Utility Tax Cut Favored as Shops Bring Revenue

Anticipating a windfall in sales taxes collected from the future tenants of the Bixby Old Ranch Towne Center, the City Council gave initial approval to an ordinance that would reduce the city’s utilities tax for residents from 11% to 9.5%.

Mayor Patty Campbell said she reluctantly voted for the reduction at the council meeting last week because, “overall, that’s what the city wants.” But she is concerned about the estimated $28 million needed for the city’s infrastructure repair.

City officials believe that sales tax revenue from the stores within the shopping center, which is under construction at Seal Beach Boulevard and Lampson Avenue, will not be realized until fiscal year 2001-02. The center’s proposed tenants include Target, Ralphs and Sav-On.

The council still must take a final vote on the ordinance, which passed 5 to 0 at its first reading. It proposes to reduce utilities taxes 180 days after the center opens.

“All we are doing is using [the shopping center] to get money,” Campbell said. “We are still going to be in a bind for infrastructure repairs. We have lots of sidewalks, streets and alleys that need fixing.”

Campbell said the city will be hard-pressed to find more revenue because there is opposition to commercial developments on vacant land such as the DWP property and the Hellman Ranch property, both next to the San Gabriel River channel.

The proposed sale of some of the Boeing Co. property off Seal Beach Boulevard close to Westminster Avenue offers some hope for generating money for the city’s general fund, she said.

But Campbell remains skeptical about the city being able to fund a backlog of needed street work.

“We’re just never going to get it done,” she said.

No date has been set for a final vote on the utility tax cut ordinance. In the next weeks and maybe months, some revisions may be made, Campbell said. But the ordinance may be put back on the council’s agenda in August.

*

Alex Murashko can be reached at (714) 966-5974.