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BACKGROUND The City of Pleasanton collects a business tax from persons and businesses conducting business in the City. There are approximately 9,000 business licenses in the City that generate approximately $3 million annually. Of the 9,000, approximately 6,300 are located in the City limit. The remaining 2,700 are mainly contractors or consultants doing business in the City but located outside of the City. In addition to generating General Fund revenue for the City, staff strives to make the business tax ordinance equitable to each and every business by ensuring each pays its fair share of tax. To that end, City staff has an internal audit program; however, it is limited in scope. The City also utilizes college student interns during the summer to take a business inventory with the goal of discovering unlicensed businesses. Even with these efforts, there continue to be unlicensed businesses operating in the City. DISCUSSION The goal of this compliance program is to "create an even playing field" for the businesses in the City. This is accomplished through ensuring compliance of the Pleasanton Municipal Code through education of the business community. Some businesses are unaware of the requirements for a business operating within the City's jurisdiction. This process will allow the opportunity for the business to understand the requirements for licensing and to comply with those requirements. The agreement includes Discovery services. Discovery services are designed to identify entities subject to taxation by the City that are not properly registered and /or otherwise not reporting taxes to the City. Discovery is achieved by comparing the City's inventory of licensed businesses with a number of cross referenced business and tax databases maintained by MuniServices to uncover possible unlicensed businesses. The attached letter will be sent out to each business that is identified as possibly requiring a business license. When a person responds to the letter they will be asked a few questions to ascertain if they are required to be licensed. This service will ensure that all businesses are treated with respect and fairness. The goal is to bring businesses into compliance while offering education related to registration requirements. In working with MuniServices, not only will revenue be produced that would not otherwise have been realized by the City, but there will be an opportunity for MuniServices to work with staff to supplement and enhance the operations and procedures currently in place. Submitted by c David P L. 3 Director of Finance Attachments: 1. Sample Cover Letter 2. Professional Services Agreement Page 2 of 2 Approve Nel City Manager