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20-079 Hinderliter, De Llamas, and Associates (HDL), Sales, Use and Transactions Tax Audit Services
Master Professional/Specialized Services Agreement/ Rev. April 2020 Page 1 of 9 MASTER PROFESSIONAL/SPECIALIZED SERVICES AGREEMENT WITH 1.PARTIES This Master Agreement is made by and between the City of Cupertino, a municipal corporation (“City”), and (“Contractor”) a for , and is effective on the last date signed below (“Effective Date”). 2.SERVICES 2.1 Scope of Services. Contractor agrees to provide the Services set forth in the Scope of Services, attached and incorporated here as Exhibit A, on an as-needed basis. The Services must comply with this Agreement and with each Service Order issued by the City’s Project Manager or his/her designee, in accordance with the following procedures, unless otherwise specified in Exhibit A.Contractor further agrees to carry out its work in compliance with the City’s Shelter In Place and Social Distancing Requirements, attached here and incorporated as Exhibit A-A. 2.2 Service Orders. Before issuing a Service Order, the City Project Manager will request Services in writing and hold a meeting with Contractor to discuss the Service Order. Contractor will submit a written proposal that includes a specific Scope of Services, Schedule of Performance, and Compensation, which the Parties will discuss. Thereafter, City will execute a Service Order Form for the Services, attached and incorporated here as Exhibit B. The Service Order will specify the Scope of Services, Schedule of Performance, Compensation, and any other conditions applicable to the Service Order. Issuance of a Purchase Order is discretionary. The City Project Manager is authorized to streamline these procedures based on the City’s best interests. Contractor will not be compensated for Services performed without a duly authorized and executed Service Order. 3.TIME OF PERFORMANCE 3.1 Term. This Agreement begins on the Effective Date and ends on (“Contract Time”), unless terminated earlier as provided herein. The City’s appropriate department head or City Manager may extend the Contract Time through a written amendment to this Agreement, provided such extension does not include additional contract funds. Extensions requiring additional contract funds are subject to the City’s purchasing policy. 3.2 Schedule of Performance. Contractor must deliver the Services within the time specified in each Service Order, and under no circumstances should the Services go beyond the Contract Time. HINDERLITER, DE LLAMAS AND ASSOCIATES Hinderliter, de Llamas and Associates California Corporation Sales, Use and Transactions Tax Audit Services June 30, 2022 Select one Master Professional/Specialized Services Agreement/ Rev. April 2020 Page 2 of 9 3.3 Time is of the essence for the performance of all the Services required in this Agreement and in each Service Order. Contractor must have sufficient time, resources and qualified staff to deliver the Services on time. Contractor must respond promptly to each Service Order request. 4.COMPENSATION 4.1 Maximum Compensation. City will pay Contractor for satisfactory performance of the Services a total amount that will based upon actual costs but that will be capped so as not to exceed $ (“Contract Price”), based upon the Scope of Services in Exhibit A and the budget and rates included. The maximum compensation includes all expenses and reimbursements and will remain in place even if Contractor’s actual costs exceed the capped amount. 4.2 Per Service Order. Compensation for Services provided under a Service Order will be based on the rates set forth in the Service Order, which shall not exceed the capped amount specified in the Service Order. 4.3 Invoices and Payments. Except as otherwise provided in a Purchase Order, monthly invoices must state a description of the deliverables completed and the amount due for the preceding month. Thirty (30) days prior to expiration of the Agreement, Contractor must submit a requisition for final and complete payment of costs and pending claims for City approval. Noncompliance with this requirement relieves City of any further payment or other obligations under the Agreement. 5.INDEPENDENT CONTRACTOR 5.1 Status. Contractor is an independent contractor and not an employee, partner, or joint venture of City. Contractor is solely responsible for the means and methods of performing the Services and for the persons hired to work under this Agreement. Contractor is not entitled to health benefits, worker’s compensation, or other benefits from the City. 5.2 Contractor’s Qualifications. Contractor warrants on behalf of itself and its subcontractors that they have the qualifications and skills to perform the Services in a competent and professional manner and according to the highest standards and best practices in the industry. 5.3 Permits and Licenses. Contractor warrants on behalf of itself and its subcontractors that they are properly licensed, registered, and/or certified to perform the Services as required by law and have procured a City Business License, if required by the Cupertino Municipal Code. 5.4 Subcontractors. Only Contractor’s employees are authorized to work under this Agreement. Prior written approval from City is required for any subcontractor, and the terms and conditions of this Agreement will apply to any approved subcontractor. 5.5 Tools, Materials, and Equipment. Contractor will supply all tools, materials, and equipment required to perform the Services under this Agreement. 99,999.99 Select one Master Professional/Specialized Services Agreement/ Rev. April 2020 Page 3 of 9 5.6 Payment of Benefits and Taxes. Contractor is solely responsible for the payment of employment taxes incurred under this Agreement and any similar federal or state taxes. Contractor and any of its employees, agents, and subcontractors shall not have any claim under this Agreement or otherwise against City for seniority, vacation time, vacation pay, sick leave, personal time off, overtime, health insurance, medical care, hospital care, insurance benefits, social security, disability, unemployment, workers compensation or employee benefits of any kind. Contractor shall be solely liable for and obligated to pay directly all applicable taxes, fees, contributions, or charges applicable to Contractor’s business including, but not limited to, federal and state income taxes. City shall have no obligation whatsoever to pay or withhold any taxes or benefits on behalf of Contractor. Should any court, arbitrator, or administrative authority, including but not limited to the California Public Employees Retirement System (PERS), the Internal Revenue Service or the State Employment Development Division, determine that Contractor, or any of its employees, agents, or subcontractors, is an employee for any purpose, then Contractor agrees to a reduction in amounts payable under this Agreement, or to promptly remint to City any payments due by the City as a result of such determination, so that the City’s total expenses under this Agreement are not greater than they would have been had the determination not been made. 6.PROPRIETARY/CONFIDENTIAL INFORMATION In performing this Agreement, Contractor may have access to private or confidential information owned or controlled by the City, which may contain proprietary or confidential details the disclosure of which to third parties may be damaging to City. Contractor shall hold in confidence all City information and use it only to perform this Agreement. Contractor shall exercise the same standard of care to protect City information as a reasonably prudent contractor would use to protect its own proprietary data. 7.OWNERSHIP OF MATERIALS 7.1 Property Rights. Any interest (including copyright interests) of Contractor in any product, memoranda, study, report, map, plan, drawing, specification, data, record, document, or other information or work, in any medium (collectively, “Work Product”), prepared by Contractor in connection with this Agreement will be the exclusive property of the City upon completion of the work to be performed hereunder or upon termination of this Agreement, to the extent requested by City. In any case, no Work Product shall be shown to any third-party without prior written approval of City. 7.2 Copyright. To the extent permitted by Title 17 of the U.S. Code, all Work Product arising out of this Agreement is considered “works for hire” and all copyrights to the Work Product will be the property of City. Alternatively, Contractor assigns to City all Work Product copyrights. Contractor may use copies of the Work Product for promotion only with City’s written approval. 7.3 Patents and Licenses. Contractor must pay royalties or license fees required for authorized use of any third party intellectual property, including but not limited to patented, trademarked, or copyrighted intellectual property if incorporated into the Services or Work Product of this Agreement. Select one Master Professional/Specialized Services Agreement/ Rev. April 2020 Page 4 of 9 7.4 Re-Use of Work Product. Unless prohibited by law and without waiving any rights, City may use or modify the Work Product of Contractor or its sub-Contractors, prepared or created under this Agreement, to execute or implement any of the following: (a)The original Services for which Contractor was hired; (b)Completion of the original Services by others; (c)Subsequent additions to the original Services; and/or (d)Other City projects. 7.5 Deliverables and Format. Contractor must provide electronic and hard copies of the Work Product, on recycled paper and copied on both sides, except for one single-sided original. 8.RECORDS Contractor must maintain complete and accurate accounting records relating to its performance in accordance with generally accepted accounting principles. The records must include detailed information of Contractor’s performance, benchmarks and deliverables, which must be available to City for review and audit. The records and supporting documents must be kept separate from other records and must be maintained for four (4) years from the date of City’s final payment. 