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HomeMy WebLinkAboutRES 23-36 RESOLUTION NO. 23-36 RESOLUTION THE CITYf1'0NVN COUNCIL CST# THE E ITY OF AP ACHE,HE, JUNCTION, ARIZONA APPROVING AND AUTHORIZING THE MAYOR TO EXECUTE AN CITY OF APACHE ,IUNCTION AND THE STATE OF ARIZONA DEPARTMENT OF REVENUEFOR THE ADNMINI ` ' ATI I I, COLLECTION, AUDIT, AND LICENSING OF TRANSACTION I I 'ILEGr TAXES, USE TAXEIS, SEVERANCE TAXES, JET FUEL EXCISE AND USE TAXES AND RENTAL TAXE'S IMPOSED BY THE STATE., CITIES TOWNS. WI ERl m Title 11,Chapter 7, Article 3(AK . § 1 1-952).Mthorizes two or more public Menc it s to enter into intergovernmental agreements to contract for sere icµes if allthoriml by their lcoklaative or governing bodies-, and WHEREAS, A.R.S, § 42-6001 ct seq, was amended efleclix e January 1, 2015 to firm ide that the Arizona Department atr'tment tit. Revenaac, hereinafter referred to as ADOR, shall enter into an intergovernmental contract or as a'cement pursuant to .R. 11-952 to proN isle as uniform method ol'aaclraainistr-cation.collection.audit and licensim, oftraansaaction l r°iN ilcge and affiliated c c:iw taxes imposed by the State, cities or towns; and WF- E-RE . represcnlaatives of_ ADOR and representatives calµ r'l/onaa cities and towns. With tafrl)ON from the 1,ei.a gue of Arizona Cities and Towns, haNe negotiated till let-ills of. ar A to take effect as described within that tic cclmentm which call be adopted individually`by each r=i/onaa city and town, and is the subject of this ReSOlcrtion, NOW THEREFORE F"C rr RESOLVED, Heart the City CwOLIncil of the City of Apache .lUnCti :n Arizona onar hereby approves the Intergovernmental mentaal Agreement between the City of Apache Junction and the Arizona Department of Revenue for the administration, collection, aaLldn and licensing of transaction privilege taxes, use tiaxes, etcrance taxes,jet fuel excise and uw taxes and rentnt OCCUFaaaii y taxes imposed by the State,cities oi-towns. and aautl1067es the 1`0110�18 lr The Nlaa °air§ or their duly authorized agent. shall no fib ADO oaf` thc w'ity's desire to enter into an IGA its required by ARS §4 - 001, % ith an effective Haire as closer°ihed x%ithin that (10cari tent, together with the encapsulated f-a-MisiOri$, fcaa°aatanrraal renewals, 11 2. The Mayor may eater` into the proposed IGA on 1relaaill'of the City of Apache ,ltiiacti rrl. and e ecctt aal1 1416 Other(10C aIllents,c01111-aacts, aaat1e1lcla1aei is and as r`eements x%ith ADOR as raaaay be ne essaat-N to effectuaale this agreement, PASS I' AND ADOP I[ C b tile 01s COL11161 01'01C City; of ApacheJunction. Arizona this pit€,= of 2023, 4 MAYOR A:I..I I S City, °` er <!K*/Li.3 1.2.� City Attorney INTERGOVERNMENTAL AGREEMENT BETWEEN THE ARIZONA DEPARTMENT OF REVENUE AND THE CITY/TOWN OF APACHE JUNCTION THIS NTERG VERNM TAL AGREEMENT ("Agreement") Is entered into this 7 — day of NOVEMBER $ 2023, by and between the Arizona Department nt ev ue ("Department") and the City/Town of APACHE JUNCTIONArizona municipal corporation ("City/Town"), This Agreement shall supersede and replace all previous intergovernmental agreements, including amendments thereto, entered into by the Department and City/Town regarding the administration, collection, audit and/or licensing of transaction privilege tax, use tax, severance tax,jet fuel excise and use taxes;and rental occupancy taxes (collectively referred to as"Taxes") imposed d by the State,City/Town,and either Arizona municipalities. RECITALS WHEREAS, ,1 . .Title 11,Chapter 7,Article .& § 11-952t sect;)authorizes two (2)or more public agencies to enter into intergovernmental agreement,,; to contract for services, if authorized by their legislative or governing bandies, WHEREAS, A.R.S. § 42-6001 et serf. was amended effective January 1,2015 to provide that the Department shall collect and administer any transaction privilege and affiliated excise tares imposed by any Arizona municipality and that the Department and each municipality shall enter into an intergovernmental contract or agreement pursuant to AR.S. § 11-952 to provide ra uniform method of administration, collection, audit, and licensing f transaction privilege and affiliated d excise taxes imposed by the Mate and Arizona municipalities. WHEREAS, City/Town has taken appropriate action by ordinance, resolution, or otherwise, pursuant to the laws applicable to the governing beady of City/Town, to approve and authorize City/'Town to enter into this Agreement. AGREEMENT NOW, THEREFORE, in consideration of the foregoing, the Department ent and City/Town enter into this Agreement as follows: e Definitions 1.1A.R.S. means the Arizona Devised Statutes. .2 Adoption of an Ordinance means final approval by majority vote of the City/Town council. September 2023 Pagel cif 39 OR-Municipal IGA for,rPT Administration L3 Ambassador Program means the Department's provided structure and support of curriculum related to tax administration and compliance education. 1.4 Arizona Management System means the State's professional, results-driven management system that focuses on customer value and vital mission outcomes for citizens. The system is based on principles of Lean, a proven people-centered approach that has delivered effective results in berth public and private sectors. Lean focuses on customer value continuous improvement and engaged employees to improve productivity,quality, and service. 1.5 Audit means an examination and verification ofaccounts and records to determine taxpayer compliance with .S, Title 42 and the Model City Tax Code, or any other assessment issued pursuant to AR.S. § 42-1108, 1.6 City Services means the Department's team or successor unit thereof that assists Arizona municipalities with administrative functions and all ether activities related to transaction privilege tax licensing, collection, and compliance of any kind; In this Agreement, all references to electronic communications with City Services shall be directed to the team's address at,cihesunit?rt azdor.. ov. 1.7 Closing rep e t means an agreement to settle a tax liability pursuant to A.R.S. 42-1113. 1.8 Collectionmeans activities to collect established liabilities for transaction privilege taxes,fees,and related penalties and interest that are due and owing, 1.9 Confi entia it Standards means the standards set Barth in AK& § 42-2001 et seq., Model City Tax Code § 5 10, Appendix A of this Agreement, and such other written standards mutually agreed to by the Department and itye'Town,and which will be incorporated into Appendix A of this Agreement. 1.10 Development Fees has the saute meaning prescribed in . .S, § 42- f1 . 1.11 Desk Reviewlocals any assessment issued pursuant to A.R.S. §42-110 . 1.12 e eral Tax Information (11 ) means federal- ncorne tax returns or return information the Department receives from the Internal Revenue Service, including any information created by the Department derived from that information. Documents obtained from a taxpayer or State income tax returns are not considered Federal Tax Information. The scope of this Agreement does not permit the Department to share IaTI with any Arizona municipality. 1.13 Independent Contractor means any individual or entity with which ty,,Town may enter into an agreement to perform transaction privilege tax administration, collection,audit,licensing,and any other related duties described in this Agreement or.A: ;S. §42-6001 et,sect. 1.14 to el City Tax Code means the document defined in AKS. § 42-60 1 September 2023Page 2 of 3 ADOR- unicipal IGA for TPT Administration L15 Municipal Tax or Municipal Taxes means collectively the transaction privilege and affiliated excise taxes, including use tax, severance tax,jet fuel excise anduse tax,and rental occupancy tax imposed by City"own in accordance with the Model City Tax Code and similar taxes imposed by City.,,'Town pursuant to a City,"Town code section outside the Model City Tax Code that are collected via the standard transaction privilege tart return; Unless the context provides otherwise, this definition includes municipal privilege tax,municipal privilege tax license fees,and all related penalties, interest and other similar charges collected by the Department on behalf of an Arizona municipality, 1.16 Options Chart means any chart contained in a section of the Model City Tax Code which identifies the various approved standard Options adopted by an Arizona municipality. 1.17 Primary Point of Contact " C" means a designated City/Town representative with the primary responsibility for communicating with the Department and their respective staff on any matters described within this Agreement. The PPOC must be an individual qualified to receive"Tax Information under Section 2.1 of this Agreement ent and be included on the Master Authorization List referenced in Section 2.3 of this Agreement. 1.18 Prode means a dedicated section of the Model City Tax Code that provides specific information for each Arizona municipality, including contact information, applicable tax rates,and amendments and provisions unique to City/Town. 1.19 Standardit Life Cycle Process Map means a document containing the decisions ns and procedures adopted by the Department and Arizona municipalities from the assignment of audits through final resolution consistent with this Agreement and the Arizona Management System principle of continuous i provernent, This document shall be reviewed by the Department and Arizona municipalities as needed,not less than annually,with any changes memorialized in revised map, In the event of a disagreement regarding proposed changes, the Standard Audit Life Cycle Process Map shall be referred to SMART for resolution. 1.20 Standard t on don List Update Process Map means a document containing the decisions and procedures adopted by the " Department and Arizona municipalities to keep an updated list of current employees and contractors who are authorized to receive Tax Information consistent with this Agreement and with the Arizona Management System principle of continuous m rovement,This document shall be reviewed by the Department and Arizona municipalities as needed,not less than annually, with any changes memorialized in a revised snap. In the event of a disagreement regarding proposed changes,es,the Standard Authorization List Update Process Map shall be referred to SMART for resolution. 1.21 Sta iard Inter-Jurisdictional Tra sfer Process Map means a docunient containing the decisions and procedures adapted by the Department and Arizona municipalities ities to document and authorize the transfer of erroneously reported o September 2023 Page 3 of 3 DOR-Municipal IGA for TPT Administration allocated tax from one 1 municipality to anther based upon a municipality's request or during the audit process consistent with this Agreement and with the Arizona ona Management System principle ofcontinuous improvement.This document shall be reviewed by the Department and Arizona ona municipalities as needed,not less than annually, with any changes memorialized in a revised neap, In the events f disagreement regarding proposed changes, the Standard Inter-Jurisdictional Transfer Process Map shall be referred to SMART for resolution. 