Vers.: Aug. 5, 2019
AMENDMENT NO. 1 TO CONTRACT NO. C23187298C
BETWEEN THE CITY OF PALO ALTO AND
HINDERLITER DE LLAMAS & ASSOCIATES (HDL)
This Amendment No. 1 (this “Amendment”) to Contract No. C23187298C (the “Contract” as defined below) is entered into as of September 29, 2025, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and HINDERLITER DE LLAMAS & ASSOCIATES (HDL), a California corporation, located at 120 S. State College Blvd. Suite 200, Brea, California 92821 (“CONSULTANT”). CITY and [CONSULTANT or CONTRACTOR] are referred to collectively as the “Parties” in this Amendment.
R E C I T A L S
A. The Contract (as defined below) was entered into by and between the Parties hereto for the provision of administration, collection, enforcement, compliance, and audit activities for the City’s business tax and business registry certificate program, as detailed therein.
B. The Parties now wish to amend the Contract in order to extend the term for an additional two (2) years, changing expiration date from June 30, 2026 to June 30, 2028 and increase the compensation value by Two Million Nine Thousand Four Hundred Forty Five Dollars ($2,009,445); changing total not to exceed compensation value from Eight Hundred Sixty Thousand Five Hundred Fifty Five Dollars ($860,555) to Two Million Eight Hundred Seventy Thousand Dollars ($2,870,000).
NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the Parties agree:
SECTION 1. Definitions. The following definitions shall apply to this Amendment:
a. Contract. The term “Contract” shall mean Contract No. C23187298C between CONSULTANT and CITY, dated October 1, 2023, as amended by:
b. Other Terms. Capitalized terms used and not defined in this Amendment shall have the meanings assigned to such terms in the Contract.
SECTION 2. Section 2. “TERM” of the Contract is hereby amended to read as follows:
“The term of this Agreement shall be from the date of its full execution through June 30, 202 8 unless terminated earlier pursuant to Section 19 (Termination) of this Agreement.”
SECTION 3. Section 4. “COMPENSATION” of the Contract is hereby amended to read as follows:
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“The compensation to be paid to CONSULTANT for performance of the Services shall be based on the compensation structure detailed in Exhibit C, entitled “COMPENSATION,” including any reimbursable expenses specified therein, and the maximum total compensation shall not exceed Two Million Seven Hundred Seventy Thousand Dollars ($2,770,000). The hourly schedule of rates, if applicable, is set out in Exhibit C-1, entitled “SCHEDULE OF RATES.” Any work performed or expenses incurred for which payment would result in a total exceeding the maximum compensation set forth in this Section 4 shall be at no cost to the CITY.
Optional Additional Services Provision (This provision applies only if checked and a not -to- exceed compensation amount for Additional Services is allocated below under this Section 4.)
In addition to the not -to-exceed compensation specified above, CITY has set aside the not -to- exceed compensation amount of One Hundred Thousand Dollars ($100,000.00) for the performance of Additional Services (as defined below). The total compensation for performance of the Services, Additional Services and any reimbursable expenses specified in Exhibit C, shall Two Million Eight Hundred Seventy Thousand Dollars ($2,870,000), as detailed in Exhibit C.
“Additional Services” means any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit A. CITY may elect to, but is not required to, authorize A dditional Services up to the maximum amount of compensation set forth for Additional Services in this Section 4.
CONSULTANT shall provide Additional Services only by advanced, written authorization from CITY as detailed in this Section. Additional Servic es, if any, shall be authorized by CITY with a Task Order assigned and authorized by CITY’s Project Manager, as identified in Section 13 (Project Management). Each Task Order shall be in substantially the same form as Exhibit A -1, entitled “PROFESSIONAL S ERVICES TASK ORDER”. Each Task Order shall contain a specific scope of services, schedule of performance and maximum compensation amount, in accordance with the provisions of this Agreement. Compensation for Additional Services shall be specified by CITY in the Task Order, based on whichever is lowest: the compensation structure set forth in Exhibit C, the hourly rates set forth in Exhibit C-1, or a negotiated lump sum.