9.ASSIGNMENT Contractor shall not assign, sublease, hypothecate, or transfer this Agreement, or any interest therein, directly or indirectly, by operation of law or otherwise, without prior written consent of City. Any attempt to do so will be null and void. Any changes related to the financial control or business nature of Contractor as a legal entity will be considered an assignment of the Agreement and subject to City approval. Control means fifty percent (50%) or more of the voting power of the business entity. 10.PUBLICITY / SIGNS Any publicity generated by Contractor for the project under this Agreement, during the term of this Agreement and for one year thereafter, will reference the City’s contributions in making the project possible. The words “City of Cupertino” will be displayed in all pieces of publicity, including flyers, press releases, posters, brochures, public service announcements, interviews and newspaper articles. No signs may be posted, exhibited or displayed on or about City property, except signage required by law or this Contract, without prior written approval from the City. 11.INDEMNIFICATION 11.1 To the fullest extent allowed by law, and except for losses caused by the sole and active negligence or willful misconduct of City personnel, Contractor shall indemnify, defend, and hold harmless City, its City Council, boards and commissions, officers, officials, employees, agents, servants, volunteers, and Contractors (“Indemnitees”), through legal counsel acceptable to City, from and against any and all liability, damages, claims, actions, causes of action, demands, charges, losses, costs, and expenses (including attorney fees, legal costs, and expenses related to litigation and dispute Select one Master Professional/Specialized Services Agreement/ Rev. April 2020 Page 5 of 9 resolution proceedings), of every nature, arising directly or indirectly from this Agreement or in any manner relating to any of the following: (a)Breach of contract, obligations, representations, or warranties; (b)Negligent or willful acts or omissions committed during performance of the Services; (c)Personal injury, property damage, or economic loss resulting from the work or performance of Contractor or its subcontractors or sub-subcontractors; (d)Unauthorized use or disclosure of City’s confidential and proprietary information; (e)Claim of infringement or violation of a U.S patent or copyright, trade secret, trademark, or service mark or other proprietary or intellectual property rights of any third party. 11.2 Contractor must pay the costs City incurs in enforcing this provision. Contractor must accept a tender of defense upon receiving notice from City of a third-party claim. At City’s request, Contractor will assist City in the defense of a claim, dispute, or lawsuit arising out of this Agreement. 11.3 Contractor’s duties under this section are not limited to the Contract Price, workers’ compensation payments, or the insurance or bond amounts required in the Agreement. Nothing in the Agreement shall be construed to give rise to an implied right of indemnity in favor of Contractor against City or any Indemnitee. 11.4. Contractor’s payments may be deducted or offset to cover any money the City lost due to a claim or counterclaim arising out of this Agreement, a purchase order or other transaction. 11.5. Contractor agrees to obtain executed indemnity agreements with provisions identical to those set forth here in this Section 11 from each and every subcontractor, or any other person or entity involved by, for, with, or on behalf of Contractor in the performance of this Agreement. Failure of City to monitor compliance with these requirements imposes no additional obligations on City and will in no way act as a waiver of any rights hereunder. 11.6. This Section 11 shall survive termination of the Agreement. 12.INSURANCE Contractor shall comply with the Insurance Requirements, attached and incorporated here as Exhibit C, and must maintain the insurance for the duration of the Agreement, or longer as required by City. City will not execute the Agreement until City approves receipt of satisfactory certificates of insurance and endorsements evidencing the type, amount, class of operations covered, and the effective and expiration dates of coverage. Failure to comply with this provision may result in City, at its sole discretion and without notice, purchasing insurance for Contractor and deducting the costs from Contractor’s compensation or terminating the Agreement. 13.COMPLIANCE WITH LAWS 13.1 General Laws. Contractor shall comply with all local, state, and federal laws and regulations applicable to this Agreement. Contractor will promptly notify City of changes in the law or other conditions that may affect the Project or Contractor’s ability to perform. Contractor is responsible for verifying the employment authorization of employees performing the Services, as required by the Immigration Reform and Control Act. Select one Master Professional/Specialized Services Agreement/ Rev. April 2020 Page 6 of 9 13.2 Labor Laws. Contractor shall comply with all labor laws applicable to this Agreement. If the Scope of Services includes a “public works” component, Contractor is required to comply with prevailing wage laws under Labor Code Section 1720 and other labor laws. 13.3 Discrimination Laws. Contractor shall not discriminate on the basis of race, religious creed, color, ancestry, national origin, ethnicity, handicap, disability, marital status, pregnancy, age, sex, gender, sexual orientation, gender identity, Acquired-Immune Deficiency Syndrome (AIDS,) or any other protected classification. Contractor shall comply with all anti-discrimination laws, including Government Code Sections 12900 and 11135, and Labor Code Sections 1735, 1777, and 3077.5. Consistent with City policy prohibiting harassment and discrimination, Contractor understands that harassment and discrimination directed toward a job applicant, an employee, a City employee, or any other person, by Contractor or Contractor's employees or sub-contractors will not be tolerated. 13.4 Conflicts of Interest. Contractor shall comply with all conflict of interest laws applicable to this Agreement and must avoid any conflict of interest. Contractor warrants that no public official, employee, or member of a City board or commission who might have been involved in the making of this Agreement, has or will receive a direct or indirect financial interest in this Agreement, in violation of California Government Code Section 1090 et seq. Contractor may be required to file a conflict of interest form if Contractor makes certain governmental decisions or serves in a staff capacity, as defined in Section 18700 of Title 2 of the California Code of Regulations. Contractor agrees to abide by the City’s rules governing gifts to public officials and employees. 13.5 Remedies. Any violation of Section 13 constitutes a material breach and may result in City suspending payments, requiring reimbursements or terminating this Agreement. City reserves all other rights and remedies available under the law and this Agreement, including the right to seek indemnification under Section 11 of this Agreement. 14.PROJECT COORDINATION City Project Manager. The City assigns as the City’s representative for all purposes under this Agreement, with authority to oversee the progress and performance of the Scope of Services. City reserves the right to substitute another Project manager at any time, and without prior notice to Contractor. Contractor Project Manager. Subject to City approval, Contractor assigns Peggy Fickett as its single Representative for all purposes under this Agreement, with authority to oversee the progress and performance of the Services. Contractor’s Project manager is responsible for coordinating and scheduling the Services in accordance with City instructions, service orders and the Schedule of Performance. Contractor must regularly update the City’s project manager about the status, progress and any delays with the work. City’s written approval is required prior to Contractor substituting a new Representative which shall result in no additional costs to City. 15. ABANDONMENT OF PROJECT City may abandon or postpone the Project or parts thereof at any time. Contractor will be compensated for satisfactory Services performed through the date of abandonment, and will be given reasonable time Select one Kristina Alfaro Master Professional/Specialized Services Agreement/ Rev. April 2020 Page 7 of 9 to assemble the work and close out the Services. With City’s pre-approval in writing, the time spent in closing out the Services will be compensated up to a maximum of ten percent (10%) of the total time expended to date in the performance of the Services. 16.TERMINATION City may terminate this Agreement for cause or without cause at any time. Contractor will be paid for satisfactory Services rendered through the date of termination, but final payment will not be made until Contractor closes out the Services and delivers the Work Product. 17.GOVERNING LAW, VENUE, AND DISPUTE RESOLUTION This Agreement is governed by the laws of the State of California. Any lawsuits filed related to this Agreement must be filed with the Superior Court for the County of Santa Clara, State of California. Contractor must comply with the claims filing requirements under the Government Code prior to filing a civil action in court. If a dispute arises, Contractor must continue to provide the Services pending resolution of the dispute. If the Parties elect arbitration, the arbitrator’s award must be supported by law and substantial evidence and include detailed written findings of law and fact. 18.ATTORNEY FEES If City initiates legal action, files a complaint or cross-complaint, or pursues arbitration, appeal, or other proceedings to enforce its rights or a judgment in connection with this Agreement, the prevailing party will be entitled to reasonable attorney fees and costs. 