1.22 State means the State of Arizona, 1.23 State & Municipal Audit Resolution Team ("SMART") means an advisory committee responsible for resolving issues as set Barth in Section 15 of this Agreement. 1.24 State Tax or State Taxes means transaction privilege tax and affiliated excise taxes, including use tax, severance tax, and jet fuel excise and use taxes imposed by the State of Arizona or its counties. 1.25 Tax Information means information deemed confidential taxpayer information protected from disclosure pursuant to A.R.S. § 42-2001 et seq. or Model City Tax Cade § 510 concerning the business financial affairs or operations of taxpayer as it relates to Municipal Taxes or State Taxes. Tax Information includes all financial information related to transaction privilege taxes obtained from any source related to are individual taxpayer and all such aggregate financial information related to any group of identified or identifiable taxpayers. a Examples of'Tax Information include without limitation: 1j Any information provided by the Department to City,,Town derived from any source including tax returns, reports, tax license applications and the New License Report or License Update Report; and 2 Any information received by, recorded by, prepared by, furnished to, or galleried by the Department or :ity,`Town with respect to a transaction privilege tax. return or the termination or possible existence of liability of any person for any transaction privilege tax and related penalty or interest, such as the taxpayer's identity, the nature, source, or amount of the taxpayer's income, payments, ts, receipts, deductions, exemptions, credits, assets,- liabilities, net worth, tax liability, taxes withheld, deficiencies, over-assessments, r tax payments; or whether the taxpayer's account was, is being,or will be examined or subject to audit, desk review, investigation, collection,or processing. b Taxpayer identifying inforination obtained by City/Town from any source not identified in Section I.25 a of this Agreement is not Tax Information for purposes of this Agreement, September 2023 Page 4 of 39 AD OR-Municipal unic:ipal IGA for"TPT Administration 1.26 Voluntary Disclosure Agreement means a document ent used in a voluntary disclosure program designed for eligible taxpayers with exposure for tax liability and/or civil penalties arising from a failure to report and/or pay all Taxes dare which allows the taxpayer to come into voluntary compliance. 2. Authorized Access Lists 2.1 Statutory Authority: The disclosure of inf ri ati n relating to State Faxes and Municipal Taxes is governed byA.R.S. y' 2-200I el seer.,and,for reporting periods prior to January 1, 2015,, y Model City Tax bode§ 5 10. .2 Qualified Recipients of Information: The Department and City/Town shall only disclose 'fax Information related to State Tax and Municipal Tax pursuant to this Agreement to individuals authorized by law as described in Section 2.1 of this Agreement, including those authorized persons listed on the Authorized Access .Lists provided by the Department and Arizona municipalities, Questions related to listed Department recipient may be directed to City Services at citiestrnit&va dor.°oy. Questions related to a listed Arizona municipal recipient may be directed to the PPOC of the pertinent Arizona municipality, 2.3 Department's Authorized AccessList: Pursuant to Section 2a4(c) of this Agreement,the Department shall maintain,n,update,and provide a current statewide Master Authorization list of names, job titles, and contact information of the Department staff and Arizona municipal representatives es are authorized by law as described in Section. 2.1 of this Agreement to receive Mate Tax and Municipal Tax information from the Department or Arizona municipalities,as defined in the Standard Authorization list Update Princess Map,Updates shall be provided on not less than a monthly basis. The Department shall promptly notify Arizona municipalities of any individual whose authorization to receive State flax and Municipal"Tax information has been revoked for any reason, 2.4 i y ow 's Authorized Access List. City/Town shall maintain, update, and provide a current Authorized Access List of names, job titles, and contact information for all persons acting on behalf of City/Town authorized ed y law as described in Section 2.1 of this Agreement to receive State Tax and Municipal"Tax information as defined in the Standard,Authorization List Update Process Map. a) City/Town shall indicate one PPOC on the Authorized Access List to resolve any administrative issues with the Authorized Access List, At its discretion, it �''T n may also indicate an additional individual as a back- up or alternate PPOC. b) City/Town shall ensure all personnel on the Authorized Access List meet the requirements indicated in the Confidentiality Standards (Appendix A) including completing all required confidentiality training certification and recertification as required from time to time,within the time required by the Department. September 2023 Page 5 of 39 ADO -Municipal f A for TPT Administration Upon execution of this Agreement and on the first day of each calendar quarter thereafter, City/Town shall email to City Services at iti sun tttt eft . d a current Authorized AccessList of its staff" and representatives authorized to receive State Tax and Municipal Tax information from the Department and Arizona municipalities, including additions and deletions, changes in job titles, and contact information. it To vri's I C sha11 ro t1 trtsti the rtment of art arson whose authorization to receive State Tax and u ieipa Ttt infor ation is revoked for an re son. (d) The Department shall review City/To n's Authorized Access List, Ifthe Department finds that any person on the list has not completed the required confidentiality training in a timely manner or does not meet the Confidentiality Standards in Appendix A of this Agreement, the Department shall notify the City/Town PPOC to resolve the issue. The Department shalt not include that person on the blaster Authorization List until the issues have been resolved to the satisfaction of the Department. 2.5 Independent Contractors: (a) City/Town may at titres choose to enter into a contract with an Independent Contractor to perform the transaction privilege tax; administration, collection, audit, desk review, licensing, and rather duties described in this Agreement or A.R.S. §42-6001 et seq. (b) In accordance with A.R.S. §§ 42.1004 and 2-600 , no contract with an Independent Contractor may be entered into on a contingency fee basis for the performance of any transaction privilege tag related functions, including but not limited to license inspections,audits desk reviews,or collections. (c) Within ten. (10) business bays of ratification of this Agreement, or subsequent execution of such a contract between City/Town and an Independent Contractor, pity,,`Town shall provide a copy of each such contract to the City Services electronically at itiesrrrittr azdor. o , d 'itTown shall notify the Department of the expiration, termination, or amendment of any agreement with such Independent Contractors within ten (I0)business clays of such event. cI In this Agreement it is presumed that any reference to a municipal employee such as a license inspector, auditor, desk reviewer, collector, supervisor, etc., also refers to an Independent Contractor performing that function can behalf of the Department rtment or City/Town. f An Independent Contractor is subject to all training requirements, authorization limitations,and rather privileges and restrictions incorporated into this Agreement or provided in statute in the same form and manner as September 2023 Page 6 of 3 DOR-Municipal IGA fer`€'PT Administration such conditions apply to an employee performing the same function can behalf ofthe Department or City.`Town, When are Independent Contractor issues any correspondence to a taxpayer on behalf ofthe Department or City:°"€own,the Independent Contractor shall expressly identify all of the following on such correspondence. the Independent Cntractor' name the name of the Independent Contractor's firm, if applicable, the Independent Contractor's status as a license inspector, auditor, desk reviewer, or collector acting on behalf of the Department ent or City;,Town,, the Independent'Contractor's mailing address, telephone number,and e-mail address;and the telephone number and e-mail address of a specific person who is an employee of the Department or City/Town capable of responding to the issues raised in the correspondence for the Department or Cw'i "To n. h The Department and/or City,Town may pursue any remedy authorized by this Agreement or by statute for a violation of this Section by an Independent Contractor. 2.6 Sharing of Authorized AccessLists: The Department shall share the Department's Authorized ed Access List and the Authorized Access Fists for all Arizona municipalities provided to the Department on the Grate SFTP site. The Department shall update the lists on a monthly basis with information provided by each Arizona municipality,or as needed to immediately remove any person whose authorized access has been revoked by the Department or an Arizona municipality, 3$ Disclosure of Informat r Arizona Icl alit , 3.1 Disclosure and Use of Municipal Tax Information: Any Tax Information released by City/Town to the Department or another Arizona municipality may curtly be used by persons authorized to receive such Tax' Information for tax administration and collection purposes and may not be disclosed to the public in any manner that dries not comply with A.R.S. 42-2003, and/or Model City Tax Grade§ 5 10 for reporting periods pricer to January 1,2015.All Tax Information shall be stored and destroyed in accordance with the Confidentiality Standards (Appendix.A . 