Title
Recommendation to Accept the Quarterly Sales Tax Report for the Reporting Period Ending March 31, 2019 (Funds Collected During the Period October 1, 2018 to December 31, 2018). (Finance 2410)
Body
To: Honorable Mayor and Members of the City Council
EXECUTIVE SUMMARY
The California Department of Taxes and Fees Administration (CDTFA), formerly the Board of Equalization, allocates sales tax to the City of Alameda (City) on a monthly basis. This report provides information about the activity for the period ending March 31, 2019 (funds collected during the period of October 1, 2018 to December 31, 2018).
BACKGROUND-
This report summarizes the sales tax receipts for the point-of-sales activity for the period of October 1 through December 31, 2018. This is the basis for sales tax revenues received by the City between January 1, 2019 and March 31, 2019. For the purpose of this report, sales tax revenues exclude Proposition 172 funds, the allocation from statewide pool for public safety services.
DISCUSSION
Fiscal Year to Date (July 1 to December 31)
For the 2018-19 Fiscal Year, Sales Tax is the second largest source of General Fund revenues for the City, representing approximately 12% of the total budgeted revenues. As of March 31, 2019, the General Fund has received approximately $6.3 million in Sales Tax receipts. The General Fund received $5.8 million in Sales Tax receipts during the same period last fiscal year. This represents an 8% increase in year over year Sales Tax revenues received for that period.
The California Department of Taxes and Fees Administration’s (CDTFA) has resolved the majority of outstanding payments that resulted from taxpayer processing complications due to their new computer system, launched earlier in the year.
4th Quarter 2018 to 4th Quarter 2017 Comparison
Alameda’s receipts from October through December showed a 10.2% increase compared to the fourth quarter sales period in 2017. Excluding reporting anomalies, actual sales were up 2.5%. Following is a summary of sales tax performance by key economic categories in comparison to the same quarter of the prior year based on numbers adjusted for aberrations.
|
Economic Category |
Total |
Percent of Total |
Dollar Change Over Previous Year |
Percent Change Over Previous Year |
|
Business and Industry |
$699,383 |
24% |
$66,552 |
10.5% |
|
Restaurants & Hotels |
496,148 |
17% |
(5,311) |
-1.1% |
|
General Consumer Goods |
547,274 |
19% |
(100,058) |
-15.5% |
|
State and County Pools |
466,987 |
16% |
47,074 |
11.2% |
|
Fuel and Service Stations |
274,859 |
9% |
52,715 |
23.7% |
|
Food and Drugs |
221,071 |
8% |
479 |
0.2% |
|
Autos and Transportation |
114,143 |
4% |
89 |
0.1% |
|
Building & Construction |
99,502 |
3% |
16,314 |
19.6% |
|
Transfers & Unidentified |
2,452 |
0% |
(7,134) |
-74.4% |
|
Total - Quarter |
$2,921,819 |
100% |
$70,720 |
2.5% |
The multi-quarter adjustments that occurred, due to the CDTFA resolving outstanding payments, spiked returns in drug stores, service stations, light industrial/printers, and the City’s share of the countywide use tax allocation pool. As of the fourth quarter, CDTFA was still in the process of receiving late payments. A reporting error in the family apparel category brought down results in the general consumer goods revenues in the holiday quarter. The business-industry group experienced an increase despite temporary declines on some sectors. Casual dining has been impacted by benefits and minimum wage increases. Building and construction activity remained strong. Fuel and service station receipts were up due to increasing gas prices. Misallocations to the State and County Pools rather than the jurisdictions are expected to be adjusted in the next quarter. Delayed allocations contributed to the loss in autos and transportation category.
The following is a summary of Sales Tax by geographic area, in comparison with the same quarter of the prior year:
|
Geographic Areas |
Total |
Percent of Total |
Dollar Change Over Previous Year |
Percent Change Over Previous Year |
|
South Shore Center |
$369,328 |
12.6% |
($10,335) |
-2.7% |
|
Park - North & South of Lincoln |
421,646 |
14.4% |
(4,009) |
-0.9% |
|
Clement Ave & Blanding Ave |
175,545 |
6.0% |
7,297 |
4.3% |
|
Webster |
166,883 |
5.7% |
10,289 |
6.6% |
|
Alameda Landing |
329,363 |
11.3% |
16,910 |
5.4% |
|
Harbor Bay Business Park |
596,824 |
20.4% |
(1,809) |
-0.3% |
|
Marina Village Business Park |
43,906 |
1.5% |
3,360 |
8.3% |
|
Bridgeside Center |
99,394 |
3.4% |
20,379 |
25.8% |
|
North Waterfront |
55,143 |
1.9% |
642 |
1.2% |
|
Alameda Point |
79,293 |
2.7% |
8,326 |
11.7% |
|
Neighborhood Development Districts |
82,927 |
2.8% |
108 |
0.1% |
|
Harbor Bay Landing |
37,583 |
1.3% |
(3,270) |
-8.0% |
|
Marina Village Shopping Center |
37,974 |
1.3% |
(5,273) |
-12.2% |
|
Alameda Marina |
10,831 |
0.4% |
(11,705) |
-51.9% |
The majority of the geographic areas reflected the missing payments and delayed disbursements which were collected in the current quarter.
This quarter’s 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. Alameda County All Agencies Comparison
7. Seven Cities Per Capita Sales Comparison
8. City to State Comparison by Sector - 4th Quarter 2018
ALTERNATIVES
Accept the report due to no further action being requested.
FINANCIAL IMPACT
This is an informational item only. There is no financial impact from acceptance of the report.
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.
CLIMATE IMPACT
There is no climate impact from acceptance of this report.
RECOMMENDATION
Accept the Quarterly Sales Tax Report for the reporting period ending March 31, 2019 (funds collected during the period October 1, 2018 to December 31, 2018).
CITY MANAGER RECOMMENDATION
The City Manager recommends accepting the Quarterly Sales Tax Report.
Respectfully submitted by,
Elena Adair, Finance Director
Exhibit:
1. Quarterly Sales Tax Report