19.THIRD PARTY BENEFICIARIES There are no intended third party beneficiaries of this Agreement. 20.WAIVER Neither acceptance of the Services nor payment thereof shall constitute a waiver of any contract provision. City’s waiver of a breach shall not constitute waiver of another provision or breach. 21.ENTIRE AGREEMENT This Agreement represents the full and complete understanding of every kind or nature between the Parties, and supersedes any other agreement(s) and understanding(s), either oral or written, between the Parties. Any modification of this Agreement will be effective only if in writing and signed by each Party’s authorized representative. No verbal agreement or implied covenant will be valid to amend or abridge this Agreement. If there is any inconsistency between any term, clause, or provision of the main Agreement and any term, clause, or provision of the attachments or exhibits thereto, the terms of the main Agreement shall prevail and be controlling. 22.INSERTED PROVISIONS Each provision and clause required by law for this Agreement is deemed to be included and will be inferred herein. Either party may request an amendment to cure mistaken insertions or omissions of required provisions. The Parties will collaborate to implement this Section, as appropriate. Select one Master Professional/Specialized Services Agreement/ Rev. April 2020 Page 8 of 9 23.HEADINGS The headings in this Agreement are for convenience only, are not a part of the Agreement and in no way affect, limit, or amplify the terms or provisions of this Agreement. 24.SEVERABILITY/PARTIAL INVALIDITY If any term or provision of this Agreement, or their application to a particular situation, is found by the court to be void, invalid, illegal or unenforceable, such term or provision shall remain in force and effect to the extent allowed by such ruling. All other terms and provisions of this Agreement or their application to specific situations shall remain in full force and effect. The Parties agree to work in good faith to amend this Agreement to carry out its intent. 25.SURVIVAL All provisions which by their nature must continue after the Agreement expires or is terminated, including the Indemnification, Ownership of Materials/Work Product, Records, Governing Law and Attorney Fees, shall survive the Agreement and remain in full force and effect. 26.NOTICES All notices, requests and approvals must be sent in writing to the persons below, which will be considered effective on the date of personal delivery or the date confirmed by a reputable overnight delivery service, on the fifth calendar day after deposit in the United States Mail, postage prepaid, registered or certified, or the next business day following electronic submission: To City of Cupertino Attention: Email: To Contractor: Attention: Email: 27.VALIDITY OF CONTRACT This Agreement is valid and enforceable only if (a) it complies with the purchasing and contract provisions of Cupertino Municipal Code Chapters 3.22 and 3.23, as amended from time to time, (b) is signed by the City Manager or an authorized designee, and (c) is approved for form by the City Attorney’s Office. 28.EXECUTION The person executing this Agreement on behalf of Contractor represents and warrants that Contractor has full right, power, and authority to enter into and carry out all actions contemplated by this Agreement and that he or she is authorized to execute this Agreement, which constitutes a legally binding obligation of Contractor. This Agreement may be executed in counterparts, each one of which is deemed an original and all of which, taken together, constitute a single binding instrument. 120 S State College Blvd., Suite 200 Brea CA 92821 Hinderliter de Llamas and Associates Andrew Nickerson anickerson@hdlcompanies.comkristinaa@cupertino.org Kristina Alfaro 10300 Torre Ave., Cupertino CA 95014 Select one Master Professional/Specialized Services Agreement/ Rev. April 2020 Page 9 of 9 IN WITNESS WHEREOF, the parties have caused the Agreement to be executed. CITY OF CUPERTINO A Municipal Corporation By Name Title Date CONTRACTOR By Name Title Date Tax I.D. No.: APPROVED AS TO FORM: HEATHER M. MINNER Cupertino City Attorney ATTEST: KIRSTEN SQUARCIA City Clerk Date: R. Andrew Nickerson 33-0008507 President/CEO R. Andrew Nickerson Jun 30, 2020 Heather M. Minner Kristina Alfaro Director of Administrative Services Kristina Alfaro Jun 30, 2020 Jul 8, 2020 Revised: April 30, 2020 – Services Agreements 1 Exhibit A-A – SHELTER IN PLACE AND SOCIAL DISTANCING REQUIREMENTS A. Health Laws Acknowledged. It is acknowledged that Consultant’s/Contractor’s (“Contractor”) duty to comply with Laws, as defined in Section 13 of the Contract/Agreement (“Contract”), includes immediate compliance by Contractor and its subcontractors with the restrictions on travel and the Social Distancing Requirements set forth in the most recent health order issued by the County of Santa Clara Health Department in response to the COVID-19 pandemic, and any subsequent amendments or superseding orders thereto (the “Health Order”), and any other local, state, or federal laws that have been or may be enacted in response to the COVID-19 pandemic (collectively, “Health Laws”). B. Health Order Compliance. Contractor shall comply with any restrictions on travel and social distancing requirements in the Health Order when preforming work under this Contract. If a scope of work item, notice to proceed, or work order under this Contract specifies work that cannot be performed in compliance with the Health Order or other Health Laws, Contractor shall refrain from conducting the work and immediately inform the City. C. Individuals at High Risk of Severe Illness. Nothing in this Contract shall be interpreted to require any person at high risk of severe illness from COVID-19 to leave their residence to perform work under the Contract. Contractor will inform the City if other arrangements for the work must be made, and City will do so, with no penalty to Contractor, although Contractor will not be compensated for work performed by the City or third parties. Information from the Center for Disease Control (“CDC”) on “high risk” categories is available at the CDC's website at: https://www.cdc.gov/coronavirus/2019-ncov/specific-groups/people-at-higher-risk.html. D. Health Order Requirements and Best Practices. Contractor will immediately undertake all appropriate measures to ensure compliance with the Social Distancing Requirements in the Health Order by all individuals performing work under this Contract, including Contractor's or any subcontractor's workers, employees, representatives, vendors, or suppliers (collectively, "workers"), and shall maintain these measures for as long as required by the Health Order or other Health Laws. As long as required by the operative Health Order or other Health Laws, these measures shall include, but are not limited to, the following: 1. Meetings/Site Access. Use electronic alternatives to in person meetings, e.g., conference calls, video-conferencing, etc., to the greatest extent possible. Limit access to any project site or any work area to workers who are necessary to perform in-person work. Require non-essential personnel to work from home to the extent possible. Avoid all non-essential travel. 2. Distancing. Where workers perform in-person work at a project site or a work area, prohibit workers from being less than six feet apart, unless and only to the extent that would compromise worker safety or violate safety Laws for specific operations. Prohibit handshaking or any physical contact among workers, with the sole and limited exception Revised: April 30, 2020 – Services Agreements 2 of any physical contact required for worker safety or to comply with safety Laws. Prohibit workers from sharing a vehicle. E. Changed Requirements. It is understood and acknowledged that circumstances pertaining to the COVID-19 pandemic are evolving rapidly and that new local, state, or federal requirements may modify the requirements under this Exhibit. Contractor agrees to work cooperatively with the City to implement new or changed requirements as quickly as possible. F. Subcontracts. Contractor shall include the terms of this Exhibit in all subcontracts and require any agents, subcontractors, or subconsultants to comply with its provisions. 1229192.7 Exhibit A Scope of Services Sales, Use and Transactions Tax Using confidential taxpayer records as authorized by Revenue and Taxation Code Section 7056, Hdl will find and correct errors that result in underpayments of tax to the City of Cupertino. The firm will employ a series of analyses, comparisons with other data sources and physical canvassing the City to find, document and submit for correction all taxpayer errors that result in lost City revenue or could result in lost revenue in the future. When errors are found, Hdl staff will promptly file claims for their correction following BOE procedures and regulations. Thereafter, Hdl will diligently work with the BOE to ensure the prompt recovery of all escaped revenues. Documentation of errors will be regularly provided to the City. In conducting these activities on behalf of the City, Hdl will provide quarterly reports that accurately depict the City's sales tax base, use tax collections and revenues. All reports, graphs, tables and revenue forecasts are designed to enhance the City's capacity to plan for, expand and manage its various sales use and district tax revenues. Reports identifying and comparing the retail composition of various sub- geographic-areas of the City will also be provided. 