REPORT TO COUNCIL
SUBJECT
Title
Adopt a Resolution Authorizing the Finance Director to Renew a Business License Tax Data Exchange Agreement with the California Franchise Tax Board
Report
BACKGROUND
Chapter 5.04 of the Sunnyvale Municipal Code (SMC) is known as the Business License Tax Ordinance of the City of Sunnyvale. SMC Section 5.04.100 states: "No person shall transact, engage in, or carry on any business within the City without first having procured a license from the City to do so and having paid the tax".
Department of Finance staff regularly conduct audits to locate businesses that are operating in Sunnyvale without a license in violation of SMC Chapter 5.04. This data exchange program began because of the enactment of Senate Bill 1146 on September 26, 2008. This Act authorizes a city to enter into a reciprocal agreement with the California Franchise Tax Board (FTB) to exchange tax data. The data exchange enables both parties to identify any non-compliant businesses.
In 2009, the Council approved the initial agreement with the California Franchise Tax Board (FTB) to exchange data related to Business Licensing (RTC No. 09-232). The data exchange program has been renewed three times (RTC No. 12-053, RTC No. 15-0490, RTC No. 18-0221). The current agreement expired on December 31, 2020. The City needs to enter a new agreement by May 1, 2021 to continue the data exchange program through December 31, 2023.
EXISTING POLICY
Council Policy 7.1B.3.2 states: An aggressive collection system for all accounts receivable will be utilized to assure that monies due to the City are received in a timely fashion.
ENVIRONMENTAL REVIEW
This action is exempt from environmental review under the California Environmental Quality Act (CEQA) pursuant to CEQA Guideline Section 15378(b)(5) (government organizational and administrative activities that will not result in a direct or indirect physical change to the environment).
DISCUSSION
The City of Sunnyvale has conducted reg...
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