Newport’s tax revenue to climb steadily through 2022, analysis says
An area economic analysis firm is bullish about Newport Beach’s revenue for the next five years.
In a forecast released this month, Los Angeles-based Beacon Economics expects steady growth in income from property, sales and hotel occupancy taxes, generally 4% to 6% annually through 2022.
Beacon’s local forecast assumes a baseline trajectory for the national economy, with corporate and personal tax cuts boosting local activity.
The city collected $78.5 million in property taxes in fiscal 2016-17 and is expected to take in $83.7 million in 2017-18 and $107.6 million in 2021-22, Beacon reported.
Beacon said home price growth and construction activity support near-term revenue growth. The median Newport Beach home price was $2.1 million as of late 2017.
Beacon said the city collected $34.4 million in sales taxes last fiscal year and is expected to take in $35.8 million this fiscal year and $43.2 million in 2021-22.
Beacon called last year’s sales tax revenue “tepid” but added that “impacts from the Tax Cuts & Jobs Act will be broadly simulative and should help support nominal taxable sales growth.”
The city collected $27.2 million in hotel bed taxes in fiscal 2016-17 and is expected to take in $28.2 million this fiscal year and $36.5 million in 2021-22, Beacon said.
The city Finance Department prepared a revenue report last fall that also had a generally optimistic outlook on property, sales and bed taxes, with some differences. The city, for example, used several property revenue categories to reach a 2016-17 total of $94.4 million in property taxes, while Beacon looked only at the city’s share of secured property tax, which is the tax only on residential and commercial land.
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