1. Audit Recovery To achieve the highest audit and recovery results, Hdl employs the following audit techniques and programs: a. Identification of Errors and Revenue Maximization Opportunities 1. Field Surveys: Field inventories of the City's business and industrial areas are conducted every 10-12 months to identify businesses located within the City that appear to be underreporting revenues or are not on the BOE allocation rolls. Specially trained field auditors, using the latest in mapping, GPS and digital recording technology, document not only the existence of sales tax producing businesses but also any relevant factors such as size, presence of a large stock of goods, will-call windows and any specific references to sales activity. This process identifies a wide range of registration errors including erroneous consolidation of multiple outlets, misreporting of point of sale from an erroneous location and delays in reporting new outlets. 2. Tax Area Code (TAC) Review: Hdl reviews every active account on the BOE's allocation rolls reporting $50 or more in local tax to ensure proper TAC assignment. Government and private sector mapping and GIS databases are used extensively in this process. These programs are important because physical canvassing will not reveal businesses with missing or incomplete signage, or those that are home-based. A complete TAC review is performed at least once every 9-12 months. 3. Deviation Assessment: Hdl applies proprietary queries and analyses to its statewide allocation database to identify a// accounts for which there has been a substantial change in allocation pattern. Hdl's database, unmatched in size, comprises over 98.5% of all sales and use tax transactions in California and allows for the most comprehensive audits in the state. The deviation review is performed every three months and is far more sophisticated and thorough than a review of the BOE's published Quarterly Distribution Report. The review is applied to direct allocations and to the county pools, and allows for a much broader view and understanding of what has happened in any given quarter. Well-founded leads are quickly culled from this process, often without the need for time-consuming manual reviews of taxpayer files. This allows for faster processing and less time used for preparing submittals. This in turn lowers recovery fees by reducing the amount of prior quarter revenue requiring redistribution. 4. Use Tax Errors and Opportunities: State Board of Equalization Regulation 1802(d) allows for direct allocation of local use tax on qualifying individual sales or purchases over $500,000. Under Regulation 1699.6, businesses and organizations (including local government agencies) with aggregate purchases subject to use tax of at least $500,000 per year can apply for a Use Tax Direct Payment Permit, allowing for direct allocation of the corresponding local share. Finally, under a resolution adopted by the BOE in December of 1994, a construction contractor who enters into a contract equal to or greater than $5,000,000 may elect to obtain a sub-permit for the jobsite resulting in a direct allocation of local use tax to the jurisdiction where the jobsite is located. Hdl analyzes the use tax allocation pools of the 58 counties and the state each quarter to identify instances where a taxpayer may have misidentified a transaction as use tax rather than sales tax. Further specialized reviews and techniques are employed to identify direct allocation opportunities of local use tax. 5. Regulation 1699 Evaluations: BOE Regulation 1699 controls when and where a permit should be issued to a given business location. Wholesalers, contractors, processors, manufacturers, and other non-retail businesses that do not normally sell merchandise often conduct occasional sales, self-accrue use tax or are levied deficiency assessments by the state. Hdl uses proprietary methods for finding companies that should be taking out permits so that those revenues are allocated to the City. b. Recovery of Misallocated Revenue 1. Development of Correction Data: Preliminary lead lists developed through any of the aforementioned audit programs are further culled using a variety of programs and databases to reduce the need for taxpayer contact. Companies remaining in the audit database are then contacted by a specialized audit unit whose members are specifically selected and trained to interview tax preparers and marketing, warehouse and management staff. Taxpayer interviews are always conducted in a business friendly, nonintrusive manner that emphasizes cooperation and protection of confidentiality. 2. Documentation: Telephone contacts are often accompanied by a written follow-up questionnaire concerning business activities, a specific one-time transaction or a written confirmation of our findings. This documentation is always filed with the petition to minimize BOE processing time. Solid documentation and follow-up lowers client fees by reducing the number of quarters requiring retroactive adjustment and ensures faster recovery of misallocated revenues. 3. City Review: To avoid potential conflicts with a City's in-house audit efforts, Hdl prepares a list of misallocated or under-reporting businesses for City officials to review and authorize prior to any invoicing. This line item, account-level approval process is an important step in eliminating any misunderstandings or disagreements regarding what may be considered a valid audit "find." 4. Preparation and Submittal of Corrections: Petitions are prepared (BOE Form 549-S or 549- L) that notify the BOE the existence and nature of the misallocation. All relevant and available supporting documentation is included. Copies of all transmittal forms and correspondence with the BOE and taxpayers are sent to City staff. 5. Continuous Follow-up: Hdl employs a full-time case manager whose responsibility is to monitor and follow-up on case inventory. An aging report is updated and reviewed on a monthly basis and the appropriate follow-up is initiated on cases that are taking an inordinate amount of time to correct. This follow-up emphasizes partnership and cooperation with BOE Allocation Group staff. Hdl's continuous efforts to check on the status of submittals are made to ensure that corrections are being pursued. Timely follow up on cases reduces the time it takes for the City to recover its revenue. 6. Appeals: Hdl cases are thoroughly researched, vetted and documented prior to submittal. This ensures the fastest possible processing times, and reduces the number of cases that are initially disclaimed and must be further researched and defended through a very lengthy BOE appeals process. Nearly all Hdl cases are resolved favorably at either the first or second levels of the BOE petition process described in Regulation 1807. Hdl has cultivated close working relationships with the BOE Appeals Division and with each of the elected Board Members. When an appeal is required, Hdl has the necessary expertise and access to competently and aggressively represent client interests. Having a large number of cases on appeal may be presented by some vendors as evidence of a more sophisticated and aggressive audit program. It should be viewed, however, as an indication that inadequate supporting documentation tends to require more case appeals and lead to otherwise unnecessary procedural delays. c. Track Record Hdl is effective in recovering misallocated revenue for client agencies in 97% of all cases submitted to the BOE. In the roughly 3% of cases that are initially disclaimed, Hdl is able to achieve positive results by successfully appealing cases. The small amount of cases that do to appeal is evidence of Hdl's thorough research and the quality of the factual information included to support claims. Only 5% of Hdl's case submittals are unresolved after two quarters with an average for all cases of 186 days. The company's backlog of cases requiring retroactive adjustments for any lengthy period of time is one-fifth that of other companies submitting claims to the BOE. 2. Management Analysis a. Hdl Database, Reports and Training Hdl maintains Cupertino's detailed sales tax data back to 1994 and will provide City staff with unlimited access to its quarterly updated web-based sales tax system to facilitate "in-house" analysis and printing of reports. The system allows City staff to search, print and export their sales tax data for a variety of financial, management and planning functions. The system provides the ability to search all sales tax producers in the City by business name, address, BOE account number and current or historical sales tax allocations. The web application also provides access to the City's archived quarterly sales tax reports. Data is easily queried and exported to either comma delimited or native Excel formats, allowing for convenient use with standard applications such as the Microsoft Office suite. The web application is accessible from all major operating systems, internet browser platforms, and device types (laptop, tablet, PC, mobile). The City's archived quarterly sales tax reports can also be accessed through the online sales tax application. Hdl's Geo-area feature supports use of address ranges, which ensures the inclusion of all appropriate BOE registrations and also allows City staff to create and modify Geo-areas without a separate GIS system. Hdl also supports interfacing with the City's GIS by including accurately geocoded latitude and longitude for each business. This data can include all data fields including historical allocation information and can be quickly exported by City staff on demand using Hdl's Sales Tax Web Application. Additionally, City created shape files can be used to define a Geo- area, which would identify related businesses by latitude and longitude. Training on use of the software and ongoing upgrades is provided at no additional charge. Quarterly sales tax reports are provided on both a cash and adjusted basis . Cash reports reconcile to BOE payments and are necessary for any revenue sharing agreements that the City might have in place. The adjusted reports shift payment aberrations (double-up payments, BOE audit adjustments, etc.) into the quarter where the sales occurred to accurately show the City's true economic trends. The quarterly sales tax data will be presented in reports for major sales tax producers by both rank and category, analysis of sales tax activity by category, business