To accept a Task Order, CONSULTANT shall sign the Task Order and return it to CITY’s Project Manager within the time specified by the Project Manager, and upon authorization by CITY (defined as counter-signature by the CITY Project Manager), the fully exec uted Task Order shall become part of this Agreement. The cumulative total compensation to CONSULTANT for all Task Orders authorized under this Agreement shall not exceed the amount of compensation set forth for Additional Services in this Section 4. CONSULTANT shall only be compensated for Additional Services performed under an authorized Task Order and only up to the maximum amount of compensation set forth for Additional Services in this Section 4. Performance of and payment for any Additional Services are subject to all requirements and restrictions in this Agreement.”
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SECTION 4. The following exhibit(s) to the Contract is/are hereby amended or added, as indicated below, to read as set forth in the attachment(s) to this Amendment, which is/are hereby incorporated in full into this Amendment and into the Contract by this reference:
a. Exhibit “A” entitled “SCOPE OF SERVICES ”, AMENDED, REPLACES PREVIOUS.
b. Exhibit “B” entitled “SCHEDULE OF PERFORMANCE”, AMENDED, REPLACES PREVIOUS.
c. Exhibit “C” entitled “COMPENSATION”, AMENDED, REPLACES PREVIOUS.
d. Exhibit “C -1” entitled “ SCHEDULE OF RATES ”, AMENDED, REPLACES PREVIOUS.
SECTION 5. Legal Effect. Except as modified by this Amendment, all other provisions of the Contract, including any exhibits thereto, shall remain in full force and effect.
SECTION 6 . Incorporation of Recitals . The recitals set forth above are terms of this Amendment and are fully incorporated herein by this reference.
(SIGNATURE BLOCK FOLLOWS ON THE NEXT PAGE.)
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SIGNATURES OF THE PARTIES
IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed this Amendment effective as of the date first above written.
CITY OF PALO ALTO
City Manager
APPROVED AS TO FORM:
City Attorney or Designee
(Contract over $25k)
HINDERLITER DE LLAMAS &
ASSOCIATES (HDL)
Officer 1
By:
Name:
Title:
Officer 2 (Required for Corp. or LLC)
By:
Name:
Title:
Attachments:
- EXHIBIT A – SCOPE OF SERVICES, AMENDMENT NO.1 (AMENDED, REPLACES PREVIOUS) - EXHIBIT B – SCHEDULE OF PERFORMANCE, AMENDMENT NO.1 (AMENDED, REPLACES
PREVIOUS)
- EXHIBIT C – COMPENSATION, AMENDMENT NO.1 (AMENDED, REPLACES PREVIOUS) - EXHIBIT C-1 – SCHEDULE OF RATES, AMENDMENT NO.1 (AMENDED, REPLACES
PREVIOUS)
Docusign Envelope ID: 57BCB9CE-AD42-4F27-A3F8-6069FD6EC900 Vice President
Robert Gray
CFO
Richard Park
Vers.: Aug. 5, 2019
EXHIBIT A
SCOPE OF SERVICES, AMENDMENT NO.1
(AMENDED, REPLACES PREVIOUS)
CONSULTANT shall provide the Services detailed in this Exhibit A, entitled “SCOPE OF SERVICES”. CONSULTANT shall provide the Services detailed in this Exhibit A, entitled “SCOPE OF SERVICES”. Notwithstanding any provision herein to the contrary, CONSULTANT’s duties and services described in this Scope of Services shall not include preparing or assisting CITY with any portion of CITY’s preparation of a request for proposals, request for qualifications, or any other solicitation regarding a subsequent or addi tional contract with CITY. CITY shall at all times retain responsibility for public contracting, including with respect to any subsequent phase of this project. CONSULTANT’s participation in the planning, discussions, or drawing of project plans or specifi cations shall be limited to conceptual, preliminary, or initial plans or specifications. CONSULTANT shall cooperate with CITY to ensure that all bidders for a subsequent contract on any subsequent phase of this project have access to the same information, including all conceptual, preliminary, or initial plans or specifications prepared by CONSULTANT pursuant to this Scope of Services
CONSULTANT (HdL) will provide the following monthly recurring services relative to the administration, collection, enforcement, compliance, and audit activities for the City’s business tax and business registry certificate program:
Task 1:
1. Operations Management Services
1.1. Establish and maintain database of businesses for the business registry certificate program and business tax.
1.2. Receive and process, in a timely fashion:
1.2.1. Business registry applications, renewals and payments, and.
1.2.2. Business tax filings, amended returns, and payments.
1.3. Renewal and payment notices:
1.3.1. Business registry renewal notices will be sent renewal notices to active businesses within 30 days of the renewal period end date or at another interval specified by CITY.
