R-13-08-08-G12 - 8/8/2013RESOLUTION NO. R -13-08-08-G12
WHEREAS, the City of Round Rock ("City") has received $9,041,207.80 in local taxes
in error from the Texas Comptroller of Public Accounts ("Comptroller's Office"); and
WHEREAS, the City has requested a four-year payout arrangement to repay the excess
taxes to the Comptroller's Office; and
WHEREAS, the Comptroller's Office has reviewed and approved the City's payout
arrangement; and
WHEREAS, the City Council wishes to approve the payment schedule as outlined in the
attached letter from the Comptroller's Office, 25% of which to be repaid from the Round Rock
Transportation and Economic Development Corporation and 75% of which to be repaid from the City's
General and Self -financed construction funds, Now Therefore
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS,
That the payment schedule as outlined in the attached letter from the Texas Comptroller of
Public Accounts, a copy of which is attached hereto as Exhibit "A" and incorporated herein for all
purposes, is hereby approved.
The City Council hereby finds and declares that written notice of the date, hour, place and
subject of the meeting at which this Resolution was adopted was posted and that such meeting was
open to the public as required by law at all times during which this Resolution and the subject matter
hereof were discussed, considered and formally acted upon, all as required by the Open Meetings Act,
Chapter 551, Texas Government Code, as amended.
RESOLVED this 8th day of August, 2013.
ALAN MCGRAW, Mayor
ATTEST: City of Round Rock, Texas
1 i
afriAL
SARA L. WHITE, City Clerk
0112.1304; 00279080
June 4, 2013
RV J�
TEXAS COMPTROLLER Of PUBLIC ACCOUN iS JUN 122013
P.O.Box 13528 • AUSTIN, TX 78711-3528 BY:
Mr. Steve Norwood
City Manager
City of Round Rock
231 East Main Street
Round Rock, TX 78664
Dear Mr. Norwood:
I am writing to inform you that your request for a four-year payout arrangement for the
$9,041,207.80 in local taxes paid to the City of Round Rock in error has been reviewed and
approved.
The City of Round Rock will make payments by check directly to the Comptroller's Office as
shown on the following schedule beginning in September 2013.
September 2013 . $2,260,301.95
September 2014 . $2,260,301.95
September 2015 . $2,260,301.95
September 2016 $2,260,301.95
Please mail the payments to my attention at: State Comptroller's Office, P 0 Box 13528 Austin,
Texas, 78711-3528.
If you have any questions or need additional information, I can be reached at (512) 475-0550 or
my email address is shirley.kaatz@cpa.state.tx.us.
Sincerely,
Shirley Kaatz
Revenue Accounting Division
Tax Allocation Section
cc: Cheryl Delaney
Finance Director
EXHIBIT
nAa
ROUND ROCK, TEXAS
IPURPOSE RASION PROSPERITY
City of Round Rock
Agenda Item Summary
Agenda Number: G.12
Title: Consider a resolution approving the four-year payout arrangement with the
Texas Comptroller of Public Accounts.
Type: Resolution
Governing Body: City Council
Agenda Date: 8/8/2013
Dept Director: Cheryl Delaney, Finance Director
Cost: $9,041,207.80
Indexes:
Attachments: Resolution, Exhibit A
Text of Legislative File 13-583
In January 2013 the City was notified about a sales and use tax audit initiated and
conducted by the Texas Comptroller of Public Accounts (Comptroller). The audit resulted in
Dell paying tax on transactions that were not taxable in Texas. In March 2013, the State
issued a refund directly to Dell in the amount of $38.3M. This refund included both the state
and local portion of the sales and use tax paid. The local portion was $9.2M, which was
paid to Round Rock over several years.
In the State of Texas, the tax liability lies with the purchaser. This means that the purchaser
(Dell), not the seller, is ultimately responsible for paying the sales and use tax to the
Comptroller. Therefore, the Comptroller paid the refund amount directly back to Dell and
not the various sellers.
The State requested the City provide a written proposal for repayment. The City will pay
$2,260,301.95 annually over a four year period starting September 2013. Funding will be
paid out of reserves from the General Fund, Self Financed Construction and Type B
Corporation. This resolution will approve the four-year payout arrangement with the
Comptroller's office.
Cost: $9,041,207.80
Staff recommends approval
City of Round Rock Page 1 Printed on 8/5/2013