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Travel helps fuel sales tax growth

Ripon biggest winner with 30.7% gain; Manteca up 3.9%

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POSTED October 2, 2012 2:24 a.m.

Californians are on the move again helping Ripon, Lathrop and Manteca businesses catering to everyone from tourists to truckers.

Data released this week by the California Board of Equalization shows taxable sales transactions in the three communities jumped 9.7 percent in April, May, and June of 2011 compared to the same three months in 2010. Combined retail transactions went from $270.6 million to $297 million.

Ripon was the biggest winner with its long-term strategy of developing into a major truck and travel stop at Jack Tone Road and Highway 99. There are three major truck stops and associated highway services such as vehicle gas and food. Ripon’s taxable sales shot up 30.7 percent in the second quarter of last year. That reflects a gain of $12.1 million in taxable sales that translates into $121,000 more in tax receipts for that city’s general funds.

Lathrop - which also has a healthy travel-orientated retail base along Interstate 5 - jumped 14.3 percent for a $7.39 million taxable sales jump that brought $73,900 more into the city coffers than in the comparable second quarter of 2010.

Manteca’s overall taxable transactions edged up by 3.9 percent. By far the biggest sub-category was for gasoline stations that increased 15 percent in Manteca going from $18.2 million in the second quarter of 2010 to $20.9 million in the second quarter of 2011.

The second quarter jump coincides with an uptick in trucking and travel that started occurring in the same time period based on state data and information from the California State Automobile Association.

Manteca’s overall gain would have been higher but point of sale transactions for non-retail concerns such as manufactures with a sales office located within the city limits that handle direct sales to customers dropped off 31.7 percent to $31 million

A similar trend is what hit Lodi hard causing that city to be the only jurisdiction in the county to lose sales tax receipts.

If you take other outlets out of Manteca’s sales tax picture, the city gained 5.5 percent in overall retail sales.



Manteca’s net gain for budget is $105,000


Even so the $7 million gain in sales translates into $70,000 more for the Manteca general fund. That does not include an additional $35,000 that flowed into the Measure M Public Safety Tax account above and beyond the 2010 levels.

Manteca from 2008 to 2010 posted gains in sales tax each quarter sometime going as much as 8 percent while every other jurisdiction the county was retreating. The city credits the bulk of the gain to receipts to Bass Pro Shops and Costco that had just opened as the economy started tanking. Both businesses draw  consumer dollars significantly from other communities with an estimated 98 percent plus of all transactions at Bass Pro Shops coming from non-Manteca residents.

The current city budget was based on sales tax - which is now the biggest source of general fund revenue at 33 percent - increasing 2 percent. Property tax receipts are now expected to increase ever so slightly by 4 percent to reflect assessed property values of $4.5 billion that will translate into property tax receipts of almost $8.9 million. That is double the property tax increase of 2 percent the city projected. The increase in sales tax will make property tax the second largest source of general fund income. That is the first time ever that sales tax has displaced property tax as the city’s top source of revenue.

Since sales tax receipts are calculated and distributed to the cities some six months plus behind the quarter they are collected the figures from this week’s sales tax data are what drive the current municipal general fund budgets for cities. That means Manteca’s municipal finial situation is improving at a slightly better clip than expected in budget projections,

Ripon and Lathrop are both doing better than they projected. It was reflected in actions by both cities recently to relax compensation cutbacks they had imposed to weather the economic downtown.

Manteca , has suffered smaller percentage losses in property tax values than any other jurisdiction in San Joaquin County thanks primarily to residential housing still going on at a clip of 300 units per year plus commercial and business parks that were completed in the early part of The Great Recession.

Even though Manteca will have at least four new retailers – Burlington Coat Factory, Banana Republic, Big Lots, and Dollar General – in business in the critical fourth quarter, none of the sales collected will help in the current fiscal year starting July 1. That’s because the state – as part of a move several years ago to cover one of their previous year’s budget deficits – holds onto to all sales tax from new retail outlets for  almost a year before giving cities and counties their legal share.

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