1.3.2. Business tax payment reminder notices will be sent within 30 days of the tax payment due date or at another interval specified by CITY.
1.4. Provide businesses multiple options for submitting applications, renewals, tax filing, payments, or support requests (including via website, email, mail, phone, and fax).
1.4.1. Have experience and capabilities to process business payments, renewals, delinquent payments and ongoing monitoring and administration of CITY’s business registry certificate program and business tax, as described in the CITY’s municipal code, ordinances, policies and program procedure manuals.
1.4.2. Consultant specialists will be available for live interactions Monday through Friday, 8:00am to 5:00pm Pacific).
1.4.3. Respond to business correspondence via return phone call or written correspondence within 24 hours.
1.5. Remit revenue to CITY no less than monthly, along with detail of business registry Docusign Envelope ID: 57BCB9CE-AD42-4F27-A3F8-6069FD6EC900 Vers.: Aug. 5, 2019
applications, business tax filings, and any additional documentation.
1.6. Provide CITY staff access to website portal offering business registry inquiry, reporting, and electronic department approval capabilities.
Task 2:
2. Compliance Services: 1) Identify and register businesses which are subject to business registry certificate program and/or business tax, 2) collect known debt as pertains to business registry certificate and/or business tax, and 3) identify under-reported registration fee and/or tax liability.
2.1. Discovery Services
2.1.1. Develop a list of businesses subject to CITY business registry certificate or taxation.
2.1.2. Notify non-compliant businesses of their options to comply or dispute their non- compliant status. Notification and support to businesses will be facilitated through the website, mail, email, phone and/or fax.
2.1.3. Review information and forms submitted by the business for completion and accuracy, inclusive of any additional required documentation (i.e. home occupation permit). All submissions are filed and stored electronically and made available to CITY upon request.
2.1.4. Provide businesses with detailed invoicing and options to pay via website, mail, and phone.
2.1.5. Remit revenue to CITY no less than monthly, along with detail of business registry applications, business tax filings, and any additional documentation.
2.2. Collection Services
2.2.1. Identify businesses subject to CITY business registry certificate or taxation which have known debt to CITY and have failed to pay within an appropriate time frame.
2.2.2. Notify businesses of their options to comply or dispute their non-compliant status.
2.2.3. Provide businesses with detailed invoicing and options to pay via website, mail and phone.
2.2.4. Remit revenue to CITY no less than monthly, along with detail of business registry applications, business tax filings, and any additional documentation.
2.3. Audit Services
2.3.1. Identify potential under-reporting and/or misclassified businesses.
2.3.2. Audit businesses mutually agreed to by CITY and CONSULTANT that are identified as potential under-reporting businesses.
2.3.3. Submit audit summaries to CITY and discuss further actions.
2.3.4. Educate businesses on proper reporting practices.
2.3.5. Invoice and collect identified delinquencies.
3. Payment Processing – services include PCI compliant payment processing services powered by FIS Global, which supports both credit card (taxpayer funded) and eCheck (CITY funded) transactions.
Task 3:
3.1. CITY Responsibilities
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3.1.1. As a condition to its receipt of the Service, CITY shall execute and deliver any and all applications, agreements, certifications or other documents required by FIS Global, Networks or other third parties whose consent or approval is necessary for the processing of Transactions by FIS Global. “Network” is an entity or association that operates, under a common service mark, a system which permits participants to authorize, route, and settle Transactions among themselves, including, for example, networks operated by VISA USA and Mastercard, Inc., NYCE Corporation, American Express, and Discover.
3.1.2. CITY hereby grants CONSULTANT the full right, power and authority to request, receive and review any Data or records reflected in a Transaction report. CITY represents and warrants that it has the full right and authority to grant these rights.
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EXHIBIT B
SCHEDULE OF PERFORMANCE
CONSULTANT shall perform the Services so as to complete each milestone within the number of days/weeks specified below. The time to complete each milestone may be increased or decreased by mutual written agreement of the Project Managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement. CONSULTANT shall provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the notice to proceed (“NTP”) from the CITY.