or areas specified by the City. Hdl's quarterly sales tax reports include a listing of top sales tax producers and comparisons with both regional and statewide trends. Retailer information is provided in grouped form or in business by business detail. Quarterly information will also include tables that track year-to-date receipts and show comparisons with past periods to measure progress toward achieving the City's annual budgeted revenue amount. Hdl's services are superior to other vendors because the firm provides data analysis instead of bound stacks of raw data printouts. The quarterly analysis is done in context with regional market areas, countywide and statewide trends to better monitor and compare the City's economic performance by business category and geographical area. A non-confidential newsletter is included to support management's efforts to inform and engage the public. Analysis of sales and use tax data and quarterly presentations to City staff are led by seasoned professionals, whose experience and knowledge adds value by identifying emerging retail trends, business retention needs, leveraging of economic clusters and reviewing successes in client jurisdictions with similar characteristics. Hdl staff also prepares sales and use tax projections for proposed development projects, responds to technical questions relating to BOE processes and regulations, and monitors revenue sharing agreements. b. Budget Projections and Monitoring Hdl has developed a comprehensive, detail-oriented method for projecting and monitoring client sales and use tax revenues that has proved to result in estimates that fall within 1 % of actual receipts two-thirds of the time. Initial and mid-year projections are made by factoring out payment aberrations that skew the base revenue and factoring in known changes such as new or closed businesses. Hdl also incorporates information from over 90 economic sources as well as information gathered from quarterly client meetings to develop economic factors to apply to individual retail business segments; the results are combined into a single estimate of anticipated revenue. Hdl further enhances its projections by contacting builders of large-scale development projects to better time and estimate the value of potential use tax payments into its estimates. Five year forecasts are also provided. c. Use Tax Maximization Program Major construction projects and even ongoing business operations often generate significant use tax revenues from purchases of machinery, equipment and other fixed assets. Hdl has worked with numerous clients to ensure that use tax from manufacturing and assembly plants, food processing, cold storage facilities, power/energy projects, medical, research and technical facilities, oil fields/refineries and extraction/mining industries are properly allocated to the host jurisdiction. Hdl's sales tax team includes a staff of specialists who review new business startups that might present potential self-assessed use tax opportunities, meets with contractors to advise on sub- permits and reporting procedures and provides materials and advice on purchasing companies and direct payment permits. The firm monitors major construction projects to make sure that any use tax generated is properly allocated to the job site's host jurisdiction. When brought into a project early, Hdl assists clients with inserting provisions in conditional use permits and development agreements to guarantee that use tax maximization procedures are followed and monitors projects and subcontractors to make certain that sales tax is properly allocated back to the client jurisdiction. Direct payment permits and purchasing corporations can sometimes be utilized where conditions offer mutual opportunities for the client agency to capture additional sales tax revenues and the participating company can increase control of sales and use tax liabilities. d. Economic Development Benefits When properly refined and organized, sales tax data analysis is an important tool for strengthening and expanding local economies. The data shows companies that are growing and may need expansion space and should be contacted as part of an agency's business retention program. When broken out geographically, the data produces patterns of industries that potentially share common customers, suppliers, technology and labor and therefore offer opportunities for attracting new businesses. The data further exposes retail areas that may be over saturated in some retail segments while also identifying voids and opportunities for additional retail development. Although numerous companies and agencies use the BOE's published data as a basis for analysis, the results are usually inaccurate and misleading due to address and business categorization errors in the data. To correct those deficiencies, HdL performs data validation and scrubbing techniques on an ongoing basis, fixing business addresses and re-categorizing merchants to differentiate brick and mortar retailers from "business to business" suppliers and on-line retailers. The company further creates and groups businesses into additional categories and classifications, not provided by the BOE, to better track new and emerging economic trends. Samples include the breaking out of biotech/medical suppliers, online fulfillment centers, alternate energy and utility providers, wineries and marijuana dispensaries. This focused approach to data management allows agencies to more accurately compare the impact of trends in their jurisdiction with state and regional trends. On a regional basis, it also allows for the identification of true economic voids and opportunities to expand the City's tax base. Accurate addressing allows for improved performance monitoring and comparison of specific economic areas such as shopping centers, downtown districts and auto malls with similar projects throughout California. In addition to using our large database, HdL's principals leverage their experience analyzing client data throughout California to identify new trends and developments that might help other clients. The service includes analyses to identify retail voids and opportunities and an annual publication of retailers seeking expansion in the region and state. e. Legislative Updates HdL prepares Legislative Updates for clients to keep them informed on any changes that may impact local revenues. The firm also provides Issue Updates which are similar in nature but deal with specific issues such as Sales Tax Participation Agreements. Each issue is presented in detail so that Agency staff is better equipped to handle questions on that topic from their community leaders. The firm also retains Johan Klehs as a lobbyist to represent client interests in matters before the BOE and the state legislature. Mr. Klehs is respected as an expert in budget, fiscal, taxation, and business issues affecting California and its economy. He maintains a wide range of ties with the executive and legislative branches of state and federal government. In statewide office, Klehs served as Chair and a Member of the California State Board of Equalization (1995-2003) and a Member of the Franchise Tax Board. He also served 14 years as a Member of the California State Assembly. 3. Consultation Each quarter, a principal of the firm analyzes the City's data in detail and meets with appropriate City officials to review trends and discuss and make recommendations regarding the budget implications of the quarter's data. HdL also serves as "on-call" staff to provide sales tax estimates for proposed projects, assist with budget projections and answer sales and use tax questions related to economic development, budgeting and related revenue collection. When requested by the City, principals also meet with committees of the City Council and other groups to explain sales tax regulations and their importance to the City's tax base. HdL will, when requested by the City, conduct technical seminars for City personnel on California sales and use tax processes. To support in-house efforts to maximize use tax, the seminars will cover the fundamentals of direct payment permits, purchasing corporations and maximizing "use tax" from construction projects. Hdl maintains close and positive relationships with members of the BOE and staff to quickly resolve policy issues unique to individual clients. The firm also advocates regulation and legislative changes when they are of benefit to all clients. Examples are the Company's work in the change of allocation of "use tax" for major construction projects, securing an Executive Order from the Governor to allow publishing of top taxpayers in public documents and the introduction of the problem of "point of sale" for warehouses to the BOE. 4. Transactions Tax Reports and Monitoring Hdl will monitor and report on this additional revenue source at the City's option for $100 per month. The only requirement is that the City adopts a separate resolution of confidentially authorizing Hdl's access to the confidential database. Should the City desire Hdl to audit its transactions and use taxes, the charge would be a 25% contingency fee against retroactive adjustments only (no prospective billing). Audit fees are billed only after the completion of the audit, submittal of corrections to the BOE and receipt of revenue by the City. Exhibit B Compensation Sales and Use Tax Services 1. Audit Services Hdl proposes a fee of 15% of all new sales and use tax revenue received by the City (including reimbursement from the sales and use tax compensation fund outlined in Section 97.68 of the Revenue and Taxation Code) as a result of audit and recovery work performed by the firm . This audit fee applies to monies received in the first eight consecutive reporting quarters beginning with the receipt of the audit revenue and includes retroactive back quarter adjustments obtained by Hdl. Audit fees are billed only after completion of the audit, submittal of corrections to the BOE and receipt of revenues by the client. 