3.2 MunicipalOrdinances: City/Town shall provide the Department with a coy of its Municipal Tax Cade or any City/Town ordinances imposing the taxes to be collected hereunder within tent l Cf calendar days of a request for such information from the Department,This information shall be sent to City Services electronically at cif esunit@azdorwgcav, a Tax Cade C:harr es: City,/Town shall provide notice to the Department of any tax code change with a copy of any ordinance adopted by C ity3'Town that imposes or modifies the Municipal Takes or municipal privilege tax September 2023 Page 7 of 3 r OR-Mu nicip l IGA for TILT Administration license fees to be collected hereunder within term (10) calendar days of adoption of the ordinance. This infonnation shall be sent to City Services electronically at citicstnnntat c env; (1) City/Town agrees that any ordinance that changes a tax rate,Option selection,or includes the addition or removal of a unique Model City Tax Cade exception shall take effect on the first day of the month that is at least sixty ( 0) calendar days after the City/Town council adopts the change, City/Town and the Department recognize there may be occasions when the City./Town council establishes an effective date less than sixty ( ) calendar days after adoption. If City/Town chooses to propose an ordinance with an effective date that is less than sixty (od) calendar days after adoption, City/Town shall notify the Department as soon as possible after that choice is made. (T) The Department shall incorporate all ordinance changes into the official copy of the Model City Tax Code within ten (1 ) calendar days of receipt of notice from City:'To rrn,The copy provided to the Department may be an electronic copy but shall reflect the identical language contained in the version adopted by the City/Town and shall contain the required signatures indicating council approval. (3) The Department shall notify Crity,°'To n when the tax code change has been incorporated and City/Town City/Town is responsible for confirming the change has been correctly entered in the official copy of the Model City Tax Code. (4) Pursuant to A.R. , § 42-60 2, if it t!T'ow n Bits to notify the Department of tax crude change within tent(10)calendar days lifter C;ityi'T own council approval, the ordinance shall be considered null and void, All tax erode changes described in this Section shall have no effect until reflected in the official copy of the Model City Tax Co& (b) Annexation Ordinances: Within fifteen (1 ) calendar days following the adoption of an annexation ordinance, one (1) copy of the ordinance and notification of the effective date of such ordinance shall be seat to the Department via email at I irrsa dor. r v and City Services at c,ttiesu nit a dr r. r v.City/Town may provide the Department with a list of businesses subject to Municipal Taxes known to be located in the annexed area. (c) Review of the Model C i!y Tax Code: City/Town shall be responsible for reviewing the information contained on its profile;the Options Charts,tax rates for City/Town,and other information specific to City/Town contained in the official copy of the Model City Tax geode and ensuring it is correct. September 2023 Page 8 of 3 DOR-Municipat IGA for TPT Administration City/Town affirms that it has an ongoing obligation to notify City Services of any changes needed to such information at citiest nit°' d(I octy, 3.3 Development Fees: Upon request by the Department to ity/Tow 's PP , City/Town shall provide to the Department any information regarding Development t Fees imposed by City/Town under , .S. § 9-4 3.t15 to assist the Department with the auditing of taxpayers and the ordinary billing and collection of taxes. 3.4 Prior Audits: Upon request by the Department,City,,Town shall allow inspections and copies of any City/Town tax audits conducted prior to January T,2015. 3.5 Other Information:City/Town shall provide other relevant information necessary for tax administration and collection purposes as requested by the Department. 4. Disclosure of Information e art e t in `i ct 4.1 Statutory Authority: The Department may €isclose information relating to State Taxes and Municipal Taxes to City/Town pursuant to A .S. § 42-21 3 if the information relates to a taxpayer who is or may be taxable by a county,city,or town or who may be subject to audit by the Department pursuant toA.R.S. §42-6002. 4.2 Restrictions on Use and Disclosure to Unauthorized Parties: Any Tax Information disclosed by the Department ment to Pity;T"own is subject to all restrictions provided for in AKS, § 42-2003, Tax Information shall only be used by person authorized to receive such Tax Infon-nation for internal tax administration purposes, including audit, desk review, collection, and licensing activity, and may not be disclosed to the public or any unauthorized party in any manner that does not comply with the Confidentiality Standards(Appendix A). 4.3 Liability for Improper Disclosure: The disclosure of confidential information concerning Arizona taxes is governed by A.R.S. § 42- 001 et seq., which strictly controls the accessibility and use of this information. Individuals who receive confidential information relating to State Taxes and unicipal Taxes from the Department'are subject to the penalties provided in AK& § 42-2 04 and other applicable statutes if they misuse or improperly disclose this information to unauthorized individuals. 4.4 ReportingPotential Disclosure Violations/Incidents: The Department shall not withhold Tax Information from City.?" d rt provided that City/Town complies with R& § 42-2 01 etseq.,and the Confidentiality Standards(Appendix . to IfCity/Town or the Department has info ation to suggest City/Town or any of its drily authorized representatives has violated A.R.S. § 42-2 01 e ,sect, or the Confidentiality Standards (Appendix , City/Town or the Department shall immediately stratify City Services at ciAie titttt'rz,azdor.� gyp, theDepartment's Disclosure facer at iscl sure0f`fi r( a s or ov,and the Department's Intortnation Security Team at L11foSec#cr ardor tsv. September 2023 Page 9 of 3 ICI - unieipal IGA for'TPT Administration b) C;ity;Town and the Department shall frilly cooperate with the Department's ment's Disclosure Officer and Information Security Team in investigating the alleged violation and shall promptly address any identified issues: c) The Department's Disclosure Officer and Information Security Team.- 1 Shall send written notice to C*ity/T wn's PPOC detailing the alleged breach as understood by the Department and request a response to the allegation within twenty 2 ) calendar days of the date of the letter,and (2) May inspect City/Towit's records, facilities, and equipment to determine whether there has been a violation, and 2) Shall review the written response from City/Town and consider the information contained therein and all relevant circumstances surrounding the alleged violation prior to issuing any determination, and ) Shall issue a written determination delivered by certified mail to City/Town regarding the alleged violation within sixty t )calendar days of the date of C ity"'Town's response letter, If the Department determines that a violation has occurred, the Department shall indicate whether a suspension of information is warranted and the length of the suspension. During the period of suspension, C it o"Tca n shall not access information maintained ined or created by the Department related to City/Town. d) If the Department makes a written determination to suspend sharing of information,City/Town may, within ten l )calendar days of receiving the written determination, submit a written request to SMART requesting the group review the determination as provided in Section 15 of this Agreement. e) If there is a suspension sior if Tax Information sharing with City/Town, the Department shall maintain all information collected or created during the suspension period related to C:ity�`Town that would otherwise have been shared with City/Town and shall assist City Town with accessing the accumulated information for City/Town immediately upon termination of the suspension. f) Under no circumstances shall the suspension of any right to receive Tax nfortination adversely impact the Department's artmen's delivery or transfer of any C'ityrTown revenues in any manner. 4.5 Information to be Provided:t The Department rtment shall provide information pursuant o . ; e §42-6001t ).The T e arttirent shall provide such information as outlined September 2023 Page 10 of 39 ADOR-1 nnnicipal IGA for TPT Administration in Appendix B and elsewhere in this Agreement, which shall only be modified in accordance with Section 4.7 of this Agreement, to The Department shall not provide Federal Tax Information to City/Town. lb In addition to the information detailed'i in Appendix B of this Agreement, the Department shall disclose, upon request, the following information t City/Town: l) Department tax audits, including all information related to all Arizona municipalities included in the;tax audit,and Other relevant i of n ation necessary for C°ity?Town's tax administration and collection purposes, including all information necessary to verify that City/Town received all revenues collected by the Department on behalf of C;ity.'T nwrn, 4.6 St r e and estr c io of Taxfor atio t All Tax Information provided by the Department to City/Town shall be managed,steered,protected,and destroyed in accordance with the Confidentiality equiremernts(Appendix , .7 Specificity ofData: Pursuant to ,1 . . §42-6001, the Department and City/Town agree that the data fields identified in Appendix of this Agreement and the JT-1, `PT-TPT-2, and TPT-EZ forms in Appendix C of this Agreement also provided online at wmwL ,a d rs ov meet the specificity requirements refC ty,'Town.The data fields identified in Appendix B and the forms in Appendix C may be revised or replaced only by mutual agreement of the Department and Arizona municipalities,with any unresolved issues being referred to SMART for final determination. . . Notwithstanding any provision to the contrary,nothing in this Section shall prevent the Department f orn complying with state information security requirements in the situation of data breach or similar event. 5. Audit The Department shall administer audit functions with City/Town in accordance with the Standard Audit Life Cycle Process Map and with the following provisions. .1 Training: All auditors, desk reviewers, and supervisors shall be trained in accordance with the policies of the Department. Auditors and desk reviewers who have not completes the training may only work in conjunction with a trained auditor or supervisor and cannot be the only auditor or desk reviewer assigned to the audit r desk review, The Department shall do all the following: a Provide semi-annual audit and desk review training in accordance with AK& §42- 0 C )and be responsible for the costs of the training,limited to any cost for procuring the site and training materials; September 2023 Page l l of 39 ADO -Municipal IGA for TPT Administration {b) Notify City/Town of any training sessions at least thirty calendar days before the date of the training session; tc Permit City/Town auditors, desk reviewers, and supervisors to attend any scheduled training as space permits at any designated training location, d Provide additional training, as heeded, to inform auditors, desk reviewers, and supervisors regarding changes in State law, the Model City Tay Code, audit and desk review procedures,or Department artment policy, .2 Conflicts of Interest: a auditor, desk reviewer, supervisor, or Independent Contractor trained and authorized to conduct an audit or desk review, in addition to the restrictions provided under A.R.S. Title 38, Chapter 3, Article 38- t i d.rat,shall not conduct any of the following prohibited acts: t 1 Represent a taxpayer in any tax matter against the Department or City/Town while employed by or its are Independent Contractor relationship with the Department or City/Town. Attempt to use his/her official position to secure any valuable thing or valuable benefit for hitnself1herselfor his/her family members, (3) Represent a taxpayer