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2011-172-1565 - MOU with IRS City of Miami Gardens Agenda Cover Memo Council Meeting Date: October 12, 2011 Item Type: (Enter X in box) Resolution Ordinance Other X Fiscal Impact: (Enter X in box) Yes No Ordinance Reading: (Enter X in box) 1st Reading 2nd Reading X Public Hearing: (Enter X in box) Yes No Yes No Funding Source: Community evelopment Block rant (CDBG)Fund DG Advertising Requirement: (Enter X in box) Yes No X Contract/P.O. Required: (Enter X in box) Yes No RFP/RFQ/Bid #: X Strategic Plan Related (Enter X in box) Yes No Strategic Plan Priority Area: Enhance Organizational Bus. & Economic Dev Public Safety Quality of Education Qual. of Life & City Image Communication Strategic Plan Obj./Strategy: (list the specific objective/strategy this item will address) N/A X Sponsor Name Councilman Oliver Gilbert, III Department: Mayor and Council Short Title: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MIAMI GARDENS, FLORIDA, AUTHORIZING THE CITY MANAGER AND THE CITY CLERK TO EXECUTE AND ATTEST RESPECTIVELY, THAT CERTAIN MEMORANDUM MEMORANDUM OF UNDERSTANDING WITH THE INTERNAL REVENUE SERVICE REGARDING THE HOSTING OF A FREE TAX PREPARATION SITE AT THE BETTY T. FERGUSON RECREATIONAL CENTER; AGREEING TO WORK WITH THE IRS TO RECRUIT VOLUNTARY TAX PREPARERS AND AUTHORIZING THE PROMOTION OF THE EARNED INCOME TAX CREDIT PROGRAM CITY‐WIDE; PROVIDING FOR INSTRUCTIONS TO THE CITY CLERK; PROVIDING FOR THE ADOPTION OF REPRESENTATIONS; PROVIDING FOR AN EFFECTIVE DATE. Staff Summary: Background Since its incorporation in 2003, the City’s leadership has sought to continually enhance the services available to its residents. Moreover, in 2006 a huge need among a large segment of the City’s ITEM K-3) CONSENT AGENDA RESOLUTION MOU w/Internal Revenue Service 1515 NW 167 Street, Building 5 Suite 200 Miami Gardens, Florida 33169 population was identified. The need for financial literacy and asset building and management was very pronounced, especially as the City carried out activities using its Community Development Block Grant Funds. It was also clear that a concerted mechanism to assist residents with this financial literacy and asset building was absent. In 2008, approximately 35,813 residents residing in zip codes 33054, 33055, 33056, and 33169 filed for EITC, an increase of 3,483 from the previous year. The total sum of EITC received was $81,621,190. Nationally, the IRS estimates that only 75 to 85 percent of those eligible for EITC file for it. Using these figures as a guideline, it is estimated that the unclaimed EITC for Miami Gardens residents are between 12 to 20 Million dollars. (Brookings Institution) And while the Internal Revenue Service (IRS) has offered a Volunteer Income Tax Assistance (VITA) site for several years at St. Thomas University, the data suggests that a more concerted effort would yield greater penetration of filed EITC. Current Situation The IRS has sought to increase their involvement in local communities to increase individual tax payer benefits. Through the Stakeholder Partnership, Education and Communication program (SPEC), the City of Miami Gardens can formally partner with the IRS to increase participation in the number of residents that are eligible for the earned income tax credit. The SPEC program proposes a three‐prong approach which includes: Awareness & Education; Asset Building; and Tax Preparation. This approach will emphasize greater coordination of existing services, leveraging community resources; and community collaboration & outreach to assist Miami Gardens’ residents. Through this partnership, the City will benefit by bringing in dollars and other resources into the community, provide volunteers valuable personal skills and financial insights; and satisfy community outreach goals or requirements. This program will also provide Miami Gardens’ residents the ability to accumulate assets and move into self‐sufficiency. The proposed resolution will authorize the City Manager to execute the attached Memorandum of Understanding with the IRS. In addition, it will authorize the dedication of the needed City resources to host a free tax preparation site at the Betty T. Ferguson Recreational Complex, and to work with the IRSSPEC program to recruit volunteer tax preparers, and promote the earned income tax credit program city‐wide. The financial impact to the City is not expected to exceed $3,000 Proposed Action: Councilman Gilbert recommends approval of the proposed resolution. Attachment: • Memorandum of Understanding with IRS Memorandum of Understanding Between Internal Revenue Service and The City of Miami Gardens This Memorandum of Understanding (MOU) establishes a partnership between the Internal Revenue Service-Stakeholder Partnerships, Education and Communication (IRS-SPEC) and the City of Miami Gardens. This MOU will attempt to clarify each participant’s role within IRS-SPEC programs to insure greater and more effective participation. Mission Together, the Parties enter into this Memorandum of Understanding to mutually promote the Earned Income Tax Credit understanding and awareness; preparing tax returns free of charge for low-to-moderate income taxpayers; and encouraging personal asset building and self-sufficiency through tax incentives. Responsibilities Each party will appoint a person to serve as the official contact and coordinate the activities of each organization in carrying out this MOU. The initial appointees of each organization are: Internal Revenue Service: Barbara Acebal, Senior Tax Consultant Partner: The parties agree to the following Action Plan and recommended timeframe to be carried out by the appointees or their delegates: IRS-SPEC responsibilities: June through September, IRS-SPEC will: • Provide a Relationship Manager (RM) to assist with issues involving IRS policy, procedures and outreach activities. • Provide Form 13325, Statement of Assurance Concerning Civil Rights Compliance for SPEC Partnerships and Form 13533, Sponsor Agreement. • Refer potential volunteers that show an interest in volunteering at the Partner's sites. • As needed, assist in the registration of each VITA site in the e-file program by helping the partner prepare Form 8633, “Application to Participate in the IRS e-file Program.” October through December: • Provide training materials. • Conduct Site Coordinator training (face to face or conference call) . • Assist in the preparation of a marketing plan for the VITA sites. • Complete a SPEC training Support Assessment (Form 13826) prior to training and assist in the training of volunteers as needed. • Provide tax preparation software (desktop or online) for the VITA sites for Tax Season 2011 at no cost to the partner, • Provide the forms needed to operate the VITA sites, including the IRS Intake/Interview and Quality Review Sheet January through May: • Publicize through IRS channels, the days and hours when the VITA sites are open • Assist partner with training on e-file transmission, record keeping and resolution of e-file rejects • Perform site visitation(s) to ensure compliance with tax law, electronic filing procedures, and quality review procedures of this program. • Provide the close-out procedures for each site, including requirements for backup of data, data retention and storage of F 8879s and related documents. Throughout the year: • Participate in financial education and asset building outreach activities whenever possible. Partner Responsibilities: June through September: • Recruit volunteers for the VITA Program to staff each site with an adequate number of certified volunteers. • Identify outreach and publicity partners • Provide the SPEC contact with a project of numbers of volunteers and training method to be used so that the appropriate training material can be ordered. • Develop a marketing plan for advertising the VITA site. October through December: • Provide space, equipment, volunteers and administrative support to operate the free tax preparation program. • Sign a copy of Form 13325, Statement of Assurance Concerning Civil Rights Compliance for SPEC Partnerships, and Form 13533, Sponsor Agreement, before software orders are placed. • Designate a site coordinator responsible for overall management for each tax preparation site and require attendance at the IRS Site Coordinator Training • Conduct volunteer training utilizing computers and IRS provided training material • Establish the official Kick-Off event date and submit to IRS-SPEC pertinent activities for this day 2 3 January through May: • Adhere to the Quality Site Requirements as established by the IRS. • Establish the days and hours of operation for the VITA site by January 1; notify the IRS SPEC contact of changes immediately or as they are implemented. • Provide a listing of certified volunteers to the IRS by February 1, 2010 and up date monthly as needed • Allow IRS access to the tax preparation site during hours of operation to conduct site and return reviews. • Provide passwords to the IRS for the online and desktop software. • Follow the privacy and confidentiality guidelines as discussed in IRS Publication 4299, Privacy and Confidentiality – A Public Trust. • E-file no less than 100 accepted returns per EFIN. • Follow the close out procedures provided by IRS for each site. This MOU is entered into on this, the ______ day of _____________, 2011. Partner: _______________________________________________________________ Signature Title Internal Revenue Service: __ ______________________________________ Ron Albert, Territory Manager SPEC -Plantation Territory Rev Oct. 2011