100% of all new revenue generated by Hdl flows to the City after the completion of the eight quarters. The fee constitutes the full reimbursement to Hdl and covers all direct and indirect costs incurred by the firm under this contract. This includes all salaries of our employees, travel expenses and service contracting costs as well as the software to be delivered to the City of Cupertino under this proposal. Invoices are submitted only for recoveries previously approved by the City. Hdl does not bill for audit revenues until the client has actually received said monies. Further, if during the billing cycle, a taxpayer receives a refund for overpayment of taxes generated during that cycle, Hdl credits back any proportionate share of the fee that may have been levied. Invoices are submitted quarterly after the City has received the revenue from the audit correction. The invoice includes a printout showing the name, address, and sales tax registration number of each company, and the specific amount of revenue allocated by the SBOE to the City for those businesses. If a misallocation correction involves additional revenue from a company that had already been partially allocating revenues to the City, the City and Hdl will agree in a Work Authorization, prior to billing, the methodology for identifying the incremental revenue attributable to Hdl's work. 2. Web-Based Application and Sales Tax Management Services Hdl's standard fees for an agency of Cupertino's size and character is $850 per month billed quarterly. This includes ongoing analysis, reports, legislative support and unlimited access to Hdl's team members for sales and use tax related questions, as well as training and support for internal implementation of a program of use tax maximization and economic expansion. 3. CPI Adjustment Fees for Operations Management Services are adjusted at the beginning of each calendar year by the change in the Consumer Price Index - West Urban (CPI-WU) as reported by the Bureau of Labor Statistics. Each annual adjustment will not be less than two percent (2%) or greater than ten percent (10%). 4. Transactions and Use Tax Audit and Management Services Hdl will monitor and report on the City's Transactions and Use Tax. The current charge for this service is $100 per month and a 25% contingency fee against retroactive adjustments only (no prospective billing). Audit fees are billed only after the completion of the audit, submittal of corrections to the BOE and receipt of revenue by the City. Exh. D-Insurance Requirements for Design Professionals & Consultant Contracts 1 Form Updated Sept. 2019 Consultant shall procure prior to commencement of Services and maintain for the duration of the contract, at its own cost and expense, the following insurance policies and coverage with companies doing business in California and acceptable to City. INSURANCE POLICIES AND MINIMUMS REQUIRED 1. Commercial General Liability (CGL) for bodily injury, property damage, personal injury liability for premises operations, products and completed operations, contractual liability, and personal and advertising injury with limits no less than $2,000,000 per occurrence (ISO Form CG 00 01). If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location (ISO Form CG 25 03 or 25 04) or it shall be twice the required occurrence limit. a. It shall be a requirement that any available insurance proceeds broader than or in excess of the specified minimum insurance coverage requirements and/or limits shall be made available to the Additional Insured and shall be (i) the minimum coverage/limits specified in this agreement; or (ii) the broader coverage and maximum limits of coverage of any insurance policy, whichever is greater. b. Additional Insured coverage under Consultant's policy shall be "primary and non-contributory," will not seek contribution from City’s insurance/self-insurance, and shall be at least as broad as ISO Form CG 20 01 (04/13). c. The limits of insurance required may be satisfied by a combination of primary and umbrella or excess insurance, provided each policy complies with the requirements set forth in this Contract. Any umbrella or excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary basis for the benefit of City before the City’s own insurance or self- insurance shall be called upon to protect City as a named insured. 2. Automobile Liability: ISO CA 00 01 covering any auto (including owned, hired, and non-owned autos) with limits no less than $1,000,000 per accident for bodily injury and property damage. 3. Workers’ Compensation: As required by the State of California, with Statutory Limits and Employer’s Liability Insurance of no less than $1,000,000 per occurrence for bodily injury or disease. Not required. Consultant has provided written verification of no employees. 4. Professional Liability for professional acts, errors and omissions, as appropriate to Consultant’s profession, with limits no less than $2,000,000 per occurrence or $2,000,000 aggregate. If written on a claims made form: a. The Retroactive Date must be shown and must be before the Effective Date of the Contract. b. Insurance must be maintained for at least five (5) years after completion of the Services. c. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a Retroactive Date prior to the Contract Effective Date, the Consultant must purchase “extended reporting” coverage for a minimum of five (5) years after completion of the Services. EXHIBIT D Insurance Requirements Design Professionals & Consultants Contracts Exh. D-Insurance Requirements for Design Professionals & Consultant Contracts 2 Form Updated Sept. 2019 OTHER INSURANCE PROVISIONS The aforementioned insurance shall be endorsed and have all the following conditions and provisions: Additional Insured Status The City of Cupertino, its City Council, officers, officials, employees, agents, servants and volunteers (“Additional Insureds”) are to be covered as additional insureds on Consultant’s CGL and automobile liability policies. General Liability coverage can be provided in the form of an endorsement to Consultant’s insurance (at least as broad as ISO Form CG 20 10 (11/ 85) or both CG 20 10 and CG 20 37 forms, if later editions are used). Primary Coverage Coverage afforded to City/Additional Insureds shall be primary insurance. Any insurance or self-insurance maintained by City, its officers, officials, employees, or volunteers shall be excess of Consultant’s insurance and shall not contribute to it. Notice of Cancellation Each insurance policy shall state that coverage shall not be canceled or allowed to expire, except with written notice to City 30 days in advance or 10 days in advance if due to non-payment of premiums. Waiver of Subrogation Consultant waives any right to subrogation against City/Additional Insureds for recovery of damages to the extent said losses are covered by the insurance policies required herein. Specifically, the Workers’ Compensation policy shall be endorsed with a waiver of subrogation in favor of City for all work performed by Consultant, its employees, agents and subconsultants. This provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer. Deductibles and Self-Insured Retentions Any deductible or self-insured retention must be declared to and approved by the City. At City’s option, either: the insurer must reduce or eliminate the deductible or self-insured retentions as respects the City/Additional Insureds; or Consultant must show proof of ability to pay losses and costs related investigations, claim administration and defense expenses. The policy shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the insured or the City. Acceptability of Insurers Insurers must be licensed to do business in California with an A.M. Best Rating of A-VII, or better. Verification of Coverage Consultant must furnish acceptable insurance certificates and mandatory endorsements (or copies of the policies effecting the coverage required by this Contract), and a copy of the Declarations and Endorsement Page of the CGL policy listing all policy endorsements prior to commencement of the Contract. City retains the right to demand verification of compliance at any time during the Contract term. Subconsultants Consultant shall require and verify that all subconsultants maintain insurance that meet the requirements of this Contract, including naming the City as an additional insured on subconsultant’s insurance policies. Higher Insurance Limits If Consultant maintains broader coverage and/or higher limits than the minimums shown above, City shall be entitled to coverage for the higher insurance limits maintained by Consultant. Adequacy of Coverage City reserves the right to modify these insurance requirements/coverage based on the nature of the risk, prior experience, insurer or other special circumstances, with not less than ninety (90) days prior written notice. SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. INSURER(S) AFFORDING COVERAGE INSURER F : INSURER E : INSURER D : INSURER C : INSURER B : INSURER A : NAIC # NAME:CONTACT (A/C, No):FAX E-MAILADDRESS: PRODUCER (A/C, No, Ext):PHONE INSURED REVISION NUMBER:CERTIFICATE NUMBER:COVERAGES IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must have ADDITIONAL INSURED provisions or be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. OTHER: (Per accident) (Ea accident) $ $ N / A SUBR WVD ADDL INSD THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. $ $ $ $PROPERTY DAMAGE BODILY INJURY (Per accident) BODILY INJURY (Per person) COMBINED SINGLE LIMIT AUTOS ONLY AUTOSAUTOS ONLY NON-OWNED SCHEDULEDOWNED ANY AUTO AUTOMOBILE LIABILITY Y / N WORKERS COMPENSATION AND EMPLOYERS' LIABILITY OFFICER/MEMBER EXCLUDED? (Mandatory in NH) DESCRIPTION OF OPERATIONS below If yes, describe under ANY PROPRIETOR/PARTNER/EXECUTIVE $ $ $ E.L. DISEASE - POLICY LIMIT E.L. DISEASE - EA EMPLOYEE E.L. EACH ACCIDENT EROTH-STATUTEPER LIMITS(MM/DD/YYYY)POLICY EXP(MM/DD/YYYY)POLICY EFFPOLICY NUMBERTYPE OF INSURANCELTRINSR DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (ACORD 101, Additional Remarks Schedule, may