before the Department or City/Town concerning any matter in which he/she personally participated for a period of one year after hc"" he ends employment or the Independent Contractor relationship with the Department or City?Toys, Use information heishe acquires in the course of the official duties as an auditor,desk reviewer, supervisor, or Independent Contractor in a manner inconsistent with his/her official ditties without prior written approval from the Department. For a period of one l calendar year after heishe ends employment by or an Independent Contractor relationship with the Department or City/Toxin, work in the saute firm as a person who represents a taxpayer against the Department orCity/Town unless the firm institutes a formal screen or ethical mall to prevent any sharing of information between the person and the remainder of the firm, Documentation of such formal screen or ethical wall shall be provided by the firm to the Department or City/Town upon request. Deceive compensation from a source other than Cit akTown or pursuant to an agreement with City/Town for the performance of any work or transaction perforined expressly on behalf of City.Town. September 2023 Page 12 of 39 O1 - unic:ipal IGA for TPT Administration Make any representation of being an employee or contractor of pity°Town or the Department in marketing and promotional materials soliciting work or transactions to be performed on behalf of a taxpayer or potential taxpayer. b) In addition to any other remedies available tote Department and ity'Town by statute and under the teens of this Agreement, the Department may revoke an individual's authority to audit or perforrn desk reviews on behalf o the Department or City/Town and prohibit the use of any auditor, desk reviewer, supervisor, or Independent Contractor who violates this provision. 53 Audits and DeskReviews: a) City/Town City/Town may request the Department arty en conduct are audit or desk review o any taxpayer engaged in business in City/Town,including taxpayer whose business activity is subject to tax:byCity/Town but is not subject to tax by the State. The Department and Arizona municipalities shall collaboratively establish and maintain tain minimum justification standards and procedures City/Town shall adhere to when submitting an audit or desk review request, b) City/Town may conduct an audit or desk review of a taxpayer engaged its business only in City/Town. Before commencing such audit, CitylTo` n shall submit a Field Audit Request Form, Before commencing such desk review, City/Town shall submit the request using the Desk Review Approval Excel Sheet. The Department shall provide City/Town with a determination of approval or denial of the request within tent 0) calendar clays of the notice from City/Town. c) Except as pernutted below,the Department shall conduct all audits and desk reviews of taxpayers having locations in two 2) or more Arizona municipalities. A City/Town auditor may participate in any audit or desk review ity/Town,reguested the Department to perform. d) City/Town shall notify the Department if it wants to conduct an audit or desk review of a taxpayer having locations in two 2) or more Arizona municipalities and whose business activity is subject to tax by City,"Town but is not subject to tax by the State;The Department shall authorize such audits or desk reviews, to be overseen by the Department, unless there is already an audit or desk review of the taxpayer in process, scheduled or placated,or the Department determines the audit or desk review selection is discriminatory, an abase of process, or prises other similar defects. The Department shall notify City/Town of its determination within ten 1 ) calendar clays. No initial audit or desk review contact may occur between City/Town and a taxpayer until the Department approves the audit or desk review notice. September 2023 Pa c 13 caf3 ADOR-Municipal IGA for ITT Administration e) In the case of taxpayers doing business in more than one 1) Arizona unicipality 1) it "T wn'may request the Department conduct an audit or desk review of a taxpayer having locations in two 2) or more Arizona municipalities and whose primary business is subject to both Municipal Taxes and State Taxes. 2) City/Town may request authorization from the Department for City,'°Town to conduct an audit or desk review of a taxpayer having locations in two 2) or more Arizona municipalities and whose primary business is subject to both Municipal 'Taxes and State Taxes. 3) Requests pursuant to c)(1) or (e)(2) shall be trade using the Department's Field edit Request Form or the Desk Review Approval Excel Sheet, as appropriate. The Department shall notify City"T own of its decision regarding the request within ten 10) calendar ass of receipt of the request. f The Department may deny, in writing, ity/T own's request for the Department to conduct an audit or desk review within ten 1 p)calendar days f receiving the request for any of the following reasons: 1) An audit or desk review is already in process or is scheduled or planned for the taxpayer within six t months of the request, 2) The requested audit or desk review would interfere with strategic tax administration planning; 3) The audit or desk review selection is discriminatory, an abase of process, or poses other similar defects; ) The request lacks sufficient information for the Department to determine whether it is appropriate, 5) The"Taxpayer was audited within the previous two 2)years; 6) The Department lacks sufficient resources to conduct the audit or desk review`, ) The scrape or subject of the audit or desk review dries not justify the use of Department rtment resources. ) If the Department denies a request to conduct an audit or desk review for the reasons provided in ) or ), and the audit or desk review is not for a taxpayer that only has a business location in City/Town, then City Town may request to conduct the audit or desk review itself under the September 2023 Page 14 of 39 DOD-Municipal11A for I T Administration supervision of the Department, No Initial audit or desk review ont ct may occur between City/Town and a taxpayer until City/Town receives written Department approval h Any decision by the Department rtment denying C;ity/Town's request to conduct any audit or desk review may be referred to SMART in accordance with Section 15 of this Agreement. i All audits or desk reviews conducted by City/Town shall be in accordance with standard audit procedures defined in the Department audit manual and the Standard Audit Life Cycle Process Map. All auditors and desk reviewers shall be trained in accordance with Section 5.1 of this Agreement. t1 The Department may appoint a Department manager to supervise any audit or desk review conducted by City/Town. kAll audits shall include all taxing jurisdictions in the State regardless of which jurisdiction's auditors participate in the audit. All desk reviews must include all taxing jurisdictions for which there is information provided by the taxpayer: 1 The Department shall issue all audit or desk review assessments on behalf of'all affected taxing jurisdictions in a single notice to the taxpayer. (in) The Department shall issue amendments- to audit or desk review assessments on behalfo all affected taxing jurisdictions in a single notice to the taxpayers .4 Claims for Refund: a When a taxpayer files a request for refund, including refunds requested by filing amended returns,the Department shall process the request and review it for mathematical errors or for the failure of the taxpayer to properly compute the tax based on the taxable income reported on thereturn r refund request. b = The Department tment shall notify City/Town` of all refund requests that are reviewed and approved involving City#`Town's Municipal Taxes within thirty 3 calendar days of processing the refund. City,"Town may request an audit of the taxpayer as set forth in Section 5.3 of this Agreement. c The Department may assign a Department auditor to review requests for refunds.The Department shall notify City/Town of all refunds under review by an auditor pertaining to a taxpayer who engages in business within City/Town within thirty 30 calendar days of initiating the review and may request that City/Town assist with such reviews, with acceptance of each request at the discretion of City/Town,The Department may assign a refuted request to a City/Town for review, with acceptance of such assignment at September 2023 Page 15 of 3 DOR-Municipal IGA for TPT Administration the discretion of City/Town. The :department may only assign refund requests to CityJown iftaxes paid to City'Town are included in the refund request. (d) CityJown is responsible for payment of all amounts to be refunded t taxpayers for Municipal Tax incorrectly paid to City/Town. The Department may offset a remittance to Cit :"T`own under this Agreement to cover the amounts of allowed Municipal Tax refunds paid by the Departments (e) The Department shall issue refund approvals/denials on behalf of all taxing jurisdictions in a single notice"to the taxpayer, City/Town may request copies of such determinations, ns. 5.5 Protests: Taxpayer pretests of audit assessments, desk review assessments, and refund denials shall be directed to the Department. Protests of audit assessments, desk review assessments, and refund denials shalt be administered pursuant t . S. Title 42, Chapter 1, Article 6. The Department shall notify City/Town of any protests within thirty 30) calendar days of receipt of the pretest. 5.6 StatusReports- The Department shall keep all Arizona municipalities apprised of the status of each pretested matter involving the imposition of Municipal Taxes. City:/Town may request to be can a distribution list for monthly status reports by contacting City Services at citiesuniviragdo dy. e ; a tatDisclosure rd ants The Department may enter into a Voluntary Disclosure Agreement with a taxpayer. A Voluntary Disclosure Agreement may limit the years subject to audit and waive penalties, If the taxpayer discloses to the Department that it owes Municipal'Taxers to City/Town,tile Department shalt notify City/Town of the Department's intent to enter into a Voluntary Disclosure Agreement it and the Department shall provide the to payer's identity within thirty (3 ) calendar days of the identity being disclosed d to Department. City,,Town may subsequently request an audit of a taxpayer subject to a Voluntary Disclosure sure Agreement pursuant to Section 5.3 of this Agreement. License CoMpliance 7.1 License IssuanceRenewal: The Department shall issue new municipal privilege tax licenses and shall annually renew such licenses for City/Town Municipal Tax. The Department shall provide City/Town with information about all persons obtaining and renewing municipal privilege tax licenses as set forth in Appendix B of this Agreement. 