Sales Tax Attack (In color!)
The fiscal year 2007, third quarter sales tax numbers are out and going to the council next Tuesday. At the same time, the council will be receiving a report on the second quarter receipts and budget adjustments. Add these together and we’re in for a fun ride!Despite a 10% increase in Sales Tax generation at Alameda Towne Centre, year-to-year comparison shows sales tax receipts declining in the 3rd quarter by ).4% overall. The good news is that this is a smaller decline than past reports (if that can be called good news). The terrible news is that two of the city’s top tax-generators, Toyota of Alameda and Good Chevrolet are both looking to leave town (The Good Chevrolet bit is only rumored, but well sourced, the Toyota is a done deal). This doesn’t bode well in the short term.
The extremely ugly news is that the city is expecting to receive about $4 million dollars less than it budgeted, which is leading to cuts in staff and the deferral of projects already. Watch the contract negotiations with the firefighters to see how this fun fact is going to spill over into political amusements for everyone! The council is holding a closed door session on this issue next week as well.
Here’ what the city’s 10-year sales collection looks like. In 04/05, the State instituted the “triple flip” as a budgeting maneuver to close the budget gap (worked out didn’t it!). This resulted in a reduction in the collection of sales tax by the city.
Curious as to where the collections are coming from? Here’s a pretty graph of the ’06 collection. Note that transportation is 29% of the total collection. That’s the auto dealers!
I don’t mean to start this long President’s day weekend on such a downer, but dang! the future’s a little dim. That said, there’s lot’s of new retail about to come on-line at Towne Centre and in Park Street, hopefully that will help stave off some of the problems we might be facing in the next few years.
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