be attached if more space is required) EXCESS LIAB UMBRELLA LIAB $EACH OCCURRENCE $AGGREGATE $ OCCUR CLAIMS-MADE DED RETENTION $ $PRODUCTS - COMP/OP AGG $GENERAL AGGREGATE $PERSONAL & ADV INJURY $MED EXP (Any one person) $EACH OCCURRENCE DAMAGE TO RENTED $PREMISES (Ea occurrence) COMMERCIAL GENERAL LIABILITY CLAIMS-MADE OCCUR GEN'L AGGREGATE LIMIT APPLIES PER: POLICY PRO-JECT LOC CERTIFICATE OF LIABILITY INSURANCE DATE (MM/DD/YYYY) CANCELLATION AUTHORIZED REPRESENTATIVE ACORD 25 (2016/03) © 1988-2015 ACORD CORPORATION. All rights reserved. CERTIFICATE HOLDER The ACORD name and logo are registered marks of ACORD HIRED AUTOS ONLY 6/29/2020 Woodruff Sawyer 2 Park Plaza,Suite 500 Irvine CA 92614 Audrey Curtis 949.435.7345 949.476.3118 acurtis@woodruffsawyer.com National Fire Insurance Company of Hartford 20478 HDLCOMP-01 Continental Insurance Company 35289HinderliterdeLlamas&Associates HdL Software,LLC. 120 S State College Blvd.,Suite 200 Brea CA 92821 Continental Casualty Company 20443 Lloyds of London Federal Insurance Company 20281 88405538 A X 1,000,000 X 1,000,000 15,000 1,000,000 2,000,000 X Y Y 6056953483 5/26/2020 5/26/2021 2,000,000 A 1,000,000 X X Y Y 6056953466 5/26/2020 5/26/2021 B X X 3,000,00060569535025/26/2020 5/26/2021 3,000,000 X 10,000 B B XY6056953497 6056677063 5/26/2020 5/26/2020 5/26/2021 5/26/2021 1,000,000 1,000,000 1,000,000 D C E Professional Liability/Claim Made Cyber Liability Crime MPL1007920 6078657761 82556901 5/26/2020 5/26/2020 5/26/2020 5/26/2021 5/26/2021 5/26/2021 Each Claim/Aggregate Cyber Limit Crime Limit $2,000,000 $2,000,000 $1,000,000 The City of Cupertino,its City Council,officers,officials,employees,agents,servants and volunteers are included as additional insureds,on a primary/non-contributory basis with respect to General Liability and Auto Liability per attached forms. Waiver of Subrogation applies as respects to the General Liability,Auto Liability and Workers Compensation per attached forms. Notice of Cancellation applies with respect to General Liability per attached forms. The City of Cupertino,its City Council,officers,officials, employees,agents,servants and volunteers 10300 Torre Avenue Cupertino CA 95014 Business Auto Policy Policy 5. a. (1) (2) b. c. d. 6. a. b. 7. a. b. (1) (2) (3) (4) (5) Other Insurance For any covered "auto" you own, this Coverage Form provides primary insurance. For any covered "auto" you don't own, the insurance provided by this Coverage Form is excess over any other collectible insurance. However, while a covered "auto" which is a "trailer" is connected to another vehicle, the Covered Autos Liability Coverage this Coverage Form provides for the "trailer" is: Excess while it is connected to a motor vehicle you do not own; or Primary while it is connected to a covered "auto" you own. For Hired Auto Physical Damage Coverage, any covered "auto" you lease, hire, rent or borrow is deemed to be a covered "auto" you own. However, any "auto" that is leased, hired, rented or borrowed with a driver is not a covered "auto". Regardless of the provisions of Paragraph a. above, this Coverage Form's Covered Autos Liability Coverage is primary for any liability assumed under an "insured contract". When this Coverage Form and any other Coverage Form or policy covers on the same basis, either excess or primary, we will pay only our share. Our share is the proportion that the Limit of Insurance of our Coverage Form bears to the total of the limits of all the Coverage Forms and policies covering on the same basis. Premium Audit The estimated premium for this Coverage Form is based on the exposures you told us you would have when this policy began. We will compute the final premium due when we determine your actual exposures. The estimated total premium will be credited against the final premium due and the first Named Insured will be billed for the balance, if any. The due date for the final premium or retrospective premium is the date shown as the due date on the bill. If the estimated total premium exceeds the final premium due, the first Named Insured will get a refund. If this policy is issued for more than one year, the premium for this Coverage Form will be computed annually based on our rates or premiums in effect at the beginning of each year of the policy. Policy Period, Coverage Territory Under this Coverage Form, we cover "accidents" and "losses" occurring: During the policy period shown in the Declarations; and Within the coverage territory. The coverage territory is: The United States of America; The territories and possessions of the United States of America; Puerto Rico; Canada; and Anywhere in the world if a covered "auto" of the private passenger type is leased, hired, rented or borrowed without a driver for a period of 30 days or less, provided that the "insured's" responsibility to pay damages is determined in a "suit" on the merits, in the United States of America, the territories and possessions of the United States of America, Puerto Rico or Canada, or in a settlement we agree to. We also cover "loss" to, or "accidents" involving, a covered "auto" while being transported between any of these places. Underwriting Company: Policy ; Page: 12 of 16 Policy Page: 30 of 75National Fire Insurance Company of Hartford, 151 N Franklin St, Chicago, IL 60606 Policy No: Policy Effective Date: Form No: CA 00 01 10 13 © Copyright Insurance Services Office, Inc., 2012 6056953466 05/26/2020 Technology General Liability Extension Endorsement K. Other Person Or Organization / Your Work Any person or organization who is not an additional insured under Paragraphs A.through J.above. Such additional insured is an Insured solely for bodily injury,property damage or personal and advertising injury for which such additional insured is liable because of the Named Insured’s acts or omissions. The coverage granted by this paragraph does not apply to any person or organization: 1.who is specifically scheduled as an additional insured on another endorsement to this Coverage Part; nor 2.for bodily injury or property damage included within the products-completed operations hazard except to the extent all of the following apply: a.this Coverage Part provides such coverage; b.the written contract or agreement described in the opening paragraph of this ADDITIONAL INSUREDS Provision requires the Named Insured to provide the additional insured such coverage; and c.the bodily injury or property damage results from your work that is the subject of the written contract or agreement, and such work has not been excluded by endorsement to this Coverage Part. 2. ADDITIONAL INSURED - PRIMARY AND NON-CONTRIBUTORY TO ADDITIONAL INSURED’S INSURANCE A.The Other Insurance Condition in the COMMERCIAL GENERAL LIABILITY CONDITIONS Section is amended to add the following paragraph: If the Named Insured has agreed in writing in a contract or agreement that this insurance is primary and non-contributory relative to an additional insured's own insurance, then this insurance is primary, and the Insurer will not seek contribution from that other insurance. For the purpose of this Provision 2., the additional insured's own insurance means insurance on which the additional insured is a named insured. B.With respect to persons or organizations that qualify as additional insureds pursuant to paragraph 1.K.of this endorsement, the following sentence is added to the paragraph above: Otherwise, and notwithstanding anything to the contrary elsewhere in this Condition, the insurance provided to such person or organization is excess of any other insurance available to such person or organization. 3. BODILY INJURY – EXPANDED DEFINITION Under DEFINITIONS, the definition of bodily injury is deleted and replaced by the following: Bodily injury means physical injury, sickness or disease sustained by a person, including death, humiliation, shock, mental anguish or mental injury sustained by that person at any time which results as a consequence of the physical injury, sickness or disease. 4. BROAD KNOWLEDGE OF OCCURRENCE/ NOTICE OF OCCURRENCE Under CONDITIONS, the condition entitled Duties in The Event of Occurrence, Offense, Claim or Suit Condition is amended to add the following provisions: A. BROAD KNOWLEDGE OF OCCURRENCE The Named Insured must give the Insurer or the Insurer’s authorized representative notice of an occurrence, offense or claim only when the occurrence, offense or claim is known to a natural person Named Insured, to a partner, executive officer, manager or member of a Named Insured, or to an employee designated by any of the above to give such notice. B. NOTICE OF OCCURRENCE CNA74872XX (1-15) Page 5 of 14 Policy No: Endorsement No: Effective: Insured Name: Copyright CNA All Rights Reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. 6056953483 05/26/2020 POLICY NUMBER: COMMERCIAL AUTO CA 04 44 10 13 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. CA 04 44 10 13 Copyright, Insurance Services Office, Inc., 2011 Page 1 of 1 WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US (WAIVER OF SUBROGATION) This endorsement modifies insurance provided under the following: AUTO DEALERS COVERAGE FORM BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM With respect to coverage provided by this endorsement, the provisions of the Coverage Form apply unless modified by the endorsement. This endorsement changes the policy effective on the inception date of the policy unless another date is indicated below. Named Insured: Endorsement Effective Date: SCHEDULE Name(s) Of Person(s) Or Organization(s): Information required to complete this Schedule, if not shown above, will be shown in the Declarations. The Transfer Of Rights Of Recovery Against Others To Us condition does not apply to the person(s) or organization(s) shown in the Schedule, but only to the extent that subrogation is waived prior to the "accident" or the "loss" under a contract with that person or organization. 