7.2 License Checks: The Department and City/Town shall coordinate efforts t conduct mutual tax license compliance checks through canvassing slid either compliance methods. Septcmber 2023 Page 16of 39 ADO -Municipal l A for TPT Administration .3 Confidentiality: Any tax license information City/Town obtains from the Department is confidential and may only be disclosed as authorized by ARS. 42-2003. Any tax, license information City,,Town obtains through its own efforts may be disclosed as allowed by City/Town ordinance or policy. �4 Changes to LicenseFees: Within ten(1€1)business days following the adoption of an ordinance(car official acknowledgment of an ordinance approved by voters in an election) creating or modifying a municipal privilege tax license fee, one( )copy of the ordinance and notification of the effective date of such ordinance shall be sent to City Services at ci iesunit@ dor. ov, The Department shall not be obligated to begin collection ofthe new or modified tax license fee any sooner than sixty( calendar days after the:date the Department received the ordinance from City/Town. 8. lositt r f The Department shall notify City/Town before entering into d Closing Agreement and shall seek a range of settlement authority from CityiTown related to the tax levied and imposed by City/Town in accordance with the Standard Audit Life Cycle Process. 9. es s2ris f" r resentatio Lai atfd 9,1 Administrative Proceedings: Pursuant to A.I .S. §42-6002, the Department xient shall coordinate the litigation and defense of assessments and refund denials in any administrative appeals before the Office of Administrative Hearings or the Director of the Department regardless of the jurisdiction that conducted the audit, desk review,or refund review in accordance with the Standard edit Life Cycle Process Map, The Department shall diligently defend the interests of City/Town and CityllTown shall assist the Department in such representation as requested by either party. .2 Further Appeals: The Arizona Attorney General is responsible for defending the assessment or refund denial at the Board of Tax Appeals, the Arizona Tax Court, and all higher courts, CityiTown shall assist the Attorney 1eneral in such representation and litigation as requested by the Attorney General's Office in accordance with the Standard Audit Life Cycle Process Map. .3 Mutual Cooperation: The Department and City/Town agree they shall cooperate in the appeal and litigation processes and shall ensure their auditors desk reviewers, supervisors, and other necessary employees are available to assist the Department and the Attorney General through informal interviews, providing documents and records,preparing for depositions,attending depositions and trial as witnesses,and assisting in trial./hearing preparation,as needed. 9.4 Administrative ec s o ss The Department shall provide a copy of all administrative hearing level decisions regarding State Taxes and Municipal Takes, includingDirector's decisions issued by the Department, to ity,,,"T swn within ten (10) business days after issuance of the decision if City/Town requests to be September 2023 Page 17 of 3 DOR-Municipal IGA for T I' dirtinistration included on a distribution list created by the Department for the purposes of disseminating such decisions, ity'Town may request to be can the distribution list by contacting City Services at Administrative decisions contain Tax Information and must be stored and destroyed in accordance with the Confidentiality Standards(Appendix 10. Collection of Municipal Taxes 10.1 Tax Returns: Taxpayers who are subject to City/Town Municipal Taxes are required to pay such taxes to the Department ent utilizing a form prescribed by the Department. 10.2 Delinquent Tax Collections: Pursuant to A.R.S. § 42-6001, the Department shall collect any delinquent Municipal Tait imposed sed by City/Town recorded on the Department's tax accounting system.In the event this Agreement is terminated,the Department shall continue to collect delinquent Municipal Taxes recorded on the Department's accounting system on behalf ofCity/Town and distribute any such amounts collected toCity/Town. 10.3 City/Town Assistance in el t Tax Collections: To expand the Department's State "Tax" and Municipal Tax collection efforts by leveraging City/Town resources, City/Town may choose to provide collection efforts by deploying City/Town collectors to workn conjunction with the Department ent on the following terms- a Training: All City/Town collectors authorized to collect obligations in cooperation with the Department shall be trained in accordance with the policies of the Department. Training shall be provided in the same mane as set forth in Section 5,t of this Agreement. (b) Conflict ofInterest:A collector trained and authorized under this provision to perform collections activity shall"not conduct any of the following prohibited acts: t1 Represent a taxpayer is any tax matter against the Department ent or City/Town while employed byCity/Town. Attempt to use his./her official position to secure any valuable thing or valuable benefit for himself/herself or his,`her family members. 3 Represent a taxpayer before the Department orCity/Town concerning any batter in which helshe personally participated for a period of one 1 calendar year after he/she ends employment with City/Town. 4 Use information lie/shc acquires in the course of the official duties as a collector in a manner inconsistent with his/her official deities without prier written approval from the Department. September 2023 Page 18 of 3 ImaOR-Municipal IGA tur°ITPT Administration For a pentad of one t 1 calendar year after he/she ends employment with City/Town, work in the sane farm as a person who represents a taxpayer against the Department or Citye'Town unless the firm institutes formal barriers to prevent any sharing of informatio between the trained collector and the remainder of the firm, Revocation: The Department may revoke the authorization of CityiTown or ofany individual ityt°Town employee to collect obligations under this Section, A revocation determination may be subject to review by SMART upon request by the individual or City,"To n .4 State of Arizona Liquor License f a avit: City/Town may request that the Department issue a liquor license affidavit. The Department shall respond to the request via secured e-mail to indicate the status ofcompletion of the request with a note stating complete, in-process,or unable to complete. 10.5 collecti le iscreti ary rite-offs: The Department shall share the annual list ofuuc le tible/di crd nary write-offs f C ty owns Municipal"faxes prior to the write-off event at the end of the fiscal year. City/Town shall have forty-five (4 calendar days is submit feedback. 10.6 Remittance: All amounts collected by the Department for City/Town'City/Town's Municipal Taxes tinder this Agreement drill be remitted to City,,,"To n weekly on the basis of actual collections. To the extent possible, the Department shall initiate the electronic payment by Noon on the Monday after the end of the week in which the collections were received by the Department. 1f the Monday falls on a holiday, payment will be initiated by Noon on the Tuesday after the end of the week is which the collections were received by the Department. Remittance shall be made in the form of immediately y available hands transferred electronically to the bank account designated by C ity"Town. 10.7 Abatement: Pursuant toA.R.S. § 4 -10 4, the Department, with the approval f the Attorney General, may abate tax tattier certain circumstances including Municipal Taxes. During the ordinary course of business the Department may determine that certain taxpayer accounts shall be chased or cancelled. The Department shall seek input from City/Town or SMART T efore abating unicipal Taxes or closing accounts with Municipal Taxes due.The Department.dent may request a telephonic meeting ofSMART if time or circumstances require immediate action. 10.8 n s Owed to City/Town: t all times and under all circumstances, payments remitted by a taxpayer to the Department for City/Town Municipal Taxes shall be considered property of C°ityt'T"own, The Department may not retain or fail toe fit such farads to City/Town for any reason not specifically set forth in this Agreement including,but not limited to,during the course of s dispute betweenCity/Town and the Department. September 2023 page 19 of 3 AD -Municipal IGA for'TPT Administration inistration 10.9 Adjustments to Reported Taxes: If.the Department determines that a payment remitted by a taxpayer incorrectly identifies the city or town to which the payment should be made, the Department may temporarily hold the payment until the distribution of the payment is corrected to ensure the appropriate: city or town receives the payment, If payment by the Department has been made to an incorrect City/Town, the Department arid affected Arizona municipalities shall follow the Standard Inter-Jurisdictional Transfer process Map, 10.10 Collection Ra orts: The Department shall keep all Arizona municipalities cipalities apprised of the status of every open ease in a collection status involving the imposition of Municipal Taxes. City/Town may reddest to be on a distribution list for monthly status reports by contacting Cities Collections at c;itiescollee ionfitardor. __V. 11m l ifor it The Department shall be responsible for issuing the official responses to taxpayer ruling requests and requests for interpretation of the Model (Pity Tax Code. City/Town acknowledges that pursuant to .R.S. § 42-6005(B), when the state statutes and Model City Tax Code are the same and where the Department has issued written guidance, the I`te artmenfs interpretation is binding on Arizona municipalities and interpretation of Model City "Tax Code. The Department ent acknowledges that in all either situations, interpretation of the Model City Tax Code is the sale purview of Municipal Tax Code .:omission or its designee. This Section is net intended to affect procedures for appeals and litigation as outlined in Section 5.5 and Section 9 oft is Agreement, 12. Financi u,Collection of Taxes The costs incurred by the Department in administering this Agreement shall be financed through the State general fund appropriation to the Department. This provision does not relieve City/Town of any financial obligation imposed by statute, f: . Inter-Jurisdictional Tra sfers f" s" The Department arty ent shall administer Inter-Jurisdictional Transfers of Municipal 'Tax monies in accordance with the Standard Inter-Jurisdictional Transfer Process Map. Tile affected Arizona municipalities ipalitie shall agree on any amounts to be transferred before notifying the Department of such amounts to be transferred tender this Section. 14.