ADMINISTRATIVE REPORT
MEETING DATE: October 7, 2026 AGENDA CATEGORY: Consent - Resolutions TO: Honorable Mayor and City Council
FROM: Randy McKeegan, Finance Director
DATE: September 21, 2026
SUBJECT: Dispense with bidding for purchase of Business License Software & Support services for the Treasury Division.
1. Resolution determining that Business License Software & Support services cannot be reasonably obtained through the usual bidding procedures and authorizing the Finance Director to dispense with bidding and negotiate the purchase of Business License Software, not to exceed $256,260 for the Treasury Division within the Finance Department.
2. Agreement with Hinderliter de Llamas & Associates (HdL) (not to exceed $256,260) to provide Business License Software & Support services for a five-year term.
RECOMMENDATION:
Staff recommend adoption of the resolution and approval of the agreement BACKGROUND:
In 2021, the City completed a competitive Request for Proposals (RFP) process to select a new Enterprise Resource Planning (ERP) system, including a business license software solution as part of the overall ERP replacement. Clariti was selected based on its representation that its software could provide comprehensive business license services and meet the City’s operational requirements.
During implementation, however, City staff identified significant gaps between the Clariti software and the City's actual business license needs. Despite extensive training, documentation, demonstrations, and working sessions with Clariti and its implementation partners, the software was unable to adequately support several basic, day-to-day business license functions. After further evaluation and demonstrations near the end of Fiscal Year 2024-25, it was determined that the functionality gaps could not be resolved through configuration or implementation assistance. As a result, the City terminated its agreement with Clariti for business license services.
The City now requires a business license software solution that can effectively support its existing operations and utilize the City's established business license data and processes. HdL is well positioned to provide this solution based on its longstanding relationship with the City, its knowledge of the City's business license operations, and its proprietary business license software.
LONGSTANDING RELATIONSHIP WITH HdL
The City has worked with HdL for several years on a variety of specialized revenue-related services, including sales and use tax, transient occupancy tax (TOT), business license compliance audits, and other revenue and compliance support. Through this work, HdL has developed extensive knowledge of the City’s operations, revenue programs, local ordinances, business community, and compliance requirements.
This longstanding relationship provides significant continuity and institutional knowledge. HdL is already familiar with the City's business license processes, data, and revenue programs, allowing the City to transition to a replacement solution without starting over with a new vendor and repeating the extensive implementation and training process experienced with Clariti.
HdL’s business license software is a proprietary solution designed to integrate with the City's existing business license data and established processes. Purchasing the software directly from HdL will allow the City to utilize its existing business license information and processes within a solution specifically designed for this purpose, while maintaining continuity with the business license services HdL has historically provided to the City. HdL also specializes in serving California local governments and reports serving approximately 90% of California municipalities. Its experience with municipal revenue administration and business license compliance provides specialized knowledge directly applicable to the City's needs.
Based on the proprietary nature of the software, its integration with the City's existing business license data and processes, the expedited nature of the implementation and HdL's established knowledge of the City's business license operations, staff determined that the Business License Software can reasonably be obtained only from HdL. City Municipal Code Section 3.20.060(D)(2) permits the City to dispense with competitive bidding when work, supplies, equipment, or materials can reasonably be obtained from only one vendor due to restricted availability.
Accordingly, staff recommends adoption of the resolution to dispense with bidding and approval of a fiveyear agreement with HdL for Business License Software in the amount of $256,260.
FISCAL IMPACT:
Funds are available in Fiscal year 2026-27 Capital Outlay Fund for this purchase.
COUNCIL GOAL:
Reliable Infrastructure
ATTACHMENTS:
1. Dispense with bidding Resolution
2. Signed Agreement