Milestones
Completion
Number of Days/Weeks (as specified below)
from NTP
1. Task 1: Operations Management Services Recurring monthly service within term of Agreement, with first collection cycle beginning
October 2023; filing and collection occurring
quarter beginning January 2024.
2. Task 2: Compliance Services
a. Discovery
b. Collection
c. Audit
Recurring monthly service within term of
Agreement.
3. Task 3: Payment Processing Recurring monthly service within term of Agreement.
Optional Schedule of Performance Provision for On-Call or Additional Services Agreements. (This provision only applies if checked and only applies to on -call agreements per Section 1 or agreements with Additional Services per Section 4.)
The schedule of performance shall be as provided in the approved Task Order, as detailed in Section 1 (Scope of Services) in the case of on-call Services, or as detailed in Section 4 in the case of Additional Services, provided in all cases that the schedule of performance shall fall within the term as provided in Section 2 (Term) of this Agreement.
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EXHIBIT C
COMPENSATION, AMENDMENT NO.1
(AMENDED, REPLACES PREVIOUS)
AMENDMENT
NO.1
AMENDMENT
NO.1
BUDGET SCHEDULE RATE EST. UNIT
NOT TO
EXCEED
AMOUNT
(5 YEARS)
YEAR 1
FY 2024
(10/1/2023-
6/30/2024)
YEAR 2
FY 2025
YEAR 3
FY 2026
YEAR 4
FY 2027
YEAR 5
FY 2028
TASK 1: Operations Management Services
Includes all sub-tasks under Task 1 of Scope of
Services. Fees are increase as of July 1 of each year
based on the 12-month Bay Area Consumer Price
Index (Urban Wage Earners and Clerical Workers, San
Francisco-Oakland-San Jose) as of March 31, not to
exceed 5%
Max.
Annual
CPI Adj 4% 4%
Per processed account fee - any account for which an
application or renewal/return was processed, or active
account which was sent a renewal notice $17.00
8,000 $640,000.00 $85,000.00 $85,000.00 $130,000.00 $170,000.00 $170,000.00
TASK 2: Compliance Services
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2.1: Discovery Services
Contingency percentage applies to all monies received
for the current tax/license period and any other period collected (including monies received for taxes,
penalties, interest, and fees).
In the event that CITY discovers a non-compliant
business and report to CONSULTANT, activity will be
categorized as a collection service effort rather than
discover effort. 35%
170,000 $260,000.00 $60,000.00 $60,000.00 $60,000.00 $40,000.00 $40,000.00
2.2: Collection Services
Contingency percentage applies to revenues received
as a result of compliance services. 25%
1,600,000 $1,700,000.00 $200,000.00 $450,000.00 $400,000.00 $350,000.00 $300,000.00
2.3: Audit Services
Contingency percentage applies to revenues received
as a result of audit services. 35%
115,000 $160,000.00 N/A N/A $40,000.00 $60,000.00 $60,000.00
Sub-Total Compliance Services $2,120,000.00 $260,000.00 $510,000.00 $500,000.00 $450,000.00 $400,000.00
TASK 3: Payment Processing
Taxpayer Funded:
Credit and debit card processing CITY authorizes
CONSULTANT to collect convenience fee from
taxpayer at the time of payment. 2.90% N/A N/A N/A N/A N/A N/A N/A
Taxpayer Funded:
Returned payment/NSF fee, each occurrence. 25% N/A N/A N/A N/A N/A N/A N/A
City Funded:
ACH/eCheck processing per transaction fee. $0.50
2,000 $5,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00
TOTAL BASIC SERVICES
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REIMBURSEABLE EXPENSES $5,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00 $1,000.00
ADDITIONAL SERVICES OR CONTINGENCY $100,000.00 $20,000.00 $20,000.00 $20,000.00 $20,000.00 $20,000.00
TOTAL NOT-TO-EXCEED $2,870,000.00 $367,000.00 $617,000.00 $652,000.00 $642,000.00 $592,000.00 Docusign Envelope ID: 57BCB9CE-AD42-4F27-A3F8-6069FD6EC900 Vers.: Aug. 5, 2019
EXHIBIT C-1
COMPENSATION, AMENDMENT NO.1
(AMENDED, REPLACES PREVIOUS)
YEAR 1 through 5, ADDITIONAL SERVICES
Title
Hourly Rate
Principal $325
Programmer $295
Senior Analyst $245
Analyst $195
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