Special Notice / Hearing: None__
Vote Required: Majority
To: Honorable Board of Supervisors
From: Sandie Arnott, Treasurer-Tax Collector
Subject: Agreement with Hinderliter, de Llamas & Associates to Provide Transient Occupancy Tax and Vehicle Rental Business License Tax Administrative and Audit Services
RECOMMENDATION:
title
Adopt a resolution authorizing an agreement with Hinderliter, de Llamas & Associates to provide Transient Occupancy Tax and Vehicle Rental Business License Tax administrative and audit services for the Treasurer-Tax Collector, for the term July 1, 2026 through June 30, 2029 in an amount not to exceed $550,000.
body
BACKGROUND:
The Treasurer-Tax Collector is responsible for administering and enforcing the collection of Transient Occupancy Tax (TOT) and Vehicle Rental Business License Tax (VRBLT) from businesses operating in the unincorporated areas of the County. The Treasurer-Tax Collector requires a firm with a proven track record and demonstrated capacity to enhance operational efficiency, reduce administrative costs, and improve compliance with County ordinances.
DISCUSSION:
Collections of TOT and VRBLT, currently levied at rates of 10 percent and 2.5 percent respectively, are important sources of non-property tax revenue for the County. TOT is imposed on transients who occupy lodging facilities-including hotels, motels, campgrounds, Short Term Rentals (STRs), and vacation homes-for 30 consecutive calendar days or less. Operators subject to these taxes are required to register with the County, obtain the appropriate certificates, and report and remit taxes on a quarterly basis. In San Mateo County, vehicle rental businesses operating in unincorporated areas are required to obtain a Vehicle Rental Business License and remit a business license tax equal to 2.5 percent of gross rental receipts, reported to the County Tax Collector. In addition to revenue collections, the Treasurer-Tax Collector requires a firm with a proven track record and demonstrated capacity to accurately and timely identify TOT, STR, and VRBLT operators that are out of compliance.
In April 2026, the Treasurer-Tax Collector issued a Request for Proposals (RFP) for TOT, STR, and VRBLT administrative and audit services. The RFP was published on OpenGov for three weeks to allow comprehensive and competitive bids to be submitted. Two proposals were received and were evaluated by an RFP committee consisting of members from the Treasurer-Tax Collector’s Office and Planning & Building Department. The RFP Matrix describing the process and selected companies is attached as Attachment A.
Hinderliter, de Llamas & Associates (HdL) was selected to provide TOT and VRBLT administrative and audit services based on their experience of working with tax and finance departments across multiple jurisdictions, comprehensive range of services, and overall cost-effectiveness. This agreement with HdL will enhance operational efficiency and ensure effective revenue administration and compliance enforcement for the Treasurer-Tax Collector’s Office.
The resolution contains the County’s standard provisions allowing amendment of the County fiscal obligations by a maximum of $25,000 (in aggregate).
County Attorney has reviewed and approved the agreement and resolution as to form.
PERFORMANCE MEASURE:
|
Measure |
FY 2024-25 Actual |
FY 2025-26 Actual |
FY 2026-27 Target |
|
STR Compliance Growth |
≥10% per year |
≥10% per year |
15% per year |
|
Annual Audit Frequency |
≥10% of all accounts |
≥10% of all accounts |
15% of all accounts |
COMMUNITY IMPACT:
Approval of this resolution supports timely and accurate billing, collection, and audit services for TOT and STR and VRBLT accounts. These services promote compliance, protect County revenue, and support funding for essential public services. The action has no adverse impact on the community.
FISCAL IMPACT:
The term of agreement with HdL is from July 1, 2026 to June 30, 2029, with a financial obligation not to exceed $550,000. Funding for this agreement has been included in the Treasurer-Tax Collector’s FY 2026-27 Recommended Budget. Similar arrangements will be made for future budget years.