How to Use OTC Reports & Resources 2013 OML Conference Presented By: Dana Ratcliffe, City of Weatherford - City Treasurer Breck Buchanan, MBA, City of Tulsa - Treasury Analyst Davis Puryear, City of Oklahoma City - Assistant City Treasurer

Presentation Overview Oklahoma Taxpayer Access Point (OKTAP) What is OKTAP Access & Navigation Reports How to use the information Tulsa Weatherford

What is OKTAP Central Access Point For Sales & use tax collection details Permit and taxpayer research Tax payments Business Registration

OKTAP Access & Navigation Access and Getting Started Register with the Oklahoma Tax Commission Contact Dave Francis, OTC – (405) 522-6600 Navigation https://oktap.tax.ok.gov/OkTAP/Web/_/#1 How to log-in Accessing each months return Running reports

Reports Account Details – Total sales & use tax collections by COPO Collection Details – Summary of revenues collected for your municipality by taxpayer Collection By NAICS Code – Summary of collections by industry Tax, Penalty, and Interest – Total collections and penalty/interest breakdown by taxpayer Balance Due – Balances owed from an audit assessment and/or a filed return with no payment List of Delinquent Taxpayers – Taxpayers who failed to file a report for a two consecutive months New Sales Tax Permits – All new permits issued during the month Canceled Sales Tax Permits – Permits canceled during the month Audit Details – A summary of audits that were assessed for the period

Tulsa: Data Analysis Data Analysis Overview How We Use The Data Sales Tax Permit List Sales and Use Tax Collections Analysis Delinquent Listing / Balance Due Listing Monthly Reports

Data Analysis Process Field Inspections Reports Audit Leads Business OTC Tax Data COT Treasury Data Repository Audit Leads Data Analysis Our data analysis process begins with the receipt of data from OTC; we then import this data into our data repository, which is currently ACL Analytics. For your city or town, Excel may be the only tool you need. From here we analyze the data, create reports, and facilitate other functions such as business license approvals. Business License Approvals Enforce Municipal Codes

Data Analysis Process Obtain Data Confidential Report Data – “Old Data” OkTAP Data - “New Data” Compile Data Combine Old and New Data Can use ACL Analytics, Access, or Excel Reports Create Visualize the data in a meaningful way Excel is a great tool for this Take Action Make decisions and take corrective actions Here is an overview of the analysis process. It’s important to review collections up to 36 months from your most recent report. Pre-OkTAP or “old” data is in text format and can be pulled from the OTC’s old confidential reports site.

Sales Tax Permit Analysis Check permits for proper COPO registration OkTAP: Retailer Permit Search / Sales Tax Permit Lookup Pull lists of permits by: Name, Street, City, State, ZIP or COPO Only displays up to 250 results per search Check streets/addresses that border your city One problem we watch out for is vendors within our city registered with an incorrect COPO (City / County Code). This is a problem because a vendor may be located in your municipality, making sales, and due to incorrect registration, unknowingly remit sales tax collections to the wrong COPO. In other words, their collections simply get paid to the wrong City. Several tools are available to verify that permits are registered properly. Two tools I’ll briefly discuss are the OkTAP sales tax permit lookup system and batchgeo.com. The OkTAP tool is helpful in that you can pull up registered permits in your COPO, and other COPOs, based on name, zip, address. For example, you may have new construction or new vendors occurring near your city limits, are they registered properly?

Example of where to access the OkTAP search tool within OkTAP.

Example of OkTAP search tool with results displayed.

Sales Tax Permit Analysis Check permits for proper COPO registration batchgeo.com: Free tool to map up to 250 addresses at once A great free tool for mapping addresses is batchgeo.com. Up to 250 addresses can be mapped at a time to see where businesses are located.

Example of batchgeo. com results Example of batchgeo.com results. The circles with numbers indicate how many addresses are located in that general area. Zooming in closer towards any of the circles will reveal more precise address markers.