6056953466 Hinderliter de Llamas &Associates 6/29/2020 The City of Cupertino,its City Council,officers,officials,employees,agents,servants and volunteers 10300 Torre Avenue Cupertino,CA 95014 CNA Paramount Waiver of Transfer of Rights of Recovery Against Others to the Insurer Endorsement Policy No: Endorsement No: TBD Effective Date: Endo EffectiveDate: CNA75008XX (10-16) Page1 of 1 { CNA } Insured Name: Hinderliter de Llamas & Associates, HdL Software, LLC. Copyright CNA All Rights Reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART SCHEDULE Name Of Person Or Organization: (Information required to complete this Schedule, if not shown above, will be shown in the Declarations.) Under COMMERCIAL GENERAL LIABILITY CONDITIONS, it is understood and agreed that the condition entitled Transfer Of Rights Of Recovery Against Others To Us is amended by the addition of the following: With respect to the person or organization shown in the Schedule above, the Insurer waives any right of recovery the Insurer may have against such person or organization because of payments the Insurer makes for injury or damage arising out of the Named Insured’s ongoing operations or your work included in the products-completed operations hazard. All other terms and conditions of the Policy remain unchanged. This endorsement, which forms a part of and is for attachment to the Policy issued by the designated Insurers, takes effect on the effective date of said Policy at the hour stated in said Policy, unless another effective date is shown below, and expires concurrently with said Policy. The City of Cupertino,its City Council,officers,officials,employees,agents,servants and volunteers 10300 Torre Avenue Cupertino,CA 95014 6056953483 05/26/2020 6/29/2020 POLICY NUMBER: 6056953466 COMMERCIAL AUTO CA 20 48 10 13 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. CA 20 48 10 13 Copyright, Insurance Services Office, Inc., 2011 Page 1 of 1 DESIGNATED INSURED FOR COVERED AUTOS LIABILITY COVERAGE This endorsement modifies insurance provided under the following: AUTO DEALERS COVERAGE FORM BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM With respect to coverage provided by this endorsement, the provisions of the Coverage Form apply unless modified by this endorsement. This endorsement identifies person(s) or organization(s) who are "insureds" for Covered Autos Liability Coverage under the Who Is An Insured provision of the Coverage Form. This endorsement does not alter coverage provided in the Coverage Form. This endorsement changes the policy effective on the inception date of the policy unless another date is indicated below. Named Insured: Endorsement Effective Date: SCHEDULE Name Of Person(s) Or Organization(s): Information required to complete this Schedule, if not shown above, will be shown in the Declarations. Each person or organization shown in the Schedule is an "insured" for Covered Autos Liability Coverage, but only to the extent that person or organization qualifies as an "insured" under the Who Is An Insured provision contained in Paragraph A.1. of Section II – Covered Autos Liability Coverage in the Business Auto and Motor Carrier Coverage Forms and Paragraph D.2. of Section I – Covered Autos Coverages of the Auto Dealers Coverage Form. Hinderliter de Llamas &Associates 6/29/2020 The City of Cupertino,its City Council,officers,officials,employees,agents,servants and volunteers 10300 Torre Avenue Cupertino,CA 95014 CNA Paramount Additional Insured - Designated Person or Organization Endorsement Policy No: Endorsement No: TBD Effective Date: CNA74745XX (1-15) Page1 of 1 PolUWCompany - CNA Paramount Insured Name: HdL Companies Copyright CNA All Rights Reserved. Includes copyrighted material of Insurance Services Office, Inc., with its permission. This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART SCHEDULE Name Of Additional Insured Person Or Organization: Information required to complete this Schedule, if not shown above, will be shown in the Declarations. It is understood and agreed that the section entitled WHO IS AN INSURED is amended with the addition of the following: A.The person or organization shown in the Schedule is an Insured, but only with respect to such person or organization’s liability for bodily injury, property damage or personal and advertising injury caused in whole or in part, by: the Named Insured’s acts or omissions, or the acts or omissions of those acting on the Named Insured’s behalf: 1.in the performance of the Named Insured’s ongoing operations; or 2.in connection with premises owned by or rented to the Named Insured. B.However, if coverage for the additional insured is required by written contract or written agreement, subject always to the terms and conditions of this policy, including the limits of insurance, the Insurer will not provide such additional insured with: 1.coverage broader than required by such contract or agreement; or 2.a higher limit of insurance than required by such contract or agreement. C.The coverage granted by this endorsement does not apply to bodily injury or property damage included within the products-completed operations hazard. Any coverage granted by this endorsement shall apply solely to the extent permissible by law. All other terms and conditions of the Policy remain unchanged. This endorsement, which forms a part of and is for attachment to the Policy issued by the designated Insurers, takes effect on the effective date of said Policy at the hour stated in said Policy, unless another effective date is shown below, and expires concurrently with said Policy. The City of Cupertino,its City Council,officers,officials,employees,agents,servants and 10300 Torre Avenue Cupertino,CA 95014 6056953483 6/29/2020 Workers Compensation WC 04 03 06 (04-1984) Policy No: Policy Effective Date: Policy Page: 1 of 1 Form No: WC 04 03 06 (04-1984) © Copyright 1998 by the Workers' Compensation Insurance Rating Bureau of California. All rights reserved. From the WCIRB’s California Workers’ Compensation Insurance Forms Manual © 2001. We have the right to recover our payments from anyone liable for an injury covered by this policy. We will not enforce our right against the person or organization named in the Schedule. (This agreement applies only to the extent that you perform work under a written contract that requires you to obtain this agreement from us.) You must maintain payroll records accurately segregating the remuneration of your employees while engaged in the work described in the Schedule. The additional premium for this endorsement shall be Waiver of Subrogation Percent of the California workers' compensation premium otherwise due on such remuneration. Schedule Person or Organization Waiver of Subrogation Person or Organization Job Description Waiver of Subrogation Job Description All other terms and conditions of the policy remain unchanged. This endorsement, which forms a part of and is for attachment to the policy issued by the designated Insurers, takes effect on the Policy Effective date of said policy at the hour stated in said policy, unless another effective date (the Endorsement Effective Date) is shown below, and expires concurrently with said policy unless another expiration date is shown below. WAIVER OF OUR RIGHT TO RECOVER FROM OTHERS ENDORSEMENT – CALIFORNIA The City of Cupertino,its City Council,officers,officials,employees,agents,servants and 10300 Torre Avenue Cupertino,CA 95014 6056953497 05/26/2020 Hinderliter, de Llamas and Associates Corporation Sales, Use and Transactions Tax Audit Services Final Audit Report 2020-07-08 Created:2020-06-30 By:Mariela Vargas (marielar@cupertino.org) Status:Signed Transaction ID:CBJCHBCAABAAWQfHfUZfM1n-YdnyQoGTW6-AnCJ7HhJf "Hinderliter, de Llamas and Associates Corporation Sales, Use a nd Transactions Tax Audit Services" History Document created by Mariela Vargas (marielar@cupertino.org) 2020-06-30 - 5:12:53 PM GMT- IP address: 174.85.97.187 Document emailed to Mariela Vargas (marielar@cupertino.org) for approval 2020-06-30 - 5:13:05 PM GMT Document approved by Mariela Vargas (marielar@cupertino.org) Approval Date: 2020-06-30 - 5:13:41 PM GMT - Time Source: server- IP address: 174.85.97.187 Document emailed to Araceli Alejandre (aracelia@cupertino.org) for approval 2020-06-30 - 5:13:44 PM GMT Document approved by Araceli Alejandre (aracelia@cupertino.org) Approval Date: 2020-06-30 - 5:25:04 PM GMT - Time Source: server- IP address: 24.23.184.82 Document emailed to R. Andrew Nickerson (anickerson@hdlcompanies.com) for signature 2020-06-30 - 5:25:07 PM GMT Email viewed by R. Andrew Nickerson (anickerson@hdlcompanies.com) 2020-06-30 - 5:25:21 PM GMT- IP address: 98.152.155.130 Document e-signed by R. Andrew Nickerson (anickerson@hdlcompanies.com) Signature Date: 2020-06-30 - 5:26:19 PM GMT - Time Source: server- IP address: 98.152.155.130 Document emailed to Heather M. Minner (minner@smwlaw.com) for signature 2020-06-30 - 5:26:22 PM GMT Email viewed by Heather M. Minner (minner@smwlaw.com) 2020-06-30 - 10:55:53 PM GMT- IP address: 45.41.142.196 Document e-signed by Heather M. Minner (minner@smwlaw.com) Signature Date: 2020-06-30 - 10:56:33 PM GMT - Time Source: server- IP address: 52.39.49.65 Document emailed to Kristina Alfaro (kristinaa@cupertino.org) for signature 2020-06-30 - 10:56:35 PM GMT Email viewed by Kristina Alfaro (kristinaa@cupertino.org) 2020-06-30 - 11:22:56 PM GMT- IP address: 104.47.46.254 Document e-signed by Kristina Alfaro (kristinaa@cupertino.org) Signature Date: 2020-06-30 - 11:24:47 PM GMT - Time Source: server- IP address: 208.82.101.101 Document emailed to Kirsten Squarcia (kirstens@cupertino.org) for signature 2020-06-30 - 11:24:48 PM GMT Email viewed by Kirsten Squarcia (kirstens@cupertino.org) 2020-07-08 - 11:40:54 PM GMT- IP address: 148.64.105.190 Document e-signed by Kirsten Squarcia (kirstens@cupertino.org) Signature Date: 2020-07-08 - 11:42:21 PM GMT - Time Source: server- IP address: 148.64.105.190 Signed document emailed to Kirsten Squarcia (kirstens@cupertino.org), R. Andrew Nickerson (anickerson@hdlcompanies.com), Mariela Vargas (marielar@cupertino.org), Araceli Alejandre (aracelia@cupertino.org), and 3 more 2020-07-08 - 11:42:21 PM GMT