Title
Recommendation to Accept the Quarterly Sales Tax Report for the Period Ending March 31, 2016 Collected During the Period October 1, 2015 to December 31, 2015. (Finance 2410)
Body
To: Honorable Mayor and Members of the City Council
From: Jill Keimach, City Manager
Re: Recommendation to Accept the Quarterly Sales Tax Report for the Period Ending March 31, 2016 Collected During the Period of October 1, 2015 to December 31, 2015
BACKGROUND-
This report summarizes the sales tax receipts for the point-of-sales activity for the period of October 1 through December 31, 2015. This is the basis for sales tax revenues received by the City between January 1, 2016 and March 31, 2016. For the purposes of this report, sales tax revenues exclude Proposition 172 funds, the allocation from statewide pool for public safety services.
DISCUSSION
For the 2015-16 fiscal year, sales tax is the second largest single source of General Fund revenues for the City, representing approximately 11% of the total budgeted revenues. As of March 31, 2016, the General Fund has received over $4.2 million (46% of budget) in sales tax revenues. The General Fund received $3.9 million during the same period last fiscal year. This represents an 8% increase in year over year sales tax revenues recognized between July 2015 and March 2016.
The following is a summary of sales tax performance by key economic categories in comparison to the same quarter of the prior year:
The City had an increase of approximately $73,000 in sales tax revenues for the fourth quarter of 2015 compared to the same quarter of the previous year. Recently added outlets and an increase in general consumer goods, food and drugs, and restaurant groups were a major factor in the overall gain in receipts. Existing family apparel stores, casual and fine dining restaurants also contributed to the increase. The Building and Construction sector was boosted by many one-time payments from contractors. A large one-time payment, which inflated the prior year’s returns, resulted in a decrease in Business and Industry results. Lower retail gas prices continue to affect the Fuel and Service Stations category. Three of the categories experienced a drop, yet overall receipts, including County pool allocation, from October through December were 4.3% higher than the prior year fourth quarter sales period.
As discussed in the prior quarterly report, a reporting error from a tax paying entity has temporarily spiked the results in the General Consumer Goods category and skewed the year to date sales tax receipts by an estimated $450,000. Per conversation with Board of Equalization representative, the error will not be corrected until sometime in September 2016. However, Finance will account for the error in Fiscal Year 2015-16.
Alameda Landing experienced the highest increase compared to other geographic areas at almost 37% due to the progress of construction and new business activity. Half of the areas showed a slight increase while the other remaining showed some decrease in sales tax revenues.
This Quarterly report includes a supplemental section containing the following information:
1. City of Alameda Sales Tax Update
2. Major Industry Groups - Current Quarter Comparison
3. Major Industry Groups - 13 Quarters History
4. Sales by Geographic Area - 13 Quarters History
5. PER Capita Sales Tax Surplus/GAP Comparison by Retail Category
6. Quarterly Sales Comparison of Cities in Alameda County
7. Nine Cities Per Capita Sales Comparison
8. City to State Comparison by Sector - 3rd Quarter 2015
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
This action is in conformance with the Alameda Municipal Code and all policy documents.
ENVIRONMENTAL REVIEW
This activity is not a project and is exempt from the California Environmental Quality Act (CEQA) pursuant to section 15378 (b)(4) of the CEQA Guidelines, because it involves governmental fiscal activities, which does not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment.
RECOMMENDATION
Accept the Quarterly Sales Tax Report for the period ending March 31, 2016 collected during the period October 1, 2015 to December 31, 2015.
Respectfully submitted by,
Elena Adair, Finance Director
Exhibit:
1. Quarterly Sales Tax Report Supplemental Information