> ucatio and OutreachEfforts To farther its focus on serving taxpayers and its commitment to fundingArizona's future through enhanced customer service, continuous improvement, and innovation, the Department is expanding its outreach and education program to connect with all citizens of Arizona by strategically working with taxpayer and industry groups, tax practitioners, and Arizona's municipalities to ensure consistent tax education is widely available. September 2023 Page 20 of 3 AD-Municipal IGA for TPT Administration AnyCity/Town may further this mission, at its own expense, in providing education and outreach to taxpayers. Education and outreach programs and content shall be consistent with applicable law and the Department's written guidance Increased education and outreach efforts undertaken by the Department and Arizona municipalities will ensure collaborative partnerships beneficial to both parties,emphasize an ongoing two-way exchange of information, enhance communication on issues of common interest, and promote cooperation in areas of overlapping special projects. Therefore, upon request, C:ity.'Town shall provide information to the Department concerning such education and outreach efforts The Department shall implement an Ambassador Program, whereby the Department provides curriculum,,structure,and support for education related to tag administration and compliance. City/Town" shall be provided a standard work process when participating in Department-led educational,events 15. State& Municigal . it Resolution Team J"SMART" 15>1 Members: The SMART committee shall consist of four 4 primary (voting) members representing municipal taxing jurisdictions and four 4primary voting members representing the Department. There shall also be two alternate members representing each party, who are non-voting epresentati s unless required to vote due to the absence,recusal,or disqualification of primary(voting) member. All primary and alternate members are required to attend all meetings unless excused. 15.2 Selection: The director of the Department shall appoint Department employes to serve as primary and alternate's members representing the Department, Arizona municipalities shall collectively appoint municipal employees to serve as primary and alternate members representing the Arizona municipalities The members representing either party may be changed at any time following the standard work process agreed upon by bath parties, 15.3 Meetings: SMART shall meet monthly.unless there is no business to be conducted, Additional meetings ins can be scheduled as necessary to timely discuss issues presented. 15.4 Issues: The Department or it ,!T own may refer issues to SMART for resolution including but not limited to: a Decisions by the Department to not audit a taxpayer; b Amendments to Department audit procedures or manuals; c Chasing Agreements or a range of settlement authority; d Abatement or account closure in collections; September 2023 Page 21 of 39 DO - Iuni if al I A for TPT"Administration ) Suspension of disclosure of Tax Information to itya"Town Disagreements regarding proposed changes to the process reaps delisted in Sections 1.19, t.20 and l.21 of this Agreement; ( ) Revocation of collection authority;and (h) Other issues as authorized by the Director of the Departmentear agreed upon by the parties, subject to the limitations described"in Section 29 of this Agreement. 15.5 c do s> SMART shall make recommendations to the Director of the Department orDirector's designee. if the recommendation is approved by at test five ( ) members of SMART, the Director shall accept the recommendation of ART. If SHAFT cannot reach a recommendation agreeable to at lest five ) members of the group,the Director or Director's designee may act as they deem to be in the best interests of all parties, Notwithstanding the above, upon request by City,FT own,the Director shall submit their decision to the Attorney General's Office for review, 15.6 t t Any voting member of the committee may request the vote be held by secret ballot. 15.7 Procedures: SMART shall develop procedures concerning the operation of the committee consistent with this Agreement, 16. Fundinc,of Additional Auditor 11 16.1 t At the scale discretion of City/Town,City/Town, City,Town own may contribute funding to the Department to pay for additional auditors to assist the Department in the performance of audits of Municipal 'Tax awed to City/Town. Such additional auditors funded byCity/Town shall at all ties be deemed to be employees of the Department and udder no circumstances all be deemed to be employees or agents of City°T"own. It is the Parties' intention that any City./Town funding provided pursuant to this Section shall be used to increase the resources and capabilities of the Department artment to perform Municipal Tax audits and not"tee subsidi e or replace State funding required for audit and collection of taxes. .2 Use ofFunds: City/Town funding for additional auditors under this Section shall be used to fttrtd the auditors' salaries and related expenses and shall not be used to pay for Department office space, utilities, equipment, supplies, or similar kinds of overhead. .3 Pool of n sg The Department may pool anyCity/Town funding with any other similar finding provided by other Arizona municipalities to pay for additional auditors dedicated to serving those jurisdictions. The Department shall separately account for such funds its its annual budget. September 2023 Page 22 of 3 DOR- unicipal IGA for TpT"Administration 16.4 Accounting: The Department shall provide an annual accounting to C ity=''T`own,by August 31 each year describing how CityiT wn funding was resell during the prior fiscal year: M Satellitet' e fn art ertt t rs 17.1 Funding: City/Town,at its own expense and at its sale discretion,may provide one 1 or more satellite offices and associated amenities for use by Department employees to provide audit and/or customer service to taxpayers. Use of such facilities by Department employees stall use at the idle discretion of the Department. Nothing in this Section shall require the Department to make use of such facilities provided by City/Town, 17.2 e ire e ts: Any Department employee using a City/Town satellite office must meet reasonable requirements of City/Town related to the use of the facility. City/Town shall be responsible for notifying the Department of any concerns and the Department shall be responsible for taking appropriate actions to resolve lve those concerns. 17.3 Termination:Once a satellite office is established,City"T"own shall provide at least one hundred eighty t1 0 calendar days' written notice to the Department prier to the termination or relocation of a satellite office. The Department rtment may discontinue the use of a satellite office at any nine upon notice to City/Town and shall promptly remove all Department property. 17. ce rse: All requirements ofCity/Town and the Department t elated to the satellite office shall be outlined in a mutually acceptable form of license and subject to separate approval. 17.5 Workers' Compensation for Satellite Offices and Certain Site "visits: If employees of City!To n or Department are working at the facility of the other public agency pursuant to this Agreement, it is agreed that. a Each employee will be deemed an ernpluyee of both public agencies for the purposes of: .lt.S. §23.10 t1 and Arizona workers'compensation laws. b Each employee's primary employer (i.e., the State of Arizona for a Department ent employee, and Cityf'T own for a CityiT'own employee or Independent Contractor) shall be solely liable; for the payment of workers` compensation benefits. c Each public agency for which employees of City/Town or Departmentare working at the facility of the rather public agency nder this Agreement shall post a notice complying withA.R.S. § 23®I }3 . d In all circumstances either than as provided in the foregoing nothing in this Agreement shall be construed to result in any person being the officer, September 2023 Page 23 of 3 DOR-Municipal I{W A for TPT Administration agent, employee, or servant of either party when such person, absent this Agreement and the performance thereof, would not in law have such status, 1 - ail flit of Funds Every payment obligation of the Department and City/Town pursuant to this Agreement is conditioned upon the availability of fluids appropriated or allocated for the payment of such obligation, except for the rendering of hinds to City/Town paid by a taxpayer for Municipal Taxes or municipal privilege tax license fees of City/Town. If funds are not appropriated, allocated, and available, or if the appropriation is changed resulting in funds no longer being available for the continuance of this Agreement, this Agreement may be to ina ed at the egad of the period for which funds are available, No liability shall accrue to the State or City/Town, as applicable, in the event this provision is exercised and the Mate or City/Town, as applicable,shall not be obligated or liable for any future payments ..writs or for any damages as a result of tentrination under this Section. The termination of this Agreement shall not entitle the Department to retain any Municipal Tax col ccted on behalf of City/Town pursuant to this Agreement. 19. Waiver Nothing in this Agreement should be interpreted as CityiT"o n relinquishing its legal rights tinder the Arizona Constitution or other applicable lair, nor that City/Town is conceding the administration and collection of its Municipal Tax is not of a local interest or should not be tinder local control. 20. Cancellation The requirements ofA.R.S. § 38-511 apply to this Agreement. The Department or City/Town may cancel this Agreement,without penalty or further obligation, if any person significantly involved in initiating, negotiating, "securing, drafting, or creating this Agreement on behalf ofile Department or C" ty.!To tn is,at any time while this Agreement or any extension is in effect, an employee, agent, or consultant of the Tither party with respect to the subject matter of this Agreement. The obligation of the Department toe it City/Town taxes shall survive cancellation. 21. Notice Ca When any Notice to City/Town is required sander the terms of this Agreement,such Notice shall be sears by electronic correspondence o: Leslie DeReche Id r 1 ` n tion b When any Notice to the Department is required wander the terrns of this Agreement, such Notice shall be sent by electronic correspondence to City Services at e tie canita` a dor. ov, September 2023 Page 24 of 39 ,DOR- unicipal IGA for TPT Administration 22. Non-discrimination ADOR and City/'Town shall comply with Executive Order 2 23-01, which prohibits discrimination n based on race, color, sex, pregnancy, childbirth or medical conditions related to pregnancy or childbirth, political or religious affiliation or ideas, culture, creed, social origin or condition, genetic information, sexual orientation, gender identity or expression, national origin, ancestry, age, disability, military service or veteran status, or marital status, by persons performing state contracts or subcontracts. ADOR and City/Town also agree to comply with Executive Orders 20 3-22 and 9 9-09 as amended by Executive Order 20 3- 1, all other applicable State and Federal employment lays, rules, and regulations, including the Americans with Disabilities Act of 1990. ADOR and the City/'Town shall also comply with Executive Order 2 -09 prohibiting race-based hair discrimination. 