Residents Spend More, Providing Cities Tax Relief

A spate of new retail centers in Ventura County and a rebounding sense of job security among workers have boosted spending and pumped millions of new tax dollars into city governments over the past few years, state figures show.

City officials throughout Ventura County, who had anticipated the increased sales tax revenues, said the money is welcome relief for local governments stripped of millions of dollars in recent years by state lawmakers.

For example, Camarillo sales tax receipts over the past year ended June 30 jumped more than 28% as the city collected more than $1.1 million more than in the previous year. But Camarillo Finance Director Anita Bingham said the $600,000 in unexpected cash, which includes money from cigarette taxes and other sources, does not translate to surplus tax dollars.

“It’s certainly more than the average annual growth we’ve had, but it wasn’t a surprise that the sales tax grew,” Bingham said. “We’d budgeted for $4.6 million and we got about $5.2 million.”

There are always capital improvement and other projects to pay for, she said.

“We increased our police services this year, so that will be an ongoing cost that we’ll have to cover,” she said.

Like most cities in Ventura County, Moorpark also reported sharp gains in sales tax revenues over the past few years.

“It’s hardly a windfall because the state rerouted about $400,000 from our general fund to schools,” Deputy City Manager Richard Hare said. “But it does help offset some of the losses we’ve sustained.”

Moorpark collected almost $250,000 in new sales tax revenues over the past two years, a tax growth that mirrors increases in population and new construction permits. But along with such development come more demands on such city services as water, sewers, streets and police.

One day, Moorpark will run out of places to build new commercial centers, and another money crunch may follow, Hare said. One-third of the Moorpark general fund comes from sales taxes.

“We can see the point where we won’t have any more commercial space left,” Hare said. “Other cities that may be built out now have to take a serious look at whether they can use other areas for commercial space.”

Countywide, sales tax revenues increased nearly 50% over the past decade, rising to more than $64 million in the latest fiscal year. Cities got the vast majority of that money, with Ventura County receiving $4.9 million.

“The whole general fund budget is almost $600 million, so that is small, percentage-wise,” said Bert Bigler, the county budget manager. “But it’s a positive sign because if sales taxes are doing well, then other revenues tend to do well.

“We could use more of that,” said Bigler, who is facing a budget deficit of about $20 million for the upcoming fiscal year.

The highest-grossing city continues to be Thousand Oaks, home to a regional auto mall and The Oaks shopping center. Sales tax revenues there reached their peak just after the Northridge earthquake, rising four straight quarters.

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But Finance Director Robert Biery said the momentum has since tapered off. The city saw a drop of about $130,000 in sales tax revenues from the previous year, but much of that was based on conservative estimates.

The state Board of Equalization returns sales tax money to local governments based on estimates made by finance officers up to six months in advance.

“We didn’t try to rely on that kind of increase for another year,” said Biery, referring a dramatic jump in sales in Thousand Oaks following the 1994 Northridge quake, which devastated shopping centers in the San Fernando Valley. “And [sales have] since flattened out to where we’ve only got slight increases.”

In Thousand Oaks, sales taxes make up about 40% of the city’s general fund. Biery said he worries that the city will become more and more reliant on sales taxes to pay its bills.

“It certainly can become more and more of an issue as cities get more and more strapped for revenues to fund the services they’re providing,” he said.

Economist Mark Schniepp said people are gaining confidence in the economy and are willing to spend money. Developers, meanwhile, are investing millions of dollars in new commercial projects, he said.

“There’s new retail in Thousand Oaks, the Westlake Promenade has just opened, the Camarillo Town Center is new and they’re starting to build the [Camarillo] factory outlet very carefully,” said Schniepp, who directs the UC Santa Barbara Economic Forecast Project, which studies economic trends in Ventura County.

Even cities where no large retail projects are under construction are experiencing significant increases in taxable sales. “There’s nothing new in Oxnard being built and those increases are already happening,” Schniepp said.

For the first time since recession struck in the early part of this decade, employees are beginning to feel confident that their jobs are secure, Schniepp said.

“Spending had been delayed for years, and people are finally getting out and spending money,” he said. “A little more spending on building materials and we’d be back up in our all-time areas.”

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Despite some upward movement in sales of late, some business leaders said they were surprised to hear about such sizable increases in sales tax revenues around Ventura County.

“I’m still not hearing from the merchants that sales volumes are up,” said Jacki Bradbury, the Ventura Chamber of Commerce president and owner of a heating and air-conditioning firm.

“But it’s better than it being down,” Bradbury said. “In the early 1990s, all we heard was that sales volumes had dropped tremendously. We’re on the uphill climb now, we just need to get up more quickly.”

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Distribution of Taxes

The following is the revenue distributed to cities and the county from local sales and use taxes in the past three fiscal years. The fiscal year ends June 30.

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1993-94 1994-95 1995-96 Ventura County $4,480,228 $4,701,000 $4,909,377 Camarillo $3,791,960 $3,884,980 $4,986,820 Fillmore $496,433 $511,537 $531,158 Moorpark $928,393 $1,054,132 $1,170,931 Ojai $787,779 $773,676 $819,219 Oxnard $11,945,742 $12,716,275 $13,391,832 Port Hueneme $581,015 $564,309 $598,965 Santa Paula $1,238,400 $1,325,658 $1,408,257 Simi Valley $7,116,394 $7,820,895 $7,537,895 Thousand Oaks $13,698,366 $15,439,940 $15,311,092 Ventura $12,767,690 $13,284,673 $13,687,877 COUNTYWIDE TOTALS $57,832,401 $62,077,077 $64,353,422

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Source: California State Board of Equalization