Sales Tax Permit Analysis Can double check correct COPO / tax rate with OTC Sales / Use tax rate locator: http://oktax.csa.ou.edu/Rate_Locator/ Sample Address: Tulsa City Hall, 175 E 2nd St, ZIP: 74103 Another way to double check if an address is within city limits or not, as well as what tax rate should be collected by a vendor is by using the OTC Sales / Use tax rate locator. Tulsa City Hall was used as an example, with each step of the process illustrated. As can be seen, a business making sales at City Hall’s address, would charge a total rate of 8.517%.

Sales Tax Permit Analysis Compare registered permits against other data sources: City of Tulsa Utilities Data (commercial customers) Building Permit Applications Special Events Permits Dun and Bradstreet Business Directories Comparing the list of registered permits to other data sources may pinpoint other registration errors, and could also lead to discovering unregistered sellers.

Delinquent and Balance Due Lists Combine together: Delinquent Taxpayer List Balances Due: Filtered for vendors that are: Open Not in collections Not on a payout plan Check the list when vendors apply for new or renewed business licenses Listing is updated monthly Before issuing business licenses, the delinquent list and balance due list are checked to ensure licenses are not issued to delinquent sellers.

Collections Analysis Top-Down Approach Start: High Level Economic Summary What is happening on a macro level that may explain collections trends? Fed Beige Book Kansas City Fed State Treasurer: Oklahoma Economic Report News Reports: CNBC, Wall Street Journal, Yahoo! Finance We take a top-down approach to sales tax analysis which helps us explain trends that may be affecting our local vendors now, or in the future.

Collections Analysis Regional Sales Tax Collections Summary Compare this month’s change in collections to: Other MSA Cities Other Cities in the State Next, we compare our collections to other cities and towns in the MSA (Census Bureau Metropolitan Statistical Area) and also to other selected cities in the state. This may help us understand if trends in our sales tax were isolated to us or widespread. (include a report example on next slide)

Example of MSA report, sales tax normalized to 1%.

Collections Analysis Industry Analysis What industries had significant changes? Is the change widespread, or isolated to one or a few vendors? We then drill down a little further and take a look at the changes that have occurred in the major industries. Again asking if the overall changes in sales and use tax collections are isolated to a few industries or widespread. (Include examples of reports on subsequent slides)

Example of sales tax collections by SIC Division Example of sales tax collections by SIC Division. We currently convert the new OkTAP NAICS codes back to SIC codes designation and to make historical comparisons a bit easier. We also scrub the industry codes for any major errors we catch – i.e. a large exemption refund that is received without an industry code assigned. We may transition to NAICS codes once we have more than a year worth of data from OkTAP.

Example of TOP 25 SIC report Example of TOP 25 SIC report. The majority of our collections are in the top 25, while the majority of any month’s change can usually be explained in the top 10 SICs.

Collections Analysis Vendor Analysis Did any vendors have unusual changes? Reporting Period Totals: Zero balance, unusually large, unusually small, or negative periods Unusual prior period adjustments Can the change be easily explained? Weather Refunds Company Press Releases Word of Mouth News Reports Company SEC Filings Overview of vendor analysis.

Vendor Analysis Tool: Tax Dashboard Summarize collections data into Excel spreadsheet: Combine Old (pre OkTAP) and New OkTAP Data with Excel Summarize by tax filing period Use conditional formatting to highlight periods with unusual totals XX% or more below average (yellow) XX% or more above average (green) Negative (pink) Zero (red) Sparklines (“Trends” below) give a quick glance of totals Notice the low point? Scrolling further to the right reveals this to be the 3/2012 tax filing period This will be sent to the OTC for review Slide is animated. Example of a tool we use to look for collections / apportionment errors. Also, time permitting, quick demo of an excel spreadsheet that automates merging old and new data together.

Final Step Sales and Use Tax Issues Compile a list of identified issues Issues list sent monthly for review to Oklahoma Tax Commission Taxpayer Assistance Primary Contact: Dave Francis

Weatherford Revenue Review Monthly Review Top 10 Taxpayers Confirm new businesses are remitting Review credits and refunds Our process doesn’t require dedicate staff