3. COMIDliance with ImimPration Laws and A.R.S._IAI-4401 23A The Department artrl ent and City,/Town shall comply with all Federal immigration laws and regulations relating toe employees and warrants compliance with A.R.S. § 23- 214 which reads in part: "After ecember 31 2007, every employer, after hiring an employee, shall verify the employment eligibility of the employee oyee through the E-Verify program," 23.2 A breach of compliance with immigration lads and regulations shall be deemed a material breach of this Agreement and may be grounds for:the immediate termination ation of this Agreement. 23.3 The Department and City/Town retain the legal right to confirm the authorized presence and work authorization of any employee who works under this Agreement to ensure the Department and City/Town are complying with the applicable Federal immigration laws and regulations, and State statutes its set forth above. 24. Audit of Records it Jown and the Department ent shall retain all data,books, and other records ("Records") relating to this Agreement for at least six years a after termination of this Agreement,and b following each annual renewal thereof. All Records shall be subject to inspection by the Department at reasonable times, Upon request, the Department and CityJTown shall produce, any or all such. records. This Agreement is subject to XR.S. § 35-214 andA.R.S. § 35-215. 2 . Amendments Any amendments to the enumerated provisions or Appendices A, B, and C of this Agreement must be executed in writing in accordance with the provisions of this September 2023 Page 25 of 39 LJOR-Municipal I A for TPT Administration Agreement. The Standard process Maps described within certain enumerated provisions are not themselves part ofthis Agrectracnt. 26. Mutual Cooeratidit In the event of a disagreement between the parties regarding the tenras, provisions, and requirements of this Agreement, or in the event of the occurrence nc of any circumstances bearing upon or affecting this Agreement, parties hereby agree to mutually cooperate ate to resolve the said disagreement or deal with the said circumstance. 27. Arbitration To the extent required by ARS. § 12-1518and as provided for in ARS, § 12-133, the parties agree to resolve any dispute arising out of this Agreement by arbitration. The parties agree that any lawsuit filed by City/Town relating to the issues outlined in Section 19 of this Agreement is not considered to be a dispute arising out of this Agreement. 28. letation The implementation and execution n of the provisions of this Agreement shall be the responsibility of the Director of the Department or his/her designee and the Mayor of City/Town, his/her designee, or another party with designated authority pursuant to applicable law or City/Town charter to act on behalf of City/Town. 29. Limitations Nothing in this Agreement shall be construed as limiting or expanding the statutory responsibilities of the parties in performing functions beyond those granted to therm by law, or as requiring the parties to expend any sum in excess of their appropriations. 30. Duration 30.1 The term of this Agreement shalt commence from the latest date as indicated in Section 33 of this Agreement and continue in farce through December 31 st of the followin ealendar year unless canceled or terminated as provided herein.The ter of this Agreement shall automatically be extended for successive one(1)year terms commencing on January 1 st and ending on December 3 1 st of each year thereafter unless canceled or terminated as provided herein. 30.2 Amendments to this Agreement that are negotiated and agreed to by a simple majority of the review committee in Section 30.9 of this Agreementshall thereafter be excited by the parties hereto by a separate signed amendment and incorporated herein to be effective during the term of this Agreement and any extensions. .3 This Agreement may be canceled or terminated effective on December 3 1 st of any year by either party by providing written notice no later than sixty 60 calendar clays prior to the expiration of the term then in effect. September 2023 Page 26 of 39 AD OR-Municipal IGA for TPT Administration 30.4 This Agreement shall expire on December 31st of any year the Department is subject to sunset review by the legislature. Upon expiration, cancellation, or termination,any subsequent Agreement must be ratified through signature by both parties. 30.5 If State legislation enacted subsequent to the date of this Agreement substantially affects the performance of this Agreement by either party or substantially diminishes the benefits either party would receive tender this Agreement, either party may then terminate this Agreement by giving at lest thirty (3 calendar days' notice to the other party.The termination shall become effective immediately upon the expiration of the notice period unless otherwise agreed to by the parties. 30.6 Notwithstanding any provision to the contrary herein, both parties may by mutual agreement provide for the termination of this Agreement upon such terms and at such time as is mutually agreeable to them. .7 any notice of termination shall be mailed and served on the other party in accordance with Section 21 of this Agreement. 30.8 In the event of a partial or complete tent-ninatibn of this Agreement, if the parties have shared or exchanged property the parties will return the property to its original caner or dispose of it in a"manner required by the original owner as described in this Agreement. 30.9 During the term of this Agreement, the terms and conditionsof this Agreement shall undergo an annual review to be initiated no later than June Ist of each year. The review shall_ be performed by a committee made up of equal parts representatives of the Department and representatives of the municipal taxing jurisdictions entering into an l A with the Department for the administration and collection of Municipal `faxes. 31. Choice of Law The laves and regulations of the Mate of Arizona shall govcm the rights of the parties, the performance of this Agreement, and any disputes arising from this Agreement. 32. Entire ree t This document, including the specific appendices attached hereto, and any approved subcontracts, amendments, and modifications made thereto, shall constitute the entire Agreement between the parties and shall supersede all other understandings, oral or written. 33. Limature Authority September 2023 Page 27 of 39 ADOR-Municipal IGA for TT PT Administration 3 .1 By signing below, the signer certifies he or she has the authority to enter into this Agreement on behalf of his or her respective party, and fie or she has read the foregoing and agrees to accept the provisions h r in on said rt 's behalf: 33.2 This Agreement may be executed in counterpart. For the:,....mart nt,. For City Toy n, Signature Dart Signature Date Robert s,Director Walter"Chip:Wilson, or Typed Mare and Title Typed Name and title Arizona Department of RevenueCity of Apache Junction Entity Name Entity Mime 1600 W. Monroe St. 300 E, Superstition Blvd, Address Address Phoenix Arizona 85007 Apache Junction Arizona 5119 Zip City State Zip ATTORNEYRESERVED FOR THE p `his agreement between public agencies has been This agreement between public agencies has been reviewed pursuant to A.113.§ 11-952 by the undersigned reviewed pursuant toA.R.S. § t I-952 by the undersigned Assistant Attorney General who has determined that it is C°ityfT°own Attorney who has determined,on behalf of the in proper form and is within the powers and authority City/Town only,that it is in proper form and is within the granted under the laws of the State of Arizona ona to the powers and authority granted under the taws of the State Arizona Department of Revenue represented by the of Arizona to theCity/Town. Attorney General; KRIS MAYES APPROVED AS TO FORM ANDAUTHORITY: 1TY: e Attorney General Signature Y.�. Assistant rcAttorney General � CITY/TOWN ATTORNEY Date: Date: September 2023 Page 28 of 39 DORM nicip l IGA for TPT Administration APPENDIX A ARIZONA DEPARTMENT OF REVENUE CONFIDENTIALITY REQUI 1. Confidential Information 1,1 "Confidential Information" is defined in A.R.S. § 42-2001. Confidential Information may not be disclosed except as provided by statute. A.R.S. §§ 42-20 1 through h 42-2004. .2 "Tax Information"as defined in this Agreement is Confidential I f rt-nation, .3 Disclosure of aggregated financial information. Under no circumstance shall aggregated financial infor-nation related to transaction privilege taxes allow any person who is-not authorized to receive Tax Information to identify or discover the financial in fo ation of an individual taxpayer: a) Except as provided in Section 1,3(b) of this Appendix, Cityl"I own will disclose aggregated financial information its accordance with the Department's standard: 1) City/Town shall only disclose aggregated fiancia information from not less than ten 1 )taxpayers'within the political boundaries ofC City/Town. 2) No individual to pa er's financial information should be discernible due to its relative size compared to either members s of the aggregated group. For example,if one of the taxpayers in the data set represents 90 or more of the data point, then that data point must not be disclosed, regardless of the number of taxpayers. b) City/Town may disclose its aggregated financial information from less than tell 1 )taxpayers provided City/Town first determines the aggregated data could not potentially reveal the financial information of an individual taxpayer. Such a determination shall take all the following tat consideration. 1) OWnership. All taxpayers with common ownership entities shall be considered a single taxpayer for aggregationpurposes; and 2) f'roporlionali4,. No individual taxpayer's financial information should be discernible due to its relative size compared to other members of the aggregated group, and September2023 Page 29 o1'39 r l - unicipaf IGA for T T Administration Any other factor that might allow any person who is not authorized to receive Tax Information to identify or discover the financial information of an individual taxpayer. 2. o ecti nfcar t .1 City/Town must identify all places, birth physical and logical, where City/Town receives, processes, and stores Tax Information and create a platy to adequately secure those areas. 2,2 Tax Information must be protected during transmission,ission, storage, use, and destruction. City/Town must have written policies, standards, and procedures to document how it protects its information systems, including Tax Information so that it conforms to the State of Arizona statutes A.R. ,' 2-2 f{ 1 through 2-2 f and policies, standards, and procedures found can the Arizona Strategic Enterprise Technology ("A SET") ebsite at a c .,oz. oy,resources. licie - tandards- nd— reac:edtares or ASET's successor agency or vebsite and Arizona Department of Homeland Security's website at taupe dolts. tay.'ittfcat� taticata� eeurit = calicies- standard -and_ roc:et ures, 23 Department staff and authorized City/Town staff`are prohibited from inspecting Tax Information finless they have a business reason. Browsing through Tax Infort ati a concerning friends, neighbors, family members,or people its the news is strictly prohibited: 2.4 All removable media, including paper and Cobs, containing Tax Information must be secured when not in use and after normal business hours by placing all materials in a lacked Bauer or cabinet, During use, Tax Information us be protected so that it is not visible to members of the public or anyone Without a business need for the information. mation. 