AGENDA #4c
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TO: |
Roger L. Stancil, Town Manager |
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FROM: |
Loris R. Colclough |
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SUBJECT: |
Letter Agreement for Sale Tax Reallocation |
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DATE: |
September 24, 2007 |
PURPOSE
Council consideration and approval of a Letter of Agreement with Robert S. Segal, CPA for consulting services related to the examination and analysis of refunds of sales and use tax for potential reallocation to the County and the Municipalities therein. This Letter of Agreement represents a joint agreement between Orange County, the Towns of Chapel Hill, Carrboro, and Hillsborough, and Robert S. Segal.
BACKGROUND AND DISCUSSION
The Town of Chapel Hill has entered into a previous agreement with Orange County and the Towns of Carrboro and Hillsborough for services provided by Robert Segal, CPA (the “consultant”) for sales tax reallocation projects resulting in additional funds discovered and returned to the county as well as each municipality. Mr. Segal’s firm examines and analyzes sales tax refund requests submitted by the county and the municipalities, as well as refund requests submitted by school systems, non-profit corporations and the University of North Carolina to determine accuracy. Inaccurate refund requests often impacts the local sales tax revenue received by the county and municipalities, therein. In recent years, Mr. Segal’s firm has helped to recover significant amounts of revenue for the county and municipalities. An attached exhibit presents the detail distribution of the additional sales tax revenues recovered during Fiscal Years 2006 and 2007 totaling $505,538 for the county and municipalities. The amounts recorded are net of Mr. Segal’s fees.
The consultant’s fees are based on a percentage of the revenue recovery recognized as outlined in the attached Letter of Agreement. The percentages quoted by the consultant for this engagement are less than those paid on the previous engagement. The county and each municipality pay their proportionate share of the fees.
RECOMMENDATION
That the Council approve the Letter of Agreement representing a joint agreement between Orange County, the Towns of Chapel Hill, Carrboro, and Hillsborough, and Robert S. Segal, CPA PA and authorizes the Town Manager to execute the document.
ATTACHMENTS