN
By
eputy
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Exhibit A OFFICE OF THE ASSESSOR
• PROPERTY TAX ADMINISTRATION PROGRAM
ESTIMATED LOAN ALLOCATION
FY 1997-98
LOAN AMOUNT $2,022,000
Staffing:
Appraisal Staff (1 Supervising Appraiser, 2 Appraisers, 1 Auditor) 190,000
Technician Staff(5 Technicians) 158,600
Funding to maintain 94-95 Budgeted Positions 593,400
Appraisal Staff Overtime 45,000
Temporary Retiree Staff 35,000
Assessment Appeal Support 30,000
Contract Appraisers & Consultants 130,000
Consultants for Major Assessment Appeals* 400,000
Total Staffing 1,582,000
Systems and Processing Modifications & Training:
Hardware, Software, and Maintenance 155,000
Electronic Phone System 50,000
Deed Imaging System 235,000
Total Systems and Processing $440,000
TOTAL ALLOCATION $2,022,000
TOTAL 1996-97 CARRIED FORWARD $ 770,100
Estimates do not include attrition, step increases, and overhead. Attrition will be
back filled to maintain the contractually agreed to staffing level.
The $593,400 funding will help to attain and maintain 94-95 staffing level.
The Auditor-Controller and Treasurer-Tax Collector will bill the Assessor for
reasonable and necessary costs directly related to achieving the performance
goals of Section 6 of the contractual agreement between the County and State,
and meeting the requirements of Section 95.31 of the Revenue and Taxation
Code.
* At this time the exact amount that may be necessary for industry expert appraisers
& other professionals for major appeals cannot be determined. To the extent
these funds are not necessary for such assistance, it is agreed that the Assessor
may use up to $200,000 of this amount to digitize parcel maps. State Department
of Finance will be notified of any change in expenditures.
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