15 All individuals accessing or storing Tay Infon-nation from an alternative work site gust enter into a signed agreement that specifies how the Tax Information will be protected while at that site.Only trusted employees shall be permitted to access Tax Information from alternative sites. T'aati Information may not be accessed whip": in public places such as restaurants lounges, or pools. 6 Tax Information may not be discussed in elevators,restroo s,the cafeteria,or other public areas: Terminals should be placed in such a manner that prohibits public viewing of Tax Information, 12 When transporting confidential materials, the materials should be covered sea that others cannot see the Tax Information. When sending Tax Information by fax, a cover sheet should always be used. 8 Any person with unsupervised access to Tax Information shall receive training on the confidentiality laws and requirements to protect such infcartraation before being given access to such information and annually thereafter. They must sign September 2023 Page 30 of 3 AD OR-Municipal unicipal IG A for TPT Administration certificates after the training acknowledging that they understand their responsibilities. City,,!To tt must keep records to document this training and certification and submit a copy of the certification to the Department. 3. Disclosure of Information .1 Tax Information may only be disclosed as permitted byA.R.S. § 42-2003. 12 Tax Information is protected by statute and, therefore, stall not be disclosed in response to a public records request except as authorized by law. A state agency, including political subdivisions (City/Town), may deny inspection of public records if the records are deemed confidential by statute. Berry v, Stare, 145 Ariz. 12, 13 699 R,2d 387, 3 ( pp, 1985). 3 A taxpayer may designate a person to whom Tax Information may be disclosed by completing an ri otta De,artstte�tt of l c�c����, e� 2 or Fo i 285B, gar such other form that contains the authorizing information included in those forms. City/Town may contact the Department's Disclosure Officer a i c ea ur f c r rl r.tea if there are any questions concerning this requirement: 4. Retention is osa of Information 4.1 All records received from the Department must be kept for the duration of the records retention period as listed in the official records retention schedules approved by the Secretary of State Library Archives and Public Records Division ("LA " published on the LAP LAPR website. (a) The Department's custom records retention schedule is published on the LATER web to at a .a l brar is ov)rccgr ` hedules.asta b (b) In the event of a legal hold(such as a litigation hold or investigative hold), Departmentand/or City/Town may be required to retain records beyond the retention period. 4.2 The Department and City/Town shall follow the legal requirements for reporting the disposition and destruction of records to the Arizona State Library Archives, Public records Division sander A,T :S. § 41-151 19. Certificate of Records Destruction Foratts are found at: librar z. gv,, rrn/fearms. 4.3 All removable media containing Tax Information must be returned to the Department or sanitized before disposal or release from the control of CityfTown. 4A Tax Information must be destroyed by shredding or burning the materials when the retention period has been met and no legal holds are in place.'Tax Information may not be disposed of by placing the materials in the garbage or recycle bites. Destruction of Tax Information may be performed by a third-party vendor. September 2023 Page 31 of 39 R-Municipal IGA for TILT Administration ity,,'Town must take appropriate acIio to protect the Tax Information in transit and storage before it is destroyed,such as periodic: inspections of the vendor, 4.5 Computer system components and devices, such as copiers and scanners, which have beery used to share or process Tax Information may not be repurposed for non- tax administration uses unless the memory or hard drive of the device is sanitized to ensure nattier no circumstances Tart Inforritation can be restored or recovered. a Information Sep rite 5.1 Systems containing Tax Information must be protected in accordance with the State of Arizona Policies; Standards, and Procedures that govern State data found at I tips tipit env„ill caraattttic -sc caJ— olicics-staiidardi-and:pLoc�cclurg,, particularly Policies and Standards 00 - 410 and the Arizona NIST Security Baseline Controls. 1 City/Town is responsible for creating architectural diagrams of any systems connecting to theDepartment's systems and depicting the flow of State Tax Information, Architectural diagrams for systems connecting to the TOR shall be shared with the ADOR and updated after any architectural changes. 53 Incident Reporting. City,Town is required to notify the Department in the event of is suspected or actual unauthorized disclosure of Tax Information,data loss,breach, or rather security concern regarding Tax Info nation by reporting the incident to the Department's: 1 City Services Manager by email at citiesunit tr a d o r,a ov 2 Disclosure osure Officer by email t I isclosnre ffi r° a draft tsv andChief Information Security Officer's Information Security ,..Team by email at Info clear o ; 5A The Department may send employees or auditors to inspect any of City,'Tonwrn information systems and;,"or facilities used to process, store, or transmit any Department data at any time to erasure that Department information is adequately protected. City>'Town shall provide audit records and evidence of system and application hardening to the department's information security tease upon request. Hardening evidence can include,but is not limited to: I iskSense,CIS benchmarks, SCSEMs, STIt as, or other security best practices. If City,}` `ctwn Hires as third-party for any system or information support, all security provisions apply, fay `Wireless e om a wireless essnotwnrki City/Town must. 6J Establish restrictions, configuration/connection requirements, and implementation guidance for wireless access, 6.2 Authorize wireless access to the information system prior to allowing such connections. September 2023 Page 32 of 39 6.3 Employ a wireless intrusion detection system to identify rogue wireless devices and to detect attack attempts and potential conipr miss fbrc chcs to the information system. 3 September 2023 Page 33 of 3 DOR-Municipal IGA for TPT Administration tion APPENDIX B REQUIRED _., LDS t a minimum the Department of Revenue shall provide the following reports which display all of fields identified below, per report: NEW LICENSE REPORT and LICENSE UPDATE REPORT o Region Code o Run Date o .sport Start It o Report End Date o Update Its o Ili Type o III o Account o Entity Name o Ownership Type o License III o OT /Applied For indicator o Bankruptcy Indicator o Filing Frequency o Issue Date o Account Start Date o Business Start Date o Arizona Start Date o Doe Loc N o Accounting Method o Close Date o Close Cody o Business Description o NAICS I o II o IAI o IAI o Mailing tr l o Mailing trcc 2 o Mailing trc t o Mailing City o Mailing Stag o Mailing ZIP o Mailing Country o Mailing Phone Number o Mailing Address Add date o Mailing Address Fttd Tate September 2023 Page 34 of 39 D ID-Mu s ipal IGA for'I'P*f Administration o Audit Streetd o Audit Street o Audit Street o Audit City o Audit State o Audit Zip o Audit Country o Audit Phone Number o Audit Address Add Date o Audit Address End Date o Location Code o Business Codes o Location Name tD A c dumber of Units o Location Street I s Location Street o Location Street o Location City o Location State o Location n Zip o Location Country Location Phone Number o Location Start Date o Location End Date o Primary Location n Street s Primary Location Street c) Primary`Location Street o Primary Location City o Primary Location State o Primary Location Zip Code o Primary Location Country o Primary Location Phoned timber; o Primary Location n Start Date o Primary Location End Date o Owner Name o Owner Title o Owner Name o Owner Title o Owner Marne 3 o Owner Tide CITY PAYMENT JOURNAL o Run Date c Report Start date o Report End Date o CAL Accounting Period September 2023 Page 35 f 3 ADO -Munici al IGA.f r T't'_l,Administration o Period End Date * Payment received date Return received date Payment process date a Return process date Filing Frequency o License e III Entity Name Location Code Location n Name DB * Location Street Location Street Location on Street Location on City Location State Location Zip Location Country l Business Code o Doc Lee Nbr o t L> c Nbr Grass Receipts * Total Deductions Tax or Fee Collected * P& l Collected Audit Collections * Tian Type T arp Subtype o Rev Type CITY PAYMENT JOURNAL SUMMARY Region Code Run Date Report Start Date * Report Ertel Date c L Accounting atin Period * Business Code Number of Account Collections NO MONEY REPORT <-, Region Code cc, GL Accounting Period o Period End Date Payment received date Return received date September 2023 Page 36 of 3 r DOR- unicipal IGA for TVI, dministration o Payment process date o Return process date o Filing Frequency o License ILA o Entity Name o Location Code o Location n antic D o Location Street t o Location Street o Location Street o Location City o Location State o Location in Zip o Location Country o l*l. IS o Business Code o Lac L: c Nbr o Prat Loc Nbr o Gross Receipts co Total Deductions ns o Tax or Fee Collected o P& I Collected o Audit Collections o "ran Type o Fran Subtype DEDUCTION REPORT o Region Code o Run Ditty o Report Start Date o Report Enid Date o GL#Accounting Period o Period End Date o License ILA o Entity Nante r Location Code o Location Name L I o Business Cody o Doc LeeI br o Deduction Code o Deduction Amount o TTran Type o Tram Subtype o Rev Type September 2023 Fags 37 of 39 OR-Muni ipal IGA for TPT Administration FUND DISTRIBUTION REPORT co Region Code c Run Date o Report Start Date o Rupert End Date Accounting Period a Period Fttd Date o Payment Received Date o Return Received Date o Payment Processed Date o Return Processed Date o License ID o Entity am o Location Cody o Location Name o Business Code o Doc Loc l br o Fund Allocation Cody o Amount Distributed FUND DISTRIBUTION SUMMARY REPORT o Region Cody a Run Date o Report start Date o Report Frtd Date o GL Accounting Period o Fund Allocation Code r Amount Distributed Septembcr 2023 Pate 38 of 39 D t a uniciP I is for TPT Administration REQUIREDAPPENDIX C 1 -1 Joint 1 1 of ADOR F . t 10196 2. TPT-2 Transactioni11 Ali is byLinninLon or AFTER June 1 2016 ADOR Fomi 11249 Transaction ° 11 � ADOR Fomi 1123 September 2023 Page 39 of 39